The number of Scots going bust has fallen dramatically, according to
official figures released today by Accountant in Bankruptcy.
The annual total number of personal insolvencies, which include both bankruptcies and Protected Trust Deeds, has fallen 19.1 per cent to 11,161 compared to a year ago.
In the final quarter of 2014-15 up until March 31, a total of 2,569 personal insolvencies were recorded, which is the lowest combined total since the fourth quarter of 2004-05. This represents a 2.4 per cent drop on the previous quarter to the end of December 2014 and means personal insolvencies are at their lowest level for 10 years.
The longer term trend shows total personal insolvencies have declined every year for the past three years - and at an increasing rate.
There were 4,147 debt payment programmes approved under the Debt Arrangement Scheme (DAS) in the past year, 9.4 per cent fewer than the annual total for 2013-14. However, the amount of money repaid through DAS continues to rise, with £36.8 million recouped for creditors over the year, up 22.5 per cent, or £6.8 million.
In a further sign of an improving economy in Scotland, the number of Scottish-registered companies becoming insolvent is also down 8.2 per cent on the annual total for 2013-14 and now stands at the lowest level for seven years.
The 197 receiverships or liquidations of Scottish companies recorded for the fourth quarter of 2014-15 is 19.3 per cent lower than the same quarter a year ago.
Business Minister Fergus Ewing welcomed the latest figures.
He said: “These are extremely encouraging numbers which illustrate that Scotland’s recovery continues to gather pace.
“We are now looking at levels of sequestrations and companies going to the wall that haven’t been seen since before the global recession.
“Nevertheless, this Government remains committed to doing all it can to ensure fewer and fewer people experience the misery associated with problem debt.
“The introduction of the Bankruptcy and Debt Advice (Scotland) Act earlier this month is a pioneering policy which places Scotland at the cutting edge of global approaches to dealing with personal debt.
“Measures such as mandatory money advice for people seeking access to statutory debt relief instruments such as sequestration ensures debtors are matched with the solution that best fits their needs and circumstances.
“Compulsory financial education for those who have been sequestrated more than once has also been introduced to help the financially vulnerable and prevent them facing future economic difficulties.
“We have also introduced a new route into bankruptcy for those with few assets, ensuring we continue to do all we can to ease the burden of debt on those who can bear it the least.”
The latest AiB figures also show that bankruptcies alone have also fallen compared to a year ago, with 1,735 awards granted in the fourth quarter of 2014-15, 1.3 per cent lower than the same quarter a year ago. Numbers rose by 10 per cent over the third quarter of 2014-15 to 1,735, with some debtors choosing to apply under the pre-April 2015 legislative regime.
(Source - AiB News Release)