Written question asked by Lord Sharpe of Epsom (Conservative) on Thursday, 23 July 2026, in the House of Lords. It was due for an answer on Thursday, 6 August 2026. It was answered by Baroness Lloyd of Effra (Labour) on Monday, 3 August 2026 on behalf of the Department for Business, Innovation, Science and Trade.

Insolvency

Question: To ask His Majesty's Government, further to the remarks by Lord Leong on 21 July (HL Deb col 1070), what assessment they have made of whether commercial contracts subject to sections 233, 233A and 233B of the Insolvency Act 1986 are treated differently to other creditors.

Answer: All creditors in an insolvency are treated equally in their class according to a strict statutory priority. Without the provisions in sections 233 to 233B Insolvency Act 1986, essential suppliers could demand payment of existing debt, thereby undermining this priority. The provisions strike an important balance between the rights of the supplier and the benefits of business rescue, with mitigations included to prevent hardship. A 2023 review of the provisions found early positive signs that they are meeting their objectives and produced an estimated ongoing annual benefit to business creditors from increased company rescue of £73.2m.

Secondary information

Type: Written question
Reference: HL2756
Session: 2026-27
Related items: Commercial Payments Bill [HL]
Tuesday, 21 July 2026
Proceeding contributions
House of Lords
Subjects: Insolvency
Legislation: Insolvency Act 1986
Link: View this Written question on www.parliament.uk