The UK’s insolvency and restructuring profession saved an average of 800 jobs and returned around £5m to creditors in insolvency cases every day during 2019, according to new industry research.
Insolvency and restructuring trade body R3’s new Value of The Profession report found that the sector rescued 297,000 jobs during 2019 and returned a total of £1.82bn to creditors in insolvency cases over the same 12 months.
R3 North East chair Alexandra Withers is now emphasising the role that regional insolvency practitioners will play in sustaining struggling regional firms and the jobs they support as the economy looks to recover from the impacts of the pandemic.
And she is urging business owners to seek qualified support at the first signs of potential financial distress to give themselves the best chance of finding a positive way forward.
R3’s research showed the profession rescued a total of 7,200 UK businesses in 2019, with nearly four out of ten (39%) of the businesses advised by R3 members still open after their insolvency procedure concluded.
Members of the profession advised a total of 60,000 businesses and 144,000 individuals in 2019, and of the £1.82bn that was returned to creditors during that year, £353m was from corporate insolvency and restructuring cases, and £1.47bn from personal insolvency cases.
Alexandra Withers, who is an associate solicitor in the insolvency department of Short Richardson & Forth Solicitors in Newcastle, says: “This research shows the scale of the economic contribution made by the profession – the businesses and individuals it helps, the jobs it saves, and the money it returns to creditors.
“It highlights contribution the profession made in a relatively calm period for the economy and also underlines the important role we can play in supporting businesses, individuals and the wider economy to resolve financial distress in a post-pandemic environment.
“The North East is home to a community of high-quality insolvency practitioners and restructuring experts who already make a significant contribution towards the overall well-being of the regional economy, a contribution that is often unsung due to the range of support they can provide to struggling firms before any formal insolvency procedure is needed.
“Our members are already helping dozens of regional firms get themselves in the best possible shape for managing the return to an open economy, and we would strongly urge any business owners with concerns about their finances to seek qualified support as soon as they can, so they can give themselves the best possible chance of surviving and thriving in the future.”
The R3 report’s findings are based on responses to a survey of representatives of 71 companies from the UK insolvency and restructuring profession in the UK and was carried out by Savanta ComRes.