Bankruptcies

HC Deb 30 January 1985 vol 72 cc274-6

14. Mr. Ron Brown

asked the Secretary of State for Trade and Industry how many firms went bankrupt in 1984; and what is the total number of bankruptcies since 1979.

Mr. Fletcher

Provisional 1984 figures for Great Britain are 8,509 bankruptcies and 14,210 company liquidations. In the six years 1979 to 1984 there were 34,862 bankruptcies and 61,785 company liquidations. The bankruptcy figures include deeds of arrangement, and cover all individuals and partnerships.

Mr. Brown

Does the Minister agree that the figures are a terrible indictment of his Government? How many more firms will go bust as the pound declines and interest rates reach record level, s? Will he tell us the truth for a change?

Mr. Fletcher

I shall tell the hon. Member another truth — the number of new company starts is also at a record level with almost 100,000 new starts in 1984 alone. In other major industrial countries the number of bankruptcies and insolvencies in the last few years has been very high. Perhaps the next time that the hon. Gentleman visits the Red Army in Afghanistan he will stop off at one or two countries and find out for himself.

Mr. Phillip Oppenheim

Is my hon. Friend aware that many bankruptcies are caused by poor management, but that occasionally companies run into difficulties because of unfair trade barriers set up by other countries? Is my hon. Friend aware that Siemens sell telex machines and telecommunications equipment on the British market and that other companies, such as Olivetti, have telex equipment on sale and approved in this market but that British telex and telcommunications manufacturers are not allowed to sell in Italy, Germany, Japan, France and most other countries?

Mr. Fletcher

I am grateful to my hon. Friend. If he can provide details I am sure that my right hon. Friend the Minister for Trade will look into that.

Mr. James Hamilton

Will the Minister be realistic and rectify what is happening in my constituency, where virtually every week, without fail, bankruptcies occur? Is the Minister aware that the construction company for which I worked, which is now over 100 years old, will close its doors on 1 February? Is he also aware that, because of Government policy, that company has gone out of commission? Does the Minister remember the 1979 Conservative manifesto in which promises were made to smaller companies and to industrialists in general? Finally is he aware that companies are now sadly disillusioned with the Government? Pray God that they will vote Labour at the next general election.

Mr. Fletcher

I am interested in the fact that the hon. Gentleman seeks aid from yet another place. The point is that manufacturing investment in companies in the market today amounted to £6 billion in the year to September 1984. That was up 16 per cent. on the year before. Retail sales were up 4.5 per cent. in real terms in 1984 compared with 1983. There is no shortage of demand in the market. The challenge is for British companies to meet that demand.

Mr. Spencer

Does my hon. Friend agree that a number of firms in the city of Leicester went bankrupt because they were crucified by a monstrous rate bill imposed by the city council?

Mr. Fletcher

I am sure that that is correct. It applies to many companies, especially small companies, throughout the United Kingdom.

Mr. Gould

Is the Minister aware that because the deposit on a debtor's petition and the minimum debt to support a creditor's petition were increased by 100 per cent. and 120 per cent. respectively in October last year, the figures which he has just given the House do not fully reflect the full severity of this immense and record surge in business failures? Is the Minister further aware that if the figures are disaggregated they cast a yet more unflattering light on Government policy because they show that, following the imposition of VAT on home improvements, business failures among glazing firms have doubled and that even in high technolgy — computer manufacturers and distributors — so much touted as a success by the Government, the failures have doubled?

Mr. Fletcher

Even taking into account the increase in the debtor's petition, the monthly figures show a levelling off in the number of bankruptcies.