Will The New Liberal Government Impact Bankruptcy In Canada?

Elected as Canada’s 23rd Prime Minister, as head of the Liberal party, Justin Trudeau has officially been sworn in to become Canada’s new leader as of this week.

In the recent election Canadians overwhelmingly voted for change in parliament shifting from the Harper led Conservatives to a majority Liberal government. Our new Liberal government has promised us that many changes will come over the next four years. For Canadians in debt, and Canadians who are currently in bankruptcy, some may be wondering if a change in federal governance will also result in changes to our Bankruptcy and Insolvency Act.

The Bankruptcy and Insolvency Act of Canada is federally legislated, which does mean that any changes or amendments to the Act are the responsibility of our federal government and by extension, the leadership of Prime Minister Trudeau and the Liberal party. While the federal government does have the final say on any changes to the Act, the change in leadership itself, is not likely to bring any significant changes in the near future.

BIAA few facts about the Bankruptcy and Insolvency Act of Canada

  • The Bankruptcy and Insolvency Act (BIA) that we know today originally came into force on July 1, 1920
  • The Act is primarily intended to “provide for the financial rehabilitation of insolvent persons” but is also intended to ensure that creditors are treated fairly with regard to the debts owed to them.
  • Significant changes to the BIA were made in 1992, 1997, 2005, with the latest amendments and changes occurring between 2007 and 2009.
  • 2009 was a big year for the BIA with many of the most important changes to the Act finalized. The changes made in 2009 have since greatly impacted the decisions of indebted persons seeking creditor protection.

Given the history outlined above, it is clear that changes to the Bankruptcy and Insolvency Act happen rarely – the most recent changes took a long time to be fully incorporated into the legislation. Our federal government has so many pressing areas of concern to address each year; therefore, changes to the Bankruptcy and Insolvency Act are not typically at the top of Parliament’s to-do list.  The final amendments in 2009 were made to ensure that additional changes would not be needed in the near future.

Do we need to worry about big changes to the BIA any time soon?

In all likelihood, we do not. Prime Minister Trudeau mentioned more than enough issues in his election campaign that he intends to tackle over the next four years and bankruptcy reform was definitely not among them.

So, if you are struggling with debt(s) and considering personal bankruptcy, you can rest assured that the advice you receive today from a licensed Trustee is not likely to change in the near future. To book a free consultation to discuss your options, please contact one of our qualified professionals by telephone or via the form on this page.