Record number of insolvencies

The number of people declared insolvent in England and Wales hit a new record high during the third quarter of the year, official figures showed today.

A total of 35,242 people became insolvent in the three months to the end of September - up 7 per cent on the previous quarter and 28 per cent on a year ago, according to the Insolvency Service.



The number of company liquidations - in which a firm is wound up and its assets sold off - stood at 4,536 in England and Wales, although the pace of growth slowed sharply for the second quarter in a row.





Today's individual insolvency figures were again the highest since records began in 1960 as the economic woes continued to take their toll.

But there was some hope for an improved picture as the level of quarter-on-quarter growth slowed slightly from 9% in the three months to June.



The number of personal bankruptcies - at 18,347 across England and Wales - also eased by 3% on a quarterly basis, marking a fall for the second straight quarter.



But this is partly thought to be down to take-up of the Government's recently introduced Debt Relief Orders (DRO), which were launched on April 6 as an alternative to bankruptcy.



Take-up among those eligible for DROs - people with debts of less than £15,000, assets of less than £300 and less than £50 surplus income a month - more than doubled to 4,505 in the third quarter.



DRO figures were particularly low initially due to orders taking longer to process than expected, which led to a backlog that only began to clear in the third quarter.



The Insolvency Service statistics also revealed that the number of people taking out an individual voluntary arrangement (IVA), under which interest on debt is frozen in exchange for a set amount being repaid each month, leapt by 21% year-on-year to 12,390, again the highest level since the final quarter of 2006.



Stephen Speed, chief executive of the Insolvency Service, said: "Debt Relief Orders have provided real help to significant numbers of people on low incomes, who were overwhelmed by relatively low levels of debt which they had no way of repaying."

He added: "Bankruptcies have decreased since last quarter and more people are seeking debt relief through an IVA - which result in greater return for creditors and are less distressing for debtors."



But experts said there should be little comfort drawn from the figures, with predictions for a grim total figure by the end of the year.



Marks Sands, director of personal insolvency at Tenon Recovery, said: "We have already exceeded the annual record for personal insolvencies and if this trend continues we are likely to see levels exceed 130,000 by the end of the year.



"We expect to see around 150,000 personal insolvencies next year, with record levels set to stay until 2012."



Company figures revealed an easing picture for corporate Britain, showing that firms in administration - often a more representative measure of business failures - fell 3% year-on-year to 974.



Administrations, where an insolvent firm is placed into the hands of administrators and managed with the hope of it continuing as a going concern, have not fallen on an annual basis since the fourth quarter of 2007.



But recent high profile casualties, such as Threshers parent First Quench and coffee shop chain Coffee Republic, have highlighted the ongoing difficulties faced by firms amid the recession.



Mike Jervis, partner at PricewaterhouseCoopers, said: "The statistics have shown a slight decrease quarter on quarter, but they still remain at unprecedented levels.



"Experience shows that there is spike in the number of businesses going bust as an economy recovers and companies need to remain obsessively focused on costs, cash and turnover if they do not want to become one of those statistics."



The third quarter Insolvency Service figures also showed 5,767 individuals were declared insolvent in Scotland in the third quarter, down 4% on a year earlier, while there were 381 individual insolvencies in Northern Ireland, a 1.3% annual decrease.

News
people
Arts and Entertainment
Armstrong, left, and Bain's writing credits include Peep Show, Fresh Meat, and The Old Guys
TVThe pair have presented their view of 21st-century foibles in shows such as Peep Show and Fresh Meat
Arts and Entertainment
Keys to success: Andrew and Julian Lloyd Webber
arts + entsMrs Bach had too many kids to write the great man's music, says Julian Lloyd Webber
Sport
footballMan City manager would have loved to have signed Argentine
PROMOTED VIDEO
News
people
News
i100
Arts and Entertainment
Hand out press photograph/film still from the movie Mad Max Fury Road (Downloaded from the Warner Bro's media site/Jasin Boland/© 2014 Warner Bros. Entertainment Inc.)
films'You have to try everything and it’s all a process of elimination, but ultimately you find your path'
Arts and Entertainment
Imelda Staunton as Dolores Umbridge in the Harry Potter films
books

