Have your say on the proposed changes to the Statement of Insolvency Practice 3.1 on Individual Voluntary Arrangements

The Joint Insolvency Committee (JIC) is consulting on proposed changes to Statement of Insolvency Practice (SIP) 3.1 – Individual Voluntary Arrangements (IVAs).

The JIC, through a working group, has undertaken a review of SIP 3.1 and is consulting on proposed changes to the SIP. The working group is made up of insolvency professionals, regulators and other stakeholders including HMRC and the Insolvency Service involved in the IVA process.

The Insolvency Service is the secretariat for the JIC and is publishing this consultation on the JIC’s behalf. These arrangements which reflect the UK Government’s 2023 proposal to give the Secretary of State overall responsibility for setting the profession's ethical and technical standards, subject to legislation.

The JIC remains responsible for maintaining Statements of Insolvency Practice and for considering consultation responses. 

Proposed changes

The IVA market continues to evolve. Since the last update to SIP 3.1. in 2023 the FCA has implemented its ban on referral fees to debt packagers. This has led to the emergence of new routes through which IVA providers, particularly those in the volume sector, obtain work. As a result, customers may experience a complex referral journey that lacks transparency before entering an IVA. 

The revised SIP therefore strengthens and expands the requirements for due diligence of referrers. It requires insolvency practitioners to identify and understand the entire referral journey and to ensure that debtors are aware of the roles and responsibilities of everyone involved in the IVA process. This would be from the initial point of contact and advice through to the implementation of the arrangement, including who each party works for.

The revised SIP emphasises that the customer must understand all the information, explanations, consequences of an IVA and other debt solutions available and that they must have sufficient time to consider this information before deciding whether to proceed. 

The SIP also expands on the requirements for identifying, assessing and responding to customer vulnerabilities. This is intended to ensure that customers can fully understand the IVA process and their obligations, and that an IVA is a suitable and sustainable solution for their circumstances.

• Other revisions to the SIP include:
  Clarification that all records, regardless of format, should be retained for at least the duration of the IVA.
• Strengthening of the requirement to provider advice tailored to each person’s circumstances, including where interlocking IVAs are being considered.
• Reorganising, consolidating and renaming sections, such as those on record keeping and the nominee, to improve the flow of the SIP and reduce repetition.
• Introducing a new section on decision procedures.

How to share your views

The JIC welcome responses from anyone with an interest in IVAs, particularly:

• Insolvency practitioners.
• Creditors and creditor organisations.
• Debtors.
• Providers of debt advice.
• Recognised Professional Bodies.
• Insolvency trade bodies.

The consultation is open for 12 weeks. It will close on 8 December 2026.

The JIC will consider all responses before introducing any revised SIP. It will also consider the continuing challenges facing the insolvency profession when planning any changes.