Passing the Century Mark: The Urgent Need for Reform of Insolvency Law and Policy in New Zealand

Abstract

Research into individual insolvency is a recent phenomenon, reflected in legislation much the poor relation to its more prestigious corporate insolvency cousin. The Insolvency Act 1967 (NZ) (the Act), founded upon pre-twentieth century policy, is devoid of any discernible scheme and purpose. In moving to remedy this state of affairs, this paper reviews recent international debate on fundamental issues, including the implications of discharge and alternatives to bankruptcy. Measures to reform New Zealand's legislation are offered, including a draft purpose statement, suggested statutory reorganisation and revision, and policy issues deserving of further debate. A call is made for further research with an empirical focus and for immediate inclusion of the Act on the reform agenda.

Keywords: Consumer insolvency, reform, policy

JEL Classification: K39