ENFORCEMENT OF CIVIL OBLIGATIONS IN SCOTLAND: ANALYSIS OF CONSULTATION RESPONSES
PART 3 STRUCTURE AND ORGANISATION OF THE ENFORCEMENT SYSTEM
Q3.1 Should there be a Scottish Civil Enforcement Commission to carry out the enforcement functions specified?
3.1 There was overwhelming support for the establishment of a Civil Enforcement Commission to carry out the enforcement functions detailed in the consultation document. Support ranged across the Advice Sector, Financial and Business, Legal Sector and the Scottish Court Service. A particular advantage of a Commission, highlighted by the general money advice field, is the perceived closer regulation and accountability of Enforcement Officers 11 which will arise from the existence of a Commission.
3.2 The minority of respondents who opposed a Commission, were of the view that the status quo regarding regulation and professionalism was adequate. However, the Society of Messengers-at Arms and Sheriff Officers (SMASO) is in favour of a Commission, with one reservation:
"we do not consider that there is any necessity for alteration to the functions of the Committee of Examiners".
3.3 One enforcement agency pointed to the potential for conflict of interest and Human Rights issues in establishing a Commission due to "the Executive itself being a major creditor", and one significant organisation in the legal sector, whilst supporting a Commission, does not consider it a suitable body for the supervision of debt arrangement schemes.
Q3.2 Should the Commission have responsibility for determining an education and information programme and what form should this take?
3.4 There was almost unanimous agreement with this proposal. A number of respondents offered useful suggestions for the form of an education and information programme. Money Advice Scotland suggested the development of a communications/media and marketing strategy to educate not just the general public but all those who are involved in the process, including money advisers, lay representatives etc. and that the various organisations (money advice, courts) involved in the process could be used to promote awareness of the role etc of Enforcement Officers.
3.5 Money Advice Scotland would also like to see improved use of electronic learning resources (ELR); campaigns to raise awareness, particularly (but not exclusively) at the end of Council Tax year when a large amount of final reminders will be sent out, and that the Commission should have its own web site with links to other relevant web sites.
3.6 Citizens Advice Scotland suggest that in any educational function the involvement of lay advisers representing debtors will be crucial, whilst The Advice Shop, Edinburgh made the suggestion that long term objectives may be met by including civil obligation issues in the school curriculum as part of citizenship, as well as inclusion in other initiatives, for example Scottish Young Consumer of the Year or Young Scot information, which would spread knowledge of the system. Short-term measures could be adult education classes probably linked to financial issues.
3.7 North Ayrshire Council Social Services proposed a public information campaign, which could be readily available in appropriate community venues, e.g., Council Tax and Rent Offices, Advice Agencies, etc. They added that material should also be issued along with any debt recovery documents.
3.8 SMASO (Society of Messengers-at-Arms and Sheriff Officers) proposed an information pack for creditors and for those providing advice to debtors and recommended that information given to debtors must be short, eye catching, easily read and easily understood. SMASO also recommended consideration be given to radio and television advertising of what a debtor should do if he is in financial difficulties and cannot meet his obligations.
3.9 One debt enforcement organisation suggested any education and information programme should be developed in consultation with and in conjunction with SMASO. They also suggested the programme should be thereafter implemented and run by SMASO. This was not the feeling of the generality of respondents, who favoured more of a partnership approach.
Q3.3 Should the Commission carry out other functions?
3.10 In line with previous questions, there was an overwhelmingly positive response to this question from the Advice Sector, Financial and Business Sector, Legal Sector and Local Authorities. Minority opposition came from the Legal Sector, some Local Authorities, one advice agency and financial agency.
3.11 There was a view shared by respondents in the money advice, financial and business sector and by local authority respondents that the Commission should set and approve new standards in terms of the training and competence of the Enforcement Officers and that the training should include a section on the role of money advice, and information about levels of benefits etc.
3.12 Money Advice Scotland propose that, given that the Enforcement Officers have an advisory/customer care role, there should be a link not just to the national standards in enforcement but also to advice and customer care. There was a suggestion that the Commission should also appoint Enforcement Officers under Nolan principles.
3.13 North Ayrshire Council Social Services supported the view that the Commission could be responsible for appropriate input and/or appointment of personnel to public bodies involved in any Debt Arrangement Scheme.
3.14 A number of voluntary and public sector organisations wish to see a swift complaints scheme for debtors established by the Commission, and a number of advice agencies suggested the introduction of sanctions against creditors who behave inappropriately towards debtors e.g. "exploiting debtors' knowledge deficit with a view to gaining an advantage for themselves."
