§ Mr. Gryllsasked the Secretary of State for Social Services what are the criteria for deciding which of the directors who may be liable under section 152(4) of the Social Security Act 1975 will be proceeded against; what are the limits within which the inspector may negotiate on the timing and amount of any settlement with a director who may be liable under this section; and what are the circumstances in which his Department would initiate bankruptcy proceedings against a director who may be liable under this section.
§ Dr. BoysonA decision to take proceedings under section 152(4) of the Social Security Act 1975 will depend on whether the Department can establish that a particular director knew or could reasonably be expected to have known of the company's failure to pay contributions. The Department also considers whether the taking of proceedings against the director(s) is likely to be effective. Although inspectors occassionally negotiate settlements in straightforward cases, negotiations are normally conducted by officials from the Department's Headquarters. The Department initiates bankruptcy proceedings when a jugdment against a director remains unsatisfied; it has not been possible by any other means to reach a satisfactory outcome; and such action seems likely to be effective.