Insolvencies of companies in England and Wales, rose in November to their highest level since January 2019; before the coronavirus pandemic hit the UK shores.
The Insolvency Service reports that there were a total of 1,674 registered company insolvencies in England and Wales last month. November’s record high figure was up from the 1,405 company insolvencies registered in October.
November’s tally was 88% more than the same time a year ago, and 11% more than in November 2019 – pre-pandemic levels.
The number of creditors’ voluntary liquidations (CVLs) – where a company chooses by itself to put itself into liquidation because it cannot pay its debts, more than doubled on an annual basis.
Difficult COVID-19 Situation
Christina Fitzgerald, vice president of insolvency and restructuring trade body R3, said:
“The monthly increase in corporate insolvencies has been driven by a rise in Creditor Voluntary Liquidations (CVLs) to the highest number in more than two and a half years.
“The increase in the use of this process suggests that a rising number of company directors are choosing to close their businesses, perhaps because they feel that survival is impossible in the current climate.
“Times are tough for businesses in England and Wales as the pandemic continues to take its toll on the economy and the firms that drive it. Over the last few weeks, businesses have been hit by the triple whammy of increased costs, supply chain issues and rising COVID cases.
“They have also been operating in the face of low consumer confidence and anaemic economic growth in recent months, which, coupled with an increasingly difficult COVID situation, has led to changes in people’s shopping and spending habits and taken its toll on revenue levels.
In Scotland, it was a similar story. Company insolvencies in Scotland increased last month to their highest level since monthly records began in January 2019.
