Policy Paper on Debt Counselling Non Statutory Service

1. The Trading Standards Service delivers a wide range of services for the benefit of consumers, industry, commerce and society as a whole. Its aim is to foster fair trading and compliance with consumer protection legislation and the delivery of debt counselling service is part of the array of services designed to meet that and other objectives. The Service also strives to meet the Council's strategic objectives which lay stress on the need to alleviate the worst effects of poverty thereby improving health, wellbeing and care whilst promoting social inclusion and helping to stimulate the local economy.

2. The service carries the responsibility to enforce the Consumer Credit Act 1974. This legislation seeks to regulate most aspects of the activities of the consumer credit industry in the UK, i.e. banks, HP companies, finance companies, money lenders, check traders, pawn brokers, second mortgage providers, credit brokers, debt collectors, credit reference agencies, etc.

3. The service also delivers a consumer advice service under the authority contained in: -

   The Local Government (Scotland) Act 1973

   The Weights and Measures Act 1985

4. The motivators referred to in (1), (2) and (3) above provide the rationale for the delivery of the debt counselling service.

5. Debt Counsellors provide assistance and support to clients with multiple debt problems. They importantly act as a barrier between debtor and creditor helping alleviate stress and providing information and guidance to both parties. The counsellors try to maximise clients income and negotiate repayment schedules for both parties to agree thereby freeing up sufficient income for clients to maintain an acceptable lifestyle without the worry of pursual by debtors or their agents.
   
   

6. The service participates in the North Lanarkshire Information and Advice Forum with social services welfare rights, all local Citizens Advice Bureaux and Independent Advice Centres. This Forum acts as an information exchange and referral system whereby clients gain access to money advice and the North Lanarkshire Council services who can affect an increase in client income and ease the burden of debt. Additional benefits claimed or won and the income released by the re-negotiation of debt are re-cycled into both the local community and the Council area.

7. By delivering these services and participating in collaborations, the Trading Standards Service benefits from the build up of a database of creditor activity. When instances of malpractice arise they can either be dealt with locally by the enforcement teams or referred to the Office of Fair Trading, which regulates the market in the UK and licences credit providers and others in the industry.
   

8. In its recent deliberations the Scottish Executive has recognised the need for better and more accessible advice and information services following the abolition of poinding and warrant sales. Along with other agencies it recognises that, if high quality advice and information were available, the need for the intervention of the civil courts would be minimised.

9. In addition to the Information and Advice Forum, the development of a North Lanarkshire Consumer Support Network as part of DTI initiative and in which Trading Standards take a lead role, will result in a much more coherent debt counselling/money advice service throughout the Council area. At its centre, Trading Standards will play a pivotal role as the only agency able to enforce legislation and liaise directly with the Office of Fair Trading and the other enforcement agencies.

10. Because of the close working relationships developed with the office of Fair Trading and other agencies in this field, including the Council as a creditor, it is appropriate that this Service continues to deliver debt counselling/money advice services through its Advisory Services working in partnership with the enforcement staff.

Further information on the Debt Counselling service can be viewed under Living Here, Consumer Issues, Money Advice, Consumer & Trading Standards Money Advice Service  or by clicking on the hyperlink.