| Online insolvency plans criticised |
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Proposals to allow civil servants to act as adjudicators in insolvency cases have been severely criticised. The reforms suggested by the Insolvency Service would see petitions for bankruptcy and winding up done online rather than via the courts. The Chief Bankruptcy Registrar, Stephen Baister, described the proposals as “satirical”. Speaking at the Insolvency Practitioners Association’s (IPA) annual lecture, Baister believed that the move would create more bankruptcies and company liquidations. He said: “Currently many winding-up petitions result in settlement of the debt, often very late in the process, perhaps after a court adjournment. Many of those cases in the future could end up with businesses being shut and employees dismissed.” His concerns included the transparency of the process as petitions would be removed and civil servants would decide whether there is a dispute or not. He added: “Everyone is entitled to a fair and public hearing. The lack of public scrutiny bothers me. It may be inconvenient to the government but there is a practical value in a hearing.” Baister questioned whether a civil servant would have the necessary qualifications, experience and competence to deal with potentially complex areas of law and noted a conflict in placing the adjudicator in the same government agency as the official receiver. |
