Cost of insolvencies to Government halved in 2021

22nd February 2022

The amount paid by the Government to workers because their employers went bust was cut in half last year, according to new analysis by of real estate advisory firm Altus Group.

The Insolvency Service paid out £228.28 million last year to people who lost their jobs as a result of administrations, liquidations or other insolvencies.

The figures are down around 49.6% from the £453.37 million paid during 2020 because Treasury financial support helped many firms avoid collapse.

The drop reflected a 65% plunge in compulsory liquidations in 2021 compared with the previous year, while administrations dropped 48% to the lowest figure in almost 20 years.

The annual number of CVAs (Company Voluntary Arrangements) were also at their lowest levels since 1993.

Robert Hayton, UK President at Altus Group, said “Fiscal and other support measures that were put in place by Government, including temporary restrictions on the use of statutory demands and certain winding-up petitions, have all played their part getting businesses through the pandemic.”