A recent survey by R3, the insolvency trade body has revealed that 58% of the British public feels bankruptcy is too lenient. The results suggest that an increasing amount of us (82%) believe that some people are taking advantage of the bankruptcy system to get rid of debts they have built up through reckless spending.

The survey brings to light that 64% would like to see the system altered by changing how people were treated in bankruptcy dependant on their previous spending patterns, potentially introducing a direct correlation between prior spending habits and the term of the bankruptcy.

65% also agreed that a majority of people might be able to avoid bankruptcy if they altered their current spending habits.

Managing Director and Insolvency Practitioner at Focus Insolvency Group; Anthony Fisher, commented on the survey results:

“Although it may seem at times that Bankruptcy is a light option, I think it’s a little harsh to entirely blame the consumers. Very few people ever take credit knowing that they won’t be able to pay it back and very few people know the relief Bankruptcy allows prior to obtaining credit and getting into difficulty. Everyone should make sure they can comfortably afford to repay the credit they have obtained but there is also a responsibility on the lender to conduct checks and make sure people can afford to pay. More often than not a change of circumstance causes a debt crisis like redundancy or the breakdown of a relationship and people are just unable to continue to honour the original agreement. Bankruptcy law at present tries to ensure a balance between realisation of assets to pay debts and being able to start life again. If the regime was too harsh, the motivation to do well for yourself would likely to be lost. Now, if someone has done something they shouldn’t like deliberately incurring credit they can’t afford to repay, then that individual can find themselves subject to Bankruptcy for up to 15 years under present legislation, which is a much improvement from the previous rules. If a consumer can pay something towards their debts then there is also the alternative of seeking an Individual Voluntary Arrangement, which allows a proportion of the debt to be repaid over a set period of time, which can have added benefits for the consumer and creditor alike.”