Insolvency experts anticipate busier times with the fallout from pandemic

Insolvency practitioners have “a unique toolbox”, says his fellow director Michael Goldstein, that in some cases “enables us to stop creditors taking recovery action. We’re seeing a lot more restructuring these days where people come to us. We were able to assist them in rescuing the business, if not the company.

“We are well aware that behind most businesses is a family, someone not trying to buy a yacht or a second Ferrari, just trying to get their kids through school and pay their mortgage. We will always look to see if there is a part of the business that can be rescued.

“It’s about picking those parts out that will act as an engine to get the rest of the business to regenerate and renew.”

But, he stresses, “the earlier people come to see us, the more options are available. The worst thing that people can do is nothing and hope.

“You need to talk to people who understand the options. The guy standing next to you at a socially distanced minyan with the best of intentions won’t always have the knowledge.”

One option increasingly being taken up is a CVA, a company voluntary arrangement — “an agreement whereby the company usually pays into the CVA every month for up to five years and the creditor accepts that some of the debt will be written off”. It was a solution recently agreed by one Jewish owner of a small company hit by the pandemic. “His workers were scared to come to work; he couldn’t complete projects,” Mr Goldstein recalls.

“It was starting to get to a point where all sorts of penalties are accruing. He’s got a liability to the Crown, he’s got suppliers he owes money to. He’s got rent on his offices.”

While the CVA meant creditors would suffer “a haircut in the amount they are owed, the company’s got five years to sort out and improve the position”.

Mr Goldstein reports that since the onset of the coronavirus crisis, they have seen people prepared to do deals that previously would “have been unimaginable“.

“Most people want to try to come to some sort of arrangement which keeps everyone going,” Mr Radomsky adds. “There’s very little desire out there to have everyone close each other down. That doesn’t help anyone.”

Located in the heart of the Hertfordshire Jewish community, they can see the communal impact. “We’ve had contact with people in various charities. We know that a lot of charities have furloughed staff. Longer term is the impact on the donations available. People are looking at their budgets and saying: ‘Do we need to be paying this any more?’”

But they have also witnessed a great deal of local resilience. “On the flip side, our community has had an incredible response,” Mr Goldstein reflects. “Our shul has a hardship fund that helps a lot of people. We have seen an army of volunteers going out and helping the most vulnerable.

“The whole role of both religious and lay leadership has changed — it is far more inclusive and supportive. It’s a privilege to be part of the community.

“Out of the darkness, the tough times, I’ve seen so much good come out from a community point of view. The way we act has changed and may never go back to the way before.”