New essay by JK Rowling went live on Pottermore site on Friday

News
people

Top Gear presenter is no stranger to foot-in-mouth controversy

News
Russia Today’s new UK channel began broadcasting yesterday. Discussions so far have included why Britons see Russia as ‘the bad guy’
news

New UK station Russia Today gives a very bizarre view of Britain

News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
Keira Knightley and Benedict Cumberbatch at the premiere of The Imitation Game at the BFI London Film Festival
filmsKeira Knightley tried to miss The Imitation Game premiere to watch Bake Off
News
i100
Sport
Enner Valencia
footballStriker has enjoyed a rapid rise to fame via winning the title with ‘The Blue Ballet’ in Ecuador
Arts and Entertainment
A top literary agent has compared online giant Amazon to Isis
arts + entsAndrew Wylie has pulled no punches in criticism of Amazon
Arts and Entertainment
Charlie Sheen said he would
tv

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

The benefits of Recruitment at SThree...

£18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...

Trainee Recruitment Consultants

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Finance Assistant - Part time - 9 month FTC

£20000 - £23250 Per Annum pro rata: Clearwater People Solutions Ltd: Pro rata ...

Marketing Manager

£40 - 48k + Benefits: Guru Careers: We are seeking a Marketing Manager to join...

Day In a Page

Bryan Adams' heartstopping images of wounded British soldiers to go on show at Somerset House

Bryan Adams' images of wounded soldiers

Taken over the course of four years, Adams' portraits are an astonishing document of the aftermath of war
The drugs revolution starts now as MPs agree its high time for change

The drugs revolution starts now as MPs agree its high time for change

Commons debate highlights growing cross-party consensus on softening UK drugs legislation, unchanged for 43 years
The camera is turned on tabloid editors in Richard Peppiatt's 'One Rogue Reporter'

Gotcha! The camera is turned on tabloid editors

Hugh Grant says Richard Peppiatt's 'One Rogue Reporter' documentary will highlight issues raised by Leveson
Fall of the Berlin Wall: It was thanks to Mikhail Gorbachev that this symbol of division fell

Fall of the Berlin Wall

It was thanks to Gorbachev that this symbol of division fell
Halloween 2014: What makes Ouija boards, demon dolls, and evil clowns so frightening?

What makes ouija boards and demon dolls scary?

Ouija boards, demon dolls, evil children and clowns are all classic tropes of horror, and this year’s Halloween releases feature them all. What makes them so frightening, decade after decade?
A safari in modern Britain: Rose Rouse reveals how her four-year tour of Harlesden taught her as much about the UK as it did about NW10

Rose Rouse's safari in modern Britain

Rouse decided to walk and talk with as many different people as possible in her neighbourhood of Harlesden and her experiences have been published in a new book
Welcome to my world of no smell and odd tastes: How a bike accident left one woman living with unwanted food mash-ups

'My world of no smell and odd tastes'

A head injury from a bicycle accident had the surprising effect of robbing Nell Frizzell of two of her senses

Matt Parker is proud of his square roots

The "stand-up mathematician" is using comedy nights to preach maths to big audiences
Paul Scholes column: Beating Manchester City is vital part of life at Manchester United. This is first major test for Luke Shaw, Angel Di Maria and Radamel Falcao – it’s not a game to lose

Paul Scholes column

Beating City is vital part of life at United. This is first major test for Shaw, Di Maria and Falcao – it’s not a game to lose
Frank Warren: Call me an old git, but I just can't see that there's a place for women’s boxing

Frank Warren column

Call me an old git, but I just can't see that there's a place for women’s boxing
Adrian Heath interview: Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room

Adrian Heath's American dream...

Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room
Simon Hart: Manchester City will rise again but they need to change their attitude

Manchester City will rise again but they need to change their attitude

Manuel Pellegrini’s side are too good to fail and derby allows them to start again, says Simon Hart
Isis in Syria: A general reveals the lack of communication with the US - and his country's awkward relationship with their allies-by-default

A Syrian general speaks

A senior officer of Bashar al-Assad’s regime talks to Robert Fisk about his army’s brutal struggle with Isis, in a dirty war whose challenges include widespread atrocities