Business failures set for record high in 2023, warns insolvency expert

An insolvency practitioner of one of the UK’s leading accountancy firms has predicted the number of company insolvencies in England and Wales will set new records during 2023.
Michael Crossland
By Michael Crossland
Published 2nd May 2023, 16:45 BST

The warning comes as the latest quarterly insolvency statistics for January to March 2023 reveal there were 5,747 company insolvencies in England and Wales, 18 per cent higher than the same period in 2022.

Notably, there were 4,739 creditors’ voluntary liquidations, close to the highest quarterly level since records began in 1960. There were 652 compulsory liquidations, 318 administrations, and 38 company voluntary arrangements.

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Richard Oddy, restructuring & insolvency director at accountancy firm Azets in Yorkshire, said: “Government financial support during the pandemic led to a significant reduction in corporate insolvencies.

Figures show 4,739 creditors’ voluntary liquidations in quarter one of 2023, close to the highest quarterly level since records began in 1960.Figures show 4,739 creditors’ voluntary liquidations in quarter one of 2023, close to the highest quarterly level since records began in 1960.
Figures show 4,739 creditors’ voluntary liquidations in quarter one of 2023, close to the highest quarterly level since records began in 1960.

"Last year, insolvencies reached the highest level since 2009. If this continues to increase at the same rate as seen in quarter one of 2023, corporate insolvencies will be even higher during 2023.

“Businesses are continuing to operate in a challenging environment as inflation remains high and interest rates continue to rise. As a result, cash will become tight for many more businesses due to increased finance costs and increased costs of supplies.

“Furthermore, the Energy Bill Relief Scheme ended in March, so businesses will face a further increase in energy costs and we expect to see far more casualties in certain sectors.”

Related topics:EnglandWalesGovernmentYorkshire