Dro / bankruptcy info from insolvency minister

debt_doctor

PLEASE FIND BELOW WHAT WE HAVE JUST RECEIVED;

Business Minister Ian Lucas today announced that the Government plans to make more people eligible to apply for Debt Relief Orders (DROs) providing extra support for those in financial difficulty.
The proposed changes to DROs would mean that those with very small pension pots would be able to apply for the Orders - which are a new, lower cost option for people to avoid bankruptcy.
Ian Lucas said:
“Debt Relief Orders help people who would otherwise be trapped in poverty to get back on their feet. Following representations from independent money advisers, I’m proposing a common sense change to ensure that vulnerable people with a very small pension pot are treated fairly. The Government will consult on this change shortly.”
At the same time, as part of the annual fees review, the Government announced that changes will be made to the insolvency fees structure to ensure more cash is recovered earlier in the process so that the cost of the regime is shared by the debtor and creditors.
Ian Lucas said:
“We have always made it clear that we expect those petitioning for bankruptcy to pay their fair share of the cost and that the taxpayer should not be responsible for the cost of bankruptcy.
“That is why, as part of our annual review, we have restructured the fees arrangements to make sure that we can continue to provide a high quality service to those in debt whilst still representing good value for money.”

DD

fermi

debt_doctor wrote: »

At the same time, as part of the annual fees review, the Government announced that changes will be made to the insolvency fees structure to ensure more cash is recovered earlier in the process so that the cost of the regime is shared by the debtor and creditors.
Ian Lucas said:
“We have always made it clear that we expect those petitioning for bankruptcy to pay their fair share of the cost and that the taxpayer should not be responsible for the cost of bankruptcy.
“That is why, as part of our annual review, we have restructured the fees arrangements to make sure that we can continue to provide a high quality service to those in debt whilst still representing good value for money.”

DD

Which means exactly what in practical terms?

fermi

Now this really is taking the proverbial, when people can't afford it at the current rate. :mad: :eek:

For petitions presented on or after 6 April 2010 and bankruptcy or winding up Order made on or after 6 April 2010:

i. Debtor’s deposit on a bankruptcy petition increases from £360 to £450.
ii. Creditor’s deposit on a bankruptcy petition increases from £430 to £600.
iii. Creditor’s deposit on a winding up petition increases from £715 to £1,000.
iv. No change to bankruptcy case administration fee.
v. Increase from £2,160 to £2,235 of the company winding up case administration fee.
vi. Restructuring of the Secretary of State (SoS) fee where the percentages charged on asset realisations that are defined as chargeable receipts will be increased (see “SoS table” below).
The case administration fee is a fee charged by The Insolvency Service to every bankruptcy and winding up case on the making of a bankruptcy or winding up Order. The case administration fee is partly discharged by the deposit paid on the petition.

debt_doctor

:eek::eek::eek::eek::eek::eek:

Ive just shocked my colleagues with that one - completely unfair.

DD

fermi

debt_doctor wrote: »

:eek::eek::eek::eek::eek::eek:

Ive just shocked my colleagues with that one - completely unfair.

DD

I know. :eek:

Looks like I'll be posting a sticky in a bit, saying that if you are going BR do it BEFORE 6th April.

fermi

Sorry to detract from the good news on DROs DD.

Was just flabbergasted, that's all.

Classylady2010_2

am glad that you have let folk know, its a big increase
classy

debtinfo

There is also a restructuring of the SOS fees which affects creditors, at the moment it is 17% of recoveries.

This is the new structure

SoS Table
Bankruptcy

0% charge on the first £2,000
100% charge on the next £1,700
75% charge on the next £1,500
15% charge on the next £396,000
1% charge on the balance

The total fee paid is capped at £80,000