The number of individuals entering a personal insolvency procedure has hit the highest Q3 level since 2010.
The figures, released by the Insolvency Service, show there were 30,879 individuals entering either bankruptcy (4,122), a debt relief order (6,784) or an individual voluntary arrangement (IVA) (19,973) in the third quarter of 2019.
The statistics show that one in 365 adults entered a personal insolvency procedure in the rolling 12 months to the end of Q3 – September 30, 2019 – up from one in 382 adults in the rolling 12 months to the end of Q2.
Alec Pillmoor, personal insolvency partner at RSM, said: “Despite already seeing near decade long highs over the last 18 months, personal insolvency numbers continue to rise and have exceeded 30,000 for the fourth successive quarter for the first time since 2011 and recorded the highest quarter three total since 2010. Longer term we would anticipate that this will increase further as following a recent YouGov poll, conducted on behalf of StepChange Debt Charity, 29 percent of Brits expect their finances to actually get worse in the next year.”
Duncan Swift, president of insolvency and restructuring trade body R3, said: “British consumers’ confidence is low – they’re spending less, the economic uncertainty is putting them off making big purchases, and they are pessimistic about the economy and how it will fare over the next year.
“Although real wages have hit a recent high, they are still lower than they were before the financial crisis. Unemployment may be low, but it’s not necessarily secure for everyone.”
Meanwhile, underlying corporate insolvencies rose by 0.4 percent in Q3 2019 compared to the second quarter, and rose by 1.6 percent compared to Q3 2018.
“Today’s figures are further evidence that the economic and political turbulence of the last 12 months has taken its toll on businesses,” Swift added. “Uncertainty and stop-start stockpiling are among the factors hitting recruitment, investment, and wider business health, and we’re seeing more businesses worrying about their cashflow levels and their order books over the next quarter and the next year."
The Turnaround, Restructuring and Insolvency (TRI) Conference takes place on November 13 at the London Hilton Bankside. Visit its site to view the agenda and book your place.