House of Lords on Tuesday Nov. 23rd.

Apologies - 10 + apologies received
Present : Sabine McNeill [Co-ordinator]; Donald Martin [Chairman];
Christopher Stockwell (Speaker), Lord Ahmed (Host); Lord Sudeley (Adviser); Lord Caithness (Adviser); Lawrence Bloom (Adviser); Canon Peter Challen [Minute Secretary]; Dr. John Courtneidge; Keith Whincup [SAFE]; Shard Duhart; David Schoibl; Nathaniel Rohde for Tim Lawson-Cruttenden [Lawyer]; Damian Mearns; Tony Pritchard; Judith; Tony Chevasse; Shaheen; Flora Kerrigan; Mary Fee; Benedict Goldsmith; Bob Arnold; Cllr Andrew Creery; Peter Browne; Francois;
Tarak Diwany; MA Ghamen; Neil Bhatier; Karam Bawany. (29)

Among our purpose is to fashion a 'Banking 2000 - Miscellaneous Provisions Bill'.

And to do so in our agreed context, recited at each gathering; to which we added this time: * Maximising Personal Responsibility

The Chairman drew out the interests in the assembly,  and Sabine led us through the developments of the Forum's activities and the green leaflet defining many of the issues.
We are considering 3 distinct issues that require legislation:-
1) protection of bank victims
2) legislating the lenders
3) regulating Company administration, Bankcrupty and Insovlency
procedures that may be derived from amendments to the Queen's Speech.

Christopher Stockwell presented his paper, promoting changes in the law governing bankruptcy [described by one as 'stunning' and another as 'both depressing and inspiring'.]                    He spoke of 3 stages:
1. PRE-BANKRUPTCY
Distinguish between the insolvent who has caused a loss to themselves and others, and the insolvent who has become so while being entirely honest. The liability should be proven beyond all doubt and to be the direct consequence of the individual's own actions.
There should be a requirement introduced into the law that those
petitioning for the bankruptcy have to prove to the court that bankruptcy is likely to produce a better result for creditors than an Individual Voluntary Arrangement [IVA].

2. DURING BANKRUPTCY
It should only last a  year, as in the USA.
Bankrupts must be allowed a bank account in the period - possible
in law, but not followed by most banks.
If bankrupt not guilty of dishonesty he should be allowed to serve as
a company director or a trustee or on a public body.
Pensions should not be forfeited .

3. POST BANKRUPTCY
This is the most unsatisfactory stage. Discharge should be the END.
They can be lawfully hounded indefinitely by Trustees in Bankruptcy.
Fees must be regulated. Fees taken by insolvency practitioners leads to a great injustice.

General point:
'Penalty clauses' dressed up as 'incentives' should be identified and
made unenforceable in English courts. We should acknowledge that most bankrupts are honourable people.

CORPORATE BANKRUPTCY
The consequences of corporate insolvency are usually completely
disproportionate to the indebtedness, and the bankruptcy has
extensive knock on effects in terms of unemployment and seizure of assets.

There should be strict rules on the way in which banks and other
substantial creditors can behave in a situation of corporate insolvency.
Those rules should require the bank to give the directors a substantial notice of their intention to call in loan at facilities or guarantees and that there should be a court supervised process to enforce the banks and creditors of the company to make a realistic assessment of the company's prospects with a view to sharing the pain in advance of bankruptcy and with the intention of maintaining the company as a going concern rather than pulling the rug from under it.

In sum, Christopher is in favour of restricting the ease with which
bankruptcies or company administration can be sought, preferably reducing the time spent in bankruptcy (hard to see what is achieved by making it last three years), requiring creditors to seek an alternative arrangement to bankruptcy, and keeping pensions out the bankrupt estate. 

The rights of a well funded institution like Lloyds to abuse
its powers need careful restriction with the new guidelines aimed at
preventing penalty clauses being dressed up as incentives. 
There should be regulation of the fees of Insolvency Practitioners and that if, as a last resort someone is made bankrupt, his discharge should be an end to the matter.

The story that Christopher unfolded was of astonishingly poor law and of ineptitude or fraud. Much needs to be changed.
The description of Lloyds as 'stupid gentlemen and sharp barrow boys' seemed sadly apt to the story that we heard.

It led to lengthy and detailed discussion which the Steering group will
take into its thinking about out-comes and their impact on the type of
Bill(s) proposed.

New books by Richard Douthwaite, 'The Illusion of Growth' and
'The Ecology of Money' from Green books & the Schumacher Society; and Bishop David Jenkins' 'Market Ways and Human Wherefores' were recommended.

Please send additional reflections to me before the next gathering. (see above).

I also like to have apologies that indicate continuing interest and support even when attendance is not possible.

Other regular London meetings continuing the debate are open to you  and to others YOU invite:-
- The Global Cafe every Wednesday 11-1
- The Clink Debtors prison meeting on Thursday 9th December  6-8  - ask me for details of an unusual venue.

If you do not wish to be kept on the list for notes of these explorations, please let me know.

Peter