To what extent the increases can entirely be attributed to the pandemic is unclear, but the latest figures show that bankruptcies rose by 34% in September when compared to the previous month. In total there were 1,036 bankruptcies – 963 debtor applications and 73 creditor petitions.
There was also a 14% month-on-month increase in the number of Debt Relief Orders, where the total for September stood at 1,527.
Company insolvencies also increased by 19% in September, when compared to August. The total figure for company insolvencies during September was 926, comprising 742 creditors’ voluntary liquidations (CVLs), 44 compulsory liquidations, 109 administrations and 31 company voluntary arrangements (CVAs).
There was, however, a decrease in the number of individual voluntary arrangements (IVAs), based on a three-month rolling average basis. There was an average of 4,639 individual voluntary arrangements in the months from July to September, which is 5% lower than the average for June to August. It is also 38% lower than the equivalent figure for September 2019.
Colin Haig, president of insolvency and restructuring trade body, R3, suggested that Covid-19 had some impact on the increases, but that the Government’s financial support was still acting as a mitigating factor.
Mr Haig commented:
“These results show that the toll of the Covid-19 pandemic is taking on businesses and consumers may be starting to be felt in the official insolvency numbers, but the government’s support measures have reduced the size and scale of the initial impact.
“Despite the increases, today’s figures are still lower than pre-lockdown levels of insolvency and don’t fully reflect the health of businesses and the economy in the way they would normally.”
The information shown in this article was correct at the time of publication. Scott Robert’s articles are not routinely reviewed and as such are not updated. Please be aware of the facts, circumstances or legal position may change after publication of the article