Company Insolvencies Continue To Fall In The First Quarter Of 2010

May 17, 2010 - PRLog -- "People will be relieved that there has been a drop in the number of business failures in the first quarter of this year. Unfortunately, we expect to see an increase in administrations now that the general election is over," commented Malcolm Shierson, Partner at Grant Thornton''s Recovery and Reorganisation practice.

"Whomever forms the next government, UK economic growth will be hampered by projections reductions in public spending and a likely increase in taxes. It is likely that lenders will take a tougher stand on struggling enterprises, which may also be squeezed as ''Time to Pay'' Tax schemes are phased out."

The latest number of administrations represent a fall of 7.8% on the previous quarter (849 in Q4 2009 and a staggering fall of 40.3% against the same period in the previous year (1,311 in Q1 2009).

Company liquidations in England and Wales also dropped to 4,082 in Q1 2010. This figure reflects a fall of 8.4% on the previous quarter (4,457 in Q4 2009) and a fall of 17.8% against the same period in the previous year (4,964 in Q1 2009).

"The health of the UK economy is mainly reflected in the number of administrations. Typically large employers are placed in administration when they run into trouble, whereas liquidations are more common among smaller enterprises," concluded Grant Thornton''s Malcolm Shierson.

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