Insolvency (Cork Committee)

Oral Answers to Questions — Trade – in the House of Commons at 12:00 am on 8th November 1982.

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Photo of Mr David Ginsburg Mr David Ginsburg , Dewsbury 12:00 am, 8th November 1982

asked the Minister for Trade when he expects to reach a conclusion on the recommendations of the Cork committee on insolvency.

Photo of Mr Tim Smith Mr Tim Smith , Beaconsfield

asked the Minister for Trade what representations he has received in response to his invitation for comments on the Cork report.

Photo of Dr Gerard Vaughan Dr Gerard Vaughan , Reading South

The Government accept the general principles underlying the Cork report. We are still waiting for some of the consultation comments to come in. As soon as we have those, I hope to announce whether there are steps that we can take to deal with abuses in advance of the major legislation which would be required to implement the main body of the report.

Photo of Mr David Ginsburg Mr David Ginsburg , Dewsbury

I welcome the Minister's reply, but is he aware that there is considerable disappointment that he has not made a definite commitment at least to incorporate legislation on the appointment of administrators so that in the current climate companies threatened with insolvency can be kept going and the workers employed?

Photo of Dr Gerard Vaughan Dr Gerard Vaughan , Reading South

I make it clear to the House that I am concerned, as is any hon. Member, to stop the abuses of the insolvency laws that are undoubtedly taking place. I am keen to take some action soon, and for that reason I had a meeting with Sir Kenneth Cork only last week.

Photo of Mr Tim Smith Mr Tim Smith , Beaconsfield

To which of the Cork committee's recommendations does my hon. Friend attach the greatest priority? Has he referred any of the recommendations to the advisory panel on company law?

Photo of Dr Gerard Vaughan Dr Gerard Vaughan , Reading South

I am considering what parts can be pulled out from the Cork package. It is an integrated package. I do not wish to make the mistake of pulling out some parts and creating difficulties in others. I have not yet taken any advice on that matter.

Photo of Mr Clinton Davis Mr Clinton Davis , Hackney Central

While the Minister, in effect, prevaricates about the Cork report, will he at least bury one point which emerged from the Government's Green Paper on insolvency law and practice, namely, the proposal to emasculate the official receiver service? Is that now dead?

Photo of Dr Gerard Vaughan Dr Gerard Vaughan , Reading South

That aspect of the Cork report will require careful consideration. I cannot give the hon. Gentleman an answer at the moment.

Photo of Mr Bowen Wells Mr Bowen Wells , Hertford and Stevenage

Is my hon. Friend aware of the great impatience among the public in general and consumers in particular over the continuous dragging of feet on this issue both by the Labour Government and this Government? Will he give me an assurance that he will introduce legislation during this parliamentary Session?

Photo of Dr Gerard Vaughan Dr Gerard Vaughan , Reading South

I do not accept that the Government are dragging their feet. I am well aware of the need to protect consumers as much as possible. I shall come back to the House with proposals as soon as possible.

Photo of Mr John Fraser Mr John Fraser , Lambeth Norwood

Does the Minister realise that the insolvency laws have been recognised to be unsatisfactory for at least a decade and that legislation is now long overdue? The present law is particularly hard on consumers, suppliers and unsecured creditors. If the Government cannot bring forward such legislation in this Session, will the hon. Gentleman publish detailed legislative proposals so that the next Labour Government can do something about the situation?

Photo of Dr Gerard Vaughan Dr Gerard Vaughan , Reading South

When the hon. Gentleman sees our proposals he will have to accept that the Government are mindful of the urgency of this matter. I suggest that he waits until we produce some recommendations.

Photo of Mr Robin Squire Mr Robin Squire , Hornchurch

May I encourage my hon. Friend by assuring him that if he wished for a short, sharp measure to protect consumers, I have a strange feeling that it would pass through the House more rapidly than other legislation that might be contemplated?

Photo of Dr Gerard Vaughan Dr Gerard Vaughan , Reading South

I am grateful to my hon. Friend for that advice.