The Draft Tribunals, Courts and Enforcement Bill published by the Department for Constitutional Affairs (DCA) includes proposals by the Insolvency Service to provide debt relief for people in England and Wales who owe relatively little, have no income and no assets to repay what they owe and cannot afford to make themselves bankrupt.
Debt relief orders are designed to give those who have debts of £15,000 or less, assets of less than £300 and surplus income of less than £50 per month the opportunity to apply for an order that will lead to the debts being discharged after one year.
During that period, people who have a debt relief order will be protected from enforcement action by their creditors and will be subject to similar restrictions to bankruptcy. Those whose financial circumstances improve during the order will be expected to make arrangements to repay their creditors, and there will be civil and criminal penalties for those who abuse the system.
It will only be possible to obtain a debt relief order by applying to the official receiver through an approved intermediary and The Insolvency Service has set up a working group comprising representatives from the advice sector to look at the detail of how this will work.
The Bill will be introduced as soon as parliamentary time allows
Further details about the bill can be found on the DCA website
