News
CREDIT CRUNCH
The number of companies in administration rocketed up 54% in the first quarter of this year, compared to the previous three months, new figures show. The statistics from the Insolvency Service shows that the number in administration— which typically involve larger corporate entities—rose from 557 in Q4 2007 to 858 in Q1 2008. Ken Baird, head of restructuring and insolvency at Freshfields, says the credit crunch—now in its 10th month—has caused a sharp reduction in the availability of credit and higher loan costs, factors which have drained much of the liquidity available within the market. “This has triggered a marked downturn in fortunes across sectors with companies that were already under financial pressure being among the first to throw in the towel,” he says.
BICHARD BOWS OUT
Sir Michael Bichard, the chairman of the Legal Services Commission (LSC), plans to stand down from his role at the end of August, it has been announced. He will take up a new post as director of a new institute for government, funded by the Gatsby Charitable Foundation, in September. A recruitment exercise to find a new LSC chairman will be launched shortly.
STATS MY BOY
The Bar Council has recruited an economic statistician in its bid to come up with a workable alternative to the Legal Services Commission’s (LSC) very high cost criminal cases scheme. Professor Martin Chalkley has been analysing complex LSC data for this process as the Bar strives to find a scheme which allows the ablest barristers to undertake these difficult cases; on a fee basis which does not contain what the Bar describes as “perverse incentives” and not on an hourly rate; and which delivers within budget. Members of the Bar and the Law Society have met ministers and senior LSC staff in a bid to hammer out a deal, hopefully by the end of June. So far, only 110 barristers and two QCs have signed up to the existing scheme.
