Consultation outcome

Insolvency Proceedings: Review of debt relief orders and the bankruptcy petition limit

• From: The Insolvency Service and Jo Swinson
• Published: 6 August 2014
• Last updated: 15 January 2015 — See all updates

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

This consultation has concluded

Read the full outcome

Analysis of responses

PDF, 496 KB, 19 pages

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Detail of outcome

Executive summary

We received 50 responses to the call for evidence and have analysed all of the information submitted. We received responses from a variety of respondents including debtors, debt advisors, debt charities, large business, micro business, academics and the judiciary. The distribution of respondents is set out in Annex 1.

The evidence suggests that the DRO competent authority and intermediary model is working well and that DROs have a very significant impact on the wellbeing of debtors. We received many useful suggestions on how the DRO process could be improved. We received some moving examples of the impact that DROs have had on the most vulnerable people in our society. DROs have provided a lifeline for many, resulting in improvements in mental and physical health and wellbeing.

There was overwhelming support for an increase in the maximum amount of debts and assets that a debtor can have to apply for a DRO but for the amount of surplus income to remain at £50 per month.

The evidence also confirmed that the creditor bankruptcy limit should be increased.

We are grateful to those who took the time to respond.

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Original consultation

Summary

Call for evidence asking how the debt relief order process can be improved and whether a change to the bankruptcy petition limit should be made.

This consultation ran from
9:30am on 6 August 2014 to 11:59pm on 8 October 2014

Consultation description

Debt relief orders are a low cost form of debt relief targeted at vulnerable people with low levels of debt and little means of paying it off. Introduced in April 2009, we are reviewing how they have performed and how they could be improved.

The creditor petition limit has been set a £750 since 1986. We are asking whether this figure should be increased.

Users of DROs are welcome to complete a survey of their experience of DROs to help us understand the impact of the DRO on their lives.

A press release was issued in conjunction with this consultation.

Documents

Call for evidence: debt relief orders and petition limits

PDF, 504 KB, 33 pages

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Debt relief orders infographic

PDF, 1.38 MB, 1 page

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Published 6 August 2014
Last updated 15 January 2015 + show all updates

1. 15 January 2015

   Analysis of responses published

2. 13 August 2014

   Added headlines infographic

3. 6 August 2014

   First published.