Number of Scottish firms failing hits highest level in seven years

Tim Cooper is the chair of trade body R3 in Scotland. Picture: Renzo Mazzolini Photography
Tim Cooper is the chair of trade body R3 in Scotland. Picture: Renzo Mazzolini Photography
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Conditions may be harshening for Scottish businesses after an increase in the number of firms going bust last year.

The latest official statistics show that corporate insolvencies in Scotland for the whole of 2019 were 4 per cent up on the year before, at 980, putting them at their highest level since 2012.

The number of insolvencies actually fell by 4 per cent in the October to December period, compared with the previous three months, but were up 8 per cent, year-on-year, compared with the final quarter of 2018.

Tim Cooper, chair of insolvency and restructuring trade body R3 in Scotland, which analysed the statistics from the Accountant in Bankruptcy (AIB), said: “The higher level of corporate insolvencies in Scotland in 2019 compared with previous years is a worrying sign that conditions may be harshening for Scottish enterprises.

“The figures released do not include administrations or company voluntary arrangements, either, meaning the true extent of Scottish business difficulties could be even higher.

“If one word could be said to sum up 2019, there’s an argument to be made for it to be ‘uncertainty’. Brexit uncertainty led to many companies understandably taking a ‘wait and see’ approach on everything from new equipment to decisions about opening offices.

“This in turn added sand to the wheels of dealmaking and business investment, with knock-on effects for the economy as a whole.”

Meanwhile, there were 13,589 personal insolvencies during 2019, 13 per cent higher than the previous year and at their highest level since 2013.

“The insolvency profession helped thousands of Scots sort out their finances last year,” added Cooper.