The January to March 2020 (Q1) company insolvency stats for England and Wales have been published by The Insolvency Service, together with related figures for Scotland and Northern Ireland.
Company insolvency statistics for England and Wales – Q1 2020
In England and Wales in Q1 2020, there were a total of 3,883 company insolvencies, including:
- 2,708 creditors’ voluntary liquidations (CVLs)
- 701 compulsory liquidations
- 404 administrations
- 69 company voluntary arrangements (CVAs)
- 1 receivership
Total company insolvencies in Q1 2020 decreased by 8.5 per cent from Q4 2019 and decreased by 8.5 per cent from the same quarter in the previous year. Except for compulsory liquidations, which increased by 1 per cent when compared to Q4 2019, there were quarterly decreases in all types of company insolvency.
However, while the statistics cover the period up to, and including, 31 March 2020, The Insolvency Service suggests that they largely predate the emergence of and response to the Coronavirus (COVID-19) pandemic. Individuals, insolvency practitioners, intermediaries and courts may have been unable to process insolvencies in the usual manner during the latter part of March and therefore some caution needs to be applied when interpreting trends.
Liquidation rate statistics for England and Wales – Q1 2020
In the 12 months ending Q1 2020:
- 1 in 246 companies were liquidated
- the company liquidation rate was 40.7 per 10,000 active companies in England and Wales
- the company liquidation rate was slightly down from 42.1 per 10,000 seen in both the 12 months ending Q4 2019 and the same quarter a year ago
Unlike the absolute number of liquidations over a period, the liquidation rate indicates the probability of a company entering liquidation in the previous four quarters. In general, periods of economic growth result in liquidation rates decreasing.
Industry sector insolvency findings for England and Wales – Q1 2020
In the 12 months ending Q1 2020:
- the construction industry had the highest number of new underlying company insolvencies with 3,077
- the construction industry group also saw the largest decrease in underlying insolvency volumes (150, a 5 per cent decrease), when compared with the 12 months ending Q4 2019
Elsewhere the wholesale and retail trade, repair of vehicles industrial grouping had the second highest number of new underlying company insolvencies in the 12 months ending Q1 2020 with 2,360, while the accommodation and food services grouping had 2,317 insolvencies.
Scotland company insolvency statistics – Q1 2020
The Accountant in Bankruptcy, Scotland’s Insolvency Service, administers company insolvency in Scotland. They reported that in Q1 2020:
- company insolvencies in Scotland decreased
- there were 235 company insolvencies
- this was a decrease of 14.5 per cent compared to Q1 2019
Of the 235 total insolvencies in Scotland, 137 were compulsory liquidations, 77 were CVLs, 20 were administrations, one was a company voluntary arrangement and there were no receiverships.
Due to administrative differences, most company liquidations in Scotland are compulsory liquidations. This contrasts with England and Wales where creditors’ voluntary liquidations (CVLs) account for most company liquidations. Figures in Scotland are also not seasonally adjusted.
Northern Ireland company insolvency statistics – Q1 2020
In Northern Ireland in Q1 2020:
- total insolvencies decreased in Northern Ireland
- there were 83 company insolvencies
- this was a decrease of 26 per cent when compared with the same quarter of the previous year
Of the 83 company insolvencies in Northern Ireland, 51 were compulsory liquidations, 20 were CVLs, seven were CVAs, four were administrations and one was an administrative receivership.
Please note, the figures for Northern Ireland are not seasonally-adjusted.