Government to expand IVAs
The government is aiming to increase consumer use of individual voluntary arrangements (IVAs) as a debt-replacement programme designed to provide a positive alternative to bankruptcy.
The Treasury is aiming to devise a 'simple IVA' to facilitate access to the scheme, whereby lenders agree to erase up to 65 pence in the pound off their balance if a creditor makes a regular monthly repayment.
Under the plan, a standardised and speedier application process will be put on offer and the terms of the scheme will be enlarged to incorporate a wider range of debtors.
'With personal debt higher than ever in the UK and bankruptcies at record levels, the situation needs addressing,' said John Porter of insolvency specialists The Debt Counsellors.
'The IVA is the best solution to insolvency for many people and preferable to bankruptcy in a lot of cases, so simplifying the process and broadening its suitability can only be a good thing.'
The number of people signing up for IVAs in expected to grow by 50 per cent in 2006, to reach a total of 30,000. | 
