To ask His Majesty's Government what assessment they have made of the impact on the UK economy of any decline in trading businesses.
Answered on
2 December 2022
The Government considers a variety of factors to understand the health of the UK corporate sector and economy. This includes monitoring official data, economic modelling and regular engagement with firms and business groups.
Like other advanced economies, the UK is affected by global economic challenges, including the unprovoked Russian invasion of Ukraine. Support provided over the past two years has put businesses and the UK economy in a good position to deal with these challenges.
Insolvencies fell below the historical average during the pandemic as the Government supported businesses through this economic shock. As we exit the pandemic, and pandemic related support has unwound, insolvencies have risen. This is in line with industry expectations though, and total insolvencies since the start of 2020 remain below what would have been expected based on pre-pandemic trends.
The number of new incorporations remains above pre-pandemic levels, showing that the UK continues to offer good opportunities to setup new businesses.