News In Focus
Bankruptcy figures hold steady in latest quarter
The number of Scots seeking a way out of insolvency remained steady in the third quarter of 2016-17, according to figures just released by the Accountant in Bankruptcy (AiB), but an upward trend could be emerging.
Out of the total 3,145 cases in the three months to 31 December 2016, a 1.9% increase on the previous quarter, 1,116 bankruptcies were awarded, just three more than the previous quarter – but nearly 15% up on the same period in the previous year.
The number of protected trust deeds recorded was up from 1,311 to 1,500, a 14.4% rise on the previous quarter, but new debt payment programmes approved under DAS fell to 529. This compared with 662 approvals in the previous quarter but was 2.3% up on the previous year, while 408 DAS debt payment programmes were completed, up 30.8% on the previous year.
Personal insolvencies in Scotland have more than halved since 2008-09, and the numbers fell significantly in early 2015-16, the first months after the Bankruptcy and Debt Advice (Scotland) Act 2013 came into force, but the latest figures, up for the third quarter in a row, show a return to levels seen before the introduction of the Act.
Govan Law Centre has described personal insolvency services in Scotland as a "dysfunctional market", with numerous instances of bad practice operating to the prejudice of debtors. (Click here for Journal article.)
Commenting on the latest figures, Minister for Business, Energy and Innovation Paul Wheelhouse said there was "no room for complacency".
The number of Scottish businesses becoming insolvent or entering receivership fell from 218 in the second quarter of 2016-17 to 209 in the current quarter, made up of 137 compulsory liquidations and 72 creditor voluntary liquidations. No receiverships were recorded for the quarter. There were also 151 members' voluntary liquidations, up from the 106 recorded in the previous quarter.
Click here to access the full report.