Research shows distressed debtors, particularly in the area of consumer debt, are still going to advisers that are not regulated. A Department of Trade study to be published later this year is expected to show qualified insolvency practitioners are advisers in less than 10% of personal insolvency cases.
This is why the Insolvency Practitioners Association and R3, the association of business recovery professionals, have set themselves the goal of raising the profile of the profession. Colin Haig, president of the IPA said that publicising the insolvency world was one of the areas where change needed to be achieved this year. He said: ‘People need to be made aware of how to get in touch with an IP and we need to be more open in dealing with inquiries.’
The solution, he added, was increased publicity, ‘both in terms of publicising how we regulate members, and how to get in contact when they need the IPA’.
Peter Hughes-Holland, chairman of the small practice issues committee at R3 told Accountancy Age, that the government and the association had seen the need for people to see regulated advisers and that they were working together on a publicity campaign. ‘There is a huge potential that bankruptcy could double,’ he said.
With the potential political implications of a rise in the number of bankruptcies, the government has a vested interest in getting people to consult regulated debt advisers.
According to Hughes-Holland, the government is particularly favourable to Individual Voluntary Agreements.
‘The problem is that the cost of IVAs is disproportionate and many people cannot afford them. The government wants the profession to drive down costs so that more people can go into IVAs,’ he said.
He added R3 would have to deal with the huge increase in IVAs and attempt to drive down costs in an efficient way so practitioners would still be able to earn from the procedures.
Steve Absolom and Will Wright from KPMG Restructuring have been appointed joint administrators to City Motor Holdings and associated companies
Partners from Johnston Carmichael have been appointed as joint administrators to Axon Well Interventions Products UK
Begbies Traynor have been appointed administrators of William Anelay Ltd, York, one of Britain’s longest-established construction and heritage restoration companies
Smith & Williamson has been appointed administrators of charity 4Children