Cuts undermine confidence in Insolvency Service

New funding structure needed for Insolvency Service, MPs say

Under-resourcing is risking undermining stakeholder confidence in the work of Insolvency Service, a Commons select committee has warned.

The Business Innovation and Skills select committee has endorsed evidence put forward by Prospect over the last year, and acknowledges that resource constraints have impacted on the investigatory and enforcement work of the agency.

Without an increase in resources, the investigations unit will be unable to increase the number of cases it can prosecute, which will further undermine stakeholder confidence, the committee has warned.

The BIS committee report points out that the aim of the service must be to disqualify or sanction all directors found guilty of misconduct and calls on the government to provide the funding necessary to achieve appropriate disqualification.

It has also accepted that the fee-generated income model for the Official Receiver Service is unreliable in the current economic climate, and that the service needs to look at alternative funding models that are sustainable and not wholly reliant on unpredictable levels of casework and asset values.

You can read the final report on the parliament website.