Legislative Reform

The £17 million figure is the savings from both the order we have proposed, which has been considered by the Committee, and the parallel changes to the insolvency rules, which are dealt with in a separate order under the negative resolution procedure. The reason why we have to do it this way lies in the origins of the insolvency legislation. There will be estimated savings of £17 million a year from the changes. That is only part of a much wider package of proposals to streamline and modernise the insolvency rules and other relevant provisions—part of which, I should inform the House, will include a further legislative reform order—which should save a total of about £40 million per year. Huge sums may not be involved in each individual case, but over the piece the savings gained for the insolvency process are certainly worth having. We believe the costs of introducing the order are minimal, and there is no reason why we should not introduce the changes. The Committee expressed concerned about the money going to liquidators rather than to creditors, but protection against that is already built into the legislation. The terms governing the liquidator's remuneration will be fixed by the creditors and the creditors can apply to the court if they consider the amount of the liquidator's remuneration to be excessive. Any liquidator taking remuneration that was not justified could find themselves subject to the scrutiny of the courts. I understand that the Committee—this is reflected in its report—was concerned that the savings would not be passed on, so let me make it clear to the House that I want them to be passed on. There is absolutely no reason why what we propose today, and what we propose in the other connected changes to come, should increase fees charged by insolvency practitioners. This is not about increasing fees; it is about avoiding unnecessary expenditure.