Alan McIntosh: Broken laws not the prescription for solving problem debts



Alan McIntosh

Alan McIntosh writes on problem debt ahead of tomorrow’s meeting of the Economy, Energy and Fair Work Committee.

The decision by the Scottish government this week to reject the evidence of Citizen Advice Scotland, Money Advice Scotland, Stepchange and Govan Law Centre over the evidence of Esther McVey’s Department of Works and Pensions (DWP) is disturbing.

The decision related to the Prescription (Scotland) Bill 2018, which deals with the issue of what timeframe creditors have to pursue people for debts, such as benefit overpayments. The Scottish government decided to agree with Esther McVey that the period should be for up to twenty years for UK benefits, but for Scottish benefits only five years.

It made me think of a story I was told by a member of the Irish Insolvency Service several years ago about a family who were struggling with substantial problem debt and whose living room mirror got cracked. They couldn’t afford a new one so they moved it upstairs, as the mother did not want her visitors to know she couldn’t afford a replacement.

Every morning her children stood in front of the mirror and checked themselves before leaving for school. The mother, however, would cry every time she looked into it, as all she could see was the crack that reminded her she couldn’t provide for her children.

It’s not the most harrowing story, not like some we hear about Universal Credit, but it reminds me that the pain of debt has to begin somewhere and it usually begins when people are denied the right to live with dignity and respect.

I was also reminded of this story earlier this week as I gave evidence to the Scottish Parliament on the Scottish government’s decision to push ahead with their Common Financial Tool (Scotland) Regulations 2018.

These regulations propose new secret amounts that people in debt get to live on. The amounts are that secret even members of the Economy, Energy and Fair Work Committee cannot discuss them in public.

They have, however, heard evidence of Scots being required to justify even their most personal of living expenditure, such as for incontinence pads, and having to provide documentary proof to avoid being forced into payments to their creditors that they cannot afford.

They also took evidence that if the regulations are passed, the expenditure figures in future will be the responsibility of an unelected, governing body, not accountable to the Scottish Government or Parliament. Future scrutiny will not be possible.

This all raises the question: what type of society is it we are becoming in Scotland? One in terms of the Scottish social security system that treats the poor with dignity and respect, or one in terms of problem debt that leaves people staring into broken reflections of themselves?

Alan McIntosh (LLB Hons) is a senior money adviser and blogs at www.advicescotland.com. All views expressed are his own.