Insolvency Service to cut 60 debtor petition staff posts

Prospect is in consultations with the Insolvency Service over a decision to reduce the number of debtor petition staff by a third.

Sixty roles are at risk of redundancy, and the union is currently talking to management about redeploying as many of these posts as possible.

National secretary Geraldine O’Connell pointed out that flaws in the funding regime for the Insolvency Service have led to fewer individuals using bankruptcy orders through the organisation.

Prospect also raised criticisms of how the Official Receiver Offices are funded in its evidence to the Commons Business Innovation and Skills Committee select committee in February. Under the current system, a flat-rate fee is charged for every petition undertaken by the service.

O’Connell said: “The Official Receiver Offices provide a vital service to the business community and the public in investigating bankruptcies and liquidations. They do so by identifying where the government can recover monies for the benefit of creditors.

“But on the downside, their fees have to be recovered from assets retrieved through bankruptcy orders, which are often insufficient to meet the total costs involved.”

She pointed out: “The government’s austerity measures have already reduced the Insolvency Service’s capacity to deal with insolvency cases by more than 25 per cent. We are currently arguing that where debtor petition staff have been declared surplus, their skills should be redeployed and used to assist in company investigation work and other duties.”