North East Sees IVA And Bankruptcy Cases Soar

The North East of England has more personal insolvency and bankruptcy cases than anywhere else in the country, according the new research.

Research by insolvency trade body R3 showed that you are more likely to experience bankruptcy or apply for an individual voluntary arrangement  (IVA) if you live in the North East, compared to other areas across England and Wales.

The report showed that there were 5,923 new insolvency cases in the North East, with 29 in every ten thousand people declaring insolvency. The average insolvency cases per ten thousand in London is just 17.1 people, while the UK average is 24.3 per ten thousand.

Seaside towns have also been hit hard by new insolvency cases and show that debt problems in coastal towns are common. Torbay, a popular South West holiday area, had a recorded 45.8 new insolvencies per ten thousand, while the town of Hastings recorded 36.9.

The President of R3, Steven Law, said: “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.”

The findings take into account personal insolvency options such as IVAs and bankruptcies but do not consider other forms of debt management such as debt management plans.

R3 concluded that there are 500,000 people in the UK who have started a debt management programme of some variety, while there are a further one million people who are struggling with their debts but have yet to seek help for them.