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Contingent Liability Notification: British Steel

Volume 660: debated on Thursday 23 May 2019

Today I lay before Parliament a departmental minute describing a contingent liability arising from an indemnity for the official receiver acting in the insolvency of British Steel Limited.

It is normal practice when a Government Department proposes to undertake a contingent liability of £300,000 and above, for which there is no specific statutory authority, for the Department concerned to present Parliament with a minute, giving details of the liability created and explaining the circumstances.

British Steel Limited entered into liquidation on 22 May 2019. The official receiver has been appointed as liquidator and the Department for Business, Energy and Industrial Strategy has provided him with an indemnity in respect of:

carrying out the proper performance of the official receiver’s duties as liquidator of the company: and

maintaining, securing and funding the ongoing operation of the company’s undertaking, and distributing the assets of the company in the ordinary course of the official receiver’s duties as liquidator of the company.

It has not been possible to observe the usual waiting period for this contingent liability, since it only materialised when the company entered into liquidation yesterday morning.

HM Treasury has approved the proposal in principle.