With the Scottish Parliament starting a debate on the Tenancy Deposit Scheme, ARLA, the Association of Residential Letting Agents, called for ministers to give it their backing without re-inventing the wheel.

ARLA was behind the operation of the voluntary Tenancy Deposit Scheme in England and Wales before deposit protection became mandatory last year. This legal requirement for the Private Rented Sector gives Alternative Dispute Resolution free to the tenant should there be problems over the allocation of deposits at the end of a tenancy.

ARLA hopes this will be the prime objective of any similar scheme operated in Scotland.

However, ARLA is concerned at the attempts to link deposit protection directly to landlord registration in Scotland. There are already three government authorised schemes for England and Wales. They have developed the sophisticated software and structure to cope with the high volumes of tenants’ money that needs to be safeguarded.

“There is no need to re-invent the wheel,” said Ian Potter, ARLA's Head of Operations. “There is now a very high degree of experience in Britain that can be utilised for deposit protection across Scotland.”

In addition to the benefits to be gained by drawing on this experience, ARLA believes that local authorities in Scotland have proved unenthusiastic over landlord registration. As a result, they have lost the confidence of landlords, agents and tenants.

“It would be exceedingly misleading for tenants to believe that their deposits are protected under the current regime,” Potter added.

There are three schemes operating in England and Wales. Two are insurance- based schemes operating with regulated agents and affiliated landlords groups.

The third is a custodial scheme where deposits are lodged with the scheme at the outset. This scheme is paid for from the interest on deposits.

The insurance - based schemes are funded through subscription from either the letting agent or the landlord. Except for the notification of the start of a tenancy, their services are only needed in the event of a dispute arising.

All three schemes provide Alternative Dispute Resolution free to the tenant.