Fast-tracking permanent changes to the law is “inappropriate”, says Constitution Committee
12 June 2020
The Constitution Committee has published a report on the Corporate Insolvency and Governance Bill.
- Report: Corporate Insolvency and Governance Bill (HTML)
- Report: Corporate Insolvency and Governance Bill (PDF)
- Select Committee on the Constitution
The Corporate Insolvency and Governance Bill aims "to provide businesses with the flexibility and breathing space they need to continue trading" during the challenges created by the COVID-19 pandemic. It is being fast-tracked through both Houses.
In its report the Committee highlights key concerns and observes that:
- The Bill is being fast-tracked which constrains parliamentary scrutiny and restricts input from stakeholders and the public. While temporary measures to respond to the COVID-19 pandemic may meet the threshold of urgency and exceptional circumstances to warrant fast-tracking, it is inappropriate for the permanent changes proposed in this Bill to be fast-tracked.
- The Bill includes provisions which apply retrospectively. Such provisions are generally regarded as inconsistent with the rule of law and are "inherently constitutionally suspect". The Committee recommends changes to ameliorate the effects of these provisions and calls on the Government to justify their retrospective application, including an assessment of their compliance with the rule of law.
- Clause 18 includes a Henry VIII power to modify all "corporate insolvency or governance legislation" using the made affirmative procedure – such that changes to the law are made immediately and only have to be approved by Parliament afterwards. The Committee recommends that this power is constrained so that it can only be used where such urgency is justified, and that the power expires and cannot be renewed repeatedly.