BANKRUPTS (Raising of financial limit for discharge by certificate)

[Mr Speaker in the Chair]

The following Question stood in the name of Mr Chng Hee Kok-

Mr Chng Hee Kok: To ask the Minister for Law if he will consider raising the financial limit under which the Official Assignee can grant a bankrupt discharge by certificate.

The Minister of State for Law (Assoc. Prof. Ho Peng Kee) (for the Minister for Law): Mr Speaker, Sir, after a recent review of the implementation of the amended Bankruptcy Act, we have decided to increase the financial limit from $100,000 to $250,000. This will come into effect on 15th September this year.

Sir, in 1995 we made major amendments to the Bankruptcy Act. The Official Assignee could exercise his discretion to discharge a bankrupt by certificate if his debt does not exceed $100,000. With this amendment, some 4,352 bankrupts have been able to obtain their discharges in the last two years.

As at end June 1997, the Official Assignee has issued 11,636 notices of his intention to discharge bankrupts by his certificate. There were objections from the creditors in only 592 or 5.1% of the cases and few have challenged the Official Assignee's decision in the Courts.

We believe that the new provision has worked well. We started with the financial limit of $100,000 for the Official Assignee to issue a certificate of discharge. In the light of experience gained, we are satisfied that we can now raise it to $250,000. The Official Assignee will continue to apply the same criteria to select cases for discharge, balancing the interests of both creditors and bankrupts. These are the cause of bankruptcy, age of the bankrupt and of the bankruptcy, the bankrupt's conduct, his contributions to his bankruptcy estate and the extent of cooperation extended to the Official Assignee. We hope that this will give an added incentive to bankrupts to make greater efforts to work towards their discharge from bankruptcy.