SportsDirect (USC Dundonald)

Debate between Sandra Osborne and Jo Swinson

Tuesday 27th January 2015 Westminster Hall

[Jo Swinson]

I will happily talk to the sports Minister about those issues, and obviously there are specific issues for the Scottish Football Association to consider. Insolvency Service investigators are already in contact with the joint administrators of USC. That is at an early stage because the administration is fairly new, which affects the information that can be provided, but there is a legal duty to provide a confidential return to the Secretary of State about the directors’ conduct. Although the administrators’ view about that is certainly relevant, ultimately their assessment of whether there are grounds for disqualification is based on the Insolvency Service’s independent view and conclusions.

Directors can be disqualified for anything between two and 15 years. It is also worth noting that, in addition to director disqualification proceedings, the Insolvency Service can exercise its powers to investigate any UK company where it suspects misconduct. We are making it easier for disqualification proceedings to be brought where other laws have been broken—it is currently possible, but we want to make it crystal clear that it should be easier. Measures in the Small Business, Enterprise and Employment Bill explicitly state that, in deciding whether someone should be disqualified, the criteria that courts will be required to consider will be extended to include breaches of legislation. That could include health and safety law, immigration law or employment law.

[Sandra Osborne]

I have been listening to what the Minister has said. In my constituency, directors walked away from coal mines leaving £140 million of damage. I have been pursuing that matter with the insolvency people for two years and nothing has happened, so she will forgive me if I am slightly cynical about what she is saying.

[Jo Swinson]

I will be happy to look into the specific issues that the hon. Lady raises. Although the powers already exist, we recognise that making it more explicit that breaches of law can be considered in the disqualification process will make such cases easier. That is why we are changing the law. I will happily look separately at the specific case that she is pursuing.

I turn now to pre-packaged administrations, or pre-packs. They have been discussed in this House on many occasions, because there are understandable concerns about them. In a pre-pack, the sale of the viable parts of an insolvent company’s business is arranged before the administration starts and concludes shortly after the administrator is appointed. In the case we are debating, the administration has allowed the majority of the business, including more than 600 jobs across the UK, to be transferred to the purchaser, Republic, although unfortunately another 84 employees have lost their jobs.

It is important that we establish whether the pre-pack represented a necessary step to save an insolvent business, or if, as has been suggested, it was an abuse of the insolvency process. I reassure hon. Members that officials are looking at that as a matter of urgency. The changes that we are making, following the review of pre-packs by Teresa Graham, will mean that by spring there will be new checks and balances on pre-pack administrations where the sale is to a connected party, so that there is independent evaluation of whether that party is a viable business with a viable underlying business model that will not simply run into the same problems as the business in administration; there will also be evaluation of whether the sale represents the best value.

Oral Answers to Questions

Debate between Sandra Osborne and Jo Swinson

Thursday 10th January 2013 Commons Chamber

[Sandra Osborne (Ayr, Carrick and Cumnock) (Lab)]

3. What her policy is on women’s incomes.

[The Parliamentary Under-Secretary of State for Women and Equalities (Jo Swinson)]

The Government are committed to reducing the pay gap and guaranteeing equal pay for women. The latest figure, based on median earnings, shows that the pay gap continues to narrow and currently stands at 19.7% for all employees, but there is, of course, much more to be done, because the existence of a pay gap is unacceptable.

We are making good progress with “Think, Act, Report”, which promotes gender equality and transparency. More than 60 major companies have signed up to it, representing more than 1.2 million people and more than 11% of the target work force.

[Sandra Osborne]

What assessment has the Minister made of the impact on the retirement incomes of low-paid women of excluding all those who earn less than £9,440 a year from the new workplace pensions? Does she realise that 1 million people who could be saving for the future are being left out in the cold, and that 77% of them are women?

[Jo Swinson]

Saving for pensions is very important. That is why the Minister of State, Department for Work and Pensions, my hon. Friend the Member for Thornbury and Yate (Steve Webb), has been promoting workplace pensions. We are introducing the system gradually, because suddenly having to pay money into their pensions that they have not previously had to pay could have a real impact on people’s current incomes, but our plan is, over time, to ensure that everyone saves for a pension.