Ric Traynor, the executive chair of Begbies Traynor, expressed concerns that increased employment costs and the potential for extended high interest rates will prolong elevated insolvency levels, thus amplifying demand for guidance from insolvency and business recovery professionals.
Begbies Traynor reported a significant rise in their revenues and profits, up 16% in the last half year, indicating that the surge in insolvencies is benefitting their business, as firms seek advice on restructuring and bankruptcy.
The Labour government's tax increases, particularly on employers' national insurance contributions, have sparked considerable discontent among businesses, as it imposes a financial strain regardless of profitability, which may lead to increased insolvencies.
The UK government’s Insolvency Service noted a 7% decline in company failures from last year, yet the overall insolvency numbers are still significantly higher than pre-pandemic levels, raising concerns about the sustainability of businesses.
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