Insolvency

Kirsty Blackman Excerpts

Wednesday 28th April 2021 Commons Chamber

[Kirsty Blackman (Aberdeen North) (SNP)]

It is a pleasure to follow the right hon. Member for South Northamptonshire (Andrea Leadsom). To pick up her comments, it is incredibly important that we look at the future of corporate governance and audit. We must make sure that the report is looked at carefully so that decisions are made to ensure not just that investors can scrutinise those organisations but that consumers can do so and work out whether or not they want to be involved in them on the basis of their annual report and audit. People would get a better idea of the risk they would be under if those processes were more open and transparent. I therefore agree wholeheartedly with the comments made by the right hon. Lady.

On the Corporate Insolvency and Governance Act 2020, there is an extension for some of its provisions to the end of June this year, and an extension to September for other provisions. I am concerned that there have been so many extensions—30 June is very soon—that the Government will end up having to come back with another extension. Even if the pathway that has been laid out by the Prime Minister comes to fruition, and even if we end up with pretty much everything going back to normal in some ways by the end of June—I doubt that we will, by the way—it will not be a five-minute job for businesses to recover. They will not be back on their feet immediately; they will not suddenly make up the money that they have spent, or pay back the loans that they have had to take out during this period. They will not even be able to take back all their employees full time if social distancing continues, for example. I am concerned that there is not enough time, and if the Government intend to make a further extension, it would be useful for those organisations to be aware that that extension is likely. I would prefer such an extension to have been made already, but an extension to September for all the measures would have been slightly more helpful.

We have spoken about the impact on companies, but insolvency also has an impact on the supply chain. In particular, self-employed individuals have been missed out of the furlough scheme, and if some of those organisations go under, they are more likely than others to be hit as a result of their being part of that supply chain and their role in supporting those businesses. We are looking at the big picture, which is great, but I am concerned that there is not enough focus on the knock-on impact, particularly on those groups that have been missed out and have been hit particularly hard by the pandemic.

I am a representative for Aberdeen, and we have had a triple whammy of Brexit, covid and the reduction in oil prices in recent times. That affects not just the big companies making megabucks profits in the oil industry, but the smaller companies that are producing tech for renewables as well as tech for oil and gas extraction. We do not want to lose that intellectual property—that tech—in renewables, and we must ensure that support continues to be available, so that if big organisations fail, despite what the Government have put in, smaller companies can keep going if they have the potential to become profitable in future.

It would be useful if the Minister reassured me that the Government are not just looking at the big picture but paying attention to the smaller organisations that may not be covered by the measure, particularly in the light of the concerns that we have expressed on numerous occasions about self-employed individuals being missed out from the furlough schemes. We are concerned that they may be missed out when we look at the future of this as well.