3.15 SMASO (Society of Messengers at Arms and Sheriff Officers) raised a concern relating to the quality of statistics currently available. The example given is that whilst the number of Earnings Arrestments and Third Party Arrestments executed are known, there is no information as to whether or not this leads to successful recovery. In fact, there are no national statistics on recovery performance nor a means for collating this information. The Commission is regarded as an appropriate body for addressing this issue. The Advisory Council of Messenger at Arms and Sheriff Offiicers suggest that the Commission should have power (1) to delegate to subgroups; (2) to create its own Regulations, procedures and guidelines; (3) to review and fix fees for Sheriff Officers and Messengers at Arms.
3.16 The Scottish Sheriff Court Users Group propose the Commission could work alongside the Sheriff's Association and Judicial studies unit in setting guidelines on implementing time to pay procedures for Sheriffs and setting standards for their level of knowledge.
3.17 Glasgow City Council wish to see the Commission acting in a public relations capacity in order to enhance the public perception of Enforcement Officers, whilst Highland Council offered a range of additional functions including:
- Accredit money advice agents and debt collection agencies.
- Issue information to debtors and creditors on the new Act and all diligence.
- Administer and monitor the DAS. Act as the approved local agent for collection and distribution of payments to creditors.
- Receive disputes on DAS and set up panels to arbitrate on disputes.
- Compile, maintain and distribute the DAS register.
- Monitor the behaviour of enforcement officers
3.18 Of the agencies who responded negatively to this question, the majority believed the Commission as proposed has sufficient powers and functions.
Q3.4 Should the Commission comprise the membership specified?
3.19 The consensus of responses to this question is that a wide membership including lay representatives and representatives from the money advice sector, the credit industry and local authorities needs to be embraced. A mixture of judicial, lay and professional members is seen as desirable. Of those who might be considered to have replied negatively to this question this was because they wished to see more lay representation in the membership.
Q.3.5 Should there be a single class of enforcement officers?
3.20 The majority of respondents agree that there are practical and transparent reasons for one class of Enforcement Officers, with responsibility for their conduct resting with the Scottish Civil Enforcement Commission. A number of respondents argued the importance of retaining a link with the locality, and the importance of arrangements to ensure uniform obtaining of qualifications.
3.21 Opposition to a single class of enforcement officers is in a minority and comes principally from the enforcement officers and their representatives. Opposition is partly based on a wish to maintain and respect the history and tradition of the Messenger-at-Arms duties and title, and partly on a view that the current system of training and career paths for Sheriff Officers and Messengers-at-Arms remains suitable and appropriate. The argument is that a higher degree of legal knowledge and experience is needed for a Messenger-at-Arms than for a Sheriff Officer, with varying lengths of training and expertise. A compromise suggestion was that even if there were to be one title for both Sheriff Officer and Messenger-at-Arms, that the "two tier" appointment system should continue.
3.22 With regard to changing the name to Enforcement Officer, those who opposed the single class of officer also opposed this name change and suggested that if any replacement title were to be put in place it should be Officer of Court.
Q3.6 Should informal debt collection activities be regulated in Scotland including mandatory codes for appropriate standards of care and conduct?
3.23 The majority view was strongly in favour of regulating informal debt collection activities, with a number of respondents referring to their knowledge of harassment and intimidation of debtors by both creditors and debt collectors (SMASO, Scottish Courts, Scottish Consumer Council, Citizens Advice Scotland). Comments in support stem from a general wish to protect debtors from unscrupulous debt collectors, allied with a wish to ensure equal treatment of debtors by debt collection agencies both sides of the border. The point was made by several respondents that in England debtors are protected from harassment under the Administration of Justice Act 1970 and there was a wish expressed "that Scottish consumers do not continue to be less well protected against such practices than people in England and Wales".(Scottish Consumer Council).
3.24 Those in favour of regulation were for the most part in favour of mandatory codes for appropriate standards of care and conduct.
3.25 A small number of respondents pointed to the fact that "the dual role of sheriff officers as enforcement and debt collectors is confusing to debtors. Debtors can be caused significant and undue alarm where they believe sheriff officers are acting as officers of the court, when in facto they are carrying out their debt collection role." (Scottish Consumer Council). The SCC also suggest "the Commission should monitor and regulate the separation of these two roles."
