PUTRAJAYA: The Insolvency Department has released 142,510 individuals from bankruptcy under the Second Chance Policy introduced in October last year, says Prime Minister Datuk Seri Anwar Ibrahim.
“For these 140,000 individuals, companies and families who were stuck in a lurch not knowing their future, this will definitely help them and also assist in driving growth,” said Anwar.
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He said this during the 100th anniversary celebration of the Insolvency Department at Putrajaya on Thursday (July 25)
Anwar credited the Insolvency Department and the increase of the minimum debt threshold to RM100,000 from RM50,000.
He also said this is an unprecedented success for the Insolvency Department and Putrajaya.
“People always get anxious when they assume that the government is doing nothing, This is not true. From 1957 to now, there is no government that has been able to solve over 142,000 bankruptcy cases," said Anwar.
According to Anwar, the figures from March last year till June 30 this year also showed that the Insolvency Department had exceeded its target of releasing 130,000 cases from bankruptcy this year.
“We can make amendments to the law. But if government or department officers are slow, the target of 130,000 will not be met,” added Anwar.
Anwar also hinted that there will be positive surprises in store for the Insolvency Department because it managed to exceed its target.
“We are studying the effectiveness of streamlining government systems and therefore, the role of the Insolvency Department will surely be given special attention for its good performance,” said Anwar.
Anwar also said that government achievements like the Insolvency Department should be publicised by the media to quash negative perception on social media.
Meanwhile, Anwar said reforms are bearing fruit in Malaysia, as there are many positive international news coverage on Malaysia being a new regional hub for artificial intelligence and data centres.
“Change requires us to have not just fresh ideas, but effective execution of actions involving the civil service,” added Anwar.
Minister in the Prime Minister’s Department (Law and Institutional Reforms) Datuk Seri Azalina Othman Said, who was also present during the ceremony, said the Second Chance Policy reflects the government’s commitment in ensuring that no Malaysian is left out from national development.
In line with current trends and technological advancements, Azalina said the digitalisation of operations plays an important role in modernising operations.
To that note, Azalina said the government had taken steps to improve digitalisation among government agencies.
“In driving competitiveness for sustainable growth, the government has taken steps to improve the adoption of technology and digitalisation through the development of the Enterprise Architecture (EA),” said Azalina.
Azalina also said the government conducted a feasibility study on incorporating the Insolvency Department in accordance with best international practices, and the views of cross-border insolvency specialists, as well as Malaysians to ensure a more efficient insolvency administration.
“By no means, this effort can promote cash flow, economic growth, as well as attracting financial investments and international trade to Malaysia.
“This is another commitment of the Madani government in ensuring the wellbeing of Malaysians and driving national economic growth to make Malaysia a developed high-income country,” added Azalina.
The Second Chance Policy was first announced on Oct 13 last year during the tabling of Budget 2024 by Anwar.
The policy is a government initiative designed to protect the welfare of the people burdened by small-scale debts and to provide a pathway out of bankruptcy under specific conditions.
The policy includes amendments to the Insolvency Act 1967, among them includes increasing the minimum debt threshold from RM50,000 to RM100,000.
When tabling the revised Budget 2023 in February last year, Anwar also said that while waiting for the amendments to the Insolvency Act 1967 to be passed by Parliament, bankrupts with debts below RM50,000 could be discharged if they met certain qualifications.
Recently, Anwar also announced in Budget 2024 that the Second Chance Policy will be expanded this year to cover bankrupts aged 40 and below with debts not exceeding RM200,000.
The amount of bankrupts had reduced from 6,554 cases in 2021 to 5,695 cases in 2022, 4,810 last year and 2,401 up till May this year.
