Sunday 1st of August 2010
Many people on benefits could be set to seek individual voluntary arrangement (IVA) answers, as a charity has highlighted potential future debt problems.
The Consumer Credit Counselling Service (CCCS) welcomed the government’s 21st Century Welfare paper, which includes proposals for the simplification of tax and benefit systems.
However, it warned thousands of people could face further financial problems as a result of amendments to incapacity benefits.
Pilot schemes will see recipients undergo assessments and it is thought many payments will be reduced or no longer awarded, with CCCS chairman Malcolm Hurlston suggesting people will "plunge deeper into debt".
However, those who do find employment again could find that IVA information shows them a way to repay what they owe in a manageable way.
If at least £15,000 is owed to three or more creditors, a borrower who is in work can enter this form of insolvency to pay back the money over a period of five years of hard work and commitment.
By Kimberley Parsons
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