The data revealed that corporate failures had increased in Scotland and Northern Ireland during the separate collection period.
Next week, Kwasi Kwarteng is expected to provide more details about the government’s mini-budget.
The insolvency rate in England and Wales climbed 43% in August, government figures show, adding to worries about the health of the economy.
In August 2019, there were 1,348 insolvencies, compared with 1,933 in the same month last year, the Insolvency Service said. It was 42% higher than August 2019, before the Covid-19 pandemic hit, the statement said.
Economists fear that business will suffer
Economists fear that businesses will suffer as consumers curtail spending as inflation rises. The government has intervened by freezing energy prices, but the cost of gas and electricity will still be higher than usual this winter despite the freeze.
Businesses are facing similar energy price pressures and other costs, and the government has promised “equivalent support” for six months. However, the details of the package may not be made public for several weeks, the prime minister’s office has said.
Bank of England predicted a long recession
Many companies are likely to go insolvent due to the delays in providing support, according to business groups.
The future plans of the Truss and Kwarteng governments to prevent the economy from shrinking will be made clear in a mini-budget on Friday, according to reports. Despite this, some economists have said a recession is likely to occur. The Bank of England has predicted a long recession, but without taking into account the new government’s proposals.
US dollar after the UK retail sales data
Berenberg, an investment bank, senior economist Kallum Pickering said: “However, if the government fixes energy prices and temporarily cuts taxes, a shock to real incomes might be softened but it would not be prevented.”
The pound fell to a 37-year low against the US dollar after the UK retail sales data, adding to worries about the economy.
Corporate insolvencies in England and Wales
The government’s unprecedented pandemic protection has kept some British companies from much of the economic turmoil of the past two and half years. The furlough scheme, which compensated workers during lockdowns, and a series of loan schemes were among them.
In February 2021, the number of corporate insolvencies in England and Wales rose sharply to less than 750 per month.
The data revealed that corporate failures in Scotland and Northern Ireland had increased during the period.