An unexpected monthly fall in corporate insolvencies in England and Wales does not reflect current tough trading conditions and the number of businesses becoming insolvent in the region is likely to ‘rise significantly’ through 2024, according to the Eastern branch of the sector's trade body R3. Corporate insolvencies totalled 2,002 in December, down by 19 per cent on November's figure but up slightly on the month a year ago and 79% higher than in the pre-pandemic figure in December 2019.

R3 Eastern chair Hayley Watson, associate director at McTear Williams & Wood, said: “These new figures are the highest for December in four years and reflect the final month of a difficult year. December was tough for many local businesses as they faced additional expenses at a time when margins were already tight. These won’t have been helped by a slowdown in consumer spending and a rise in energy prices."

She added: “These extra costs could have been the final blow for many businesses and may have led to their directors turning to an insolvency process to resolve their firm’s financial issues. If the New Year trading period hasn’t improved on the one before Christmas, we could see insolvency numbers continue to rise, as businesses who had banked on a festive income boost to cover any financial shortfall turn to the profession for help."