PracticeConsultingInsolvency Bill on collision course

Insolvency Bill on collision course

Insolvency experts could be set for collision with the government over amendments to the long-awaited Insolvency Bill which this week entered its second reading at the beginning of a crowded House of Commons sitting.

The Bill, which completed its passage through the Lords in July, aims to help rescue viable businesses that face short to medium-term financial difficulties and promote enterprise.

Louise Brittan, insolvency partner at Baker Tilly, said: ‘There are definitely mixed feelings – although there is relief it has finally reached parliament, the moratorium has raised serious concerns.’

Small companies will be allowed to make company voluntary arrangements (CVAs) with their creditors through a moratorium, which will give time for the company to draw up a rescue plan.

Insolvency practitioners are concerned that they, rather than courts, will be burdened with decisions on granting these breathing spaces.

Insolvency partner Nick Oliver at Moon Beever said: ‘The measures could open the way for actions by creditors against practitioners, if they feel voluntary arrangements were issued without adequate funds or care.’

A spokesman for insolvency body R3 attacked government for not listening to informed comment but hoped that a ‘more workable rescue mechanism’ would emerge.

Practitioners have also raised concern that the Bill has been introduced in parliament before completion of a DTI/ Treasury review on company rescue, and at a time when parliament has such a packed agenda, especially relating to environmental legislation.

Related Articles

5 tips for SMEs to protect cash flow

Accounting Software 5 tips for SMEs to protect cash flow

9m Alia Shoaib, Reporter
Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

Consulting Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

1y Stephanie Wix, Writer
Managing partner Q&A - the year ahead: Richard Toone, CVR Global

Accounting Firms Managing partner Q&A - the year ahead: Richard Toone, CVR Global

1y Kevin Reed, Writer
Deloitte 'self-imposes exile' on government contracts to defuse PM row

Accounting Firms Deloitte 'self-imposes exile' on government contracts to defuse PM row

1y Kevin Reed, Writer
Managing partner Q&A - the year ahead: Julie Adams, Menzies

Accounting Firms Managing partner Q&A - the year ahead: Julie Adams, Menzies

1y Kevin Reed, Writer
Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

Business Regulation Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

1y Kevin Reed, Writer
Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

Audit Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

1y Kevin Reed, Writer
New head of equity capital markets for KPMG

Accounting Firms New head of equity capital markets for KPMG

1y Stephanie Wix, Writer