For the first time since the second quarter of 2014, individual insolvencies have increased, according to the latest statistics published by the gover…
For the first time since the second quarter of 2014, individual insolvencies have increased, according to the latest statistics published by the government.
In the third quarter of 2015 there were 19,683 individual insolvencies, 2.8 per cent higher than in the second quarter of 2015. This was however a decrease of 18.5 per cent compared to the third quarter of 2014.
This growth of insolvencies was driven by a rise in individual voluntary arrangements (IVAs). The 10,197 IVA's in the third quarter of 2015 was a 9.3 per cent increase compared to the second quarter of 2015. Again though, this is a decrease from the third quarter of 2014, of 17.9 per cent.
Even though these figures have seen an increase, the rate of insolvency across England and Wales has still dropped. In the 12 months ending in September 2015, one in 550 adults (0.18 per cent of the adult population) became insolvent. This was the lowest rate since the 12 months ending in December 2005.
In contrast to insolvency figures, the number of bankruptcies was at the lowest level in 25 years. There were a total of 3,857 bankruptcy orders in the third quarter of 2015, which was 3.3 per cent lower than the second quarter. Furthermore, this was a decrease of 21.4 per cent from the third quarter in 2014. The number of bankruptcy orders has been on a decreasing trend since 2009. However, the introduction of debt relief orders (DROs) in 2009 is likely to have affected the number of bankruptcies.
DROs have also seen a decrease since their introduction, with 3.5 per cent less in the third quarter of 2015 than in the second. The drop from the same period in 2014 stands at 17.3 per cent.
Companies have seen improvements this quarter, with continuous decreases in insolvencies, compulsory liquidations, creditors' voluntary liquidations and administrations and company voluntary arrangements (CVAs). The estimated liquidation rate in the 12 months ending in September 2015 was 0.46 per cent of active companies, the lowest level since comparable records began in the last quarter of 1984.