An Administration order is a county court order which prevents individual creditors taking enforcement action without the permission of the court and which requires that all a person’s debts be treated together.

If you have at least one High Court or County Court judgement (CCJ) against you and your total debts are no more than £5,000 you can apply for an Administration Order. With this, you make regular payments (for example monthly) to the court at a rate that you can afford. The court then sends that payments to your creditors.

There is no fee payable to make the application, but costs will be added to the sum you repay at the rate of 10p per pound repaid.

The only debts that cannot be included on an administration order are Social fund Loans and benefit overpayments, where you are still in receipt of a benefit from which deductions can be made. The Administration Order can include: -

• All non priority debts
• Council Tax
• Gas and Electricity arrears
• Water arrears

Creditors may tell the court that they don’t want to be included on the Administration Order, but the court will decide whether or not to include them. The court may set a hearing date to hear any objections from creditors.

You can ask the court for a Composition Order, which is a way of time limiting the payment period. You pay your debts at the rate you can afford for a fixed period, normally three years. After this time, any money you still owe is written off.

The advantages of an administration order are:-

• You only make one single payment each month. This payment is fixed within your ability to pay and this ensures peace of mind
• once an order has been made by the court, no further interest on county court debts or debts that have not gone to court before the date of the administration order can accrue
• The court will automatically consider whether you should only repay a proportion of the total debt. This is called a composition order.
• Once the order is made, a creditor cannot take any further action to recover any debt included in the schedule. This can be useful if you have multiple debts with several court actions pending
• it avoids some of the problems of dealing with lots of debts, such as dealing with a number of different creditors, the additional costs of numerous court appearances and visits from bailiffs
• if there is a dispute between you and creditor about the amount owed, the procedure used by the court to make administration orders can be a cheap and useful way of resolving the dispute
• it can prevent a creditor applying for bankruptcy against you if the debt owed to the creditor is £1,500 or less and if the creditor does not file a bankruptcy petition within 28 days of being notified by the court that they are to be included in an administration order
• It is a quicker procedure than negotiating a repayment scheme.

• your total debts must be less than £5,000
• it is not a total solution to many debt problems since priority debts may be excluded from the administration order
• it does not prevent creditors not included in the administration order from applying to court for enforcement orders
• You must pay the court's costs. These are currently 10 per cent of the total debt. Costs are deducted when the court pays the money to the creditors (10p from each pound paid by the client). This sum is calculated and added to the total debts when the order is made
• if you fail to make payments on an administration order, the court can revoke the administration order and place a restriction on the you that you cannot borrow more than £500 from another creditor without informing the creditor about this restriction
• the creditor or a court official can apply for a review of the order which could mean that the monthly payment changes
• it is possible that you could be paying the debt for longer than 3 years
• Many district judges will grant an administration order only on condition that it is linked to an attachment of earnings order. You may not wish your employer to know about your debts. If so, you may ask for a suspended attachment of earnings order. This means that as long as you make payments as ordered to the creditor, your employer will not be informed. Courts have been instructed that they should normally grant these. However, if a suspended attachment of earnings order has been made, and you fail to maintain voluntary payments, the court will automatically make a full attachment order
• most publicly-funded legal services are not available for help at the hearing, but legal help under the legal help scheme and/or legal help and representation under the help at court scheme may be available for help with the preparation of court papers and/or representation at the hearing
• you can be disqualified from holding certain posts and offices, for example, being a school governor
• Administration orders are entered on the Register of County Court Judgments. This may make it difficult for you to obtain credit in the future. An administration order remains on the Register for six years.