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The Guardian have published an excellent piece entitled the Diary of a Debtor. This thought provoking item highlights an interesting passage through the bankruptcy system for one debtor. It seems from this account that the system works. This will be welcome news to both the English and Scottish legislatures, particularly as regards the policy influences and push behind the relatively recent reduction in discharge periods which both jurisdictions have introduced to help aid, inter alia, rehabilitation. The piece will also make interesting reading for the debt advice industry/charitable sector as the debtor indicates that the advice he received helped start the whole process of debt relief.
There are two passages worth quoting. The first is self explanatory:
"Which brings me to something the you-brought-this-on-yourself brigade knuckleheadly fail to understand: at a certain point, debt can spiral out of hand and there's nothing you can do about it, because that certain point arrives without you realising it. If there's a massive hole in the bottom of your bank account and a third, a quarter of your income is leaking out every month, even if you spend zero on the non-optional business of paying for a roof over your head and putting food on your kid's plate, there's bugger all you do about paring back your outgoings. You can dig in your heels but you're still sliding."
The second relates to the forthcoming event at KPMG on the 11 January 2011 at which a panel of experts will debate the recent Insolvency Service mooted reforms to the bankruptcy and winding up petition process. The Guardian debtor notes in relation to the reforms:
"Now the Insolvency Service is proposing that debtors who declare bankruptcy won't even need to go to court. To save money? The solemnity of that court date was, for me, a watershed moment, like an alcoholic going to his first AA meeting or a person suffering from depression seeking help."
This is an interesting perspective on the court's function from a debtor's perspective.
"This is the ultimate statement of where the law on IVAs is to be found in our great common law...