Expert comments on new Insolvency Service statistics
Insolvency Service statistics are out today and Melissa Jackson, director of the Corporate Recovery and Insolvency team at charted accountancy firm Carter Backer Winter comments.
The general trend is that insolvencies both corporate and personal are declining. However with the current uncertainty within the economy and the risk of interest rate rises looming it would not be unexpected to see a rise in the coming year as both businesses and individuals come under continued pressure.
Despite the fact that company insolvencies have been flatlining for the last 7 years, I fully expect to see another high street name fall over at some point this year.
The UK economy is inextricably linked to the housing market. House prices are not yet stable and there may be another blip this year. If that happens, confidence will drop, people will stop buying things and we could quickly find ourselves back in a negative growth cycle. This will have a negative impact on small businesses and may lead to an increase in insolvencies.
In the retail industry, rent is still a touch point and the next quarter day of 25th March could see businesses stretched to meet rents due.
A rise in interest rates could trigger a slew of bankruptcies and company insolvencies as both individuals and business struggle to meet tier minimum commitments.
