StepChange responds to outcome of Government consultation on insolvency regulation

The Government has today published the outcome of its consultation on the future of insolvency regulation.

Responding to the findings, StepChange Director of External Affairs and Operating Subsidiaries Richard Lane said:

“Proposals to regulate all firms offering insolvency services – particularly the volume IVA providers that dominate the market – is welcome and has the potential to tighten up the system and reduce the risk of harm to financially vulnerable individuals. The rules around how these firms are regulated will need to add significant power to a regulatory structure that has not been able to get on top of problems in the IVA sector up to now.

“The sector needs more than just regulation of firms, which is why it’s welcome to see government’s intention to take control of standards and standard setting in the IVA market, which we hope will quickly lead to better outcomes for consumers. The government’s intention to introduce a better system for redress is something we have long called for, and we urge the Insolvency Service to move this forward as a priority.

“However, without a single regulator we may continue to see fractured oversight of the IVA sector. Recognised Professional Bodies need to be clear how their approach will change to address the concerns raised in this consultation.”