Scottish Parliament, 13 November 2002

338 contributions from 30 members. The official report.

Introduction

Time for Reflection

Murray Tosh (Conservative, South of Scotland)

The first item of business is time for reflection. Our time for reflection leader today is Sister Roseann Reddy, of the Sisters of the Gospel of Life.

Parliamentary Bureau Motion

Murray Tosh (Conservative, South of Scotland)

The next item of business is consideration of a business motion, S1M-3572, in the name of Patricia Ferguson, on behalf of the Parliamentary Bureau, setting out a timetable for stage 3 consideration of the Debt Arrangement and Attachment (Scotland) Bill. I ask any member who wants to speak against the motion to press their request-to-speak button now. I ask Euan Robson to move the motion.

Euan Robson (Liberal Democrat, Roxburgh and Berwickshire)

Before I move the timetabling motion, I advise the chamber that the Presiding Officer has agreed to a request from the Executive for the Deputy First Minister to make a statement on the fire dispute. The statement will take place immediately after decision time. If it proves necessary to continue business beyond 7 pm to enable the statement to be made tonight, the Scottish Executive will move the necessary motion.

I move,

That the Parliament agrees that, at Stage 3 of the Debt Arrangement and Attachment (Scotland) Bill, debate on each part of the proceedings shall be brought to a conclusion by the time-limits indicated (each time-limit being calculated from when Stage 3 begins and excluding any periods when the meeting is suspended)— Groups 1 to 7 - no later than 1 hour 10 minutes Groups 8 to 11 - no later than 1 hour 40 minutes Groups 12 to 18 - no later than 2 hours 25 minutes Groups 19 to 23 - no later than 3 hours Groups 24 to 30 - no later than 3 hours 40 minutes Groups 31 to 34 - no later than 3 hours 55 minutes Motion to pass the Bill - no later than 4 hours 25 minutes.

Tommy Sheridan (SSP, Glasgow)

May I speak, Presiding Officer?

Murray Tosh (Conservative, South of Scotland)

No. I have a request from Lloyd Quinan to speak—I assume that he wishes to speak against the motion.

Lloyd Quinan (Scottish National Party, West of Scotland)

Given the seriousness of the situation with the firefighters and the accident at the nuclear power station at Dounreay yesterday, to wait until 7 o'clock or later to hear the Executive's position on the firefighters' strike is to fail the electorate. We should have the statement now.

Murray Tosh (Conservative, South of Scotland)

As the motion does not refer to the statement, your suggestion would not be a competent amendment to the motion.

Tommy Sheridan (SSP, Glasgow)

rose—

Murray Tosh (Conservative, South of Scotland)

No other member has asked in a competent fashion to speak against the motion.

The question is, that motion S1M-3572, in the name of Patricia Ferguson, be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 77, Against 6, Abstentions 0.

Motion agreed to.

Points of Order

Murray Tosh (Conservative, South of Scotland)

Before we move to the next item of business, I have received notice of a point of order.

Tricia Marwick (Scottish National Party, Mid Scotland and Fife)

I seek your guidance on a point of order, Presiding Officer. Paragraph 13 of the policy memorandum to the Debt Arrangement and Attachment (Scotland) Bill states that the bill

"creates a new method of enforcement of legally constituted debt, known as attachment, to be permitted against corporeal moveable property in commercial cases. It makes provision, in exceptional circumstances where strict criteria are satisfied, for an order of court in respect of non-essential valuable assets in domestic cases."

However, as the long title shows, the bill does not make that distinction—the provision for the new method of enforcement that is enshrined in part 2 of the bill does not restrict the new diligence to commercial cases. Therefore, the bill clearly does not follow the policy of the policy memorandum.

In introducing the bill to Parliament on 19 September, the Minister for Social Justice said:

"Part 2 of the bill responds to recommendations from the Parliament, the working group and the consultation exercise that we should treat domestic and commercial situations differently."—[Official Report, 19 September 2002; c 13886.]

The minister agreed with the policy memorandum. Unfortunately, part 2 does not follow through with that response, which means that domestic cases could still be dealt with through the provisions that are being introduced for commercial cases. Therefore, there is doubt about whether Parliament was fully aware of the general principles of the bill during the stage 1 consideration.

Will the Presiding Officer rule whether that situation renders the bill incompetent under rule 9.3.3 of standing orders, which outlines the documents that should accompany Executive bills? I will refresh members' memories on that rule. Among the accompanying documents that are required for Executive bills is a policy memorandum, which must, among other things, set out the bill's policy objectives and its effects on a range of subject matters.

Standing orders also provide for the member who is in charge of a bill to refer part of the bill back to the relevant committee for further stage 2 consideration, provided that no more than half of the sections are referred. I ask for guidance on whether now would be the appropriate time to invite the minister to refer back sections 10 to 32 inclusive to the Social Justice Committee for stage 2 consideration under rule 9.8.6 of standing orders.

Murray Tosh (Conservative, South of Scotland)

I am grateful to the member for giving me notice of the point of order.

On your first point, the content and accuracy of the policy memorandum is entirely a matter for the Executive, as the first paragraph of the memorandum makes clear. Rule 9.3.3 simply requires that a policy memorandum be provided when a bill is introduced. There is no procedural basis for challenging a bill after it has been introduced on the basis of a perceived inadequacy in the text of an accompanying document. The proper time for questioning those documents is during stage 1. In this case, the stage 1 report on the bill comments on those documents in detail.

On your final point, you are right that the member in charge has the right to move to adjourn stage 3 to a later day or, with notice, to refer back parts of the bill for further consideration in committee. Either motion may be moved only after the amendments on the marshalled list have been disposed of. I have no indication that the minister proposes to move either such motion, but that will be a matter for him to decide at the appropriate time.

Tricia Marwick (Scottish National Party, Mid Scotland and Fife)

Are you telling the chamber that a policy memorandum that is published by the Executive can bear no relation to the bill to which it refers and that that would still be a competent process?

Murray Tosh (Conservative, South of Scotland)

I am not going to rule on hypothetical circumstances. My ruling is that responsibility for the accuracy and content of the memorandum is a matter for the Executive. Disputes about whether the memorandum represents adequately what is in the bill are a matter for political debate. There has been the opportunity—there will be further opportunity in the course of the day—to debate the politics of the issue.

Christine Grahame (Scottish National Party, South of Scotland)

On a point of order, Presiding Officer. I hope that you have received notice of this point of order regarding the amendment that I lodged to amend the long title of the bill—amendment 89—which would have deleted

"to abolish poindings and warrant sales"

and inserted

"to rename the diligence of poindings and warrant sales as 'attachment'".

The Presiding Officer ruled that the amendment was not competent and he was good enough to give me guidance why. The amendment fell under criterion 1 of paragraph 4.58 of the "Guidance on Public Bills":

"Trivial amendments or amendments that are technically defective".

It is my view that a long title must be faithful to the bill and that the bill does not abolish poindings and warrant sales but renames them. Under the circumstances, I am not satisfied that amendment 89 is a trivial amendment. It strikes at the heart of the role of the long title. I seek your guidance on how I can take the matter further.

Murray Tosh (Conservative, South of Scotland)

I am grateful to the member for giving me notice of the point of order.

As the member said, she has had the opportunity to discuss the matter with the Presiding Officer, who has given a degree of explanation. It is not the practice of the Presiding Officers to give detailed explanations about the selection of amendments. It having been stated on this occasion that, under criterion 1 of paragraph 4.58, the amendment could not be accepted, I believe that the Presiding Officer's judgment was that the amendment was technically defective. The Presiding Officer has given the member the opportunity to discuss the matter further. If the member wishes to pursue it, she might usefully seek some private guidance from the Presiding Officer. However, it is not a matter that we have ever chosen to discuss in the chamber and I do not propose that we begin to do so today.

Christine Grahame (Scottish National Party, South of Scotland)

Are you ruling that it is not competent to amend the long title? I seek that clarification.

Murray Tosh (Conservative, South of Scotland)

No, I am not ruling that at all. I am saying that the amendment was not selected for reasons that I am not prepared to discuss any further. If the member wishes to clarify the matter further, she should raise it with the Presiding Officer. The same ruling has been given on several occasions at this stage in debates, and there is no profit in any further wrangling over it.

Debt Arrangement and Attachment (Scotland) Bill: Stage 3

Murray Tosh (Conservative, South of Scotland)

The next item of business is stage 3 proceedings on the Debt Arrangement and Attachment (Scotland) Bill. I make the usual announcement about the procedures that are to be followed. We will deal with the amendments to the bill first, then move to the debate on the motion to pass the bill. Members should have the usual papers, including the bill, the marshalled list and the groupings of amendments. Members should ensure that they have the revised marshalled list—the word "revised" appears at the foot of the first page—which includes two manuscript amendments that were lodged yesterday. As is standard practice, I shall allow an extended voting period of two minutes for the first division that occurs after each debate on a group of amendments.

Murray Tosh (Conservative, South of Scotland)

Amendment 24, in the name of Tommy Sheridan, is in a group on its own.

Tommy Sheridan (SSP, Glasgow)

The problem with the discussion at stage 2 was that the minister was in automatic mode for most of it. He kept saying that every reasonable amendment was premature because the Executive was awaiting the outcome of its consultation on civil obligations in Scotland. At the 16 th meeting in 2002 of the Social Justice Committee, the minister said:

"Having proper regard to the consultation responses will enable us to take all interests into account in a balanced and measured way to ensure that workable, practical and user-friendly arrangements can be put in place."—[Official Report, Social Justice Committee, 2 October 2002; c 3072.]

Amendment 24 fits like a hand into a glove in relation to the consultation document to which the minister referred, because analysis of the consultation on the enforcement of civil obligations in Scotland is now available. Of the 44 responses to the consultation, 42 support the position that amendment 24 would include in the bill. Therefore, given that amendment 24 would guarantee that under no circumstances would debtors accessing the debt arrangement scheme have to pay any expenses or costs, I hope that the minister will say that he supports amendment 24, because it is completely in line with the consultation that he consistently referred to at stage 2.

Members will note that section 7 of the bill allows ministers to make regulations about fees and expenses for debt applications and variations. However, if it is agreed in principle that a debtor should not incur more expense by trying to access a debt arrangement scheme, surely that should be included in the bill. What is wrong with writing that into the bill? Amendment 24 would ensure that no debtor would be discriminated against or suffer by trying to access a debt arrangement scheme.

I hope that the minister will be consistent at least, given that the consultation to which he referred consistently during stage 2 is now available and shows clearly that what amendment 24 seeks to do is what the consultation requires us to do. Forty-two of the 44 consultees said that no debtor should incur extra expense by trying to access the debt arrangement scheme. I would hope that the minister will agree to amendment 24.

I move amendment 24.

Richard Simpson (Labour, Ochil)

As Mr Sheridan said, amendment 24, which reflects the amendment 66 that he moved at stage 2, would provide in the bill a requirement that a debt arrangement scheme would be cost free to debtors. The Executive confirmed at stage 2 that that was a matter of detail best dealt with in regulations, taking account of, as Mr Sheridan said, the views of respondents to the Executive's consultation.

