The North East of England becomes the region with the highest number of new personal insolvency cases in England and Wales.
Analysis by R3, the insolvency trade body, has shown that you are more likely to be declared bankrupt, or undergo Individual Voluntary Arrangements (IVA) proceedings in the North East than anywhere else in England and Wales.
There were almost six thousand (5,923) new personal insolvency cases in the North East which means that for every ten thousand people, 29 of them became insolvent.
The average number of new cases in England is 24.3 per ten thousand. In London, for example, there were 17.1 new personal insolvency cases for every ten thousand people.
With deep public sector cuts likely – many government departments are based in the North East – there is concern that the number of personal insolvencies will rise further in that region.
UK coastal towns have also been beset with debt problems, the findings show. Torbay recorded 45.8 new personal insolvencies per 10,000 and Hastings had 36.9 insolvencies per 10,000 population, for example.
“It is unsurprising that many of the top ten insolvency hotspots are coastal towns. Tourism and leisure services businesses are often the main employer in these areas and, when people are reining in their spending, these services tend to be the first affected which means businesses reduce staff hours or cut jobs; or replace permanent jobs with temporary positions.”, said Steven Law, R3’s President.
These figures map formal insolvencies which include IVAs and bankruptcies, but exclude other forms of debt help such as debt management plans.
R3 estimate that there are 500,000 in informal insolvency programmes, such as debt management, and a further one million who are struggling with debt and have not yet sought help.