§ Mrs. Margaret Ewing
To ask the Secretary of State for Trade and Industry what was, for each of the last five years(a) the number of representations received from liquidators with a view to the institution of proceedings for the disqualification of company directors and (b) the number of prosecutions actually made.
§ Mr. Redwood
[holding answer 29 October 1990]: Insolvency practitioners were first required to submit 780W statutory returns and reports on the conduct of the directors of insolvent companies under the Insolvency Act 1985 from 28 April 1986. On 29 December 1986 the relevant provisions of this Act, together with the director disqualification provision of the Companies Act 1985, were re-enacted in the Company Directors Disqualification Act 1986.
Insolvency practitioners are required to make returns where they find no unfitted conduct and reports when they believe there has been unfitted conduct.
The statistical information the hon. Member requires on the submissions of reports and returns by insolvency practitioners and the disqualification of company directors in England, Wales and Scotland, covering the period from 28 April 1986 to 30 September 1990, is as follows:
Conduct reports received1 Returns received2 1986 232 1,754 1987 2,104 9,148 1988 2,987 6,878 1989 2,037 4,500 1990 2,051 7,373 1 Unfitted conduct. 2 No unfitted conduct.
Many of these unfitted reports related to minor, one-off cases of bad conduct. These would not usually result in court proceedings because a court would not consider it sufficient to warrant disqualification. Disqualification proceedings have been commenced in all those cases of multiple bad conduct or where its gravity means disqualification is likely.
Companies Directors 1986 — — 1987 30 41 1988 144 219 1989 163 267 1990 145 224
As some voluntary liquidation and receivership cases subsequently involve court winding-up orders, I set out in the table details of disqualification proceedings commenced in official receivers' cases in the same period:
Companies Directors 1986 20 22 1987 110 139 1988 157 202 1989 137 173 1990 83 109
Disqualification proceedings brought against an individual director may include allegations of unfitness emanating from more than one insolvent company.