Treasury Minister Dr Andrew Leigh has spoken of the merits and the need for data to assist in shaping government policy and action, given in a speech to the Public Sector Data Sharing Network on 16 September 2025 – Data without borders: sharing for smarter policy, Address to the Public Sector Data Sharing Network | Treasury Ministers.
The message was positive but it seems that the operation of the Data Availability and Transparency Act 2022 which seeks to authorise the sharing, collection and use of public sector data, has faltered. It is currently under review and difficulties in using the Act have led to only a narrow base of usage, apart from the inherently challenging scope of the project itself: **.
While there has been much criticism of the lack of good insolvency data, its collection probably won’t rate, when in competition with the need for data on human health, education and climate, which would understandably take priority.
Insolvency reform, if any, may have to rely on what is now available, supplemented by surveys, submissions and, if possible, data held by practitioners themselves.
Australian Bureau of Statistics
Among many topics, Dr Leigh refers to the ABS as a ‘world leader in data linkage’, referring to the Person Level Integrated Data Asset (PLIDA) and the Business Longitudinal Analysis Data Environment (BLADE). PLIDA safely links 37 datasets spanning the Census, tax returns, welfare payments, migration, health, education, disability, and state-level data such as crime, courts and corrections.
As an example, linking the Pharmaceutical Benefits Scheme with PLIDA identified five previously unrecognised medicines associated with heart failure, leading to regulatory action.
In a business context, Dr Leigh refers to BLADE linking taxation, trade, intellectual property, employment and insolvency data with ABS survey data,
“creating a rich resource for understanding business performance and productivity” informing “our understanding of entrenched disadvantage, business dynamism, health and skills …”.
Merger reform
As another example, Dr Leigh has explained how our recent merger reform is based on Australia’s first economy-wide merger database which usefully shows that “it’s the big end of town doing the buying, and the mid-tier firms doing the selling”.
This evidence underpins the reforms to merger laws and thresholds, evident in the Treasury Laws Amendment (Mergers and Acquisitions Reform) Bill 2024’s Explanatory Memorandum.
And without that data, as Dr Leigh says,
“we might still be debating merger reform in the dark”.
Legislating in the dark
Without distracting from his valuable message, this coincides with my forthcoming podcast for INSOL International on numerous issues I have raised about the low standard of data available on the insolvency system in Australia, as to which I have often referred to an IMF paper’s “legislating in the dark” theme. [1]
Inadequacy of insolvency data has been the subject of critical comments over the years, including, most recently, the 2023 PJC Report on Corporate Insolvency.
A brief summation is that the standard of empirical financial data we have in support of the insolvency system leads to the view that we are often “legislating in the dark”, as the IMF paper describes it, without assurance that the reform is necessary and well directed. That is compounded by a lack of attention to the collection of data in order to monitor the effect of any reform.
Economic and social data
We can take some comfort that good economic and social data is collected, by the Reserve Bank, the Productivity Commission and more, evident from their reports on firm entries and exits, their size, industries and regions, no doubt sourced from BLADE and other government data.
In the insolvency context, the Reserve Bank has reported findings that over 90% of displaced employees are re-employed by another business within a few months or have been retained, and they have been able to recover their pre-insolvency earnings within a year.[2]
Similarly, the Productivity Commission refers to US studies showing that laid-off workers often found new jobs at more productive firms and that the relatively high rates of US labour ‘churn’ after the COVID-19 pandemic potentially assisted productivity growth.[3]
The pros and cons of competition’s impact on business survival, weighing employee and business disruption against the merits of business dynamism are very useful in setting the aims of insolvency law, and restructuring, the latter in so far as it impacts upon competition policy.
Granular data is limited
On a more granular level, insolvency data is limited, this despite the empirical nature of much insolvency data.
ASIC data is available as to numbers of liquidations, voluntary administrations etc, data rather dismissed by the IMF as being only available
“at a very high level of generality … [giving] a broad-brush view on the financial health of the economy. … The data on gross numbers of liquidations or debt restructurings does not, however, provide insight on how the legal and institutional framework for insolvency is performing”.
One exception might be the large increase in Part 5.3B restructurings since their introduction in 2021.
