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PERSONAL INSOLVENCIES HIT RECORD LEVELS

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The number of people declared insolvent in England and Wales reached an all-time high of 135,089 in 2010, but there are signs for encouragement on the horizon.

The Insolvency Service said the 0.7% rise on 2009’s figure came despite a 13.6% drop year-on-year in individual insolvencies, as the number of people struggling financially continued to the decline.

But Insolvency Service figures also showed that 30,729 people were declared insolvent in the fourth quarter, down on the previous month by 9.4%.

That drop came as the number of personal bankruptcies fell to its lowest level for more than five years – at 12,049 in the final three months of 2010 – and this was down 29.2% on 2009.

Personal insolvencies have now fallen consistently quarter-on-quarter since the beginning of 2010 and business figures also show further improvements in company liquidations across England and Wales, which fell 15.9% in 2010 to 16,045.

But in a worrying sign for UK businesses, company administrations – often seen as a more representative measure – rose quarter-on-quarter for the first time since the height of the financial crisis.

And individuals are also not out of the woods yet, too. UK Debt charity the Consumer Credit Counselling Service (CCCS) warned that the squeeze on household income this year from tax hikes, spending cuts and soaring inflation was likely to push personal insolvencies higher in 2011.

According to both the Insolvency Service and the CCCS, the best way to avoid insolvency issues is to tackle financial problems early and seek advice before it’s too late.

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Written by Andrew Hodges

February 14, 2011 at 5:33 pm

Posted in Comment, LinkedIn

Tagged with , ,

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