FIGURES from the Southern Committee of R3 have revealed that the agricultural industry has the lowest percentage of companies at high risk of insolvency in the South East.

Just 18.94 per cent of agricultural companies are showing signs of being at high risk or caution of entering insolvency in the next 12 months.

However reports from the National Farmers Union (NFU) say that the introduction of the National Living Wage in April will have a "profound effect" on the industry.

The NFU warned that the National Living Wage will increase the cost of season wages for grower businesses by 35 per cent over the period 2016-2021.

The Department for Business, Innovation and Skills (BIS) has also raised concerns that just 45 per cent of businesses have updated their payroll ahead of the changes and only 39 per cent have discussed the changes with their staff, according to a BIS survey of 1000 UK employers.

The research from R3, compiled using Bureau van Dijk's 'Fame' database of company information, tracks the proportion of businesses across key sectors that have a heightened risk of entering insolvency in the next year. The figures showed that this month, the agricultural industry in the South East saw a very slight increase (0.6 per cent) in the percentage of companies at risk of insolvency.

Chairman of the Southern Committee of R3 and a partner at Quantuma in Southampton Andrew Watling said: "Although the agricultural industry has the lowest percentage of companies at risk of insolvency in the South East and seems to be the most secure, that percentage has been increasing since the beginning of the year. With the NFU warning that there has not been enough time to prepare for the effects of the introduction of the National Living Wage, businesses should seek professional advice now, rather than later."