PPP update: January 2022

09 February 2022

2021 was a significant year for the insolvency and restructuring profession, and for R3’s Press, Policy and Public Affairs team who worked hard to promote and defend the profession and its work.

And with proposals to overhaul to the insolvency profession’s regulatory framework out for consultation, continued media and parliamentary interest in the profession and its work, and further insolvency and restructuring-related policy announcements underway or in development, the first month of 2022 continued to be busy.

A voice in the regulation debate

The Government announced in December 2021 that it is seeking views on proposed changes to the insolvency regulation framework, with its consultation closing towards the end of March.

Although we welcome the opportunity to discuss how the framework can be improved, we need more detail on how the proposed single regulator will operate from within the Insolvency Service without creating a conflict of interest and how these proposals will be introduced and implemented.

This is something we will continue to call for while the consultation is open, alongside our work to produce a consultation response, and keep members informed of the Government’s plans for the future as they develop.

On 7^th February, we hosted a joint webinar with the Insolvency Service, during which members had the opportunity to hear about the proposals from the Service’s Head of Policy, Paul Bannister. A live Q&A at the end of the session gave attendees the opportunity to have their questions answered by Paul and other senior Insolvency Service officials.

We will be submitting a consultation response before the 24^th March closing date, and in preparation have been meeting with our policy committees to discuss the proposals and garner feedback from members of the profession.

In addition to this, R3 CEO Caroline Sumner and Head of External Affairs James Jeffreys will be attending meetings around the UK to talk directly to members about their views of proposed new regulatory framework. We will also publish a member survey so every R3 member has the chance to share their thoughts and ideas on the proposals and on the future of how the profession is regulated.

Challenging insolvency fee misconceptions

The fees insolvency practitioners charge are often the subject of criticism in parliament and in the media, particularly in large, high profile cases – but there is often little resemblance between the fees that are charged and the fees that are received.

This month, the PPP team has been putting final touches to a paper addressing the most common misconceptions about insolvency fees. This paper will explain how insolvency fees are charged, regulated and approved, and crucially how the headline-grabbing amount charged more often than not bears little resemblance to the amount IPs will actually be paid at the end of the day.

Once published, the paper will be made available to R3 members, sent to parliamentarians, journalists, and stakeholders to provide context around the issue of IP fees, and used in R3’s ongoing digital, public affairs and media work.

We expect to publish the paper by the end of Q1 and all R3 members will receive a digital copy of the paper on the day it’s launched.

R3 in the media

In addition to the media coverage generated by our response to the insolvency regulation consultation, media interest in corporate and personal insolvency statistics remains high.

Our statement on the monthly insolvency statistics for England and Wales was picked up by the Daily Express and the Daily Telegraph, while Colin Haig's comments on the annual insolvency statistics for 2021 were featured in the FT, Reuters, and the Independent, and in many regional news outlets.

The comments from Richard Bathgate, Chair of R3 in Scotland, on the Q3 insolvency statistics for Scotland were covered in the Herald and Insider, and in a range of trade media outlets.