On 21 December 2021, when the Insolvency Service opened another door on their advent calendar to look into the future of regulation of our glorious profession, they saw the prospect of two things. The much-trailed 'single independent regulator' to take the place of the four existing bodies, and regulating and punishing firms as well as individuals for misbehaviour.
The Insolvency Service are due to announce the reforms next week, but someone has been leaking out of Whitehall and we got a preview of what might be to come over the weekend. Those who were looking at big changes could well be disappointed. Sky News have reported that the announcement from the Service will come nearly two years after a consultation was launched to pave the way for the creation of a new independent regulator to sit within the Insolvency Service, but ...
... it looks as if ministers have decided against establishing a new regulator with a big brush to clear away that part of the job of the IPA, ICAEW, ICAS and ICAI. True, a system providing four regulators for a profession just shy of 1,600 practitioners does seem a little on the heavy side, but the new regulator appears to be out of a job even before getting half a shoe under the desk.
It was always going to be a push to understand the purported remit of 'independence'. Being overseen by the Insolvency Service means (meant) that they would not be truly independent, as the Official Receiver is also part of the Insolvency Service, and the Official Receiver is arguably in competition with Insolvency Practitioners, and is not regulated. (You can begin to understand why the general public who, in any event, cannot see their bankruptcies from their Carillions and who need to be furious about absolutely everything these days, have a problem with our profession.)
One leaky practitioner, whose identity was protected by Sky, said they were surprised that ministers had decided against proceeding with a new regulator. Yet another 'source' said (albeit behind a hand whilst standing in one of those funny little half-streets just off Morrgate) that could yet be an option in the longer term, but would require legislative time.
For now it seems that the new rules governing firms would be implemented and managed by the current quartet of RPBs, including membership of an Insolvency Practitioners' register, the potential implementation of a financial compensation system and that thorny issue of regulating firms as well as individual Insolvency Practitioners.
The package of reforms, to be announced, the NTI newsroom understands, as early as this week, is more leaky than absolute, but you can be sure we will be reporting on it as soon as it lands.