Company insolvencies are a sign of a healthy economy and preventing companies from failing, or allowing 'zombie companies' to linger on, may be actually stifling the innovation the country needs to grow.

While insolvency statistics for companies have fallen steadily throughout 2012 and again in the first quarter of 2013, the reality is that the economy is effectively stagnant and businesses are generally therefore not growing. Insolvencies, together with mergers and acquisitions, new company registrations, recruitment, and redundancies are, strange though it may seem, a sign of a healthy economy. We need growth even if it results in additional company failures.