Tribunals, Courts and Enforcement Act 2007

Part 1Main amendments

Introduction

1This Schedule amends the Attachment of Earnings Act 1971 (c. 32).

Amendment of section 6: Effect and contents of order

2(1)For section 6(1)(a) (instruction to employer to make deductions from debtor’s earnings) substitute—

“(a)to make periodical deductions from the debtor’s earnings, as specified in the order; and”.

(2)After section 6(1) insert—

“(1A)If a county court makes an attachment of earnings order to secure payment of a judgment debt, the order must specify that periodical deductions are to be made in accordance with the fixed deductions scheme.

(1B)If a court (whether a county court or another court) makes any other attachment of earnings order, the order must specify that periodical deductions are to be made in accordance with Part 1 of Schedule 3.”

(3)In section 6(5) (order to specify normal deduction and protected earnings rates), for “the order” substitute “a Schedule 3 deductions order”.

Insertion of new section 6A

3After section 6 insert—

“6AThe fixed deductions scheme

(1)In this Act “fixed deductions scheme” means any scheme that the Lord Chancellor makes which specifies the rates and frequencies at which deductions are to be made under attachment of earnings orders so as to secure the repayment of judgment debts.

(2)The Lord Chancellor is to make the fixed deductions scheme by regulations.

(3)The power to make regulations under subsection (2) is exercisable by statutory instrument.

(4)The Lord Chancellor may not make a statutory instrument containing the first regulations under subsection (2) unless a draft of the instrument has been laid before, and approved by resolution of, each House of Parliament.

(5)A statutory instrument containing any subsequent regulations under subsection (2) is subject to annulment in pursuance of a resolution of either House of Parliament.”

Amendment of section 9: Variation, lapse and discharge of orders

4After section 9(1) (power of court to vary order) insert—

“(1A)Subsection (1) is subject to Schedule 3A (which deals with the variation of certain attachment of earnings orders by changing the basis of deductions).”

Insertion of new section 9A

5After section 9 insert—

“9ASuspension of fixed deductions orders

(1)A county court must make an order suspending a fixed deductions order if the court is satisfied of either or both of the following—

(a)that the fixed deductions order requires periodical deductions to be made at a rate which is not appropriate;

(b)that the fixed deductions order requires periodical deductions to be made at times which are not appropriate.

(2)The county court is to make the suspension order on the following terms—

(a)if the condition in subsection (1)(a) is met: on terms specifying the rate at which the debtor must make repayments (whether higher or lower than the rate at which the order requires the deductions to be made);

(b)if the condition in subsection (1)(b) is met: on terms specifying the times at which the debtor must make repayments;

(c)if either or both conditions are met: on any additional terms that the court thinks appropriate.

(3)If the employer is given notice of the suspension order, the employer must cease to make the deductions required by the fixed deductions order; but the employer is under no liability for non-compliance before seven days have elapsed since service of the notice.

(4)A county court—

(a)must revoke the suspension order if any of the terms of the suspension order are broken;

(b)may revoke the suspension order in any other circumstances if the court thinks that it is appropriate to do so.

(5)Rules of court may make provision as to the circumstances in which a county court may of its own motion—

(a)make a suspension order; or

(b)revoke a suspension order.

(6)The suspension of a fixed deductions order under this section does not prevent the order from being treated as remaining in force subject to the provisions of this section.

(7)This section is without prejudice to any other powers of a court to suspend attachment of earnings orders or to revoke the suspension of such orders.

(8)In this section, in relation to a fixed deductions order, “repayments” means repayments of the judgment debt to which the order relates.”

Amendment of section 25: General interpretation

6In section 25(1) (meaning of particular words and phrases) insert the following entries at the appropriate place—

““fixed deductions order” means an attachment of earnings order under which periodical deductions are to be made in accordance with the fixed deductions scheme;”;

““fixed deductions scheme” has the meaning given by section 6A(1);”;

““Schedule 3 deductions order” means an attachment of earnings order under which periodical deductions are to be made in accordance with Part 1 of Schedule 3;”;

““suspension order” means an order under section 9A suspending a fixed deductions order;”.

Insertion of new Schedule 3A

7After Schedule 3 insert—

“SCHEDULE 3AChanging the basis of deductions

Part 1Changing to the fixed deductions scheme

Introduction

1This Part of this Schedule deals with the variation of a certain kind of attachment of earnings order — referred to as a Schedule 3 judgment debt order — by changing the basis of deductions.

2A Schedule 3 judgment debt order is a Schedule 3 deductions order made by a county court to secure payment of a judgment debt.

3References to variation of a Schedule 3 judgment debt order by changing the basis of deductions are references to the variation of the order so that it specifies that periodical deductions are to be made in accordance with the fixed deductions scheme.

Variation at discretion of court

4(1)A county court may vary a Schedule 3 judgment debt order by changing the basis of deductions.

(2)The county court may make the variation—

(a)in consequence of an application made to the court, or

(b)of its own motion.

(3)The variation takes effect on the date that it is made.

Variation by court upon redirection

5(1)A county court must vary a Schedule 3 judgment debt order by changing the basis of deductions if—

(a)the order lapses, and

(b)the county court directs the order to a person in accordance with section 9(4).

(2)The variation must be made at the same time as the county court directs the order in accordance with section 9(4).

(3)The variation takes effect on the date that it is made.

Automatic variation on changeover date

6(1)On the changeover date, all Schedule 3 judgment debt orders are to be treated as if a county court had varied them by changing the basis of deductions.

(2)The variation takes effect on the changeover date.

(3)The changeover date is the date which the Lord Chancellor specifies for the purposes of this paragraph.

(4)The Lord Chancellor is to specify the changeover date in an order made by statutory instrument.

(5)A statutory instrument containing an order under sub-paragraph (4) is subject to annulment in pursuance of a resolution of either House of Parliament.

Notice of variation still required

7Section 9(2) (service by court of notice of variation) applies to the variation of an order under this Part of this Schedule (including variation in accordance with paragraph 6) as it applies to any other variation of an attachment of earnings order.

Part 2Changing from the fixed deductions scheme

Introduction

8This Part of this Schedule deals with the variation of fixed deductions orders by changing the basis of deductions.

9References to variation of a fixed deductions order by changing the basis of deductions are references to the variation of the order so that it specifies that periodical deductions are to be made in accordance with Part 1 of Schedule 3.

General prohibition on changing from the fixed deductions basis

10A court may not vary a fixed deductions order by changing the basis of deductions unless the variation is in accordance with this Part of this Schedule.

Fixed deductions order directed to secure payments under an administration order

11(1)A county court must vary a fixed deductions order by changing the basis of deductions if, under section 5, the county court directs the order to take effect as an order to secure payments required by an administration order.

(2)The variation must be made at the same time as the county court gives that direction under section 5.

(3)The variation takes effect on the date that it is made.

(4)Section 9(2) (service by court of notice of variation) applies to the variation of an order under this paragraph as it applies to any other variation of an attachment of earnings order.”