IPA President’s comments: Insolvency Service Monthly Insolvency Statistics, August 2023

18 September 2023

Paul Davis, IPA President; Partner, Opus Restructuring and Insolvency

The latest statistics show increasing company insolvencies by 19% when looked at compared to the previous year in August 2022. Administrations and liquidations, both voluntary and compulsory, are at higher levels than a year ago. This suggests an increasing trend following the increases in July.

This shows that businesses are facing increasing difficulties due to higher interest rates and tightening consumer spending due to the cost-of-living crisis.

HMRC winding-up petitions are also considerably higher than in previous periods and appear to be returning to pre Covid-19 levels as it looks to collect tax revenue.

Whilst total personal insolvencies are 11% lower than in the previous year to August 2022, I would expect to see a return to increasing numbers in Q1 next year as people again need to turn their heating on and those with fixed rate mortgages either go onto variable rate or need to take out new fixes at higher rates. I would expect to see more credit card defaults. These costs will take an increasing toll on household spending.

We are also seeing a greater use of Breathing Space and Mental Health Breathing Space registrations. This causes a lag on personal insolvencies.

For any directors or individual experiencing difficulty, my advice is to seek help and speak to a licenced insolvency practitioner.

View the Insolvency Service Statistics here.