Personal insolvencies hit record high in 2010

”Personal

Figures published by the Insolvency Service have revealed personal insolvencies climbed to a new high in 2010.

According to the Insolvency Service, there were 135,089 personal insolvencies in 2010 - a rise of 0.7% compared with 2009.

This was also double the number of people declared insolvent in 2005 and represented the highest figure since records began in 1960.

In the meantime, the number of people declared bankrupt fell by 20.7% compared with 2009 to 59,194.

Company failures also fell in the 2010 year compared with the previous year.

However, while the figures appear encouraging, experts have warned that the ongoing lack of credit, coupled with the Government’s massive spending cuts, could see problems ahead – particularly for smaller companies.

Meanwhile, a report last month by insolvency specialist Begbies Traynor revealed 2011 could see a 10% hike in insolvencies.

According to the report, 147,836 firms are facing serious difficulties than at any time since the beginning of 2009.

The report suggests firms are still feeling the effects of the recession and the Government spending cuts will only make the problem worse.

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