The Bankruptcy and Debt Advice (Scotland) Bill 2013, which was hailed as “modernising bankruptcy for the 21st century” by government insolvency service Accountant in Bankruptcy, puts a bigger emphasis on financial advice and education for people and businesses in financial difficulties to avoid bankruptcy.
The proposal looks to introduce a Common Financial Tool for use by money advisers and a Minimal Asset Process route into bankruptcy.
It also asks for better co-operation between debtor, trustee and creditors and the transfer of administrative bankruptcy functions from the Sheriff Courts.
Minister for energy, enterprise and tourism Fergus Ewing said: “This is one of the most ambitious and far-reaching reforms ever considered by both the Scottish government and Accountant in Bankruptcy. The Bill provides access to fair and just processes, allowing debtors to gain control of their debt and their lives and ensures that Scotland leads the way in meeting the rights and needs of debtors and creditors.
“It is vital that people who are experiencing financial hardship have the benefit of advice on the range of options open to them. By taking advice early, many people may be able to avoid bankruptcy by reaching an agreement with their creditors.
“The reforms provided for in this Bill ensure that our law on debt relief can deal with the challenges we face in modern society, providing appropriate solutions and protection to both those in debt and their creditors.”