The consultation specifically sought views on how the debt arrangement scheme should be funded. The independent analysis of responses, to which I will refer in connection with amendments that we will debate, was published on 8 November 2002. All members have been provided with a copy of the analysis report. Unfortunately, the report was not available to the Executive or the Social Justice Committee during stage 2, because of the compressed process for the bill. That, in turn, was due to the time restrictions arising as a result of the Abolition of Poindings and Warrant Sales Act 2001. Anyway, that is the situation in which we find ourselves.

The Executive sought views in the consultation on how the debt arrangement scheme should be funded, and the analysis reveals a variety of suggestions for funding the scheme. I do not propose to go into the different options today. The suggestion that there was an absolutely clear consensus is not valid. The Executive will give full consideration to the views that were expressed in the consultation when framing the regulations, which Parliament will be able to debate fully in due course.

As members will know, the Executive gave a commitment at stage 2 to lodge an amendment at stage 3 to change the procedure for scrutiny of the regulations on the debt arrangement scheme from negative to affirmative resolution procedure. I would like to apologise for the late lodging of Executive amendments 91 and 92, which are manuscript amendments. That was due to an oversight. Amendments 91 and 92 deal with the proposal to make the regulations on the debt arrangement scheme subject to affirmative resolution and allow the Parliament to debate fully the terms of any debt charge payment scheme that we introduce. We believe, however, that amendment 24 should be rejected.

Murray Tosh (Conservative, South of Scotland)

Mr Sheridan, do you wish to sum up?

Tommy Sheridan (SSP, Glasgow)

Briefly, Presiding Officer. I hope that the minister will be prepared either to agree or disagree with the fact that, in the consultation that he refers to, 42 of the 44 consultees said that money advice services in the preparation of a debt arrangement scheme application should be free. Does the minister agree with that fact?

Murray Tosh (Conservative, South of Scotland)

The minister has no right of response at this point. You are concluding the debate on the amendment.

Tommy Sheridan (SSP, Glasgow)

I am prepared to accept an intervention, but the minister's sedentary position says it all. During stage 2, the minister told us to wait for the consultation. We waited for the consultation, but now he is telling us that he will reject what was said in that consultation

Richard Simpson (Labour, Ochil)

The free text in the analysis shows that a substantial number of differing views were given and the Executive believes that it would be proper for us to take those views into account in framing regulations, which might or might not emerge in the way that Mr Sheridan suggests. This matter should be dealt with in the regulations, which the Scottish Parliament will have an opportunity to debate.

Tommy Sheridan (SSP, Glasgow)

There lies the difference: the minister thinks that matters should be dealt with in regulations, whereas other members think that they should be dealt with in the bill so that everybody can understand the position when the bill becomes an act instead of having a situation in which a great deal of power is vested in the Executive.

I urge the Parliament to support amendment 24 on the basis that any debtor who wishes to access a debt arrangement scheme should not incur more expense. If everyone agrees with that, we should include it in the bill rather than leaving it to the discretion of the ministers.

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 24 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 31, Against 79, Abstentions 0.

Amendment 24 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 25 is grouped with amendments 26 and 28.

Lyndsay McIntosh (Conservative, Central Scotland)

We can agree on the principle that debtors who agree to pay their debts in a managed way should be protected from enforcement by their creditors, but there are some uncertainties about how the legislation will work in practice. The explanatory notes and policy memorandum suggest that the debt arrangement scheme is intended only for those who can pay their debts in full, albeit over time.

However, that intention has not been made explicit in the bill. Payment in full over a reasonable period is central to the credibility of the debt arrangement scheme and to its viability for Scotland's credit markets. Without that safeguard, the debt arrangement scheme is at risk of being abused and could lead, ultimately, to the contraction of credit supply—something that we all wish to avoid. The bill should state explicitly, therefore, that full repayment over a reasonable period is an integral part of the system.

Uncertainty regarding the full payment of debts through the DAS will impact on creditor behaviour. If the operation of the DAS appears to increase the incidence of non-payment among certain types of borrowers, creditors will respond by contracting supply. In the parliamentary debate on 19 September, the Minister for Social Justice said:

"We cannot create a debt enforcement system that can be avoided and exploited."

In the same debate, the Deputy Minister for Justice said:

"We must have a system that protects the poorest in our society".—[Official Report, 19 September 2002; c 13888 and 13947.]

However, we must have a system that ensures that those people who can pay, do so.

The DAS must contain the quid pro quo that debtors will not be pursued by creditors because they have made a commitment to repay their debts in full under a debt payment programme. Existing voluntary debt repayment schemes—the minister mentioned some of those schemes at an earlier point—enjoy creditor support because they enshrine the principle of assisted repayment in full. In the debate on 19 September, the deputy minister also acknowledged the effectiveness of debt repayment schemes run by the Consumer Credit Counselling Service. Therefore, the principle of repayment in full should be enshrined in the primary legislation from the outset. Otherwise, creditor participation and confidence will risk being undermined by possible changes to the secondary regulations further down the line.

My series of amendments is designed to address an area of ambiguity in the bill. As drafted, section 2 appears to allow the debtor to determine which creditors are to be paid under the debt payment programme. Some creditors could be preferred over others in an arbitrary way and others could be left out altogether. Both scenarios are inequitable. It should not be for the debtor to pick and choose between creditors; the interests of all creditors must be taken into account. Any blanket prohibition or enforcement would be unfair. The bill should require the debtor to include all creditors in the debt payment programme and to give reasons for any proposed differential treatment. The importance of certainty for creditors was recognised on 2 October, when the deputy minister stated:

"We believe that there is a danger in permitting the debtor to be vague about his debts and about his creditors, particularly as participation in the scheme prevents creditors from exercising their rights to enforce."—[Official Report, Social Justice Committee, 2 October 2002; c 3080.]

I look forward to hearing the deputy minister's observations.

I move amendment 25.

Robert Brown (Liberal Democrat, Glasgow)

As this is the first time I have spoken in the debate, I declare that I am a member of the Law Society of Scotland and a consultant to Ross Harper solicitors in Glasgow and, for the avoidance of doubt, I declare my former chairmanship of the Rutherglen and Cambuslang citizens advice bureau.

I speak against amendment 25. Lyndsay McIntosh talked about the normal position of people requiring to pay their debts, which is correct, but we are not talking about the normal situation—we are talking about a situation where the arrangements for payment have broken down. We are trying to deal with the question of the enforceability of those arrangements under circumstances where they can be enforced and where they cannot. I will deal with this subject in my later amendment on the composition of debt and freezing of interest, but if the sort of arrangement to which Lyndsay McIntosh referred is to work satisfactorily, there must be an element of realism about it, which did not come through in her speech.

Many debts can be repaid over a year, 18 months or two years, but there have been numerous examples at stage 1 and in other contributions to the debate, of situations where debtors' ability to repay their debts is such that it could take 27 years, 54 years or 128 years. We have to be realistic and not rule out the possibility of voluntary composition of debts. We should be examining seriously the possibility—in limited circumstances—of applying for a composition arrangement. I accept that that will be covered later on. What we should certainly not do is to rule out—as Lindsay McIntosh seeks to do—alternative arrangements by introducing a technical, unrealistic requirement for debtors in the debt arrangement scheme to repay their debts in full, under all circumstances.

This is not about applications being made by the debtor alone. The debtor has to have had access to, or have benefited from the involvement of, a money adviser. That is intrinsic to the scheme. The applications have to be approved in due course under the procedures that the bill sets out. It is not simply a matter of the debtor making an application and of everybody falling in with the arrangements and that being the end of the story. A whole lot of safeguards would be required before the arrangements could be put in place.

Against that background, Parliament would be ill-advised to agree to the amendments in Lyndsay McIntosh's name.

Richard Simpson (Labour, Ochil)

Amendments 25 and 26 would make it a condition of participation in a debt payment programme that all debts will be paid in full. That may appear a laudable aim, but we have reservations about the unconditional terms of the amendments.

We have discussed the issue before in connection with the possibilities of composition and the freezing of interest, to which Robert Brown alluded, and on which an amendment is coming up later—I will not pre-empt that discussion now. Suffice it to say that the amendments in this group would actually prevent creditors who are prepared to accept less than the total that is due to them from being able to accept it under a debt payment programme. They could, of course, accept it separately, on a voluntary basis, but it would be difficult for the scheme to recognise and incorporate that. Creditors will generally be asked to consent to the debtor's application to participate in a programme. Any creditor who is not satisfied with the proposed arrangements for repayment of a debt, whether in whole or in part, will not give that consent.

Amendment 28 requires an applicant to attest that all creditors are included in the application, and, if they are not, to state why not. That is a matter of detail for the regulations, and there is power to cover that under paragraphs (a) and (b) of section 7(1).

The Executive's consultation asked for views on whether the penalty for making a false declaration should be revocation. Respondents recognised that there may be instances where debtors genuinely are not conscious of the full level of their indebtedness and that, in those instances, there should be some discretion. Most respondents agreed that, where the declaration has deliberately been falsified, the penalty should be revocation. When drawing up the regulations, the Executive will be taking those views into account, as well as our similar discussion on this topic at stage 2, in relation to variation of the debt payment programme.

Amendments 25, 26 and 28 should, therefore, be withdrawn or rejected.

Lyndsay McIntosh (Conservative, Central Scotland)

I have listened carefully to what the minister has said today, and I carefully went over the minister's previous remarks to try to find something that would accommodate our point of view. He said that the debt arrangement scheme should be framed in such a way as to

"avoid unintended consequences for the Scots law of contract and property".—[Official Report, Social Justice Committee, 2 October 2002; c 3094.]

Specific reference was made to "serious concerns" that, if a DAS resulted in an infringement of creditors' rights to property, that might contravene article 1 of protocol 1 of the European convention on human rights.

The Executive's consultation document "Enforcement of Civil Obligations in Scotland" also refers to the requirement for the debt arrangement scheme to be compatible with the ECHR in regard not only to

"the rights of the person against whom enforcement activity is taken"

but also to

"the rights of the person who needs to seek recourse to enforcement action."

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 25 be agreed to. Are we all agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 16, Against 95, Abstentions 0.

Amendment 25 disagreed to.

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 26 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 15, Against 88, Abstentions 0.

Amendment 26 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 1 is in a group of its own.

Richard Simpson (Labour, Ochil)

At stage 2, Robert Brown lodged an amendment—amendment 32—that was designed to add flexibility to the information that the debtor must provide about his or her debts in an application for approval of a debt repayment programme.

The Executive sympathised with the intention behind the amendment, but was concerned that it was too vague and could be open to abuse. We undertook to produce a more precisely worded alternative. Amendment 1 fulfils that commitment.

I move amendment 1.

Amendment 1 agreed to.

[Amendment 28 moved—[Mrs Lyndsay McIntosh].]

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 28 be agreed to? Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 15, Against 96, Abstentions 1.

Amendment 28 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 30 is grouped with amendments 43 and 44.

Lyndsay McIntosh (Conservative, Central Scotland)

The bill implies in section 2(4) that a debt payment programme will ordinarily require the consent of all creditors. However, the bill leaves open the circumstances in which consent may be dispensed with under section 7(2)(g). I believe that the consent of the majority of creditors should be a prerequisite for a debt payment programme and that that should be made explicit in the bill. The problem of the unreasonable creditor could be dealt with by majority consent or by an override procedure that would enable an unreasonable refusal to be disregarded.

