Number of firms in critical financial distress rises sharply

A growing number of UK businesses are at risk of going under as costs spiral and Covid loan repayments become due, according to a report from insolvency firm Begbies Traynor.

A growing number of UK businesses are at risk of going under as costs spiral and Covid loan repayments become due, according to a report from insolvency firm Begbies Traynor.

Although COVID restrictions have been lifted, some firms are still feeling the impact of disruptions to supply chains, and the price of energy and other inputs have risen sharply.

Firms are finding it hard to recruit staff in some sectors, and wage costs, including the minimum wage and national insurance payments, have gone up.

As the cost of living rises, many UK households are looking for ways to save money, putting further pressure on businesses that rely on discretionary spending, like bars and restaurants.

The construction and hospitality sectors are the sectors struggling most, according to the report.

Julie Palmer, Partner at Begbies Traynor, said:

'The government's finances are themselves taking a hit from the increasing interest environment; they are simply not able to introduce further significant funding into the system, and they now have a choice to make. Do they rush to recover funds handed out during the pandemic to ensure there was a functioning economy afterwards? Or look for ways to control the number of businesses that fail?

'Having put so much money into protecting businesses over the past two years, ministers won't want to see it wasted as companies collapse, unable to repay their debts.'

Internet link: GOV.UK

Always Better
at giving a first class service


3 Kingfisher Court,
Bowesfield Park,
Stockton on Tees,
TS18 3EX



T : +44 (0) 1642 660 300
E : theteam@anderson-barrowcliff.co.uk

We use cookies on this website, you can find more information about cookies here. © 2024 Anderson Barrowcliff LLP. All rights reserved. powered by totalSOLUTION Registered company number: OC334152. Registered company address: Anderson Barrowcliff Limited Liability Partnership, 3 Kingfisher Court, Bowesfield Park, Stockton on Tees, Co Durham TS18 3EX Registered to carry on audit work in the UK and regulated for a range of investment business and consumer credit activities by the Institute of Chartered Accountants in England & Wales.