Insolvency Service Reports 'Meaningful Improvements' as UK Register Shows 109,891 Companies in Liquidation

The Insolvency Service has published its 2025-2026 'Confidence in the Regime' report, finding that stakeholders believe meaningful improvements have been made to the UK insolvency system^[1]. The qualitative research, commissioned to assess the final year of the organisation's five-year strategy, drew on views from insolvency practitioners, people in debt, creditors, directors, academics, and legal professionals^[1].

Duncan Beach, Chief Executive of the Insolvency Service^[1], said the report "clearly shows the Insolvency Service and our partners across the sector are making meaningful improvements to the insolvency system"^[1]. He described the findings as evidence that reforms are being well received by those who use the system.

Key Findings on System Reforms

The report found confidence has increased particularly in the insolvency regime itself^[1]. Reforms to Debt Relief Orders (DROs) and Individual Voluntary Arrangements (IVAs) received strong support from stakeholders^[1].

DRO reforms specifically widened access and removed barriers that had previously prevented customers entering the DRO process at the optimal time^[1]. Changes around IVAs were credited with providing consumers better information and delivering positive steps towards a fairer system^[1].

Proposals to strengthen insolvency practitioner regulation were also welcomed by respondents^[1]. Overall, the research concluded that confidence in the insolvency system has improved due to clearer information, better solutions, and more efficient processes^[1].

However, remaining concerns highlighted by stakeholders include high bankruptcy costs and inconsistencies in corporate practices^[1]. The Insolvency Service indicated the findings will be used to shape how the regime works in the future and further improve confidence in the system^[1].

UK Company Register Context

While the Insolvency Service report focuses on stakeholder confidence, CompanyPulse data provides a snapshot of the system's current scale across the UK economy. As of the latest register update, 109,891 companies are recorded in liquidation status across all sectors and regions^[2].

Beyond liquidation, the register shows 4,899 companies currently in administration, 751 in receivership, and 3,234 in voluntary arrangements^[2]. These figures represent economy-wide totals rather than any specific industry or sector.

The broader UK company register^[2] contains 6,191,758 total companies, of which 5,602,795 are active^[2]. In the past seven days, 16,400 new companies were incorporated^[2].

Policy Context and Political Uncertainty

The report's publication comes during a period of political transition. Prime Minister Sir Keir Starmer announced his resignation on 25 June 2026 after losing the support of Labour MPs^[3]. Andy Burnham, the former Greater Manchester mayor, is expected to replace him and could take over as soon as 17 July 2026 if no other contenders emerge^[3].

Chancellor Rachel Reeves, speaking at the British Chambers of Commerce conference on 25 June 2026, defended her economic record and urged any incoming government to maintain current fiscal policy^[3]. She told the conference she was "proud" of her record on inflation and growth, though acknowledged there was "more to do"^[3].

Burnham is reported to be considering Ed Miliband, Wes Streeting, or Shabana Mahmood as possible replacements for Reeves^[3]. Some on the left of the Labour Party have called for Reeves' fiscal rules to be relaxed to allow more spending on defence and other priorities^[3].

What 'Confidence' Means in Practice

The Insolvency Service's qualitative report captures perceptions among professionals and users of the system. It does not quantify outcomes such as creditor recovery rates, case durations, or regional disparities in practitioner availability - metrics that would complement stakeholder sentiment with operational performance data.

The emphasis on DRO and IVA reforms suggests the Service has prioritised personal insolvency improvements. The report's reference to "inconsistencies in corporate practices" as an ongoing concern indicates that corporate insolvency - the area where the 109,891 liquidations sit - may face different challenges than the personal debt procedures that received positive feedback.

With the five-year strategy now concluded, the findings position the Insolvency Service to develop its next phase of policy priorities. The organisation stated explicitly that stakeholder views will inform future regime design, suggesting reforms may continue to be shaped by practitioner and creditor input rather than solely by government directive.

Looking Ahead

The timing of the report, published 26 June 2026, places it at the intersection of institutional assessment and political change. While the Insolvency Service operates as an executive agency with policy continuity, shifts in Treasury leadership could alter the wider economic context in which insolvency policy operates.

The report's focus on "meaningful improvements" suggests incremental reform rather than structural overhaul. For the practitioners, creditors, and directors navigating the system, the research indicates that recent changes have been broadly well-received, even as concerns about costs and corporate practice consistency remain unresolved.

As the UK insolvency regime enters its next strategic period, the balance between maintaining stakeholder confidence and addressing remaining operational challenges will likely define how effectively the system manages the 109,891 liquidations and thousands of other procedures currently in progress across the economy.