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Monthly Insolvency Statistics: March 2021

15 April 2021

Monthly Insolvency Statistics: March 2021

The Insolvency Service publish the twelfth release, of its monthly series to provide more up to date information on the number of companies and individuals who are unable to pay debts and enter formal insolvency procedures due to the COVID-19 pandemic.

Overall, the numbers of company and individual insolvencies remained low since the start of the first UK lockdown in March 2020, compared to that in the same time period in 2019 (pre-pandemic). This is likely to be driven by the Government measures put in place in response to the coronavirus pandemic, including temporary restrictions placed on the use of statutory demands and certain winding up petitions and enhanced government financial support for companies and individuals.

Company Insolvencies (UK):

In March 2021 there was a total of 992 registered company insolvencies across England and Wales, further broken down as follows:

  • 883 creditors voluntary liquidations (CVLs) – 3% lower to that in March 2020 and 23% lower to March 2019
  • 74 administrations – 44% lower to that in March 2020 and 58% lower to March 2019
  • 25 compulsory liquidations – 86% lower to that in March 2020 and 90% lower to March 2019
  • 10 company voluntary arrangements (CVAs) – 44% lower to that in March 2020 and 66% than in March 2019
  • 0 receiverships

These figures are 20% lower than that in the same month the previous year, 37% lower than that in the same month two years before and an increase compared to February 2021.

Note: between 26 June and 31 March 2021, four companies were granted a moratorium and five had restructuring plans sanctioned by the court. These new procedures were created by the Corporate Insolvency and Governance Act 2020. Low usage of these legislative tools is thought to be due to the Government support which remains in place for companies until 30 June 2021.

Company Insolvencies (Scotland)

March 2021 saw 43 company insolvencies in Scotland, comprising of 11 compulsory liquidations, 27 CVLS, 4 administrations, 1 CVA and no receiverships. Overall, this is a reduction of 43% company insolvencies, compared to that in March 2020.

Historically, the number of company insolvencies registered in Scotland has been driven by compulsory liquidations but since April 2020, there have been more CVLs registered compared to compulsory liquidations, for ten out of twelve subsequent months.

Company Insolvencies (Northern Ireland)

In March 2021, there were 7 company insolvencies in Northern Ireland; comprising of 5 CVLs, 1 administration and 1 CVA. There were no compulsory liquidations or receiverships. The total figure here was down by 77% from March 2020, but there was 2 more company insolvencies in total compared to February 2021.

Touching on individual insolvencies….

For UK figures, they were relatively low in March, seeing a 31% decrease compared to March 2020. 2021 March saw 1,591 Debt Relief Orders (DROs) and 1,028 bankruptcies (made up of 937 debtor applications and 91 creditor petitions).  Comparing to February 2021, the statistics flipped back to as they were in January with more DROs than bankruptcies.

The decrease in bankruptcies is thought to be driven by a fall in debtor applications and creditor petitions. The enhanced Government financial support for individuals and businesses since COVID-19 emerged, coupled with reduced HMRC enforcement activity and reduced running of the courts has contributed to these falls.

It was also found that there were 6,388 individual voluntary arrangements (IVAs) registered, on average, during the three months ending March 2021. This was 24% higher than the three-month average observed in the period ending March 2020 – but please note this series is volatile due to technical issues experienced by one IVA provider, meaning IVAs were not registered with the Insolvency Service on a timely basis.

When looking at the figures for Northern Ireland, March 2021 saw 184 individual insolvencies, 82% higher from March 2020. This consisted of 140 IVAs, 36 DROs and 8 bankruptcies.

Find the full publication of statistics here.

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