THE HON MARK DREYFUS KC MP
ATTORNEY-GENERAL
CABINET SECRETARY
MEMBER FOR ISAACS
Bankruptcy law reforms
The Australian Government will introduce reforms to ensure Australia’s bankruptcy system is fairer and operates in the best interests of all Australians.
Key changes include:
- Increasing the threshold for involuntary bankruptcies from $10,000 to $20,000, with the threshold to be indexed each year;
- Increasing the timeframe in which a debtor may respond to a bankruptcy notice from 21 days to 28 days;
- Reducing the period a discharged bankruptcy is publicly recorded on the National Personal Insolvency Index to seven years following discharge from bankruptcy; and
- Removing the proposal, or acceptance, of a debt agreement as an act of bankruptcy for the purposes of subsection 40(1) of the Bankruptcy Act.
These amendments will ensure a fairer outcome for debtors in the personal insolvency system and reduce the stigma currently associated with entering into bankruptcy.
In addition, the Attorney-General’s Department is today commencing consultation on the introduction of a Minimal Asset Procedure in Australia.
A Minimal Asset Procedure would clear a person’s debts and allow access to a fresh start sooner than a bankruptcy, where that person has no other way to pay. Importantly, it should also leave creditors no worse off – meaning Australia’s personal insolvency system remains fair and balanced.
Submissions for the consultation on a Minimal Asset Procedure in Australia close on 29 July 2024.
To access the discussion paper and to make submissions visit: https://consultations.ag.gov.au/legal-system/personal-insolvency-minimal-asset-procedure/
Monday, 8 July 2024
