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BIS, jointly with the Ministry of Justice and the Insolvency Service, launched a consultation on "Debt Management Schemes - delivering effective and balanced solutions for debtors and creditors" on 18 September 2009.
The consultation paper considers options for improving the way that debtors deal with indebtedness and seeks views on how Debt Management Schemes can help people in debt – and their creditors – as effectively as possible.
Debt Management Schemes are designed to assist those who are in debt and unable to meet their commitments. In these situations, a debtor's finances are assessed and a monthly repayment deal is brokered with all their creditors which all sides agree to and the debtor is able to maintain.
The consultation asks whether there is a need for intervention in this area, in light of the various other Government policies that have already been introduced to help people in debt and, if so, whether regulated schemes should be introduced and how they would work, or whether tighter non-statutory regulation of current schemes would be more appropriate.
The proposals in this paper should be read in conjunction with the Government’s White Paper “A Better Deal for Consumers: Delivering Real Help Now and Change for the Future”, issued by the Department for Business Innovation and Skills. As the White Paper describes, we have taken active steps to improve the provision of debt advice and support for people facing financial difficulty.
The closing date for the Debt Management Schemes consultation is 18 December 2009. A copy of the news release, the consultation paper and impact assessment with details of how to respond are available at:
http://www.justice.gov.uk/latest-updates/debt-management-schemes.htm
http://www.justice.gov.uk/about/docs/debt-management-schemes.pdf
http://www.justice.gov.uk/about/docs/debt-management-schemes-impact-annexes.pdf
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