Company insolvencies hit highest levels since global financial crisis
Company insolvencies in England and Wales in the second and third quarters of 2023 have hit their highest since the global financial crisis in 2009, the Insolvency Service (IS) has revealed.
The 6,208 (seasonally adjusted) registered company insolvencies between 1 July and 30 September 2023 comprised 4,965 creditors’ voluntary liquidations (CVLs), 735 compulsory liquidations, 466 administrations, 41 company voluntary arrangements (CVAs) and one receivership appointment.
“The number of compulsory liquidations and administrations increased to levels last seen before the Covid global pandemic,” the IS said in a statement. The number of CVLs were the highest seen since the start of the quarterly insolvency reports in 1960, it also said.
The five industries that experienced the high number of insolvencies in the 12 months ending Q3 2023 were:
- Construction (4,276)
- Wholesale & retail trade; repair of motor vehicles & motorcycles (3,777)
- Accommodation & food service activities (3,477)
- Administrative & support service activities (2,282)
- Manufacturing (1,911)
In Scotland, legislation relating to company insolvency is devolved, and the Accountant in Bankruptcy administers insolvency there. In Q3, the IS said, there were 296 total company insolvencies in Scotland, 7% higher than in the same quarter of 2022 and also higher than pre-pandemic. These latest insolvencies were made up of 107 compulsory liquidations, 174 CVLs and 15 administrations. There were no CVAs or receivership appointments, the IS said.
In Northern Ireland, company insolvency is governed by separate “but broadly similar” legislation to England and Wales. Northern Ireland saw 62 company insolvencies in Q3 2023, a 24% increase from the same quarter of 2022. This comprised 30 compulsory liquidations, 23 CVLs, eight CVAs and one administration. There were no administrative receiverships.
Company insolvencies in Northern Ireland remained lower than pre-pandemic levels, the IS said.
IS noted that company insolvency data were sourced from Companies House except for compulsory liquidation data for England and Wales, which were sourced from the IS itself. Compulsory liquidation data for Northern Ireland were sourced from the Department for the Economy.
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