R3’s Press, Policy and Public Affairs update, November 2020
04 December 2020
Last month held plenty to occupy the attention of R3's Press, Policy and Public Affairs team, with the looming implementation of Crown Preference a continued concern, even as we worked to advance our "Back to Business UK" campaign.
Crown Preference in insolvencies was restored for certain kinds of tax debts just after the month's end, in a move which has been opposed by virtually all of the insolvency and restructuring profession in the UK, as well as the wider business community.
Given the Government's stated aim to try and help as many businesses as possible, we find it mystifying that this measure has been brought in, just at the time when it is likely to cause the most damage. From making CVAs harder to implement, to reducing available funding for growing businesses and reducing the survival chances of companies in distress, it is hard to see any kind of an upside to this policy.
We remain committed to trying to get the Government to reverse this move, and have asked our members to send us any examples they encounter in their day-to-day work of instances where it has killed off any chance of business rescue, or cut off vital funds to a growing firm.
On a more positive note, R3's Back to Business UK campaign picked up pace, with representatives of the committee presenting free webinars to members of the Institute of Directors, the Chartered Institute of Credit Management, and the Federation of Small Businesses.
Through these webinars, R3's message on behalf of the profession that seeking early advice is more vital now than ever reached a wide audience. We will continue the campaign into the new year, and will look for new ways to get our core themes out to those who need to hear them most.
The Law Commission is conducting a consultation on its proposals to "to modernise the rules on when consumers acquire ownership of goods under sales contracts". The proposals would, if implemented, have a significant impact on the work carried out by office holders in corporate insolvencies, as R3's response to the consultation makes clear. Look out for a post from us with more detail on the issue, and the profession's concerns.
The press team had a busy month in November, responding to enquiries for comments and briefings on technical aspects of insolvency and restructuring from journalists from outlets including the Times and Sunday Times, the Financial Times, the Sun, the New Statesman, and the Daily Telegraph. Topics discussed included pre-packs, CVAs, so-called 'light-touch' administrations, and the unwelcome return of Crown Preference.
R3 was mentioned in the national press in an FT piece on CVA challenges; a Telegraph article about the challenges facing businesses over winter, while we wait for a vaccine; and another Telegraph article about HMRC regaining preferential status. Our comments on the monthly insolvency statistics for October were picked up by the Sun and the Telegraph, along with numerous trade and regional outlets. We are proud to be able to represent members' views, and to make sure the profession's voice is heard in the media.
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