New Rules for Scottish Government’s Debt Arrangement Scheme


New Rules for Scottish Government’s Debt Arrangement Scheme


The Scottish Parliament has passed new rules for the Scottish Debt Arrangement Scheme, which will help people struggling with debt.

The new rules come into force on the 4th November 2019 and will make it easier for those struggling with debts to apply to the Scheme.  They will also make it easier and quicker for them to get their repayment plans approved.

What is the Debt Arrangement Scheme?

The Scottish Debt Arrangement Scheme is a formal repayment plan that allows people struggling with debts to repay those debts, without having to worry about Sheriff Officers, wage arrestments or their bank account being frozen.

It also freezes all interest and charges on debts once they are included in a plan and prevents creditors from making people bankrupt.

It also allows people to make just one payment per month, regardless of how many debts they have; and provides a payment distribution service, which divides up the payment and pays all the individual creditors for the customer.

Originally, launched in 2004, the Scottish Debt Arrangement Scheme is unique, although plans are now afoot to introduce a similar scheme across the rest of the UK.

How do the new Rules improve the Scheme?

One of the biggest innovations that will be introduced by the new rules after the 4th November is the Scheme will be free to everyone who uses it, even if they apply through a private sector firm.

Instead, the cost of running the Scheme will now be paid for by the creditors, meaning every pound paid by someone will go towards reducing their debts.

Other changes will mean that applications will now be automatically approved, even if some creditors object to the proposals, providing they aren’t owed more than 10% of the total debt level.

However, even if they are owed more than 10%, and they do object, this won’t mean the application will fail.

Instead, the Debt Arrangement Scheme Administrator, a Scottish Civil Servant, will decide whether the proposal is fair and reasonable.  If they do, they will approve the plan.

Currently, over 96% of all proposals are approved, either automatically, or by the Debt Arrangement Scheme Administrator.

Payment Breaks

Another feature of the new rules will mean that where someone in a Programme has an unexpected emergency, they can ask their money adviser for a payment break. They can then allow this for a maximum of two months each year, without placing their programme at risk.

Where someone’s inability to pay lasts longer, they are still able to request a longer payment break for up to six months and won’t lose the protection of the Scheme.

It will also become easier after the 4th November for people to make changes to their Programme and change the amount they pay each month, providing the Scheme still remains fair and reasonable.

What is Fair and Reasonable?

Although there is no maximum length of time that a Debt Arrangement Scheme can last, as a rule of thumb, providing it is completed in less than 10 years, it will stand a good chance of being considered fair and reasonable, although every case is considered on its merits.

The average length of time at present for a Debt Payment Programme under the Debt Arrangement Scheme is 6.8 years.

Carrington Dean Welcomes the New Rules

As one of the leading providers of the Debt Arrangement Scheme in Scotland and one of the largest Payment Distributors, Carrington Dean has welcomed the new rules.

Speaking after their passage through the Scottish Parliament, Graeme Macleod, Head of Operations for Carrington Dean said:

“The Scottish Government’s latest improvements are to be welcomed; they will make the Debt Arrangement Scheme more widely available across Scotland and speed up the process for people applying. They will also introduce flexibilities that will make it easier for people to change what they are paying each month when their circumstances change and protect them when they experience unexpected emergencies”.

Over £268 million of debt is now being managed through the Debt Arrangement Scheme, with over £200 million having been repaid to Creditors since 2011. In 2018-19 £37 million was repaid to creditors, making the Debt Arrangement Scheme now Scotland’s leading debt solution for returning money to creditors.

The Carrington Dean Group is one of Scotland’s leading providers of the Debt Arrangement Scheme and its largest Payment Distributor.

To speak with a Carrington Dean Money Adviser, call 0808 2085 195 for free and confidential advice.

You could write off up to 75% of unsecured debt with our debt assistant.

Check if you Qualify

Latest Articles


Living standards questioned as over 270k Scots turn to their local Citizens Advice

More than 270,000 Scots have turned to their local Citizens Advice this past year, with 44% cases relating to benefits, new figures have revealed. Citizens Advice Scotland (CAS) has revealed in its latest annual report, ...


Covid-19 – Rishi Sunak unveils new measures to boost economy in summer statement

Chancellor Rishi Sunak has today announced a package of fresh measures to bolster the UK’s economic recovery from coronavirus and shield furloughed workers from redundancy. Headlining the Chancellor’s summer budget statement is a new £1,000 ...


Financial honeymoon period coming to an end?

The UK’s financial regulator, the Financial Conduct Authority (FCA), has sent its clearest message yet, that the financial honeymoon period that has characterised much of the start of the COVID-19 Crisis, is now coming to ...


Applications for School Age Payments open

Parents or carers of children preparing to start school are being encouraged to apply for a £250 support grant. The one-off School Age Payment is currently open to eligible families with a child born between ...