If amendment 30 were agreed to, section 7(2)(g) would not be necessary, given that the specification of the circumstances in which consent could be dispensed with would be provided for in the primary legislation. We need to try to strike a balance between protecting the interests of creditors and protecting the interests of debtors. If debt payment programmes operate in such a way as to protect only the interests of the latter, creditors will become unwilling to lend in circumstances in which they are unlikely to be able to recover their loans. The result would be increased financial exclusion.

Amendment 30 seeks to introduce appropriate balance between the parties. A requirement to secure the consent of a majority of creditors would, in turn, secure full approval and commitment from creditors who would be obliged to participate. The Deputy Minister for Justice recognised in the Social Justice Committee meeting on 2 October the threat of financial exclusion resulting from striking an inappropriate balance. He said:

"The scheme is meant for the benefit of creditors as well as debtors, and it will not work if we look after the interests of one group and not of the other. Any undue weight that might be attached to debtor interests could lead to an adverse response by creditors in relation to other matters, which might affect the future contract or credit terms offered to people on low incomes".—[Official Report, Social Justice Committee, 2 October 2002; c 3072.]

I move amendment 30.

Tommy Sheridan (SSP, Glasgow)

Amendment 44 relates to a primary amendment to establish a debt tribunal. Therefore I cannot understand why amendment 44 was selected on its own, given that the amendment on the debt tribunal was not selected. I will not be moving amendment 44.

Richard Simpson (Labour, Ochil)

Amendments 30 and 43 seek essentially to achieve the same thing and the Executive is opposed to both for the same reason. Section 2(4) already provides generally for creditors to give consent to a debtor's participation in a debt payment programme. Section 7(2)(g) allows the regulations to provide for circumstances in which that consent can be dispensed with. The question of the level of creditor support required was raised in the Executive's consultation. The independent analysis of responses shows a lack of agreement on what level of creditor support is needed for approval of a debt payment programme. Some considered that a straight majority of creditors was all that was necessary, but others disagreed and put forward other options. We think that it is right that we consider fully the responses and options before coming forward with detailed and, we hope, practical proposals in the regulations, which the Parliament will examine using the affirmative procedure.

Amendment 30 is technically defective, because it does not specify the criteria by which a majority of creditors is to be determined. It does not state whether the number of creditors or the value of the debt would be the determining factor. If the decision were based on numerical considerations, one could have a situation in which the major creditor was not in the majority, even though they had 85 per cent or 90 per cent of the debt, because there were four or five smaller creditors. There is a significant technical problem with amendment 30. It also does not deal with circumstances in which withholding consent is unreasonable.

I will not address amendment 44, as Tommy Sheridan has indicated that he will not move it. I ask for amendment 30 to be withdrawn and for amendment 43 not to be moved. Failing that, those amendments should be rejected.

Lyndsay McIntosh (Conservative, Central Scotland)

I have consulted my assistant and, in view of the minister's comments that the issue can be dealt with in regulations, I am prepared not to press amendment 30.

Amendment 30, by agreement, withdrawn.

Murray Tosh (Conservative, South of Scotland)

Amendment 2 is grouped with amendment 32. I point out that, if amendment 2 is agreed to, I cannot call amendment 32, because it will be pre-empted.

Richard Simpson (Labour, Ochil)

At stage 2, Cathie Craigie and Robert Brown expressed concerns about the requirement to prescribe an upper monetary limit for the amount of debt and a lower limit for the number of creditors in relation to participation in a debt payment programme. Instead, they wanted section 7(2) to include a permissive power, so that the conditions for participation might provide for such limits, depending on the results of the consultation exercise.

The analysis of the consultation responses on the upper limit produced a mixed result. There was no agreement on whether there should be such a limit or on what any limit should be. Therefore, it would seem right that the requirement for a prescribed upper monetary limit be reconsidered.

The Executive promised to return to the issue at stage 3. By deleting the requirement, amendment 2 meets the Executive's commitment. There is no corresponding insertion of a permissive power in section 7(2), because that is not necessary. Section 7(1)(a), as further explained by section 7(2)(a) and section 7(2)(b), would enable that to be done.

We should look closely at the balance of the differing views that have been expressed on the issue. In light of the discussions at stage 1, the Executive also sought additional information from CABx, through a survey on the levels of typical voluntary arrangements. We want to take account of that informal information. Therefore, amendment 32 would not be wise at this stage and I respectfully ask Tommy Sheridan not to move it. Of course, the regulations will now be subject to the affirmative resolution procedure.

I move amendment 2.

Tommy Sheridan (SSP, Glasgow)

As the minister said, discussion in the committee revolved around the issue of whether a maximum limit would be placed on the amount of debt of debtors seeking access to the debt arrangement scheme. All the advice agencies expressed the worry that, if a ceiling that was too low were imposed, a number of debtors would be excluded from the debt arrangement scheme. That would have a dangerous impact on whether future attachment orders would become exceptional.

In light of the minister's words and the nature of amendment 2, I am happy not to move amendment 32. I hope that the advice, information and consultation responses from Citizens Advice Scotland and others will be borne in mine and will become the guideline on access to the debt arrangement scheme. We cannot exclude people on the ground of an arbitrary, low maximum ceiling of debt.

Amendment 2 agreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 34 is in a group on its own.

Robert Brown (Liberal Democrat, Glasgow)

I mentioned that I have a history as a former chair of Rutherglen and Cambuslang citizens advice bureau. As might become evident, I bear the scars of a series of difficult negotiations with various sorts of council from the years in which I held that position. To some extent, that history forms the background of what I am saying today. The serious point that I am making is that, as it is the local authority's responsibility to provide local services, each local authority should be placed under a duty to ensure that independent money advice is available within their area to anyone who might require it under section 3.

I say that against the background of the decisions that were made on the disposal of the £3 million that the Executive provided for the support of money advisers across Scotland as part and parcel of the arrangements for the bill. CAB sources have provided me with a note that shows how that money was used. Despite a new partnership agreement to develop CAB services, East Renfrewshire Council is to keep all the funds for in-house services. North Ayrshire Council, without consulting the CABx, decided to retain all funds for in-house services. Renfrewshire Council decided to spend all its £105,000 on employing three more officers within its advice works department after only a token consultation with the CABx. In my home area of South Lanarkshire, the council allocated £30,000 of the total £177,000 to only two of the four CABx.

The money was similarly divided in the cities, although in slightly more sophisticated ways. Despite a 40 per cent cut in CAB core funding over the period, the City of Edinburgh Council is looking to employ all its money advice staff in-house—although secondment to the CABx may be possible. For Glasgow City Council, £101,000 of the £636,000 that it received will go into four of the eight Glasgow CABx. I think that members in the chamber can get the broad picture that comes out of those figures.

As I said, the precise provision that exists in each area is rightly an issue for local authorities. Obviously, I hope that, in the exercise of their responsibilities, local authorities will pay attention to the importance of independent money advice. However, it is fairly evident that a good degree of council empire building is taking place with the money that the Scottish Executive made available. To be frank, that is not the intention of ministers, the committee or the general public.

Let me touch briefly on the reasons why independent money advice is important. Local councils are often a principal creditor in many debt situations, because they are owed council tax or rent payments. Protocols exist within money advice work about the extent to which one prioritises certain degrees of on-going payment. I have no difficulty in accepting those protocols, which apply whether the money advice is provided in-house or through independent agencies across the board.

The debtor must have a choice. Rightly or wrongly—often wrongly, no doubt—many people will not see council in-house advice as being independent. The advice must not only be independent; it must be seen to be independent. The issue is whether Chinese walls and that sort of thing can be erected.

Amendment 34 would not insist that all advice has to come from the voluntary and independent sectors, but it would insist that there must be a choice. When the minister spoke about the issue at stage 2, he made what I suggest were not compelling points about the wording of the amendment, as he queried what was meant by "independent" and "accessible". There may be issues about that—although I am bound to say that the average member of the public knows what "independent" and "accessible" mean—but the Executive could have made a commitment to the idea and then amended the phraseology to achieve the objective.

Amendment 34 deals with an important issue of principle. It links in with on-going problems that the Social Justice Committee has harped on about time after time, such as the adequacy of core support for the CAB movement. I believe that amendment 34 would improve the workings of the debt arrangements by making them more accessible and more available. More important, it would make the arrangements more likely to be taken up by the debtors for whose benefit they will be put in place.

I move amendment 34.

John McAllion (Labour, Dundee East)

On a point of order, Presiding Officer. When we debate amendments, is it possible that, subsequent to hearing the mover of the lead amendment, members could hear the ministerial response before they speak to the amendments rather than having to speak to them before hearing what the minister has to say?

Murray Tosh (Conservative, South of Scotland)

We usually have the minister respond to the entire debate. It is possible for the minister to come in immediately and then speak again at the end of the debate, but on this occasion the minister has not indicated that he wants to come in early. I have the power to call the minister if he wishes to speak.

Johann Lamont (Labour, Glasgow Pollok)

The issue that amendment 34 touches on was raised in the committee and was one of the few issues on which there was real disagreement among committee members.

The Parliament must always be aware of issues of subsidiarity and the responsibility that lies with local authorities to make decisions. We would not want to draw up powers from local authorities on such matters. Amendment 34 implies that local authority workers who are charged with the responsibility of giving money advice cannot be independent. I am sure that many local authority workers doing that job would not be happy with that implication. I am certainly not happy with it.

It is perfectly possible for advice that is provided by a local authority to be just as independent as advice that is provided by the voluntary sector and—most important—for it to meet just as fully the needs of the person who is seeking that advice. That is not to say that there is not an important role for the voluntary sector to play—clearly, that sector does play a role, as we recognise. However, we must oppose amendment 34 on the ground that it implies that somebody who is given the advice role by a local authority cannot carry out their duty in a responsible way.

We may wish to consider how that work is regulated and monitored and what the local authority's role is in that work, but my experience is that local authorities are not uncomfortable with working in partnership with the voluntary sector. Amendment 34 might create an unnecessary division and an unhelpful implication in relation to the important job of money advisers, wherever they are carrying out the responsible and important role that the bill gives them. I oppose amendment 34.

Donald Gorrie (Liberal Democrat, Central Scotland)

I will speak in favour of amendment 34. Robert Brown is offering choice, not compulsion of any sort. The amendment would give the debtor the choice of going either to an in-house council debt advisory place or to an independent place such as a citizens advice bureau. Choice is a good thing.

The issue is not about in-house council money advisers not being independent; it is about the fact that they might not be seen as independent. The public have a great suspicion of public bodies and their employees. A lot of people who are in debt think that they will not get neutral advice from council advisers, who—it is thought—will naturally put debts to the council, which almost always figure among the debts, at the top of the queue for repayment. The issue is public perception.

Having been in councils for 26 years, I strongly support councils being given as much scope as possible. However, if ministers and the Parliament want independent debt advice to be given, councils should supply money to independent advisers though grants, as well as supplying in-house advice.

