§ Mr. Austin MitchellTo ask the Secretary of State for Trade and Industry what proposals he has to expand the work of the Department of Trade and Industry on insolvency.
§ Mr. RedwoodI have no such plans. The insolvency service recruits staff when necessary to meet its workload.
§ Mr. Austin MitchellTo ask the Secretary of State for Trade and Industry what proposals he has for increasing competition among insolvency practitioners.
§ Mr. RedwoodFollowing the recommendation of the insolvency review committee chaired by Sir Kenneth Cork, Government policy is to ensure that there are sufficient suitably experienced insolvency practitioners available to compete for insolvency appointments whilst at the same time enforcing acceptable standards of education and experience. This has been achieved by the introduction of licensing.
Seven professional bodies, representing accountants, solicitors and specialists in insolvency, which are able to satisfy the Secretary of State that they regulate the practice of their members, have been authorised to license their members if they are fit and proper persons to act as insolvency practitioners. Any professional body that considers that it is able to satisfy the Secretary of State's requirements may apply for recognition.
In addition, any person able to satisfy similar requirements but who is not a member of a recognised professional body may apply to the Secretary of State for authorisation. As at 31 December 1990, the professional bodies had licensed a total of 1,751 practitioners and the Secretary of State a further 138.
In liquidations and bankruptcies, the creditors have the opportunity to vote on the selection and remuneration of the practitioner. An administrative receiver is appointed by a secured creditor, who fixed his remuneration, but he is required to hold a meeting of creditors and they may apply to the court if they object to his conduct or remuneration.