But is it the eye of the storm or the beginning of the end?

It seems like a lot has happened since the General Election was announced but in the background the country continues to go about its business. 

And we’re always concerned with what’s happening to those businesses which is why the latest corporate insolvency statistics from The Insolvency Service for May make such interesting reading. 

The official figures for company insolvencies in England and Wales in May saw a total of 2,006 recorded last month. 

This total is a little lower than the 2,177 recorded last month (6%) and is lower than the same month from a year previously (21%) although May 2023 saw the highest monthly insolvency total in the previous 16 years – 2,547.

May saw a slight regression but statistically remains high – why is this?


Of the 2,006 corporate insolvencies in May, Creditors Voluntary Liquidations (CVLs) remain the most frequent kind with 1,590.

This was a small decrease (5%) on the previous month and a 26% decrease on the total from a year ago which was at a historical high level.  CVLs make up 79% of all corporate insolvencies, which has remained the same proportion for three consecutive months now.

There were 271 compulsory liquidations in May, a decrease of 29 from the 300 recorded last month. This was a reduction of 10% but a 27% increase on the total from May 2023. 

HMRC continues to aggressively pursue debtors through the use of statutory demands and winding up petitions so more directors should consider what they would do if they received one in the coming weeks and months if they owe corporation tax, VAT or PAYE.

There were 126 administrations in May, a 13% reduction from April and a 20% reduction from 12 months ago.

There were 19 company voluntary arrangements (CVAs) last month. This was an increase of one from last month but was down 37% on the 30 recorded in May 2023. 

There were no receiverships registered last month in England and Wales with one moratorium registered with Companies House. 

Since June 2020 there have been 53 companies obtaining a moratorium and 23 having their restructuring plans registered with Companies House as required under the Corporate Insolvency and Governance Act 2020.

According to the Companies House register one in 180 companies (55.6 per 10,000) entered insolvency between June 1 2023 and May 31 2024.  

This is an increase from the 54.2 per 10,000 seen in the previous 12 months. These 12 month rolling rates are calculated as a proportion of the total number of companies on the effective register and show longer term trends and reduce the volatility that are associated with estimates based on single monthly figures. 

While the insolvency rate has increased since the lows seen in 2020 and 2021, it remains 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.


In Scotland last month there were 118 company insolvencies, the joint highest monthly number in the past five years. 

This was nine more than the number recorded last month and 22% higher than the total from May 2023. 

This comprised 71 CVLs (up from 59); 43 compulsory liquidations (down from 48) and four administrations (down from two). There were no CVAs or receivership appointments. 

In Scotland, compulsory liquidations had traditionally been the most frequent kind of company insolvency but since April 2020 and the Covid-era restrictions, they have been overtaken by CVLs. This shows how proactive Scottish directors and their accountants have become in making difficult decisions and acting decisively before their creditors decide for them.

The total insolvency rate in Scotland in the 12 months to May 2024 was 53.4 per 10,000 companies on the effective register. This was up by 1.3 from the preceding 12 months ending in May 2023. 

Northern Ireland

In May 2024 there were 44 company insolvencies registered in Northern Ireland last month. This was four times higher than the same month a year ago (300%). 

This consisted of 22 compulsory liquidations (up from 17); 20 CVLs (up from 12) and two CVAs (no change). There were no administrations or receivership appointments. 

The total insolvency rate in the 12 months to May 2024 in Northern Ireland was 40.3 per 10,000 companies on the effective register. This is an increase of 14.3 from the 12 months to May 2023.

The total number of company insolvencies for the whole of the UK in May was 2,168 – a decrease of 151.

“The tide may be about to turn for the better…”

Tim Cooper, the new President of R3, the insolvency and restructuring trade body said: “The month-on-month fall in corporate insolvencies is driven by lower numbers of administrations, compulsory liquidations and CVLs while the reduction in numbers we’ve seen compared to a year ago was mainly driven by a fall in administrations and CVLs. 

“However, levels of corporate insolvency are still higher this month than they were in May 2019 because CVL levels are higher, significantly higher, now than they were then, as a greater number of directors are closing their businesses after four tough years of trading during and post-pandemic. 

“The business climate remains challenging due to a variety of short and long-term issues. Inflation levels, cautious consumer spending, and the costs of energy and fuel have been affecting businesses for months, while shorter-term issues like the rain experienced in April and May will have hit firms in the construction, retail and hospitality sectors.

“Retail and hospitality will have seen a lower footfall as a result of the wet weather over the last couple of months, and this will have been another blow after a tough start to the year, a poor Christmas trading period and the longer-term impact of people spending less. 

“These industries will be hopeful the Euros will bring an increase in footfall and spending in England and Scotland which may help make up for a slow start to the year. 

“The rain will have also caused delays and disruption to construction projects, which will create additional issues for a sector that had seen a reduction in new work at the end of last year and the start of this one. 

“Another factor affecting businesses is the wait for the Monetary Policy Committee’s decision on the Bank Rate of interest as the impact this announcement has on everything from leasehold agreements to foreign exchange rates may have resulted on firms choosing to enter or choosing to delay entering an insolvency or restructuring process depending on the timings of their current arrangements. The Committee’s decision is also likely to affect businesses in the future, given the impact it has on a range of areas of commercial and international finance.

“When it comes to trends in insolvency and restructuring over the next couple of months, I would expect the liquidation numbers to soften slightly, and mid-market businesses to look towards exploring their options. But with low market expectation of an interest rate cut before the August Monetary Policy Committee sitting at the earliest, it could be a slower summer for restructurings. 

“Despite the challenges businesses face and the uncertain political and economic climate, they are generally more optimistic about the coming months, and many expect output and sales levels to rise and are planning to recruit extra staff. 

“With the economy growing in the first quarter of this year and predicted to grow again in the next quarter, the tide may be about to turn for the better.”

While R3 are optimistic in the medium term for the economy, the immediate outlook is more mixed and with an election in the offing there will be even more delays in new policies and their effects feeding through.

This is why it’s so important to get impartial professional advice in advance so you have an action plan to implement before it becomes a necessity. 

Get in touch with us and you can arrange a free initial consultation with one of our team at a convenient time for you. 

Once they better understand your circumstances then they’ll be able to come up with solutions specifically for you and your business to implement depending on your goals.