View from the House
By Austin Mitchell
The final report of the Insolvency Review Working Party (IRWP)
is the last
throw of the dying ethos of regulation of vested interests by vested interests in
the interest of vested interests.
It ignores New Labour's new principle of independent regulation,
prioritises the interests of the industry over the consumer. Little else could be
expected from a working party appointed by the last government controlled by
the present regulatory bodies and happy to ignore all the scandals. But the
report already looks desperately out of date as we move towards
independent regulation in financial services.
The IRWP had no one to represent the interests of bank depositors,
scheme members, small businesses, employees, or any other stakeholder.
None of its meetings were open to those affected by insolvency.
no analysis of systemic failures and problems. There are no proclaimed
principles or case studies, and there is no assessment of the quality of work.
The IRWP does not care about any of that.
Some 12 million people in the UK are unable to afford access to the law.
These include entrepreneurs whose businesses are confiscated by
insolvency practitioners. Banks, pension schemes, the police and the
financial services sellers all have independent ombudsmen and
The IRWP does not want either. Why not?
Today, eight overlapping regulators regulate some 1,800 insolvency
This is regulatory overkill. And yet the IRWP wants to add still
unaccountable quangos, such as its Insolvency Practices Council.
The only excuse for the report is that it doesn't need legislation.
There is no
reason for implementing something half-baked in an industry already seen as
selfish and unaccountable and which will be viewed as becoming even more
so as the coming recession increases its business.
The committee has wasted its own time and ours trudging down a
street. Now we'll have to start all over again. Towards independent regulation.
Austin Mitchell is Labour MP for Great Grimsby