Business Minister Ian Lucas yesterday announced that the Government plans to make more people eligible to apply for Debt Relief Orders (DROs) providing extra support for those in financial difficulty.
The proposed changes to DROs would mean that those with very small pension pots would be able to apply for the Orders – which are a new, lower cost option for people to avoid bankruptcy. Currently, if someone has a pension that is over £300, they are not eligible to apply for a Debt Relief Order.
Independent money advisers now work with Government to deliver Debt Relief Orders, which provide low cost access to debt relief for those overwhelmed by relatively low levels of debt. Designed for the most vulnerable, the strict eligibility criteria require assets of less than £300, debts of no more than £15,000 and surplus income of less than £50 per month.
Ian Lucas said, “Debt Relief Orders help people who would otherwise be trapped in poverty to get back on their feet. Following representations from independent money advisers, I’m proposing a common sense change to ensure that vulnerable people with a very small pension pot are treated fairly. The Government will consult on this change shortly.”
Further information about DROs and free assistance with debt problems is available from Community Legal Advice on 0845 345 4 345.