The UK Government's most recent proposition for dealing with debt looks to be nothing more than dead duck. I would surmise that this is a badly constructed plan, badly executed, which will bring very little benefit to very few people.
The idea behind debt relief orders is a slimmed version and less formal version of debt management (IVAs and bankruptcy), which is not implemented by the courts but by the insolvency service.
The problem is that the profile for a debt relief order is so narrow that very few people would qualify for one. A contact in the industry states that 'Only a tramp would qualify for a Debt relief order,' and also 'The range of organisations which can offer debt relief orders is so narrow that obtaining one may be very difficult'.
To qualify for a Debt Relief Order you need to fulfil a number of criteria, which include having assets less than 300, 15,000 pounds of debt, and less than 50 per month of disposable income.
Owning assets of less than 300 (which is only the back catalogue of Iron Maiden on CD), would eliminate over 95% of the UK population. The combination of the other criteria would put that figure over 99.95%. So the government has created a debt solution which nobody qualifies for, which will bring limited benefit, and no real results.
The UK government has only chosen six organisations to be able to provide DROs, five of which are charitable trusts, but one commercial debt management company. How can they justify this? Is it not creating a monopoly due to public regulation? On must wonder what the government were thinking to allow this to come about?
A commercial debt management company will never make a substantial profit from completing a DRO, it is certain most clients applying for a Debt Relief Order will not qualify and Baines and Ernst will be able to sell them an IVA, Debt Management Plans, or Bankruptcy services.
We see not only parliament acting in an inefficient and wasteful manner, but in a way that seems commercially biased , corrupt, and looking after the interests of but one company within the debt management marketplace.
The idea behind debt relief orders is a slimmed version and less formal version of debt management (IVAs and bankruptcy), which is not implemented by the courts but by the insolvency service.
The problem is that the profile for a debt relief order is so narrow that very few people would qualify for one. A contact in the industry states that 'Only a tramp would qualify for a Debt relief order,' and also 'The range of organisations which can offer debt relief orders is so narrow that obtaining one may be very difficult'.
To qualify for a Debt Relief Order you need to fulfil a number of criteria, which include having assets less than 300, 15,000 pounds of debt, and less than 50 per month of disposable income.
Owning assets of less than 300 (which is only the back catalogue of Iron Maiden on CD), would eliminate over 95% of the UK population. The combination of the other criteria would put that figure over 99.95%. So the government has created a debt solution which nobody qualifies for, which will bring limited benefit, and no real results.
The UK government has only chosen six organisations to be able to provide DROs, five of which are charitable trusts, but one commercial debt management company. How can they justify this? Is it not creating a monopoly due to public regulation? On must wonder what the government were thinking to allow this to come about?
A commercial debt management company will never make a substantial profit from completing a DRO, it is certain most clients applying for a Debt Relief Order will not qualify and Baines and Ernst will be able to sell them an IVA, Debt Management Plans, or Bankruptcy services.
We see not only parliament acting in an inefficient and wasteful manner, but in a way that seems commercially biased , corrupt, and looking after the interests of but one company within the debt management marketplace.
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