On 8 January I met up with Andy Woodhead from the Policy Unit of The
Insolvency Service at their office in London. Andy explained that although he is not an official spokesperson for The Insolvency Service he was happy to meet with me to provide information and clarify a number of issues.

Andy gave me a brief (but very informative) outline of the Service, which I now know is an executive agency of the Dept for Business. Enterprise and Regulatory Reform (BERR), what the Service does and his role Service’s policy unit.

With regard to the Individual Insolvency Register (IIR), Andy explained that this has been a statutory (legal) register since 1999 and the register was made electronic as part of Government policy to provide more electronic access to public services. Andy was not aware of any any plans to change access to it, but he could understand my concerns. Andy advised that the responsibility for the IIR belongs to colleagues in to the Service’s Secretariat Unit and provided me with contact details. I will be contacting them directly going forward.

On the subject of the SIVA it still looks likely that it could commence around October 08,however there are still a number of legal hoops to be negotiated SIVAs should be in the format that I have already posted in the articles section on the IVA.co.uk site.

We then talked about the new IVA protocol that is due to start at the end of this month. Details of the new protocol can be found in the IVA News section and have now been published on the Service’s website (http://www.insolvency.gov.uk/). Briefly, the protocol will only apply to simple consumer type cases and banks and IVA providers have agreed a number of areas of best practice, for example by using the same guidelines on income and expenditure etc. The protocol also provides a set of Standard Terms and Conditions rather than each IP having its own version. The protocol also includes a standard approach for dealing with any interest in a debtor’s home. The protocol will be reviewed after three months.

Andy explained that the advantage of a protocol over statutory law is that it is flexible and things can be changed with agreement of IVA Standing Committee, unlike legislation, which can be very difficult to change.

Now that the protocol has been finalised the Service is looking at the demand for producing facts and figures relating to IVA failure rates, dividends etc etc, something that I would welcome.

I also raised the subject of IP fees being totally controlled by the creditors. Andy stated that it would be impractical for the Service to regulate IPs fees and that these should be controlled by market forces. He also pointed out that he was not aware of other professional service providers such as solicitors or accountants having their fees set by legislation.

The new Debt Relief Orders (DRO) are not active yet but are expected to come into force in 2009. They are aimed at the low income and low asset debtors that can’t pay their debts and find it hard to meet the bankruptcy costs. Applications for a DRO will be made to the Service but they will be done through authorised intermediaries, not the courts. I also learned of another abbreviation,”nina” no income and no assets.

Moving onto bankruptcy informed Andy that The Service’s guidance to ORs is available to all (under Freedom of Information) on its website http://www.insolvency.gov.uk/ . However given that the Service employs nearly 3,000 people it was almost inevitable that there would be some inconsistencies between ORs offices.

In regards to vehicles Andy did inform me that these are covered by a specific section of the Insolvency Act 1986 which sets out that a vehicle could only be exempted from a bankrupt’s estate where it was clearly identified as being necessary for employment, business or vocation. Andy also advised that the guidance also covered assessing the setting of contribution levels in relation to Income Payments Agreements/Order.

Andy recognised that how a debtor’s income and expenditure are assessed can vary as the figures might be based on the Family Expenditure Survey, the Common Financial Statement or the CCCS guidelines.

Andy also highlighted that the Service does have an easily accessible complaints procedure (http://www.insolvency.gov.uk/) that is also published on its website and that if the complaint could not be resolved by the Service it could end up with an independent adjudicator.

We also discussed whether there should be properly recognised qualifications for debt advisors. Andy did say that this is not something that could be progressed by the Service however he (and I) appreciate that if there was an NVQ type qualification it would be of great benefit.
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We talked for a full hour and I found Andy to be a wealth of knowledge, friendly and very enthusiastic about the role of The Insolvency Service. I also realised that changing any legislation regarding insolvency is a long process. I found the meeting very interesting and worthwhile, it’s good to see another area of the industry first hand.