Lord Baker of Dorking said that one of the government’s greatest achievements was to make it easier for people to go bankrupt.
His comments came as the government disclosed there had been almost 63,000 bankruptcies in England and Wales last year.
Lord Baker said: “That figure shows that since 2002, when the government eased bankruptcy regulations, the number of bankruptcies and individual voluntary arrangements has gone up by four times.”
However, a government trade minister said that the availability of credit and unemployment was responsible for the rise in individual insolvencies.
In related news, Prime Minister Tony Blair and his wife Cherie have been accused of setting a bad example by buying a fifth house and raising their level of secured debt to almost £5 million.