MONETARY LIMITS RELATING TO BANKRUPTCY AND WINDING UP (Hansard, 26 October 1976)

§ Mr. Clinton Davis
I beg to move Amendment No. 20, in page 12, line 9, column 3, leave out '£300' and insert '£200'.

§ Mr. Deputy Speaker (Sir Myer Galpern)
With this we may take Government Amendment No. 23.

§ Mr. Davis
This was a matter which attracted the consideration of the Committee for a considerable time. We originally took the view that it was necessary to increase the minimum debt to support a creditor's petition for a sequestration order in Scotland, or a receiving order in England, to a figure of £300. We have reflected on this further, as a result of the deliberations we had with the professional bodies.
Although this matter was conceded by both sides of the Committee I have analysed the figures upon which petitions were founded and have come to the conclusion that there would only be a marginal benefit in relation to the work load if we were to raise the minimum debt to £300 instead of £200. Since this lower figure seems to accord with the view of the professional bodies, it is right, having regard only to these marginal benefits, that we should concede the case at least for the time being.
It is right to monitor the situation over, say, 12 months after this provision comes into effect. We shall then be able to determine whether we should move to amend the figure to £250 or £300, but it is now possible to adopt a flexible approach, having regard to an earlier amendment which we moved.
I hope that the hon. and learned Member for Southport (Mr. Percival) will agree that I need not rehearse now the calculations upon which my conclusions were based, but I should be very happy to provide him with that information if he requires it subsequently.

§ Mr. Percival
I welcome this amendment and all the others relating to figures. We are glad that the Government have accepted both the lower figure and the spirit in which we put forward all the 348 figures. The professions felt strongly about the figure of the minimum debt on which to found bankruptcy proceedings. They felt that it would make serious inroads to raise the figure to £300.
The Minister's argument about reducing the work load of the service, to which the Solicitor-General referred also, is misleading. The work load is heavy because the service which is supplied is one that people want. It would be curious to use a heavy work load as a reason for making the remedy less available. We should think instead of ways of satisfying the demand. If we want economies, perhaps we should look at remedies which are not being used. It is illogical to save by cutting services that people want. I hope that that argument will be viewed with great caution by Ministers, since it could be misleading and could lead to the opposite of the consequences we want. Subject to that, we welcome the amendment and all the other amendments on figures.

§ Mr. F. P. Crowder (Ruislip-Northwood)
What does the Minister mean when he talks about monitoring the position in a year's time? Does he mean looking at it again, reviewing it or taking control of it? I do not care for that word.

§ Mr. Clinton Davis
I am sorry that the hon. and learned Member should take exception to the mild term "monitoring". I did not intend it as a term of abuse.
In answer to the hon. and learned Member for Southport (Mr. Percival), the reduction of the work load is part of a genuine problem. It is not a question of having a sufficiency of people or having people who are capable of pursuing these jobs pouring into this area of the Department. This is highly technical work and a great deal of training is required, but unfortunately the people are not available to match the requirements. We therefore have to consider ways and means of mitigating the intolerable burden which has fallen on this service in the last year or two. That is a fact of life.
Recruitment here is not easy. The hon. and learned Member for Southport will know this from his own experience. I know that he is not an expert in bankruptcy, although he has probably learned a great deal in recent months. We must 349 also take into account the fact that the service operates at a loss.
What I intended by the word "monitoring" was that my Department would be trying to scrutinise the results of this situation over the 12 months after this part of the Bill comes into operation. I should have thought that that term was readily understood. I hope that I have now explained it to the satisfaction of the hon. and learned Member for Ruislip-Northwood (Mr. Crowder).

§ Mr. Crowder
Surely the answer is that the Department will look at it carefully under a review, not on a monitoring basis.

§ Mr. Davis
The hon. and learned Gentleman has made a powerful intervention at this stage of our consideration of the Bill.