PPP update: February 2022

25 March 2022

February may be the shortest month of the year, but that does not make it the quietest. With work on R3’s response to the Government’s insolvency regulation consultation, a new paper to help tackle misconceptions around insolvency fees and continued engagement with parliamentarians on the importance of Companies House reform, R3’s Press, Policy and Public Affairs team has been working hard to make sure the voice of the profession is heard on key issues.

Engaging on regulation

The proposed reforms to insolvency regulation laid out in the Government’s ‘The Future of Insolvency Regulation’ consultation are set to have a significant impact on R3 members, and the wider insolvency and restructuring profession. In February the Press, Policy and Public Affairs team worked on a variety of activities to help make sure that R3 members’ views are accurately reflected in our response to the Government.

On Wednesday 23^rd February, we launched a member survey to gather feedback on the proposed reforms. As this is a once in a generation set of reforms, we have encouraged all members w to take this opportunity to voice their views.

Towards the end of the month, we also hosted a face-to-face roundtable involving a number of senior R3 members, with discussion themes including the Government’s plans for a single regulator, the introduction of firm regulation and the practicalities of introducing an insolvency compensation scheme.

With the consultation closing on the 24^th March, we will be taking the views expressed by members across the UK and incorporating those in to our consultation response.

Tackling insolvency fee myths

In February, the team continued to work on a new report, ‘Insolvency fees and the cost of regulation: the detail behind the headlines’, which aims to challenge popular misconceptions and myths about insolvency fees.

Insolvency fees are one of the most misunderstood aspects of the profession and this new paper helps to explain that the detail behind them often gets missed in media headlines – leading to an unfair perception of the profession and the work it carries out.

The report was launched on March 7^th and all R3 members received a link to it via email. Over the coming weeks, we will be promoting the report to parliamentarians, key industry and business stakeholders, as well as the media.

Companies House reform

Reform of Companies House has been a long-debated issue in parliament. But despite our continued lobbying, the Government has been slow to move on the issue since its Corporate Transparency and Register Reform consultation in May 2019 and subsequent response to the consultation in September 2020.

However, the issue was once again set in motion when Treasury and Cabinet Office Minister Lord Agnew resigned, after criticising the Government’s failures to address fraud in the UK. In response, an Urgent Question was raised by Kevin Hollinrake MP about Government plans to introduce an Economic Crime Bill and, in the debate that followed this question, parliamentarians criticised the Government’s lack of progress on introducing its Companies House reform package.

The Press, Policy and Public Affairs team wrote to MPs who have spoken on the need for an Economic Crime Bill, to further highlight the importance of Companies House in supporting the insolvency and restructuring profession’s fight against fraud. We will continue to engage with MPs on this issue, and lobby for urgent action on Companies House reform as the Economic Crime Bill begins its journey through parliament at some point in the second half of this year.

R3 in the media

Media interest in the profession and its work remains high. In February, views on the January insolvency statistics were featured in articles in the Times and the Guardian business blog, and our comments on the annual insolvency statistics featured in stories in the FT, Reuters, MailOnline and a number of trade and regional publications including Business Live and Business Up North.

We continued to highlight the profession’s concerns with the Government’s proposed reforms to insolvency regulation in February, with R3 Vice-President Christina Fitzgerald quoted in a piece in Accounting Web highlighting our members concerns about the potential conflict of interest created by the proposed new regulator being inside the Insolvency Service, and the issue of how the public and private elements of the profession would be regulated if the new proposals were introduced.