UK insolvency rules under scrutiny as timelines extend
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Treasury

UK insolvency rules under scrutiny as timelines extend

Does the high number of drawn-out insolvency cases in the UK suggest a failure of regulation?

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Lord Sikka | Photo: UK Parliament

Insolvency data is always closely analysed as a barometer of the commercial health of the nation. The figures for April show that after seasonal adjustment, the number of registered company insolvencies in England and Wales was 2,177, 18% higher than in the previous month.

However, it is the length of time taken to complete the process that has attracted the attention of Lord Sikka, professor of accounting at the University of Sheffield and emeritus professor of accounting at the University of Essex. In response to a written question in the House of Lords about how many liquidations began five, 10 and 15 years ago but are still not finalised, he was told that as of the end of last year, 8,189 companies had been in liquidation for between 10 and 15 years and a further 20,822 had been in the process for more than 15 years.

Lord Sikka is a long-time critic of the insolvency profession, which he has previously described as a "licence to print money". In a post on X in March he said: "Insolvency practitioners will feed off the carcass until no more money is left and administration/liquidation will magically end".


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