The UK government's Insolvency Service yesterday revealed that 224 Scottish companies entered insolvency in the three months to the end of September, down from 297 in the previous quarter but an 82 per cent increase on the same period last year. The downbeat annual figure compared with a 13.9 per cent drop in the number of companies south of the Border entering insolvency over the same period.
Bruce Cartwright, head of business recovery services at PricewaterhouseCoopers Scotland, said there would be more company insolvencies over the coming months as the economy struggles to recover.
"This demonstrates that there is still considerable pain in the corporate sector and I would expect it to continue because there is always a time lag as companies come out of recession.
Anne Buchanan, corporate recovery partner at PKF, said the situation was likely to be aggravated when the full impact of the cuts announced in the government's spending review take effect. "What this means is that we are likely to see a continuation of these very high corporate failure rates well into 2011 and perhaps even beyond," said Buchanan.