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Almost 20,000 firms destroyed by recession
5 Feb 2010Nearly 20,000 firms went bust last year as the recession took its toll.
The Insolvency Service today said 19,077 businesses failed in 2009 an increase of 22.8% on the previous year and the most since 1993.
The number of firms going under fell 1.7% to 4566 in the fourth quarter as Government support measures kicked in. Experts say they will go up again as taxes and interest rates rise.
Alan Tomlinson, partner at insolvency expert Tomlinsons, said: The worst effects of a recession always come after a recession. There is more pain in the pipeline, not just for UK Plc but the public, who are the victims of company failures and cost cutting. The finishing line may be in sight but it is set to be a long home straight.
Reader views (2)
One of my friends lost £6000 in rent. The Company went into administration, but they have another company and just continued where they left off leaving the £6000 debt unpaid. Another friend, an optician, paid £15,000 for a practice management system. The supplier has gone into administration and the system doesn't work. The managing director has just moved to another company. I blame the government and the accountancy firms. Too many of them are allowing directors to leave debts and move on. If you set up a limited company, you can run up loads of debts, not pay them and walk off: oh, my company has gone into administration.
- Anthony, London, 05/02/2010 14:31
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Record numbers, you know why, its too easy and there is no blame. I have a tenant in a shop. When they got into difficulties they started trading as a Limited Company, two years later the Ltd Co, went into liquidation, so they went back to being sole traders. I blame the government for not tightening legislation. Every day hundreds of people go into liquidation owing money to suppliers who can ill afford to accept 10% from the liquidator. Tighten up legislation so that business people who go into liquidation are more personally responsible.
- Nosmo King, North West, 05/02/2010 08:36
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