Monthly Company Insolvency Statistics: April 2023
In April 2023, there were 1,685 registered firm insolvencies, 15% fewer than the previous year (1,988 in April 2022). This was, however, greater than levels recorded during the Government's assistance measures in response to the COVID-19 pandemic and higher than pre-pandemic figures.
In addition, there were 183 compulsory liquidations, roughly double the number in April 2022. The number of forced liquidations has risen from historical lows witnessed during the coronavirus epidemic, partly due to increased winding-up petitions filed by HMRC.
There were also 1,368 Creditors' Voluntary Liquidations (CVLs), 23% lower than in April 2022. The numbers of administrations and Company Voluntary Arrangements (CVAs) were higher than in April 2022.
Source: Insolvency service
Five hundred thirty-one bankruptcies were registered for individuals, 5% lower than in April 2022 and less than half of pre-2020 levels.
There were 2,384 Debt Relief Orders (DROs) in April 2023, 24% higher than in April 2022. Monthly DRO numbers may be volatile at present due to the introduction of new DRO hubs.
There were, on average, 6,336 Individual Voluntary Arrangements (IVAs) registered per month in the three months ending April 2023, which is 16% lower than the three months ending April 2022.
Figure 2: DRO numbers may be volatile due to the introduction of DRO Hubs. Bankruptcies have remained stable since April 2022. IVA numbers in 2023 have been lower than the record-high numbers in 2022. England and Wales, April 2019 to April 2023, not seasonally adjusted.
Source: Insolvency service
Company and Individual Insolvencies in England and Wales
This statistics release shows the number of CVLs, administrations, CVAs, and receivership appointments based on their Companies House registration date; hence, the numbers represent firm insolvency registrations rather than insolvency procedure start dates.
Data on compulsory liquidations is obtained from the Insolvency Service and properly measures the number of new cases each month. Data for the most recent month were pulled from a live system five working days after the end of the month; hence results are preliminary.
In April 2023, firm insolvencies were 15% fewer than in April 2022. The decline in business insolvencies was driven by a decrease in the number of CVLs, the most prevalent kind of firm insolvency, compared to the same month the previous year.
In contrast to the same month the previous year, all other categories of firm insolvency rose. The rise in forced liquidations is partly due to increased winding-up petitions filed by HMRC.
Of the 1,685 registered company insolvencies in April 2023:
From the start of the coronavirus (COVID-19) pandemic until mid-2021, overall numbers of companies were low compared to pre-pandemic levels. This is likely partly driven by government measures to support businesses and individuals during this time. Company insolvency numbers have now returned to and exceeded pre-pandemic levels.
Between 26 June 2020 and 30 April 2023, in England & Wales, 43 moratoriums were obtained, and 21 companies had a restructuring plan registered at Companies House. These two procedures were created by the Corporate Insolvency and Governance Act 2020.
CoCredo UK Credit Reference Agency
Dan Hancocks, MD at CoCredo, says: The business climate still needs to change as companies throughout the supply chain strive to manage increased costs without passing them on to their customers. This task will likely become more challenging with high inflation as the year progresses and prices increase."
“It is uncertain how the increase in interest rates will affect businesses, and the full impact may not be known until later in the year when fixed-term credit arrangements expire. This could cause unexpected credit costs for businesses, especially since inflation is expected to decrease at some point over the next year. As a result, the trading climate may show slight sustained improvement but rather a fluctuation between progress and setbacks.”
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