I have put questions to ministers on the issue of independence and their answers on the subject have, as usual, been rather unsatisfactory. I also had a short exchange of views with the Minister for Social Justice, Margaret Curran, on how much of the local government money that is given by the Executive went to debt services. She has kindly written to me to point out that half of the new jobs created are in local authorities—half is a reasonable figure—but that three quarters of the money went to local councils, which gave away only a quarter of the money to CABx and other advice providers. Three quarters of the money produced only half the jobs—we should think about that.

For a whole lot of reasons, members should support amendment 34. It is not anti-local government, but pro-choice. It would give local voluntary organisations, as well as the councils, a fair do and it would help the debtor, which is what I thought the bill was all about.

Karen Whitefield (Labour, Airdrie and Shotts)

Like my colleague Johann Lamont, I call on members not to support amendment 34. It is, quite frankly, patronising to suggest that local authority employees who offer debt advice do not work in the best interests of their clients. That is most certainly not my experience in North Lanarkshire Council and I do not think that it is the experience of the many people across Scotland who have accessed services over the years—those people will have been given the best-quality advice available and will have been supported throughout the experience.

Although I agree that CABx play a valuable role in providing debt advice and information services, they are not the only organisations, either in the voluntary sector or in local authority settings, that can do that. The Scottish Executive has spent £3 million to provide free independent advice services across Scotland and in so doing—

Tricia Marwick (Scottish National Party, Mid Scotland and Fife)

Will the member give way?

Karen Whitefield (Labour, Airdrie and Shotts)

Let me finish this point.

In so doing, more than half the money adviser positions that have been created have been created within the voluntary sector. That is an important point. It ensures that there is a range of opportunities for people to access free independent advice, whether they want to access it from a local authority or from the independent and voluntary sectors.

Kenneth Gibson (Scottish National Party, Glasgow)

Robert Brown and I submitted amendments similar to amendment 34 at stage 2. I am happy to support Robert Brown and I agree with what he and Donald Gorrie said. I do not agree with Karen Whitefield that amendment 34 is patronising. We all accept that local government employees provide independent advice. However, the person who is seeking advice might not see things that way, given that local authorities are often creditors. As Donald Gorrie said, all that we are trying to do is to provide people with a choice. What is most important is that an individual in debt gets advice. Anything that encourages them to come forward and take that advice is to be commended, so the SNP will be happy to support Robert Brown's amendment 34.

John McAllion (Labour, Dundee East)

I have not made up my mind yet on amendment 34, but I do not believe that anybody should have a virtual monopoly on providing independent advice. In any community, a spectrum of advice should be available, so that people have a choice about whom to go to to seek that advice. Moreover, I do not think that we should get into the business of setting up council employees against employees in the voluntary sector. They are all working in the same area and they are all providing the same kind of service. My experience of welfare rights officers is that they are among the best people to provide advice that one could ever come across in any local community.

I am also wary about saying, "In my experience, North Lanarkshire Council is like this," or, "In my experience, Dundee City Council is like that," because I know about Dundee City Council but I do not know about all the other councils in Scotland. I remind Labour members who speak in that vein that not all councils are Labour councils. Some councils might have policies that prioritise the recovery of debts that are owed to them because of rents, council tax or outstanding poll tax, which is still owed in many areas of Scotland.

Some welfare rights officers may not be allowed to offer advice that runs counter to the policies of the council that employs them. I do not know whether that is the case, but I would like to know whether the minister has done any work on that issue. I would be reluctant for us to get into a position where the only kind of advice that is available locally is advice that says that debts that an individual owes to the council take priority over debts that he or she owes to other agencies, because it might not be in the individual's interest to prioritise debts in that way. I would be grateful if the minister responded to that point when he winds up.

Richard Simpson (Labour, Ochil)

The measures proposed in amendment 34 were debated at stage 2, so I do not propose to go over all the ground again. However, it is worth reiterating that we want ready availability of well-informed, well-trained and well-supported money advisers. We have, as members have indicated, funded advice services to the tune of £3 million per annum. Tommy Sheridan asked earlier whether the money advice will be free. The money advice will be free; it will not be charged for.

The terms of amendment 34 are unclear. There is no definition of what is meant by "independent". I know that Robert Brown says that that is self-evident, but his speech did not provide clarification; indeed, it obfuscated the issue. He implies with his amendment that a local authority adviser cannot be independent. His definition of "independent" is clearly at variance with what he understands the public's perception to be of what is meant by "independent". Amendment 34 does not define the phrase "readily accessible", either, although that might be thought to be understandable. We hope that advisers will be readily accessible. Moreover, the amendment does not indicate the extent of the duty that it imposes.

The amendment is unnecessary, because we require local authorities to ensure choice—that deals with Donald Gorrie's comments. That choice is reflected by the division of almost 50:50 in the appointed money advisers. When somebody goes for money advice, they do not say, "Are you three quarters funded because you are from the local authority or one quarter funded because you are from the voluntary sector?" They say, "Do I have a choice of money adviser?" The answer is yes. The money has been allocated to make that division. The spectrum to which John McAllion rightly referred exists. If it did not exist, we would want to examine that. We believe that it exists and that choice is available.

As we said at stage 2, the key issue is not so much choice of money advisers as whether the advice that is given is good quality. The standard that will be attained is of primary importance—Karen Whitefield referred to that. If standards are consistent, independence—whatever that means—in the sense of who provides the service is irrelevant. Quality standards and quality assurance also relate to independence in the sense of the adviser acting in the best interests of the person who consulted them—the debtor—and not in the interests of the local authority or the creditor.

Tricia Marwick (Scottish National Party, Mid Scotland and Fife)

I listened carefully to what the minister said about the independence of money advice officers who work for local authorities. Will he guarantee to local authority money advice workers that their line managers will not put pressure on them to prioritise council tax arrears?

That will allow those workers to give truly independent advice.

Richard Simpson (Labour, Ochil)

As I tried to say, an adviser acts not on behalf of their employer, but on behalf of a debtor. The debtor's interests alone must have primacy. That is not the undertaking that Tricia Marwick wanted, but I understand that that will be interpreted to mean that any attempt by an employer to suggest that an adviser should not follow best practice will be looked on severely.

Tricia Marwick (Scottish National Party, Mid Scotland and Fife)

Will the minister give way again?

Richard Simpson (Labour, Ochil)

No. I covered the point.

Further development and strengthening of standards and quality assurance will be dealt with by the Executive's proposals for enhanced central support for money advice. We have agreed to provide £500,000 of central support for the delivery of money advice training. That shows the Executive's commitment and determination that an adviser must act in the debtor's interests, no matter where that adviser is employed—I repeat that for the last time.

We ask for amendment 34 to be withdrawn; failing that, it should be rejected.

Robert Brown (Liberal Democrat, Glasgow)

I listened carefully to the debate, in which many interesting points were made. I accept the minister's assertion of the Executive's good will and the primary objective of making good-quality money advice available to debtors. I do not argue about that.

I suggest to the minister that behind the amendment lie genuine issues about the availability of independent advice. I touched on that situation in one or two earlier examples. If the relevant part of the Executive's £3 million is all allocated to council in-house services, that does not suggest that people in a local authority area will have the choice of which the minister makes much.

Cathie Craigie (Labour, Cumbernauld and Kilsyth)

I am listening carefully to Robert Brown. Will he give an example of a constituent who could not obtain independent advice from a local authority?

Robert Brown (Liberal Democrat, Glasgow)

I am not aware of the details of debtors who have gone for advice. I will quote again the example from North Ayrshire, but I can give other examples. According to my information, North Ayrshire Council decided to retain £95,000—all the funds that the Executive allocated—for in-house services, without consulting CABx.

John McAllion said that we are not talking about Labour councils only. Indeed, we are not. Angus Council, for example, allocated the CABx £10,000 out of its £50,000. There are examples in councils in which the Liberal Democrats have influence, too. The issue is not about party; it is about the balance between the council, which is responsible for the provision and strategic decisions made at the local level, and the independent sector.

Karen Whitefield suggested that the issue had been dealt with in a patronising manner. I do not accept that. I was careful to say that I was making no challenge to the individual money advisers in councils. I was saying merely that some councils appeared to be empire building with the money, which is a different issue. The issue is the balance in the availability of advice of various sorts within local authority areas across the country. I hope that the information that I have put before the chamber demonstrates that a balance does not exist in several local authority areas.

Whatever the outcome of the vote, I hope that the minister will reflect on today's debate and, when it comes to regulations, examine whether the legislation can be strengthened, perhaps through output agreements, to ensure that the Executive's objectives are brought about.

My final point is important. It concerns the fact that, although three quarters of the money has gone to local authorities, councils are providing only half the jobs, as Donald Gorrie said. That suggests to me that there are issues about pay, about what is done with the money and perhaps even about value for money. Certainly, there is an issue that has not been addressed in the debate.

I believe that subsidiarity is the right way in which to deal with such matters, but that has to operate within a framework of national standards that sets out what we are trying to achieve. I therefore ask for the chamber's support for amendment 34.

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 34 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 40, Against 74, Abstentions 1.

Amendment 34 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 35 is grouped with amendment 38.

Tommy Sheridan (SSP, Glasgow)

Amendments 35 and 38 both attempt to ensure that when debts are being repaid as part of a debt arrangement scheme, they debts cannot be enforced by the use of other diligences.

It is important to note that when respondents to the Scottish Executive's consultation document, "Enforcement of Civil Obligations in Scotland", were asked whether enforcement should be stopped once a debt arrangement scheme application has been granted, 42 consultees said that it should be stopped while only three said that it should not be. If amendment 35 is disagreed to, it would still be possible to enforce debts that are subject to a debt arrangement scheme. I hope that the minister will address that point, because during stage 2, he said that he would return to the matter. Debts that are subject to a debt arrangement scheme should be ring fenced or protected.

For example, a debtor could agree to pay a mortgage or second loan secured on a house within a debt arrangement scheme. Even if the scheme were approved and payments were being made, it would still be possible for the creditor to serve a calling-up notice against the debt under the Conveyancing and Feudal Reform (Scotland) Act 1970. Such a notice would require the debtor to repay the loan, failing which ownership of the house would be transferred to the creditor.

A calling-up notice is not a diligence; it is a statutory remedy under the 1970 act that arises on breach of a loan secured on heritable property. It does not operate by decree and is not caught by section 4 as drafted. Amendment 35 would plug that loophole and therefore take on board the almost overwhelming view of respondents to the consultation that debts that are repaid within a debt arrangement scheme should not be subject to enforcement. During stage 2, the minister felt that that point had some validity and promised to examine it. As a result, I hope that he will agree to support amendments 35 and 38.

Amendment 38 would address the situation in which a creditor who gets a decree for payment can use it to serve an inhibition, which prevents a debtor from selling his or her house. I suggest that, if the debt is being repaid within a debt arrangement scheme, it is fair and sensible for any inhibition to fall once the scheme is approved. At present, the bill does not deal with any existing diligence; section 4 prevents future diligence only from being used against debts under the debt arrangement scheme. Again, I refer members to the Executive's recent public consultation, in which 93 per cent of respondents said that enforcement should stop where debts were being repaid with a debt arrangement scheme.

Amendments 35 and 38 are entirely consistent with the results of the Executive's wide-ranging consultation, which the minister said, throughout stage 2, he was awaiting. We have now received those results and he will see that my amendments are in line with them. I hope that that means that he will support my amendments.

