Minister of state urges introduction of Limited Liability Partnerships Bill after CIC chief expresses concern.
The cabinet office this week reassured the Construction Industry Council that a bill to rejig the rules on the professional liability of consultants working in partnerships will be brought forward in the current parliamentary session.

Minister of state at the Cabinet Office, Charles Falconer, wrote to CIC chief executive Graham Watts last Friday endorsing the council’s view that the Limited Liability Partnerships Bill should be introduced as soon as possible.

The proposed legislation requires consultants working in partnerships to have more transparent operations and finances, and makes partners liable for debts, both individually and as a group.

Watts had written to the Lord Chancellor, Lord Irvine; Leader of the Commons, Margaret Beckett; and ministers at the Department of Trade and Industry and the DETR last month, expressing his concern that the LLP bill was in danger of being edged off the legislative schedule by a bill to regulate e-commerce.

In a letter to the Lord Chancellor on 28 May, Watts wrote: “It would be highly regrettable were this measure delayed or lost at this late stage – especially in view of its potential benefits and its non-controversial nature.” The draft bill was approved by the Commons Trade and Industry Select Committee in February this year.

Falconer quelled these fears in last week’s letter. “As with all legislation, the Limited Liability Partnership Bill must find a suitable opportunity in the legislative programme, against other pressing priorities,” he wrote. “That the bill has been subject to pre-legislative scrutiny, however, is a good indication of the seriousness with which this measure is being pursued.” Falconer added: “Ian McCartney, the minister in the DTI who leads on the bill, is hopeful that we may yet be able to introduce it in this session.“ In the letter to the Lord Chancellor on 28 May, Watts had urged him to give the bill priority over the e-commerce bill in the parliamentary schedule, since it was ready for its first reading.

Watts outlined the following benefits of the bill:

  • partnership practice would be encouraged in areas of activity where it is now discouraged by the overhang of the liability of individual partners for the partnership as a whole
  • potential clients would benefit from a wider range of partnerships
  • potential partners will no longer be deterred by their personal liabilities.