Q4 2015 Insolvency Statistics – What do the Numbers Say?

The latest insolvency statistics from the Insolvency Service regarding October to December 2015 have detailed further falls in the number of both corporate and individual insolvencies. The number of corporate insolvencies is now at its lowest annual level since 1989, whilst the number of individual insolvencies are at their lowest level for eleven years. Our Insolvency Practitioners have been crunching the numbers to evaluate what these figures mean for the insolvency industry.

Corporate Insolvencies

In 2015 an estimated total of 14,629 companies entered into insolvency, a figure that is 10% lower than the 2014 total. There was a decrease in all aspects of corporate insolvency, including compulsory liquidations, administrations, CVLs, CVAs and receivership appointments compared to 2014’s figures.

Compulsory liquidations have dropped dramatically this year to 2,874, with a 23% decrease in the number of winding-up orders issued compared to 2014. This annual figure is the lowest since 1981. Whilst the number of compulsory liquidations has dropped dramatically this quarter, the number of CVAs, CVLs and administration remained relatively similar to their Q3 levels.

In 2015, 0.44% of active companies entered into insolvency, which is the lowest level since comparable records began in 1984.

“Despite the year on year decreases in corporate insolvencies since 2010, here at Focus Insolvency Group we have actually had an increase in the number of Directors and Professional advisors contacting us as we increase our market share.” Anthony Fisher, Managing Director

Individual Insolvencies

In 2015, there was just shy of 80,000 individual insolvencies, which is a 19% decrease compared to 2014’s figures, and the lowest annual total since 2005. This decrease was mainly driven by the 23% reduction in IVAs. The number of bankruptcies this quarter were at their lowest level since 1990.

There were 6,501 Debt Relief Orders issued in Q4 2015; whilst there has been a 9.4% decrease in DRO’s this year when compared to last year’s figures, there has been a 15.5% increase in DROs compared to Q3 2015. The Small Business, Enterprise and Employment Act 2015 and the Deregulation Act 2015, both of which came into force on 1 October 2015, made changes to DROs, making them a more accessible solution to a wider range of people.

“As we predicted, the changes to the eligibility criteria for Debt Relief Orders has led to a big increase in their popularity. Debt Relief Orders can act as a preventative measure against individuals falling into further debt, which could ultimately result in their bankruptcy. The increase in the number of Debt Relief Orders also goes some way to explain the decrease in the number of bankruptcy orders.” Anthony Fisher, Managing Director

Can we help?

If you have a client who is experiencing financial difficulties, or if you would like to discuss anything that has caught your eye in this blog post, please get in touch! Focus Insolvency Group specialise in recovery solutions and are keen to help individuals and businesses get back on their feet. We can help with debt consolidation, preventing bailiff and debt collection agent action, allowing individuals to make a fresh start and companies to continue to trade.
Source: Statistics and data provided by The Insolvency Service