Submission to the Treasury on the Insolvency Law Reform Bill

As a community legal service providing both legal advice and financial counselling to the public, we receive many calls about personal bankruptcy and other insolvency options under the Bankruptcy Act.  We generally support any provisions which will make Trustees more accountable. However, we note that the commentary in the Explanatory Memorandum is almost exclusively about the rights of creditors, and accountability to creditors. In our Submission we note that debtors and bankrupts are fundamentally affected by insolvency laws, and their perspective should be balanced with the needs of creditors.

We support the creation of a Register of Trustees as described in the Explanatory Memorandum. We also support the more prescriptive requirements of Trustees seeking registration or renewal and the changes to the disciplinary powers of the Inspector General.

The main points in this submission were:

1. To make observations about the difficulties encountered by debtors in challenging Trustee’s remuneration and other expenses and make recommendations for improvement.
2. To outline some deficiencies in the obligations placed on trustees in relation to Part X Agreements.