Portsmouth and Hampshire see big rise in companies going insolvent, figures reveal

Around eight out of 10 UK local authorities saw an increase in company insolvencies last year compared to the year prior to the pandemic. Analysis of insolvency data shows the worst affected areas saw the number of firms winding up rise five-fold in 2022 compared to 2019.

READ NOW: Ferry company’s new deal

The withdrawal of government support and soaring energy costs have been blamed for the rise, with retail and construction the hardest hit industries.

To obtain a regional picture, the BBC Data Unit looked at insolvency notices in The Gazette, the official paper of record for public notices.

Creditors voluntary liquidations - the most common way for firms to be shut down - was also looked at between 2019 and 2022 and mapped them to 221 upper-tier local authorities across the UK.

In Portsmouth there was a rise between 2019 and 2022 of 15 insolvencies, working out as a 88% increase. This was after the city had 17 insolvencies in 2019 and by 2022 it had 32.

Hampshire had 198 insolvencies in 2019 and 377 in 2022 resulting in an increase of 179 at a 90% rise.

Southampton bucked the trend after it had 145 insolvencies in 2019 and 140 in 2022 resulting in the city having five fewer with a -3%.

The south east saw 1318 insolvencies in 2019 which increased to 1882 in 2022 with a total of 5,783 over the period with a rise of 564 working out as 43% rise.

Overall the research found:

- 187 out of 221 upper tier authorities in the UK (85%) saw a rise in liquidations comparing 2019 to 2022

- Council areas on the outskirts of London made up five of the top ten authorities with the largest proportional rise

- On a regional level, the East of England saw the biggest rise of 78%, while the South West of England saw the smallest at 31%. However every region in England saw a rise of at least a third.

- Comparing the nations, Scotland saw the biggest rise of 150%.

Michael Weedon, of the Federation of Small Businesses, said: ‘It didn’t surprise me. We knew during the first year of pandemic there was deliberate business support from the government - we knew when that tailed away, particularly in terms of finance, there was a risk we'd see companies disappearing, because if the support went away, they wouldn't be able to to persist depending on their state of confidence.

‘Business confidence fell throughout most of 2021 and 2022, and within that retail fell more sharply than the overall level of confidence - exactly as insolvencies were rising.’

A government spokesperson said: ‘The business minister recently wrote to the CEO of Ofgem to raise this issue and ask them to ensure energy suppliers show forbearance to businesses that are struggling to pay energy contracts, and government support does not go to waste.

‘We have already provided around £400bn of direct support to businesses, including business grants, coronavirus loan schemes, the Coronavirus Job Retention Scheme, plus income tax payment deferral. This is alongside a new arbitration scheme to help resolve pandemic related rent debt.’

SEE ALSO: Gunwharf investment

SEE ALSO: Hygiene inspections