Background to the guide

The government’s position is that, in general, private sector companies should be allowed to fail as part of the efficient working of markets and the economy. In some circumstances, however, it will decide it needs to intervene, either to prevent a company from failing, to rescue a company, or to manage the situation so that a company does not fail in a disorderly way.

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Scope of guide

This guide sets out the elements to consider and some questions to support good practice and value for money in monitoring, preparedness and response to company distress situations.

In 10 practical sections, it is illustrated with real examples, many of which we have examined in previous reports, such as MG Rover, British Energy, Northern Rock, Thomas Cook, Carillion, and Bulb Energy (Bulb).

The guide is intended to help officials and leaders across government to think through their duties and what they need to do to understand the nature and potential impact of company distress, so that they maximise resilience and are ready to respond if necessary. It does not replace expert advice in an emergency situation.

In addition to the guide we have published a lessons learned on the subject which will also be of interest.