I outlined the issue of enforcement orders, but I am very happy to clarify any additional tools available to the Insolvency Service and to other agencies directly—though not connected to this Bill—to help recover funds both for public authorities and individual creditors. I will write to him about that.
As I said, we have already committed in the legislation to conduct a review into how it is working in practice. That will be done within five years of commencement of the legislation, in line with our better regulation requirement. It is too soon to determine exactly how that review will look, but it will likely be informed by overall case numbers and will include an assessment of whether the new powers are being used as intended.
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The amendment also seeks to require the Secretary of State to report on the resourcing of the Insolvency Service, which is also the subject of the second amendment in the name of the noble Baroness, Lady Blake, tabled for the insolvency part of the Bill. Again, I hope that the noble Lord, Lord Fox, and the noble Baroness will be pleased to find that information on the resourcing and performance of the Insolvency Service is published and available on the internet. Its annual report and accounts for 2020-21 were presented to the other place just last week, in accordance with the requirement under Section 7 of the Government Resources and Accounts Act 2000, and were made available online on Friday; it is perhaps understandable that noble Lords have not had a chance to check them yet. They include an overview and analysis of the agency’s performance over the course of the year, including how it uses its available resources for enforcement activities and disqualification case studies. The full accounts are also now provided. They include how the funds provided by BEIS, the agency’s parent department, are applied; these are audited and signed off by the Comptroller and Auditor-General. I hope that this reassures my noble friend Lord Leigh on issues of impartiality.
My noble friend also mentioned reporting, particularly that of cases where the court has ordered that disqualified directors must pay compensation to creditors who have incurred losses as a result of the misconduct for
which the director was disqualified. I hope I can reassure him that one of the great strengths of the disqualification regime is its effect as a deterrent. To that end, the Insolvency Service regularly publicises successful disqualification actions to ensure that the message gets out that rogue directors will be held accountable for their actions. Successful compensation order applications will also be extensively publicised where they are likely to enhance the deterrent effect.
I can also assure my noble friend Lord Leigh that the legislation is specific that the court can order that compensation be paid to a creditor or creditors—or even a class of creditors. It is certainly not just for the benefit of one single creditor, such as government over private creditors. I hope that reassures the noble Lord, Lord Fox, as well.
The exact method of seeking compensation would vary from case to case, and can include a situation where a director avoids court by agreeing to an undertaking to pay compensation. However, if the misconduct for which a director is disqualified has caused a loss to a creditor or creditors of an insolvent company or a company that has been dissolved without becoming insolvent, and the person has at any time been a director of that company, the Secretary of State may apply to the court for an order that they pay compensation, as I said earlier.
My noble friend Lord Leigh asked me specifically whether insolvency proceedings would follow investigations in dissolved companies. This seems a fairly unlikely scenario, given the remote chance that there would be assets to recover, and that the company would first have to be restored to the register. However, this mechanism would remain available if it was required. I hope this satisfies noble Lords that the information they seek will be published.
I also add that the Insolvency Service uses the resources it receives to carry out its statutory enforcement function to target cases that are in the public interest and have a realistic likelihood of the investigation resulting in sanctions. The Insolvency Service, BEIS and the Treasury continue to work closely on responding to potential bounce-back loan fraud, including determining the resources required to tackle these difficult cases.
With that, I thank all noble Lords who have contributed to this debate for their interest in the Bill and their amendments. I hope I have been able to reassure them enough for them to feel able to withdraw or not press their amendments.