Similarly, AFSA’s personal insolvency data is presented in relation to the numbers of bankruptcies, debt agreements, etc, again useful for trends but for law reform we need more. Although it is of law reform significance that personal insolvencies at around 12,000 in number annually are well below their historical average of 19,000, and far below the 37,000 during the GFC.
AFSA’s annual data is useful as to the value of assets realised, costs, dividends paid, government charges levied and rates of return, but this data has stagnated and needs to offer more.
In contrast, ASIC’s data has improved with its new dataset from 2021–2022 providing significantly greater transparency by breaking down information on appointment type, industry, and other key variables that were previously harder to access. [4] This level of detail enables researchers, policymakers, and practitioners to better understand patterns in corporate insolvency activity and to make more informed decisions.
The IMF paper also makes the obvious point that data can direct law reform and it can also confirm or otherwise its merits. There are plenty of examples of law reform proceeding both without access to any data to substantiate it, and then without any monitoring of its effectiveness, if any.
Even more so, it can be based upon
“unsystematic data, such as bureaucratic value-judgments, anecdotal data or information based on expert opinion”, pursued by bureaucrats with their “whiteboards”.
What is needed in particular is data connecting personal and corporate insolvency in the small business sector. One impediment, the separation of personal and corporate insolvency policy in government, has been removed but other hurdles remain.
One difficulty there is that data on small business is itself limited and complicated by the various definitions of “small business”.
Repetition
But I am repeating myself – so take your pick: Search Results for “data ” – Murrays Legal
Just as each insolvency reform inquiry over the years has repeated the same message, the history of which is laid out in a letter from a number of insolvency academics to the Office of the National Data Commissioner, in October 2019.[5]
This letter, provided to the 2023 PJC Inquiry, relayed concerns about the lack of data expressed by the 1988 Harmer Report, the 2004 Stocktake Report, the 2010 Senate report, and now the 2023 PJC Report, with others in between.
In the midst of that time period, there was a missed opportunity in 2010 to merge the collection of personal and corporate insolvency data with the government rejecting a proposal for the joint collection of personal and corporate insolvency data.
Do with what we have
All this might suggest that there will never be relevant data and we might as well live with a regime that relies for its credibility on what we have – industry comments, surveys, submissions, and what seems like a good idea at the time.[6]
The difficulty is that insolvency is too much based on theoretical ideas as to how the system should work – for example, if a creditor receives a preference, that should be repaid to go into the pool of funds for all creditors. The evidence suggests that this rarely happens, rather the funds go to recoup the unmet remuneration of the practitioner.
Which brings in a further issue that, as Professor Jason Harris found when he looked at the figures, that
“Australia has a system that is barely supported by the assets of companies that enter external administration, and certainly is not designed to produce meaningful recoveries for unsecured creditors”
leading to a question whether liquidation is a process mainly for the benefit of the ATO and the government such that,
“why doesn’t the government pay for it?” Corporate insolvency by the numbers | Australian Insolvency Law
Role for the industry, or profession?
Important as insolvency might be to some, it may well be of low priority for government which, while it is remiss in not responding to the PJC Report, might well notice that industry’s response to the report has been limited.
Apart from the efforts of academics and others, an option then might be that if there were any professions involved in insolvency practice, they might through professional co-operation and academic assistance, extract the considerable amount of data held by practitioners themselves, which would at least provide the transparency we need, to really show how the system works.
Regardless, the answer, and necessary transparency, will probably come from AI, sooner than later.
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** Statutory Review of the Data Availability and Transparency Act 2022 – Draft Findings and Recommendations, July 2025.
[1] See my ‘The dark figures of insolvency’ (2009) 10(1) INSLB 7, which traces the largely failed efforts by government and regulator inquiries over time to collect and analyse relevant data.
[2] Financial Stability Review, Reserve Bank of Australia, April 2025
[3] Productivity Commission, Quarterly productivity bulletin – March 2025, p 5.
[4] ASIC ‘Insolvency Statistics (Current) – Series 1 and Series 2’.
[5] Response to Discussion Paper and Privacy Impact Assessment about Data Sharing and Release reforms, October 2019
[6] Valuable approaches to analyses of the insolvency system are discussed in Small to Medium Enterprises: Destined to Fail or Supported to Thrive? … PhD Thesis, Dr A J Bull, 2025.
