To ask the Secretary of State for Business, Innovation and Skills what steps his Department has taken to ensure that (a) shareholders and (b) other types of owners are not allowed to structure investment in companies in such a way as to become preferred creditors in the event of insolvency.

The order of priority in insolvency situations has been long established, and the list of preferred creditors is kept to an absolute minimum. Secured lending from whatever legitimate source is, however, vital to our commercial landscape and the elevated position of such lenders in the creditor hierarchy recognises its importance.

It will be for the appointed officeholder of an insolvent company to consider the nature of any transaction(s) that led to any charge(s) being obtained and the validity of security held.