Following the delayed release of the statistics last month (those for March 2024), the release of the insolvency statistics has returned to its usual mid-month time slot.
The number of company insolvencies in England and Wales in April 2024 was 2,177, 18% higher than in March 2024 (1,838) and 18% higher than the same month in the previous year (also 1,838 in April 2023). Numbers of company insolvencies also remained much higher than those seen both during the COVID-19 pandemic and between 2014 and 2019.
As to the breakdown by case type, there were 300 Compulsory Liquidations, 1,715 Creditors’ Voluntary Liquidations (CVLs), 144 Administrations and 18 Company Voluntary Arrangements (CVAs). All of those numbers were higher than last month and April 2023.
This increase has seen 1 out of every 175 companies on the Companies House effective register (at a rate of 57.0 per 10,000 companies) entering insolvency between 1 May 2023 and 30 April 2024. This was an increase from the 52.6 per 10,000 companies that entered insolvency in the 12 months ending 30 April 2023. However, while the insolvency rate has increased since the lows seen in 2020 and 2021, it remains much lower than the peak of 113.1 per 10,000 companies seen during the 2008-09 recession. This is because the number of companies on the effective register has more than doubled over this period.
Fans of receivership appointments were again disappointed with none being recorded in April, and there have been 2 in the last 12 months. There were also restructuring plans or moratoriums registered in April.
In cases where the industry type was recorded (using the SIC code at Companies House), 17% of cases in the last year were in the construction industry, with 16% of cases in “wholesale and retail trade; repair of motor vehicles and motorcycles” and 15% in accommodation and food service activities.
In the personal landscape, 9,651 individuals entered insolvency in England & Wales in April 2024. This was 10% higher than in March 2024 and 5% higher than in April 2023. The 9,651 individual insolvencies in April 2024 was 11% higher than the average of 8,672 over the previous 12 months.
The individual insolvencies consisted of 648 Bankruptcies, 3,436 debt relief orders (DROs) and 5,567 Individual Voluntary Arrangements (IVAs).
The number of IVAs registered in April was similar to numbers seen over the past 12 months. As the newsroom predicted last month, the number of DROs in April 2024 was a record high (having never been over 3,100 a month before) in the monthly time series going back to their introduction in 2009. This coincided (so say the Insolvency Service, but it clearly isn’t a coincidence) with the removal of the £90 administration fee to obtain a DRO from 6 April 2024. The level is 63% higher than the long-run monthly average of 2,114 since 2014.
The number of Bankruptcies was similar to the past nine months and slightly higher than in April 2023. However, Bankruptcy numbers remained at about half of pre-2020 levels. 528 (81%) resulted from debtors’ applications, which was 2% lower than in March 2024 and 15% higher than in April 2023. 120 resulted from creditors’ petitions, which was 18% lower than in March 2024 and 12% lower than in April 2023.
There were 7,649 breathing spaces registered under the Debt Respite Scheme in April 2024. This is 16% higher than in April 2023. Of the 7,649 breathing space registrations, 7,547 were “Standard” breathing space registrations and 102 were Mental Health breathing space registrations. Between the start of the scheme in May 2021 and 30 April 2024, StepChange have registered 62% of breathing spaces.
