º£½ÇÊÓƵ

The number of firms falling into administration tumbled by 12% last year, suggesting government support packages are propping up many through the pandemic.

Big Four accountancy firm KPMG has analysed notices published in the Gazette, which show just 27 companies went into administration in 2020, representing the fall of 12% and down on the 31 firms recorded the year before.

A similar picture also emerges around the º£½ÇÊÓƵ, with the overall number of insolvencies down 22% on 2019.

James Lumb, restructuring director at KPMG in the North East, said the figures show that the raft of business support measures brought in by the government are continuing to provide a lifeline for businesses badly affected by the Covid-19 pandemic.

He said: “Comfort can be taken from the fact that fewer businesses than expected have been forced into insolvency during the crisis, as the breadth and depth of support measures available, coupled with a supportive lending community, have given organisations that vital lifeline.

“We also know that there are a number of sectors, including the likes of tech, online retail and financial services, which have seen something of a Covid-bounce.

The administration figures come days after the latest Red Flag Alert research painted a bleak picture of the region’s economy, with 12,500 firms across the North East saying they are now in financial difficulty.

That report – by business rescue and recovery specialist Begbies Traynor – also showed that distress levels had also jumped by 14% in the last three months of the year, when a further 1,500 companies in the North East hit difficulties.