I move amendment 35.

Richard Simpson (Labour, Ochil)

We discussed and rejected the content of amendments 35 and 38 during stage 2. Both concern what happens to creditors' rights in relation to heritable property when a debtor enters a debt payment scheme, but the bill already provides that all diligence and sequestration will be stopped. Subsections 4(2) and (3) prohibit creditors from commencing or executing any diligence for payment or seeking to sequestrate a person who participates in a scheme. As that includes inhibition, amendment 38 is unnecessary.

Amendment 35 would have wide-reaching implications for other areas of law, such as contract and property law. The restrictions that are referred to in the amendment would inevitably cause lenders to change their practices.

The Executive has followed the approach of the Scottish Law Commission, which first recommended a debt arrangement scheme in 1985 in its "Report on Diligence and Debtor Protection". We consider that, although 16 years have passed since the Law Commission's report, many of its conclusions on matters of legal principle remain valid today. In our consultation document, we suggested that heritably secured debt should not be part of a debt arrangement scheme. It is worth noting that that is not, of course, part of the voluntary arrangements on which the bill is intended to build.

Restraints on the calling up of standard securities could be considered appropriately only in a full review of heritable securities over the homes of all debtors, taking account of all the implications for property and contract law.

We must consider any such exemptions both in light of the scheme as a whole and cumulatively. For example, for how long could a debt payment programme run? If it could run for, say, nine years, or if there were no time limit, a lender would be unable to recover potentially valuable property over decades. As we have said before, we would be worried about the effect that that could have on the economy and the availability of mortgages.

We believe that amendments 35 should be withdrawn or, failing that, rejected, and that amendment 38 should not be moved.

Tommy Sheridan (SSP, Glasgow)

The minister is in danger of over-egging the pudding in relation to the consequences of amendment 35. The idea that the economy will collapse if the amendment is agreed to is scaremongering, to say the least.

The thrust of the bill is the prevention of further diligence or recovery against debts that are already within a debt arrangement scheme. The existing loophole will not be closed unless amendment 35 is agreed to.

The minister says that he does not think that amendment 38 is necessary because its provisions will be covered in the bill. I therefore hoped that the minister would have no problem in supporting it. Given that he thinks that the point is already covered, let us have a wee insurance policy to ensure that there is no problem. I will press amendments 35 and 38.

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 35 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 32, Against 81, Abstentions 0.

Amendment 35 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 36 is grouped with amendment 45. I call Tommy Sheridan to move amendment 46—sorry, amendment 36.

Tommy Sheridan (SSP, Glasgow)

I am glad that I am not the only one who is getting confused, Presiding Officer.

Amendment 36 would freeze contractual interest from accruing on debts that are being repaid through debt arrangement schemes. The members of the Social Justice Committee will be aware that many organisations that gave evidence to that committee agreed that if contractual interest on debts cannot be frozen during the operation of debt arrangement schemes, many people will never see an end to multiple debt. It is not uncommon for debtors to have real-terms interest rates of 200 per cent. That is the norm for most clients of advice agencies in Scotland, according to Citizens Advice Scotland's 2001 report.

In short, if contractual interest is not frozen, the debt arrangement scheme might be a failure as a policy initiative. The matter is so important that the whole debt arrangement scheme might fall if contractual interest is not frozen. I hope that the minister will take on board that grave warning. I also hope that he has listened to the evidence that the advice agencies gave to the Social Justice Committee. Amendment 36 is serious and important. I hope that members will bear it in mind that if there is no freezing of contractual interest and if the measures on the composition of debts are not passed, there will be serious consequences for the ability of the debt arrangement scheme to help debtors throughout Scotland.

I move amendment 36.

Robert Brown (Liberal Democrat, Glasgow)

Amendment 45 relates to a not dissimilar issue, which is that of freezing interest and the composition of debt. That issue was referred to during the Social Justice Committee's deliberations and most members of the committee had considerable sympathy with it. We touched earlier on the background to amendment 45, in the debate on Lyndsay McIntosh's amendment 25. Many debtors who receive advice have debts that amount to many thousands of pounds, which they are unlikely to pay in full over any reasonable period.

That situation has a number of effects. The first is that the creditor will not recover their money. The second is that the debtor becomes demoralised, which means that the repayment of even part of the debt is unlikely unless there is a degree of incentive or encouragement to keep up the payments, which might be significant for those who have relatively small incomes. There are many examples—which are not imaginary—of debts that would take 27 years or some such period to repay. In such situations, repayment in full is not likely because people become discouraged and do not carry on their repayments.

In the discussions at stage 2, the deputy minister was sympathetic to the Social Justice Committee's suggestions, but, in opposition, he said that they might overlap with Westminster legislation because of the commercial element. One can understand that. Another question was whether our suggestions overlapped with the European convention on human rights—in particular, the first protocol to the convention. It might be helpful to read from the first article of that protocol, which states:

"Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest".

We are talking about creditors' rights. In common with a number of human rights provisions, that one is not absolute or black and white. Conditions and exceptions are involved and alternative arrangements are possible. For example, in bankruptcy law, creditors receive payment of a dividend—20 per cent, 50 per cent or whatever—in exchange for the full writing-off of the remaining debts.

The principle exists and I accept entirely that it is a complex area in which there is overlap with the Scotland Act 1998, the ECHR provisions, the Human Rights Act 1998 and so on. However, I ask the minister—I hope that I will receive a positive response—to undertake to consider the issue in more detail in the light of the civil diligence review and to return to Parliament on the matter in due course, rather than rule out the possibility of instituting this arrangement at the present time.

I accept Tommy Sheridan's proposition in introducing the matter, that if the arrangements for the composition of debts and the freezing of interest are not included in the arrangements, that will to some extent undermine the intention of the Executive and the Parliament that there should be success in those areas.

Murray Tosh (Conservative, South of Scotland)

I can allow Kenny Gibson only long enough to make his point.

Kenneth Gibson (Scottish National Party, Glasgow)

Thank you, Presiding Officer. We covered the matter to a great extent at stage 1 and I submitted an amendment at stage 2. I support what Mr Sheridan and Mr Brown have said. Although I do not agree that not freezing contractual interest would cause a debt arrangement scheme to fail—that is over-egging the pudding somewhat—I believe that it would damage it. I hope that the Executive will reflect on the comments that have been made at stages 1 and 2 and support Mr Sheridan's amendment 36. I understand that Robert Brown is thinking of not moving amendment 45. If the Executive were to support Mr Sheridan's amendment, we would go some way towards achieving what many members would like to see.

Jim Wallace (Liberal Democrat, Orkney Islands)

As all members who have taken part in the debate have said, the issue was covered in detail at stage 2. As Robert Brown said, my colleague, Richard Simpson expressed at that time some sympathy with the general objective of amendments 36 and 45. I share that sympathy but, for reasons that I shall explain, we do not think that it will be possible to give effect to the amendments.

Since that time, we have received an analysis of the consultation responses. The responses showed mixed views on whether the composition of debts or the freezing of interest should be imposed on creditors. I do not want to go into the fine detail, but the consultation responses reveal that, of a total of 40 respondents who addressed the issue, 24 were in favour and 14 were against those measures. Those who were in favour were mainly advice agencies that interpreted the consultation question—which asked about discharge on less than full payment—in different ways. Those who were against the amendments were, not surprisingly, mainly creditors who were very strongly opposed to any form of compulsory discharge of debts on less than full payment. There is no reason why creditors cannot voluntarily waive interest payments or write off part, or all, of a debt, as some do at present.

We will consider those views carefully and ensure that they are reflected, as far as possible, in the regulations that will now be subject to affirmative resolution. I stress the phrase "as far as possible", because we would like to allow for waiving interest by agreement between debtor and creditor and, where appropriate, for forgiveness of debt on less than full payment in line with voluntary practice in some negotiated settlements.

We know, from those who are operating voluntary schemes, that some creditors are prepared to freeze interest from the start of the scheme. To do so is often in their best interests. We also know that, towards the end of a scheme, some creditors are prepared to write off outstanding debts if debtors have paid regularly. That might not be in the creditor's best interests, but it represents recognition of the efforts that the debtor has made.

Amendment 36 would prevent any interest that was legally due to accrue on debts from being included in the programme. It would have the effect of overriding legally binding contractual arrangements that had previously been entered into by debtors. We sought legal opinion on whether an amendment could be drafted to provide reassurance that the debt arrangement scheme would allow for, but not compel, the freezing of interest and the writing off of debt without exceeding the legislative competence of the Parliament. Our advice is that it could not, hence the absence of an Executive amendment on the matter.

However desirable it might seem in social policy terms, a freeze on interest simply cannot be achieved with a stroke of the pen. It would override otherwise legally binding contractual arrangements that have been freely entered into and, as Robert Brown said, it would raise serious concerns about the infringement of creditors' rights to property under article 1 of protocol 1 of the European convention on human rights.

The creditor's right to receive full payment of the debt and interest that is due in terms of the contract into which the debtor and creditor have entered may be construed as the creditor's "possession" for the purposes of article 1 of protocol 1. The creditor could waive those rights, but it would be an entirely different matter for those rights to be automatically removed by legislation. On Robert Brown's point about public interest, it is not clear whether removing the creditor's rights would be in the public interest or in the interests of one section of the public—namely, debtors.

Robert Brown referred to the issue of bankruptcy as a possible precedent. However, the nature of bankruptcy is that a debtor's assets are insufficient to meet their debts. Amendments 36 and 45 could mean that a person would be able to pay their debts, but because of actions by the State, part of their obligation would be written off.

If the provisions in amendments 36 and 45 are contrary to the ECHR, as we believe, it would be outwith Parliament's legislative competence to introduce them. Robert Brown said that we could consider the issue in the context of the civil diligence review. I acknowledge the importance that members throughout the chamber attach to the issue of contractual interest in a debt payment programme. We would be willing to ascertain whether there are ways of addressing the matter that are within Parliament's competence. However, I cannot promise anything. Accordingly, I ask Parliament to reject amendments 36 and 45.

Tommy Sheridan (SSP, Glasgow)

I am disappointed by the minister's response. The issue of contractual interest is of cross-party concern and is clearly a major issue that unites all the benefit advice and money advice agencies. The minister's response is not good enough. Under the bill as amended at stage 2, the minister will have the power to make regulations for sheriffs to deal with creditors' refusal to enter debt arrangement schemes. Either creditors would agree voluntarily to freeze interest or the matter could be referred by ministers to a sheriff.

Therefore, it is not an insurmountable problem to include in the bill the provision to freeze contractual interest in a debt payment programme. To say that that would not comply with the ECHR is, to be frank, a red herring. Amendment 36 is important and I urge Parliament to support it. Without amendment 36, the debt arrangement scheme could be fatally wounded.

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 36 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 34, Against 80, Abstentions 0.

Amendment 36 disagreed to.

[Amendment 38 moved—[Tommy Sheridan].]

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 38 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 31, Against 79, Abstentions 0.

Amendment 38 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 42 is in the name of Tommy Sheridan. As time is now extremely tight, I will call to speak only the movers of amendments, the minister and those who are summing up.

