The Daily Star Ireland
Since its introduction three years ago, the Small Company Administrative Rescue Process (SCARP) has successfully helped preserve over 1,000 jobs, according to new statistics. The initiative is designed to assist small businesses in restructuring their debts out of court, with a focus on those considered financially viable.
Under SCARP, an appointed process adviser works with the business and its creditors to develop a plan that addresses its debt. Since the program’s launch in December 2021, 84 SCARP cases have been initiated, with 70% of them leading to successful rescue plans, saving 1,076 jobs across 59 businesses.
In 2024, 29 SCARP cases have been launched, marking a 12% decrease from the previous year. Despite the drop, 382 jobs have been saved so far this year. Dessie Morrow, Advisory and Restructuring Partner at Azets Ireland, suggested that the reduction in cases might indicate a slight improvement in business conditions, but also noted that some struggling businesses could have pushed through the busy holiday season in hopes of better prospects.
Morrow highlighted that challenges such as high energy and labor costs are likely to continue to pose significant obstacles for small businesses. The hospitality and construction sectors accounted for the largest share of SCARP cases in 2024, with each sector representing 21% of the cases. The retail sector followed with 17%.
Geographically, most businesses using SCARP were located in Dublin (more than half) and the wider Leinster area (77%). Smaller portions of cases were in Munster, Connacht, and Ulster.
As more businesses are expected to experience financial difficulties in the coming months, Morrow emphasized the importance of increasing awareness about SCARP and other restructuring options. He stressed that both SCARP and examinership are essential tools for guiding businesses through financial struggles, preserving jobs, and supporting local economies.
