§ 5. Mr. Cryerasked the Secretary of State for Trade if he will seek powers to prevent directors of companies which are compulsorily wound up engaging in the subsequent formation and operation of corporate bodies and partnerships.
§ Mr. Clinton DavisIt would be unfair to impose an automatic penalty on directors simply because they had been involved in the affairs of a company which had been compulsorily wound up. However, when new legislation comes to be prepared we will consider widening the powers of the courts to disqualify persons from taking part in the management of companies.
§ Mr. CryerI am grateful to my hon. Friend for that reply. Is he aware that in July 1970 my local paper, the Telegraph and Argus, pressed for some kind of company reform following some cenral heating frauds in the area? Is he aware that millions people would welcome firm action by a Labour Government to tighten company legislation and stop firms operating on the fringe of legality?
§ Mr. DavisNot being an avid reader of the Telegraph and Argus, I was not aware of its interest in the matter. However, I am aware of the concern which has been expressed throughout the nation about abuses of this kind. It would be unfair to assume that every director who had been involved in a liquidation was necessarily culpable. We must retain a balance. There are quite extensive powers under the 1948 Act to deal with this situation and more extensive powers were envisaged in the Companies Bill which the previous Government were proposing to introduce. We shall certainly look carefully at those provisions and I think that we would wish to implement them.
§ Mr. Teddy TaylorWhen reviewing company legislation, will the hon. Gentle- 8 man bear in mind the serious problem of liquidations of financial groups which have taken money from the public and that people, many of them elderly, do not know their rights and cannot get any answer to the situation? This is particularly evident in the National Life Insurance Company Limited affair. Will the Minister consider whether his Department or some other agency might set up an office which could answer telephone inquiries or letters from members of the public who want to know whether they have lost their money and what their rights are?
§ Mr. DavisWe would have to look carefully at that suggestion. It would not be right for a Government Department to act as a legal adviser. Nevertheless I will take on board the suggestion made by the hon. Gentleman and look at it. We would welcome in new legislation wider powers of disclosure which might go to the very heart of the matter. I hope that the hon. Gentleman will feel satisfied with that reply.