More than 2,000 companies filed for insolvency in February as economic conditions continued to bite.
The number of insolvencies in England and Wales rose by 3 per cent between January and February, with 2,035 companies winding up.
With Rachel Reeves’ increase in national insurance contributions coming into force next month, several surveys also suggest business resilience is slipping.
A survey by BCG’s Centre for Growth on the “State of UK Business” showed that 57% of businesses believed a recession was likely this year.
When asked specifically about increases to National Insurance contributions, 61% of business leaders said this would increase their running costs, with the Construction, Manufacturing, Mining and Utilities sectors most concerned.
R3, the UK’s insolvency and restructuring trade body, says a number of economic and political issues are continuing to drive insolvencies and affect businesses across the supply chain. High costs and cautious consumer and client spending mean creditors are being more aggressive about pursuing the money they are owed and aren’t afraid to turn to the courts to recover outstanding debts, while a large proportion of directors of insolvent businesses feel closure is the only option open to them after years of trading through tough conditions and with little hope of these improving in the short-term.
R3 also reports that enquiries for restructuring and insolvency support are increasing as directors look to take specialist advice about their business finances.
Mark Goodwin, Founder and Managing Director at Optimise said:
"With the economy firmly stuck in reverse gear and company insolvencies continuing to rise, there are numerous legitimate legal claims against fraudulent directors that might not be pursued due to lack of funds. Optimise is here to bridge this gap, ensuring that insolvency practitioners and creditor estates receive maximum returns. By providing the necessary funding, we help ensure that justice is served and creditors are fairly compensated."