Insolvencies continue to rise

Individual Voluntary Arrangements (IVAs), in particular, now represent an even greater share of total insolvencies.

Key Stats:

• The latest quarter shows an overall increase in individual insolvencies of 5.7 per cent over the previous quarter and 55.4 per cent on the same quarter last year. Correspondingly, IVAs, in particular, rose by 9.8 per cent and 117 per cent respectively.
• The total number of individual insolvencies for the year to date (Q4 2005-Q3 2006) totals 98,120, an increase of 63 per cent over the previous full year, 60,335.
• The comparative figures for IVAs are 38,604 and 16,538, a year-on-year increase of 133 per cent.
• For Q3 2006 IVAs represented 44 per cent of total individual insolvencies, compared to 32 per cent for the same quarter a year ago.

James Falla, managing director of Thomas Charles, said of the latest stats: "The DTI stats reflect our findings which showed that 1 in 5 adults in the UK are now in debts of at least £10,000. Unfortunately, rising bad debt is becoming a familiar trend. As long as borrowing beyond one’s means remains the norm, we will continue to see a backlash of personal insolvencies as people become overwhelmed by debt.”