Personal insolvency figures soar, but company liquidations decrease

Figures provided by the Insolvency Service this month show that UK businesses are less likely to go into liquidation than they were a year ago. Personal insolvencies continue to soar, however, as the longer term cost of "cheap" borrowing becomes more and more apparent.

COMPANY LIQUIDATIONS

There were 3,265 liquidations in England and Wales in the second quarter of 2006 on a seasonally adjusted basis. This was a decrease of 4.9% on the previous quarter and a decrease of 3.3% on the same period a year ago.

This was made up of 1,226 compulsory liquidations, a decrease of 13.7% on the previous quarter and a decrease of 7.4% on the corresponding quarter of the previous year, and 2,038 creditors voluntary liquidations, an increase of 1.4% on the previous quarter and a decrease of 0.6% on the corresponding quarter of the previous year.

0.7% of active companies went into liquidation in the twelve months ended Q2 2006, the same as the previous quarter and the same as the corresponding quarter of 2005.

INDIVIDUAL INSOLVENCIES

There were 26,021 individual insolvencies in England and Wales in the second quarter of 2006 on a seasonally adjusted basis. This was an increase of 10.0% on the previous quarter and an increase of 66.3% on the same period a year ago.

This was made up of 14,915 bankruptcies, a decrease of 3.3% on the previous quarter and an increase of 32.5% on the corresponding quarter of the previous year, and 11,105 Individual Voluntary Arrangements (IVA’s), an increase of 34.9% on the previous quarter and an increase of 153.2% on the corresponding quarter of the previous year.