Tommy Sheridan (SSP, Glasgow)

The introduction at stage 2 of paragraph (fa) to section 7(2) amended the bill to allow the Scottish ministers to introduce regulations to enable the debt arrangement scheme determinations to be appealed against. It is fair to say, therefore, that the minister has already accepted the right of debtors to be entitled to an appeal if they are refused access to a debt arrangement scheme. However, as the bill stands, if a debtor is refused access to a debt arrangement scheme, they have no right of appeal. Amendment 42 would establish a right of appeal. Already, too many of the key principles of the debt arrangement scheme are subject to delegated legislation, something which the Subordinate Legislation Committee found worrying when it considered the bill, and that many others found worrying during stage 2.

Amendment 42 would include in the bill the right for a debtor to appeal if they are not allowed access to a debt arrangement scheme. It would allow a right of recourse to the sheriff for impartial reconsideration of the matter. I make the point that that is a common provision; for example, the Housing (Scotland) Act 2001 permits disgruntled tenants to have access to the sheriff if they are aggrieved about certain formal decisions that have been taken by their landlord. The amendment is both sensible and consistent with other legislation in allowing a debtor the right of appeal in relation to a determination not to allow them access to the debt arrangement scheme.

Amendment 42 is straightforward. It would include in the bill a provision that should be in the bill. I appeal to members and the minister to support the amendment.

I move amendment 42.

Richard Simpson (Labour, Ochil)

We believe that amendment 42 is unnecessary. It had been intended that the general power provided by section 7(1) would enable regulations to provide for an appeal mechanism. However, at stage 2, a provision was added to section 7 to provide specifically that the regulations may make provision for appeals against determinations of the Scottish ministers on applications for approval or variation of debt payment programmes.

In addition, amendment 42 would provide that diligence be suspended pending the outcome of the appeal to the sheriff. However, that would have the effect of pre-judging the outcome of the appeal. I therefore recommend that Tommy Sheridan seek to withdraw amendment 42.

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 42 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 4, Against 108, Abstentions 0.

Amendment 42 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 14, in the name of the minister, is grouped with amendment 15. There is time for only the briefest of statements in support of the amendment, minister.

Richard Simpson (Labour, Ochil)

Amendments 14 and 15 are technical amendments. Members might recall that at stage 2 Robert Brown lodged amendments 40, 41 and 42 to allow not only debtors, but creditors to apply for variation of a debt payment programme.

Executive amendments 40A and 97 were offered to achieve the same purpose, but with additional clarity. Along with Robert Brown's amendment 42, those amendments were agreed by the committee on 9 October. As a consequence, amendments 14 and 15 are required to reflect the change in the text from debtor to include creditors as well.

I move amendment 14.

Amendment 14 agreed to.

Amendment 15 moved—[Dr Richard Simpson]—and agreed to.

Amendments 43 and 44 not moved.

Amendment 45 moved—[Mr Kenneth Gibson.]

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 45 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 32, Against 75, Abstentions 1.

Amendment 45 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 90, in the name of the minister, is in a group on its own.

Richard Simpson (Labour, Ochil)

Amendment 90 responds to concerns raised during stage 2 about the regulations' providing for public notice of applications. Robert Brown's amendment 43, which was passed during stage 2, deleted the enabling power in section 7, allowing the regulations to provide for public notice of applications.

The committee felt strongly that means other than public notice should be found to allow creditors who might have been omitted in error from a proposed programme to know about applications so that they could seek to be included. In the light of the committee's serious concerns, the Executive undertook to consider the matter again, so we hope that amendment 90 meets that commitment.

The regulations already provide for establishing and maintaining a register of debt payment programmes. Amendment 90 will add provision that will allow the register to include applications for the approval and variation of debt payment programmes as well as for approved debt payment programmes. This means that bona fide creditors will be able to gain access to the information that they need without any need for public notice of applications to appear in newspapers or the like.

I advise members that analysis of consultation responses on this point suggested a preference for public notice in the form that the Social Justice Committee was concerned about—I know that it was a matter of great concern to the committee. The amendment will enable suitable arrangements to be made in regulations. We will make those as workable and user-friendly as possible for creditors, while protecting debtors' privacy as far as possible.

I move amendment 90.

Amendment 90 agreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 46 is grouped with amendment 47 and both are in Linda Fabiani's name. I invite Linda Fabiani to speak to the amendments and to move amendment 46.

Kenneth Gibson (Scottish National Party, Glasgow)

Presiding Officer—

Murray Tosh (Conservative, South of Scotland)

Ms Fabiani is off sick today, I suddenly recall. We have to settle for Kenneth Gibson instead.

Kenneth Gibson (Scottish National Party, Glasgow)

Well, I do have my admirers in some quarters. I will be moving all the amendments in Linda Fabiani's name today, because, as you say, Presiding Officer, my colleague is unwell.

Summary warrants do not allow the party being pursued to be heard in court. Whatever the circumstances of the case, natural justice demands that both parties to an action should have the right to be heard. The right to a fair hearing should not be circumscribed, and it is to Scotland's shame that we have allowed the situation to persist for so long. In the interests of justice and fairness and of maintaining the dignity of our legal system, we should ensure that courts adjudicate only after hearing all the evidence, rather than half the evidence.

There are further significant reasons why we should ensure that both sides to an action have a right to be heard. The European convention on human rights enshrines the right to a fair hearing in legal proceedings. Internationally, the expectation is that fair hearings be granted to all those who are involved in legal proceedings. For the sake of justice, and for Scotland's standing in international comparisons, we must endure that a day in court is available to the defendants of an action.

I urge acceptance of amendments 46 and 47, and I move amendment 46.

Richard Simpson (Labour, Ochil)

Amendments 46 and 47 seek to ensure that attachment cannot be used to enforce a summary warrant. We debated this matter at stage 2. It is important to remember that the domestic debtor already enjoys exactly the same protections under the new procedure, regardless of the type of decree that is being enforced and of the type of creditor. I do not think that that has been fully appreciated.

Amendments 46 would also require that, for an attachment to be competent, the creditor and debtor have the right to a hearing. Under the bill, both parties will already receive intimations to attend a hearing for an application for an exceptional attachment order. In the event that an order is granted—that is, only in those cases where the sheriff is persuaded that there are exceptional circumstances—the debtor has a subsequent right of appeal to the sheriff on a point of law.

The real impact of the two amendments would be seriously to undermine the collection of moneys due to central Government and local government, which are the only creditors who can use summary warrants. That would have a similar impact on all of us, as taxpayers. Amendments 46 and 47 should be rejected.

Kenneth Gibson (Scottish National Party, Glasgow)

I will press both the amendments. Natural justice should be overwhelming. In this case, I believe that the bill as currently drafted does not allow for that.

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 46 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 32, Against 81, Abstentions 0.

Amendment 46 disagreed to.

[Amendment 47 moved—[Mr Kenneth Gibson].]

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 47 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 30, Against 77, Abstentions 0.

Amendment 47 disagreed to.

Murray Tosh (Conservative, South of Scotland)

The next amendment for debate is amendment 48, which is grouped with amendment 49. I invite Karen Whitefield to move amendment 48.

Karen Whitefield (Labour, Airdrie and Shotts)

Amendment 48 would extend the list of articles in section 11 that cannot be attached, to include gardening equipment such as lawnmowers and spades.

I have lodged the amendment because the items in question are normally kept not in a dwelling-house, but in a garage or garden shed. It is particularly important that those items should not be attached because, under their tenancy agreements, many local authority and housing association tenants are required to keep their gardens neat and tidy. If they do not have the equipment to do that, it will be impossible for them to comply with their tenancy agreements. I urge members to support the amendment.

I move amendment 48.

Murray Tosh (Conservative, South of Scotland)

I invite Kenny Gibson to speak to amendment 49.

Kenneth Gibson (Scottish National Party, Glasgow)

The SNP is prepared to allow the Scottish ministers to add protections to the bill where that is appropriate, but if they want to remove protections, they should have the courage to argue the case for doing so in Parliament.

At stage 1, the Subordinate Legislation Committee, in particular, expressed concern that the bill gave too much power to ministers. Ministers argued that that was a result of the tight timetable for consideration of the bill and the need to replace poindings and warrant sales. However, their claim is not borne out by our experience of other bills. We can only surmise that ministers do not want scrutiny of their proposed legislation to be too close and prefer to introduce a series of statutory instruments that contain tiny pieces of legislation that we must put together like a jigsaw in order to get the big picture. I ask the Executive to prove that that is not the case by supporting amendment 49.

The SNP supports amendment 48, which seeks to prevent the attachment of gardening equipment.

I know that ministers will argue that part 2 of the bill relates to commercial debt. However, the minister has failed to separate commercial debt from domestic debt, with the result that a simple attachment, rather than an exceptional attachment, may be used to pursue a domestic debt. The consequences of that failure may be horrendous. The protections that exist under exceptional attachment orders and that are listed in schedule 2 do not apply to simple attachments to domestic debt. The Executive will have removed the protections that some debtors currently have.

Margo MacDonald (Independent, Lothians)

I shall take only a minute, because I do not mean to comment on the policy content of the bill. I speak as the convener of the Subordinate Legislation Committee. My committee and I want to point out that the Executive's timetabling of the bill gave the committee inadequate time to consider stage 2 amendments. The committee was able only to consider the bill briefly yesterday and the Executive's memorandum arrived only the evening before that. As a result, the committee has been unable to produce a paper report in time to inform the Parliament in general and on this debate in particular.

I would therefore like to record the committee's unhappiness at being put in that position, particularly as the bureau had agreed to a paper setting out reasonable timetables for my committee's scrutiny as recently as September. I appreciate that lots of people do not understand the workings of the Subordinate Legislation Committee, but I have to inform the Parliament that when regulations touch as closely on people's lives as do those that will be made under this bill, we take a very close interest in them. We have not had time to scrutinise the bill properly.

Richard Simpson (Labour, Ochil)

We welcome amendment 48, which would extend the list of items that would be exempt from the attachment. The reasons that Karen Whitefield gave are very clear. It seems sensible to include on the list gardening equipment that is reasonably required to keep debtors' gardens in good order.

Amendment 49 raises an issue that was discussed with the Subordinate Legislation Committee on 25 June. The aim of section 11(2)(a) is to allow the list of items to be added to, deleted or varied according to circumstances, such as changes in the economic or social climate and technological developments. The list includes computer equipment, which would probably not have been included had the bill been in place 15 years ago. In practice it is unlikely that anything will be deleted from the list, but we do not know now whether or how quickly technological advance will lead to obsolescence. The only example that I could come up with—it is probably not a very good one—is a mangle, which is something that most people would probably not recognise today, unless they are of a certain age. I see nods from Christine Grahame and others. However, a mangle might be an antique by now and therefore of value, so we would want to remove it from the list. That might not be the best of examples, but it is the only one that I could come up with. In our view, it is preferable to retain a degree of flexibility. The important thing is that any change in the list would follow consultation.

In response to Margo MacDonald's contribution, I accept that the timetable for the bill has been extremely tight. Everyone will be familiar with the reasons for that, which were beyond the Executive's control. I realise that that has placed a considerable burden on everyone involved and I welcome warmly the way in which colleagues have risen to the challenge. I regret the fact that the Executive memorandum to the Subordinate Legislation Committee could not be produced earlier, but I must stress that that is not intended to mark a lack of respect for the committee's important role, particularly when it discusses measures that affect people's livelihoods. The committee will note that the Executive has responded positively to its principal concerns.

