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Tuesday, 24 November 2009

Phantom Recession for the Insolvency Profession?

There have been 507 CVA's in the year to Q3 2009 and 587 in the same period for 2008.

There were 4,716 compulsory liquidations and creditors’ voluntary liquidations in total in England and Wales in the third quarter of 2009 (on a seasonally adjusted basis). This was a decrease of 4.7% on the previous quarter but an increase of 14.6%on the same period a year ago.

Quarter 3 Administrations in 2009 saw a fall of 3.3% versus 2008. (974 against 1,007 in 2008).

So whats going on in the insolvency world? Insolvencies are not rising fast as was expected, why do I think this is?

See here

In early October the Government announced that it was assisting 210,000 companies with time to pay tax debts by mid September. This helpline has deferred CVA's and administrations and avoided many liquidations. We assume the numbers have carried on rising although HMRC will not confirm stating....."Our current numbers are being validated and we therefore have no figures to give at present,” a spokeswoman said.

Political genius (saving insolvent companies) or fiscal recklessness (creating tax debts that may not be recovered when companies subsequently enter administration or liquidation), time will tell.

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