Enterprise Act 2002 (Disqualification from Office: General) Order 2006

I was just observing that there are degrees of culpability in personal bankruptcy, and I was about to ask the Minister whether the framework now allows for a graduated response, depending on the level of culpability. My second area of questioning is as follows. When the Employment Act 2002 was introduced, the Opposition were concerned that it could make bankruptcy too easy, and that some people might turn to it as a first, rather than a last, resort. Indeed, the number of personal bankruptcies has risen fast. Just under 14,000 debtor petitions were issued in the first three months of 2006, which is nearly double the figure for the equivalent period last year. It seems that the increase started early in 2004, at about the time the 2002 Act came into force. This has coincided with a period of record levels of consumer debt which, we are told, is now more than £1 trillion. Such a policy therefore comes with ever greater risks, which we discussed in our consideration of the Consumer Credit Bill. Although we understand the laudable objective of encouraging entrepreneurship by reducing the stigma of bankruptcy, we question whether the law of unforeseen consequences is not setting in with a vengeance. If people increasingly take bankruptcy lightly on the basis that they can easily become bankrupt to escape from debt, creditors will be more wary of lending, and lending will become scarcer and more expensive for all borrowers. Perhaps the Minister could comment on this and set my mind at rest. Perhaps he will be able to tell me that in circumstances where people have knowingly run up debts and see bankruptcy as a convenient escape, the system will make them subject to a BRO. My third area of questioning is that, in response to a question from my honourable friend the Member for Wealden, the Minister in the other place said that the European Parliamentary Elections Act 2002 provides that a person should be disqualified from the office of MEP if he or she is disqualified from membership of the House of Commons. Section 426 of the Insolvency Act 1986 provides that a person who is subject to a bankruptcy restrictions regime is disqualified from membership of the House of Commons, so such a person would automatically be excluded from being an MEP. The Minster did not answer my honourable friend’s question about whether equivalent rules covering bankruptcies apply to all MEPs, whichever country they come from, and I would be grateful for his response.