We support amendment 48 and oppose amendment 49.

Murray Tosh (Conservative, South of Scotland)

Does Ms Whitefield wish to say anything else?

Karen Whitefield (Labour, Airdrie and Shotts)

No.

Murray Tosh (Conservative, South of Scotland)

I assume that she wants to press amendment 48.

Amendment 48 agreed to.

[Amendment 49 moved—[Mr Kenneth Gibson].]

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 49 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 32, Against 81, Abstentions 0.

Amendment 49 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 3 is grouped with amendment 50.

Richard Simpson (Labour, Ochil)

As I indicated when the Social Justice Committee discussed Kenny Gibson's amendment 110 at stage 2, on 9 October, we would have been well disposed towards workable amendments on the provision—indeed, we encouraged suggestions. Kenny Gibson's amendment 110 was rejected at stage 2 on the ground that it was insufficiently specific.

In requiring the compilation of a centrally held list, Kenny Gibson's stage 3 amendment—amendment 50—would be an unnecessarily bureaucratic and costly solution.

I indicated that, at stage 3, we would be willing to reconsider how to extend the section 12 provision to include holidays that were widely observed out of social convention, rather than specifically for religious observance. Amendment 3 seeks to achieve that by recognising local and national holidays. I recommend that amendment 50 not be moved or be rejected.

I move amendment 3.

Kenneth Gibson (Scottish National Party, Glasgow)

Amendment 50 is a follow-on to my amendment 110 at stage 2, which the minister has commented on. The purpose of amendment 50 is to ensure that the bill recognises that Scotland is a multicultural society of many faiths and none. By proposing that the taking of any action on days that are special to non-Christians should be prevented, it seeks to ensure that their beliefs are taken cognisance of when the execution of an attachment is sought.

I acknowledge that, by moving amendment 3, the minister has recognised the issue and has sought to remove specifically Christian references. We will support amendment 3, which is positive. However, because many public holidays have a religious basis, we believe that, in an equalities sense, amendment 3 does not go far enough.

Amendment 50 would allow the Executive to identify days that have a resonance for minority communities in Scotland; it would not create a bureaucratic imposition on the Executive. The proposed paragraph (a) that amendment 50 would insert in section 12(1) would allow the Executive three months to identify the relevant occasions and the proposed paragraph (b) would prevent an attachment if such days related to the debtor.

The identification of such days would not be difficult. If someone is from a Sikh or a Muslim community, for example, days that are sensitive to those communities should be avoided when an attachment is to be executed. Just as an attachment will not be executed on Christmas day because it is sensitive to the Christian community—regardless of whether the subject of the attachment is a churchgoer—a member of the Jewish community should not suffer attachment at Yom Kippur or Rosh Hashanah.

One of the objections that Robert Brown raised to my amendment 110 at stage 2 was that someone could say that any day was sensitive to them. That is hardly the case. In any event, amendment 50 would not prevent an attachment—it would simply allow for a delay of a day or two at best, without offending the debtor unnecessarily.

Murray Tosh (Conservative, South of Scotland)

I will allow Robert Brown to make a very brief contribution.

Robert Brown (Liberal Democrat, Glasgow)

I want to speak against amendment 50, which is misconceived in the extreme. Although I understand where Mr Gibson is coming from, the reason for the holidays being listed in section 12 is not that they are days of religious significance, but that they are public holidays. That is the important aspect. There must be an objective element in such matters. Amendment 50 would completely remove such an element. We cannot allow a determination that has a subjective relevance to the debtor. We can allow only what is ascertainable objectively.

Richard Simpson (Labour, Ochil)

I want to reject amendment 50, which refers to

"a day of religious or cultural celebration which ... is of relevance to the debtor."

Although such days would be specified in a list, the proposal could lead to endless debate about what was an appropriate cultural celebration. Amendment 50 should be rejected, because it is inappropriate.

Amendment 3 agreed to.

[Amendment 50 moved—[Mr Kenneth Gibson].]

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 50 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 31, Against 77, Abstentions 1.

Amendment 50 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 51 is in a group of its own. I call Kenny Gibson to speak to and move the amendment.

Kenneth Gibson (Scottish National Party, Glasgow)

I will be brief. After going through all the rigmarole of inquiring about ownership as required by section 13, the officer reaches the stage of section 13(4), which allows the officer to assume that an article belongs to the debtor unless it can be proven otherwise at the time. Section 13 does not give adequate protection to persons whose property may be in the possession of the debtor at the time. Amendment 51 would simply provide for a period of time during which documentary evidence to establish ownership could be provided in order to prevent loss to third parties.

I move amendment 51.

Richard Simpson (Labour, Ochil)

In executing an attachment, the officer may, after making inquiries, presume that all assets in the debtor's possession belong to the debtor, either solely or in common with a third party. That presumption will apply unless or until evidence has been shown to the contrary.

Amendment 51 would provide that that presumption could not be relied upon if evidence to the contrary was produced within 24 days. That is unnecessary, because section 13 already makes it clear that the presumption applies unless there is evidence to the contrary. The purpose behind referring to a 24-day period of delay is therefore unclear.

Under section 34, a third party already has a right to have his or her property released from attachment at any time before it is sold at auction. Sections 35 and 36 apply the same protection to assets that are owned in common by the debtor and a third party.

Amendment 51 is in any event defective because it fails to specify who may present the evidence and fails to provide for the procedure by which the place of the ministers' choosing is to be determined.

If amendment 51 is not withdrawn, I recommend that it be rejected.

Kenneth Gibson (Scottish National Party, Glasgow)

Given the minister's comments, I am happy to withdraw amendment 51.

Amendment 51, by agreement, withdrawn.

Murray Tosh (Conservative, South of Scotland)

Amendment 52 is grouped with amendment 57. I call Mr Gibson to speak to both amendments and to move amendment 52.

Kenneth Gibson (Scottish National Party, Glasgow)

Again, I will be brief. Amendment 52 deals with a public order consideration. The authority that we grant to persons to open, shut and lockfast premises must be strictly controlled. The best way of achieving that is to oblige the person with the power to be accompanied by an officer of the law.

I move amendment 52.

Richard Simpson (Labour, Ochil)

Amendments 52 and 57 would mean that, when an officer needed to open, shut and lockfast places, he would have to be accompanied by a constable. That would apply in non-domestic cases. We believe that that is unnecessary, because an officer can ask the police for assistance if he or she deems that to be necessary.

The bill does not need to make a specific provision to impose the requirement for a police presence in every case without the officer assessing the need for such a presence in any individual situation. Such a provision would place an unnecessary burden on police resources for no good reason. We recommend that amendment 52 be withdrawn and that amendment 57, if moved, be rejected.

Murray Tosh (Conservative, South of Scotland)

Mr Gibson, do you wish to wind up?

Kenneth Gibson (Scottish National Party, Glasgow)

I shall press both amendment 52 and amendment 57.

An officer cannot always predict what circumstances he or she will encounter when approaching premises. There may be dispute as to what happened when lockfast premises were entered. Amendments 52 and 57 would simply ensure that no such dispute would occur, and that is in the interests of all parties.

Murray Tosh (Conservative, South of Scotland)

The question is, that amendment 52 be agreed to. Are we agreed?

Murray Tosh (Conservative, South of Scotland)

There will be a division.

Murray Tosh (Conservative, South of Scotland)

The result of the division is: For 30, Against 78, Abstentions 1.

Amendment 52 disagreed to.

Murray Tosh (Conservative, South of Scotland)

Amendment 53 is grouped with amendments 54, 55, 56, 59, 63, 64, 67, 68, 77, 78, 79, 80, 81, 82, 83, 85 and 87.

Richard Simpson (Labour, Ochil)

This group of amendments—all of which deal with practical arrangements for valuing and removing articles attached under the procedures set out in the bill—falls into three smaller groups, each dealing with a particular aspect. I shall address each in turn.

The first of those smaller groups, comprising amendments 53 and 59, extends the time period for a sheriff to consider the report of an attachment. That will allow a greater opportunity to deal with any dispute about the valuation of the assets. Amendment 114, agreed during stage 2, provided that a debtor could apply for an order that an attachment should cease to have effect, or that a sheriff could so decide of his or her own accord, if he or she considered it appropriate. It also changed the point at which the 14-day period for that would start.

When we looked again at section 15(4), as amended, it became clear that timing difficulties arise from the amended provision. Two 14-day periods were foreseen—the first for submitting a report of attachment, and the second for the sheriff making a decision on whether the attachment is to cease to have effect. As the bill currently stands, those periods would run concurrently. That means that the sheriff might receive the report of the attachment on the last day that he is allowed to make an order that the attachment is to cease to have effect. That was not the intention. Amendments 53 and 59 therefore provide that the sheriff can make an order that the attachment should cease to have effect up to the day before the day on which the auction of the attached goods is to be held. That seems to us to be the most sensible approach.

All the other amendments in the group respond to a concern raised by both Robert Brown and Kenny Gibson during stage 2 about the practical arrangements for attachment under an exceptional attachment order. They each lodged amendments that sought to insert into the procedure an additional step, on a separate day, for the valuation of assets. We debated that point at length and the Executive's concerns and opposition to the amendments were explained in detail. Some of the members' amendments were withdrawn and others rejected, but members asked us to have further discussions with sheriff officers, who will be charged with carrying out the procedure in practice, to be sure that it would work smoothly. Those discussions have taken place, and the amendments are the result. They are a response to the concerns raised by Robert Brown and Kenny Gibson and to the discussion with the sheriff officers.

The second smaller group of amendments—amendments 56, 79 and 80—deal with a potential difficulty when a particular asset, such as a piano, requires specialist handling. For obvious reasons, arrangements should be made for the carriage of any such assets to be undertaken by a specialist carrier.

Tommy Sheridan (SSP, Glasgow)

The minister mentioned a piano, which may have been a non-specific example. Articles that are used for educational purposes are excluded. Does he agree that a piano is an example of one such article that would be excluded?

Richard Simpson (Labour, Ochil)

Not necessarily, because there are houses in which there are pianos that are not particularly functional and which are not being used for any purpose, or where there are no children. Therefore the pianos would not be being used for an educational purpose. We did not include a blanket exemption for pianos—we did not put them on the list of exempt items, and we do not intend to do so.

Amendment 79 provides that assets need not be removed immediately from a dwelling-house where it would be impractical to do so. In that event, amendment 80 provides that notice must be given to the debtor of when they will be removed. On any such occasion, it would also be necessary for section 16, which concerns unlawful acts after attachment, to be applied. Amendment 56 is a consequential amendment for that purpose.

All the other amendments in the group—amendments 54, 55, 63, 64, 67, 68, 77, 78, 81, 82, 83, 85 and 87—are for the same purpose. The lead amendment of that smaller group is amendment 77, and the others are consequential. Amendment 77 confirms that assets that are being attached under an exceptional attachment order will be valued at the price that they would be likely to fetch on the open market.

