Overall number of insolvencies remains low
Many peoples perception is that, due to the current economic climate, the number of insolvencies will be at a high level. However, the most recent report from The Insolvency Service shows that overall they are down, when compared to last year.
“The overall number of company insolvencies decreased by 42% in October 2020, when compared to the same month last year. This was primarily driven by a decrease in the numbers of CVLs and compulsory liquidations which fell by 36% and 76% respectively. The number of companies entering administration in September 2020 also fell when compared to the same month last year by 35%. CVAs fell by 42% in October 2020 in comparison to the same period last year.”
The Insolvency Service believe this was likely to be at least partly driven by government measures put in place in response to the coronavirus (COVID 19) pandemic.
Some of the temporary measures put in place will cease to have effect by 31st December 2020 and businesses should now be considering their options heading into the new year.