Thu., March 14, 2013
The UK government’s Insolvency Service is all but insolvent, the Financial Timesreported. Experts suggest the group, which polices bankrupt companies, liquidates failed businesses and disqualifies unfit directors, would be broke had it not received an emergency injection of cash from the government. After reporting an underlying deficit of £12m last year, the agency is heading for a deficit of £5m to £7m for 2012-13, according to Whitehall officials. “It is fair to say that if this was a company it would be in deep trouble,” said Adrian Bailey, chair of the parliamentary business committee. The Insolvency Service is dependent on fees and asset recoveries from bankrupt companies and the annual number of bankruptcies has fallen sharply over recent years. Official receivers dealt with 43,594 new cases in the 2011-12 fiscal year compared with 77,898 received in 2009-10. The agency overestimated its ability to recover assets from collapsed businesses through its receivers, known as the Official Receivers.