Insolvency practitioners (IPs) could be supervised by a single regulator after cabinet minister Edward Davey refused to rule out the idea.
Davey said that responses to a consultation on reforms to the regulation of insolvency practitioners had demonstrated strong support existed for the idea.
In his own response to the consultation, Davey said the idea of a single regulator had merit and was something he had not ruled out.
“However we wish to work with the profession and interested parties to see if there is a way to reform the system so that it delivers better against our objectives without such significant change,” he said.
If introduced, a single regulator would provide a single point through which insolvency practitioners could be licensed and supervised. This work is currently carried out by eight recognised professional bodies (RPBs).
Frances Coulson, president of insolvency trade body R3, said: “The insolvency profession looks forward to working with the minister to consider an independent single regulator while strengthening and simplifying processes for handling complaints.
“We recognise the frustrations of unsecured creditors at not receiving the returns they expect and look to greater engagement in the insolvency process. We share the minister’s aim to ensure the regulatory regime is transparent, consistent, accessible, independent and accountable.”
It comes after the Insolvency Service (IS) published the responses to its consultation on the proposed reforms to the current structure.
The three-month process, launched in February, invited views on whether the creation of an independent complaints body would improve confidence in the handling of complaints and appeals.
The IS received around 55 answers were received by the IS, and according to the consultation, many IPs were ‘generally not persuaded that fundamental changes to the present regime are justified’.
Davey also explained the IS intends to bring forward proposals to remove the Secretary of State from the process of authorising IPs, and set out plans to cut down the current role of the Insolvency Practices Council (IPC).
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