Insolvency statistics released for July 2021
While the overall number of registered company insolvencies remains lower than pre-pandemic levels, driven by the lower number of compulsory liquidations, CVLs are similar to pre-pandemic levels.
The latest monthly release of insolvency statistics for England and Wales was published on the 17 August 2021. *
Overall, the numbers of registered company insolvencies have remained low since the start of the first UK lockdown in March 2020, when compared with pre-pandemic levels..
In July 2021 there was a total of 1094 registered company insolvencies which is lower than last month (1201 ). The insolvencies comprised 1007 CVLs, 41 compulsory liquidations, 6 CVAs and 40 Administrations
Impact of COVID-19 business support measures
The overall low numbers are likely to be at least partly driven by Government measures set up in response to the coronavirus (COVID 19) pandemic, including:
- Reduced court and tribunal operations and reduced HMRC enforcement activity since the UK lockdown was applied
- Temporary restrictions on the use of statutory demands and certain winding-up petitions (leading to company compulsory liquidations) from 27 April and extended further to 30 June 2021 under the extensions to the Corporate Insolvency and Governance Act.
- Enhanced Government financial support for companies and individuals.
As the Insolvency Service does not record whether an insolvency is directly related to the coronavirus pandemic, it is not possible to state its direct effect on insolvency volumes.
The statistics in detail – July 2021*
- Of the 1,094 registered company insolvencies in July 2021:
- There were 1,007 CVLs, which is 70% higher than in July 2020 but the same as in July 2019;
- 41 were compulsory liquidations, which is 77% lower than July 2020 and 84% lower than July 2019;
- Six were CVAs, which is 65% lower than July 2020 and 85% lower than July 2019;
- There were 40 Administrations, which is 78% lower than July 2020 and 73% lower than July 2019; and
- There were no receivership appointments.
New procedures introduced by CIGA 2020
Between 26 June 2020 and 31 July 2021, 13 companies obtained a moratorium and nine companies had a restructuring plan registered at Companies House. These two new procedures were created by the Corporate Insolvency and Governance Act 2020.
Monthly company insolvency data for England & Wales can be found in the accompanying tables. Further breakdowns of company insolvencies by Standard Industrial Classification (SIC 2007) are also presented to three-digit level.
Debt relief orders and bankruptcies
There were 1,864 DROs and 620 bankruptcies in July 2021 in England & Wales.
The number of DROs in July 2021 was the highest seen since the start of the pandemic. This was 15% higher than in July 2020 but 22% lower than in July 2019. Changes to DRO eligibility came into effect on 29 June 2021, including an increase in the level of debt at which people can apply for a DRO from £20,000 to £30,000. The increase in the number of DROs registered in July 2021 is likely to have been caused by this expansion of the eligibility criteria.
The bankruptcies were made up of 534 debtor applications and 86 creditor petitions.
Bankruptcies were 34% lower than in July 2020 driven mainly by a drop in debtor applications (37% lower), to their lowest monthly number in the series. Numbers of creditor petitions were similar to July 2020. Compared to July 2019, total bankruptcies were 58% lower; debtor applications were 54% lower and creditor petitions were 71% lower.
Individual voluntary arrangements
There were, on average, 6,841 IVAs registered per month in the three-month period ending July 2021, 7% lower than for the three-month period ending July 2020 and 7% lower than the three-months ending July 2019.
Between the launch of the Breathing Space scheme on 4 May 2021, and 31 July 2021, there were 17,297 registrations, comprised of 17,098 Standard breathing space registrations and 199 Mental Health breathing space registrations.
Note that the IVA series is historically volatile as it is based on date of registration at the Insolvency Service (see the Data Sources and Methodology section for more information).
We publish a summary of the reports here each month. For advice relating to support, insolvency or recovery options, please contact us.
* This content and data was reported in full in the Insolvency Service Statistics for June 2021 published 17 August 2021 – see the full report here: Commentary – Monthly Insolvency Statistics July 2021 – GOV.UK (www.gov.uk)
Image source: The Insolvency Service Monthly insolvency statistics, July 2021