Open-market valuation of assets attached under an exceptional attachment order is already expressed elsewhere in the bill, with the practical arrangements to be covered in the rules of court. Amendment 77 confirms that an estimate of what assets would attract on the open market will be made. It will not—and we need to be absolutely clear about this—be done on a separate occasion, but at the same time as the assets are removed.

There simply is no need for entry to a house on two occasions. That would be intrusive and would also add to the costs. It is also unnecessary in view of the new procedures that are proposed elsewhere in the bill.

Let me underline the key point: assets can be removed from a debtor's home only at the end of a lengthy process during which the debtor will have received ample warning of what could happen, along with numerous opportunities to seek a negotiated settlement. The process includes the requirement for creditors to attempt to negotiate a settlement with debtors; the requirement to explore other means of enforcement; the requirement to provide advice and information; the requirement to have the matter considered by the court in the specific circumstances; the opportunity for voluntary declaration; and the option for the court to order an adviser visit.

We need to bear in mind the fact that what we are talking about here is only for the very few difficult cases where an exceptional—I repeat: exceptional—attachment order becomes necessary for the few who can but persistently refuse to pay. Other ways have been found to assist those who can pay to do so.

The amendments in the group cover the Social Justice Committee's point and have been lodged in direct response to its request.

I move amendment 53.

Amendment 53 agreed to.

George Reid (Scottish National Party, Mid Scotland and Fife)

The question is, that amendment 57 be agreed to. Are we agreed?

George Reid (Scottish National Party, Mid Scotland and Fife)

There will be a division.

George Reid (Scottish National Party, Mid Scotland and Fife)

The result of the division is: For 26, Against 82, Abstentions 0.

Amendment 57 disagreed to.

George Reid (Scottish National Party, Mid Scotland and Fife)

I call Mr Gibson to speak to and move amendment 58.

Kenneth Gibson (Scottish National Party, Glasgow)

Amendment 58 would increase the time that is given to sell an attached vehicle. The bill allows 14 days, but as many members know, that is unlikely to be sufficient time to sell a vehicle successfully. A sale in such circumstances would be unlikely to generate the best price, which would be to the detriment of the debtor and the creditor. With 28 days, more time would be allowed to sell the vehicle at a good price, which would assist both parties. The debtor would realise the best sum to set against their debt and the creditor would receive more.

I move amendment 58.

Richard Simpson (Labour, Ochil)

Section 22 protects vehicles from attachment in some circumstances, for example, when the car is necessary for the owner to travel to work or to reach regular medical treatment in a rural area that is not serviced by public transport. The sheriff has discretion to decide when holding an auction would qualify as undue harshness, according to the debtor's circumstances. That section is based on a Scottish Law Commission recommendation.

When a vehicle's value is more than £1,000, section 22(3) allows the sheriff to order its sale. Section 22(5) means that if a vehicle cannot be sold in 14 days, the vehicle's attachment will cease to have effect.

Amendment 58 would increase the time limit from 14 days to 28 days. That would decrease the debtor's protection, because if the vehicle is not sold within the time limit, the attachment ceases to have effect and the vehicle reverts to the debtor's possession. Amendment 58 should be rejected.

Kenneth Gibson (Scottish National Party, Glasgow)

There is a balance to be struck. For the reasons that I have given, I think that 28 days is a reasonable time and would protect the debtor and the creditor. I will press amendment 58.

George Reid (Scottish National Party, Mid Scotland and Fife)

The question is, that amendment 58 be agreed to. Are we agreed?

George Reid (Scottish National Party, Mid Scotland and Fife)

There will be a division.

George Reid (Scottish National Party, Mid Scotland and Fife)

The result of the division is: For 32, Against 81, Abstentions 0.

Amendment 58 disagreed to.

George Reid (Scottish National Party, Mid Scotland and Fife)

Amendment 60, in the name of Mr Gibson, is in a group of its own.

Kenneth Gibson (Scottish National Party, Glasgow)

The amendment came out of evidence that was heard at stage 1. Its intention is to extend the period of attachment to 12 months, thus giving the debtor more time to pay and reducing the number of debtors who would then proceed to exceptional attachment with all the distress that that might entail.

I move amendment 60.

Richard Simpson (Labour, Ochil)

Amendment 60 would extend the duration of the period after which an attachment may cease to have effect from six to 12 months. Section 23 provides that an attachment will cease to have effect if no further action is taken within six months of the attachment or 28 days of the removal of the attached article from the place at which it was attached, whichever is the earlier.

The amendment is unnecessary because extensions to the period are allowed under section 23(2), under which the sheriff, on application by either the creditor or the officer, may make an extension beyond the usual six-month limit. The sheriff may do so when the delay has been caused through no fault of the creditor or when the debtor is likely to comply with an agreement between the creditor and debtor for repayment of the debt that is due by instalments. Further extensions are provided for anyway by section 28(4)(b) where an auction has been cancelled and a date is specified in an exceptional attachment order.

Accordingly, amendment 60 should be withdrawn or rejected.

George Reid (Scottish National Party, Mid Scotland and Fife)

Mr Gibson, do you want to press the amendment?

Kenneth Gibson (Scottish National Party, Glasgow)

Yes.

George Reid (Scottish National Party, Mid Scotland and Fife)

The question is, that amendment 60 be agreed to. Are we agreed?

George Reid (Scottish National Party, Mid Scotland and Fife)

There will be a division.

George Reid (Scottish National Party, Mid Scotland and Fife)

The result of the division is: For 30, Against 83, Abstentions 1.

Amendment 60 disagreed to.

George Reid (Scottish National Party, Mid Scotland and Fife)

I call Mr Gibson to speak to and move amendment 61.

Kenneth Gibson (Scottish National Party, Glasgow)

Amendment 61 secures for debtors at least seven days' notice of the removal of attached articles. As current legislation contains such a safeguard, it seems somewhat draconian not to retain it. With this amendment, the debtor will be provided with additional time to make payment or payment arrangements and avoid the implementation of exceptional attachment orders. Moreover, third parties will be able to arrange for the release of their own possessions from attachment. As it is surely too harsh to carry out an order without such notice, I ask the chamber to support the amendment.

I move amendment 61.

Tommy Sheridan (SSP, Glasgow)

I want to support amendment 61. It is a draconian step too far, even for this Executive, to allow sheriff officers to turn up without any notice whatever at a debtor's home and gain entry by removing the locks. In that respect, the legislation is worse than the Debtors (Scotland) Act 1987. At least the 1987 act provided for a minimum of four days' notice, which usually meant that seven days' notice would be given. If the chamber does not accept the amendment, it will make the provision worse than it is at present, because there will be no notice. If there is notice, a debtor who—for whatever reason—has not sought proper assistance, will at least have a wee seven days' breathing space to seek help. As most people who work at the coalface and who give advice to debtors point out, it sometimes takes a final notice of sanction for people to seek assistance. From that point of view, amendment 61 is absolutely necessary if the bill is not to become one of the most draconian pieces of legislation that has ever been introduced.

Robin Harper (Green, Lothians)

I also support amendment 61. Without the proviso that it contains, the bill will cause people unnecessary fear and alarm.

Richard Simpson (Labour, Ochil)

I am tempted just to read out the first sentence of my brief, which says that amendment 61 is unnecessary and that the bill already does what it seeks to provide, but I will explain the situation, because the member who has moved the amendment clearly does not understand that.

Section 26(2) provides that the debtor must be notified of the details of an auction. Under section 26(2)(a), the notification must specify the date of auction and, under section 26(2)(c), the date for removal of assets. As section 20(6) makes clear, it is not possible for the date of removal to be fewer than seven days before the auction date. As a result, amendment 61 is unnecessary and should be rejected.

Kenneth Gibson (Scottish National Party, Glasgow)

I will press amendment 61, given that amendment 80 says that

"the officer shall give notice to the debtor"

and yet no time period has been specified.

George Reid (Scottish National Party, Mid Scotland and Fife)

The question is, that amendment 61 be agreed to. Are we agreed?

George Reid (Scottish National Party, Mid Scotland and Fife)

There will be a division.

George Reid (Scottish National Party, Mid Scotland and Fife)

The result of the division is: For 33, Against 78, Abstentions 0.

Amendment 61 disagreed to.

George Reid (Scottish National Party, Mid Scotland and Fife)

Amendment 62 is grouped with amendment 65.

Kenneth Gibson (Scottish National Party, Glasgow)

Amendment 62 seeks to ensure that the principal debt is paid off before the fees of sheriff officers are paid. One of the complaints that was made about poindings and warrant sales was that they often did not clear the debt; the money went to pay sheriff officers. Amendment 62 would ensure that the opposite happens.

When an item is not sold at an auction the creditor has the right to claim it. When the creditor claims it, under section 30(2), the value of the article is credited against the sum recoverable. Amendment 65 would ensure that the value of the article is credited even when the creditor does not bother to claim the article.

I move amendment 62.

Richard Simpson (Labour, Ochil)

Section 30(1) provides for the proceeds of the auction to be applied in a particular order: first they go to meet the expenses of the enforcement procedure and then they go to the creditor to meet the debt, with any surplus paid to the debtor. When the sum due is not realised, ownership of any unsold articles will pass to the creditor, in which case their value will be credited against the debt due, under section 30(2).

We believe that amendment 62 is unnecessary. When the expenses chargeable against the debtor cannot be recovered from the debtor, the creditor who instructed the attachment is always liable for them.

Amendment 65 would both return to the debtor the attached assets, which had not been uplifted, and reduce the debt by their value. That would benefit the debtor twice and would not achieve a fair balance.

Amendment 62 should be withdrawn or, failing that, rejected, and amendment 65 should not be moved.

Kenneth Gibson (Scottish National Party, Glasgow)

I will press the amendments.

George Reid (Scottish National Party, Mid Scotland and Fife)

The question is, that amendment 62 be agreed to. Are we agreed?

George Reid (Scottish National Party, Mid Scotland and Fife)

There will be a division.

George Reid (Scottish National Party, Mid Scotland and Fife)

The result of the division is: For 31, Against 81, Abstentions 1.

Amendment 62 disagreed to.

Amendments 63 and 64 moved—[Dr Richard Simpson]—and agreed to.

Amendment 65 moved—[Mr Kenneth Gibson].

George Reid (Scottish National Party, Mid Scotland and Fife)

The question is, that amendment 65 be agreed to. Are we agreed?

George Reid (Scottish National Party, Mid Scotland and Fife)

There will be a division.

George Reid (Scottish National Party, Mid Scotland and Fife)

The result of the division is: For 32, Against 79, Abstentions 0.

Amendment 65 disagreed to.

George Reid (Scottish National Party, Mid Scotland and Fife)

Amendment 66 is in a group of its own.

Kenneth Gibson (Scottish National Party, Glasgow)

As section 35 stands, a person who owns an article in common with a defaulting debtor will be liable for part of a bad debt as a result of that common bond. As a result of being a co-owner of an item, the third party faces either paying a debt that is not theirs or losing an asset. That cannot be viewed as fair in all circumstances. An individual who does not have the necessary finances to buy out the debtor's interest will lose an asset through no fault of their own. As an alternative to forcing debt on innocent bystanders, amendment 66 would alter section 35 by allowing the sheriff to decide the appropriate disposal of the item.

I move amendment 66.