Company insolvencies surged in July as soaring costs continued to batter firms across England and Wales, official figures have revealed today.
Insolvencies hit 1,827 in July, 67 per cent higher than the same month last year when firms were grappling with the fallout of the pandemic, and 7.5 per cent higher than June 2022 figures, statistics from the Insolvency Service showed .
Insolvency specialists at City law firm Fladgate said the jump from June levels was of “particular concern” as the economic environment deteriorated.
“It would be unsurprising if the situation was worsening for businesses and this was not merely a one month blip,” said Jeremy Whiteson, Partner in Fladgate’s Restructuring and Insolvency practice.
“High fuel prices, inflation, labour shortages, post Brexit difficulties with international shipping, uncertainty in capital markets, raising interest rates and geo-political uncertainty all pose difficulties for businesses.”
The jump in insolvencies was driven by an increase in creditors voluntary liquidations (CVLs) – a procedure used for companies with no ongoing business to dispose of remaining assets, distribute available funds to creditors and dispose of the corporate entity.
Figures revealed there were 1609 CVLs in July 2022, a 60 per cent increase on July 2021 and 11 per cent rise on June figures.