Administrations drop below pre-downturn levels
Administrations for the first nine months of the year have fallen by 36 per cent compared to the same period in 2009, according to a report by business consultancy Deloitte. The number of administrations is also 20 per cent lower than recorded in 2006 – the year before the financial downturn began.
To date, there have been 1,648 administrations in the UK this year, compared with 2,589 in 2009.
Dominic Wong, reorganisation services partner at Deloitte in Birmingham, said: “Whilst the economy holds its breath for the outcome of the Comprehensive Spending Review, these figures offer a glimmer of hope.
"For the first time since the financial crisis began, we’re beginning to see a consistent drop in the numbers of companies hitting the wall.
"This can only be a good thing.”
Deloitte said the decline in administrations was across all sectors, but most pronounced, at 50 per cent, in retail.
Wong added: "The decline in retail administrations highlights just how effective the proactive approach adopted by businesses to manage both their cash flows and stock levels appropriately has been.
"Certainly the raft of retail administrations we saw at the end of 2008 and beginning of 2009 sorted the weaker businesses from their more viable competitors."
