Third quarter company insolvencies drop in England and Wales

London: Company insolvencies in England and Wales fell in the third quarter, although personal defaults on loans continued to rise, official figures showed yesterday, suggesting economic recovery was still patchy.

The Insolvency Service said individual insolvencies rose by 2,000, or 6 per cent, from the second quarter to 35,242 in the three months through September and were up a massive 28 per cent from a year earlier.

Company liquidations were down 5 per cent from the second quarter to a total of 4,716, which was still 15 per cent higher than a year earlier.

Alan Tomlinson, partner at Tomlinson insolvency practitioners, said company failures may increase next year if tax collectors at the Inland Revenue take a tougher line.

"While the Revenue has been instructed to be cooperative, this will not continue indefinitely," Tomlinson said.

"There is talk that the recession will technically end in the fourth quarter, but for some companies the recession will really hit home when the Revenue calls in its debts," he added.

Separately, the Office for National Statistics said output prices — the cost of goods at the factory gate — were up 0.2 per cent from September to October.

Manufacturers' input prices rose 2.6 per cent compared to September, putting the overall index for October 0.1 per cent above a year ago.