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06/08/2014

Debt Relief Order Review – R3 Comments

R3 president Giles Frampton says:

“This review is very welcome. R3 has called for Debt Relief Orders to be reviewed for some time and we are pleased the Insolvency Service is taking action.”

“Although Debt Relief Orders are only a relatively new part of our personal insolvency landscape, personal debt issues move on so quickly that it is already time to look at them again.”

“An effective personal insolvency regime must strike the right balance between helping those struggling financially to get back on their feet, and protecting creditors from individuals accumulating and dumping high debts. The current regime has the right building blocks to achieve this balance, but improvements can be made.”

“Too many people are currently unable to access an insolvency option that is right for their circumstances. R3 believes that revising Debt Relief Order thresholds and limits would help address this issue.”

“We are particularly pleased that the creditors’ bankruptcy petition threshold is being looked at. This was last set in 1986 and an upwards revision is long overdue. £750 is far too low an amount of debt for somebody to be made bankrupt: were the threshold to have risen in line with inflation, it would be worth almost £2,000 now.”

 

Notes to editors:

  • R3 is the trade body for Insolvency Professionals and represents the UK’s Insolvency Practitioners.

  • R3 comments on a wide variety of personal and corporate insolvency issues. Contact the press office, or see www.r3.org.uk for further information.

  • R3 promotes best practice for professionals working with financially troubled individuals and businesses; all R3 members are regulated by recognised professional bodies
     
  • R3 stands for 'Rescue, Recovery, and Renewal' and is also known as the Association of Business Recovery Professionals.