For a man who has spent a decade heading BDO Stoy Hayward’s business recovery division in London, Tony Supperstone’s latest venture – looking after the interests of member firms at the insolvency trade body R3 – will see him spending a lot of time outside the capital.

As testament to this, our interview takes place slap bang in the centre of his old stomping ground in Birmingham.

‘Myself and the previous president Ron Robinson are from outside London. It gives us an advantage to understand what the regions want - not everything should be London-centric,’ Supperstone says.

Indeed not. Negative economic circumstances are immune to location. With the climate for UK exports as it is, there have been plenty of desperate stories from manufacturing, as well as retail, companies throughout the country.

Butchers Dewhurst and Wellington bootmaker Hunter Rubber are the latest in a series of high-profile casualties needing urgent help to return them to a solvent state. And with Supperstone surrounded by the ghost of

MG Rover in the Midlands, you could be forgiven for thinking that he will be even busier in his new role than when he was business recovery boss with Stoys.

But he’s clear that his latest position will be ‘less demanding’ and allow him to see more of his family. ‘I spent the last 14 years working in London at the weekend. I haven’t seen my family grow up,’ he says regretfully.

Deluge of debt

Supperstone’s work is not just limited to helping R3’s members save corporates. Gloomy clouds of insolvency overshadow individuals as well. With up to £1.2 trillion worth of debt owed to banks weighing down the public, it is this side of the profession that is the main area of focus for Supperstone during his year in the role.

‘R3 is looking to see how it can educate people about their own finances – it’s a big concern and one of my priorities for the year. Because there’s so much credit available, people come out of school, incur enormous debts without realising they have to be paid back, and think a fairy godmother will come along and repay them – it doesn’t work like that,’ Supperstone warns.

The trade body will look to invest resources in this campaign, so it can be seen as the expert to advise ‘individuals and not just business’, but Supperstone is at pains to point out that R3 is not a ‘bottomless pit’ of cash itself.

Nevertheless, educating the masses is vital to get people to understand that bankruptcy is not the only option for struggling debtors, and he appreciates that pride is even stronger for the public than it is for the likes of owner-managed businesses. ‘Individuals with credit card debts won’t talk to other family members,’ he laments.

Despite far-reaching concerns over the mountain of credit offered by banks, Supperstone says they face a difficult balancing act with regards to their commercial attitude, hence the need to educate those taking out the credit.

As for individuals’ choices to pay off their debt, the main option besides bankruptcy has been the popular individual voluntary arrangement. This is an agreement between the individual and creditors where a reduced amount is paid, and usually after five years the debt is considered settled. The arrangement can only be set up by an insolvency professional.

Creditors are called upon to vote either for or against the arrangement, requiring just one agreement for the IVA to take place. But if a creditor representing over 25% of the total debt votes against it then it fails. The process has proved to be an alternative to entering into bankruptcy but is not known for being particularly fast to set up.

So with alternatives lined up by the insolvency industry and government, known as ‘simple’ IVAs, Supperstone hopes that his members can deal with more people, at an earlier stage, rather than after they have dealt with the often dubious ‘debt management’ businesses.

The profession has to walk a fine line. Supperstone is confident that there are enough R3 members to handle the volume of corporate work that creditors present them, but an influx of work from the public could really stretch insolvency practitioners.

‘Many people go into informal arrangements that are not necessarily dealt with by R3 members. The vast majority of these are credit card debts, and the vast numbers are a concern. But it’s important those that need financial advice can obtain it and know where they should go,’ he says.

Some relief could soon materialise for debt-laden individuals in the form of the regulation of debt management companies whose staff are invariably not qualified practitioners.

And, according to Supperstone, the professional body Insolvency Practitioners’ Association is investigating the possibility of monitoring and licensing them.

Despite unsettled market conditions, Supperstone says that current circumstances do not compare to the changes the insolvency profession went through during the late 1990s.

The introduction of the Enterprise Act 2002, which attempted to make it easier for businesses to be saved, plus a change of attitude by all involved in and around the profession in terms of saving businesses, was the biggest time of change and will be so for many years, he says.

‘During the 1990s everyone realised it was no good companies just failing, banks losing customers, auditors losing clients. It made sense to try and rescue businesses if we could, get more value – a return. That’s where the whole “rescue culture”came about.

‘The Act helped facilitate administrations. Less emphasis on court procedure, could have taken you weeks to get a court order – now it’s almost a rubber stamping exercise.’

TUPE furore

Despite his certainty that the biggest changes to insolvency laws have come and gone, there is a sting in the tail – one that has driven R3 mad. European regulation aimed at protecting the rights and obligations of employees whose employment is taken over by another company – known in the UK as Transfer of Undertakings (Protection of Employment) or TUPE – has been updated.

Yet R3 is indignant that the government’s interpretation of the latest update is so unclear that the courts could be left to decide how the regulations are understood in relation to buyers taking on the obligations of a stricken business. The lack of clarity could put buyers off purchasing another business altogether.

‘We don’t know what the TUPE changes were meant to achieve, we assume it was to make it easier to sell businesses, but many purchasers will be put off because of obligations they’ll be taking on. The new regulations were intended to clarify that.’

Supperstone says DTI agency the Insolvency Service was not involved in drafting the regulation, hence the confusion. ‘We shouldn’t have to clarify within the courts, if it had been simply drafted regulation that applied to UK.’

He claims it is an ‘inevitability’ that the courts will be involved: ‘That won’t disappoint the lawyers but won’t help us try to sell businesses.’

So what with TUPE, campaigning for members to handle more personal insolvencies, travelling the regions and working to streamline corporate proceedings, Supperstone will not get the quieter year he was craving.

'I wanted to know why businessess failed'

Tony Supperstone, the new president of insolvency trade association R3,has like many professionals in the business been involved in handling a vast range of struggling companies.

He gained a great deal of experience working in the leisure industry in the 1990s, which included securing the survival of health club group Peak Fitness.

Yet the range of companies he has worked with spreads much farther. He acted as administrator for Planet Rapido, the producers of infamous Channel Four programme Eurotrash , and served as joint liquidator for PPP, a property investment scam based in the north-east.

Supperstone has already served in a number of key roles at the trade body. He has been councilmember of R3 for ten years and more recently held the role of chairman of R3’s Finance and General Purposes Committee.

He does not subscribe to the concept that business recovery is glamorous, preferring to call it ‘interesting’.

‘I wanted to know why businesses failed. I thought if I went into business restructuring, then I could utilise those skills when I went into industry myself – but I’m still here. And after 34 years, it probably won’t happen now,’ he says.

Yet the strange mix of businesses he has dealt with in the past may well have enticed one of his family into the profession. ‘One of my sons has just passed his joint insolvency exams. It wasn’t intentional that he followed in my footsteps’.

Supperstone sees the traditional route into business recovery – moving on froman audit role – as no longer the only choice for young people looking to work in insolvency.

‘More [firms] are recruiting direct from university into business restructuring departments. An accounting degree is not mandatory – they’re looking for at least upper seconds, but you’d have to be numerate.’