3.26 Whilst not arguing for separation of the 2 roles of sheriff officer and debt collector, SMASO, states that the conduct of some debt collection agencies has "caused the Society concern for some considerable time", and "consider it important that mandatory codes of conduct and standards be introduced as soon as possible."
3..27 The minority opposed to this proposal did so for a variety of reasons. The Council of Mortgage Lenders are to be regulated by the Financial Services Authority and regard this as sufficient regulation; others did not see any advantage in having a mandatory code of practice, whilst a local authority objected to regulation on the grounds that "from a local authority context informal arrangements operate successfully."( Fife Council)
Q3.7 Would access to information held by third parties assist towards achieving more effective enforcement?
3.28 Although, as with all the questions in this section the vast majority of responses were positive, in this instance the bulk of negative responses came from the Advice Sector rather than, as in some previous questions, the legal sector.
3.29 The majority view was that access to information about employment and bank accounts would enable "greater use of what we believe to be more equitable forms of diligence" (Debt on our Doorstep). Local authority respondents saw a usefulness in accessing databases of other local authorities, especially in relation to Council Tax, non-domestic Rates and Housing Benefit, as well as access to all national government databases, including Inland Revenue and Customs and Excise.
3.30 The Institute of Payroll and Pensions Management raised the point that access to third party information would be useful subject to the necessary Data Protection requirements and this point was picked up by a number of enforcement agencies and local authorities who believed that there would be issues relevant to civil liberties, human rights and data protection to be addressed. One suggested solution is that "the request for such information should only be made by an Enforcement Officer, being an independent third party".
3.31 Another suggestion for addressing issues of data protection, which came from a small number of local authorities, is that debtors opening a bank account or signing for benefits could sign a declaration stating that they consent to disclosure of financial information to third parties in the event that they apply for or become subject to a statutory debt arrangement scheme.
3.32 Those who opposed information sharing with third parties were mainly concerned with issues of data protection, privacy, and the potential for intrusion and coercion by creditors. There was a view that the present level of information sharing, e.g. through Credit Reference Agencies, is a sufficient balance between the needs of the creditor and the rights of the debtor. It was also pointed out that a debt arrangement scheme should lessen the need for sharing information since relevant information regarding a debtor's finances would be voluntarily forthcoming at that stage.
3.33 The Lord Chancellor's Department has instituted a Data Disclosure Order Working Group which is looking at policy and procedural issues and the Group's work will inform the eventual proposals to be put forward in the Enforcement White Paper next year. A UK government response alluded to the fact that access to information is a matter for UK legislation and that any changes arising ought to apply equally across all UK jurisdictions.
Q3.8 If so, what type of information held by which third parties should be permitted?
3.34 The majority view of respondents was that information such as a debtor's address, employment details and bank and building society accounts should be available to locate the debtor and to assess whether pursuing the debt is worthwhile.
3.35 It was suggested that this information be made available from third parties such as the Inland Revenue and banking network and employers and that the administrative burden this would place on third parties be considered.
3.36 Respondents also suggested that information be made available from the following third parties to gain an accurate picture of a debtor's financial circumstances:
- Information held by Inland Revenue, Department of Work and Pensions, Department of Social Security such as a national insurance number, eligibility for benefits
- Information held by Local Authorities e.g. Council, Tax and Housing Benefit.
- Access to information held by the DVLA such as confirmation of owners of vehicles and of their address.
3.37 Comments from the advice sector included that access to information should be restricted to that of the debtor and not extended to include any information on joint assets (such as a joint bank account) or debts.
3.38 An alternative view held was that information on the location of a debtor's accounts or employer's address should be available, but not exact details of bank account balances or earnings from employment.
Q3.9 Should the same types and sources of information be uniformly accessible in the different UK jurisdictions?
3.39 There was virtually unanimous response in favour of this question, with some respondents referring to the Data Disclosure Orders in England as a parallel procedure. Those who were in favour supported the idea for a mixture of pragmatic reasons, e.g. it would be easier to pursue a debt of a person who has moved to England, and for human rights and equal treatment reasons.
3.40 Some of those who responded negatively to this question accepted that the Scottish Executive must co-operate with the Westminster Parliament and actually agreed that the same type of information should be uniformly accessible. They argued that the means of accessing the information could vary across jurisdictions, depending on who was accessing it - in this case the proposal was that it should be an Officer of Court in possession of a valid Decree or Warrant and that his reason for requesting such information was due to the fact that all other means of enforcement had been attempted without a successful recovery and that requests for information from the debtor have not been forthcoming.