CAS responded to the Accountant in Bankruptcy's review of the Bankruptcy and Debt Advice Scotland Act 2014
› The time period for the moratorium being extended and increased in scope by including all the proposed breathing space protections, with increased availability to people with a mental health crisis.
› The Common Financial Statement (CFS) should remain as the Common Financial Tool (CFT) for assessing debt options for a temporary period. However CAS thinks that the methodology that lies behind it, and that of the Standard Financial Statement (SFS), are deficient in providing a sufficiently flexible tool for the increasingly fluid nature of peoples’ incomes and therefore they should only be seen as short-term interim solutions.
› Recognition that a change of Common Financial Tool methodology is both necessary and will take time to develop. An alternative requires more detailed discussion and should not be rushed. The principals of an alternative model are set out elsewhere in this response.
› The inefficient application of the CFT in the statutory processes needs to be addressed, because it is quite differently applied by creditors, advisers in non-statutory debt solutions and in the English equivalent processes.
› The Minimum Asset Process (MAP) minimum debt threshold should remain the same and there should be no maximum debt threshold.
› Child Maintenance should continue to be discharged but given primary preference in the distribution of any ingathered funds.
› The MAP fee should be subject to the same exemptions as apply to court fees.
› Child maintenance, bursaries and benefits income sources should be discounted from the debtor contribution order calculation.
› The debtor contribution payment period, acquirenda period and debtor discharge, should be aligned, and should all be concluded two years after the date of sequestration. This provides a consistent and simpler approach to the different periods which impact on the debtor and allows for a clean break bankruptcy discharge.