I have today agreed to the publication of the Insolvency Service’s Corporate Plan for the period 2011-15.
Over the past 18 months there has been a significant fall in the number of bankruptcies which has driven the number of new compulsory insolvency cases dealt with by the official receiver down from 78,000 cases in 2009-10 to an expected level of 45,000 to 55,000 cases in 2011-12. In response to this, the service has cut its costs principally by reducing its staff complement from 3,200 to 2,100 by May 2010.
While this is a significant reduction in capacity in a relatively short time, I am satisfied that the service will be able to maintain the levels of service that it achieved in 2010-11 and so I have decided that the service’s targets for timeliness, customer satisfaction and efficiency should be maintained at 2010-11 levels. The service will aim to achieve a real-terms reduction in insolvency case administration fees of 2.5% compared to last year.
At the same time as insolvency case numbers have fallen, the average value of assets in bankruptcy estates has also fallen, making the insolvency case administration fee more difficult to recover and putting upward pressure on the service’s bad debt position. In response to this, in 2011-12 the service, working with BIS, will review how it raises and collects the case administration fee and whether it is possible to move to a more effective and lower-risk fee regime which is fair to those affected, relying less on internal cross-subsidy and leading to lower fees overall.
Action will continue to be taken against bankrupts and company directors in respect of financial misconduct or dishonesty and the service will continue to investigate the affairs of companies in the public interest. Since 2009 the service has undertaken a stakeholder satisfaction survey of the level of confidence in its enforcement regime, achieving an overall confidence level of 68% and 64% in the two surveys to date. I have asked the service to explore what drives this confidence level so as to facilitate work towards a return to a 68% confidence level during 2011-12. I have also set a timeliness target in relation to the instigation of disqualification proceedings against company directors in appropriate cases.
I have set the service targets in relation to the timeliness of releasing reports to creditors in insolvency cases, and of processing claims for redundancy payments. I have also asked the service to at least maintain the overall satisfaction levels of its principal customers and users.
The corporate plan will be available from today, 5 July 2011, at:
http://www.insolvency.gov.uk/aboutus/CorporatePlan.pdf. Copies of this document will also be placed in the Libraries of both Houses.
Insolvency Service Published Targets
User satisfaction levels as measured through the Agency User Satisfaction Index1
Level of real term reduction in fees for insolvency case administration
Percentage of reports issued to creditors within eight weeks
for bankruptcy cases
for company cases
Stakeholder confidence in the Insolvency Service’s enforcement regime
The average time from insolvency order to the instigation of disqualification proceedings in appropriate cases
Action redundancy payment claims
within 3 weeks
within 6 weeks
1This is a combined indicator covering bankruptcy and redundancy cases.
In addition to these targets the service is required to meet Government-wide targets relating to replying to correspondence from Members of both Houses of Parliament, and making payments to suppliers, as follows:
Reply to correspondence from Members of Parliament within 10 days
Process payments to suppliers within 30 days
The Government have also instructed Departments and agencies to maximise levels of payment of undisputed invoices within eight days.