Scottish Insolvencies in the First Quarter 2010/11
22/07/2010
Official figures from Accountant in Bankruptcy (AiB) report 5,378 personal insolvencies in Scotland for the first quarter of 2010/11. This figure represents an increase of 4 per cent on the previous quarter and a decrease of 15 per cent on the same period in the previous year. Personal insolvency data consists of both bankruptcy and protected trust deed (PTD) figures.
The latest official Scottish figures released 21 July 2010, show that there were 3,139 awards of bankruptcy, showing no change on the previous quarter and a decrease of 16 per cent on the same period in the previous year.
Acknowledging these latest official figures, Fergus Ewing, Minister for Community Safety, commented:
"I am pleased to see that the total number of personal insolvencies, which includes both bankruptcies and protected trust deeds, is significantly less compared to the same quarter of last year and that the number of bankruptcies remains similar to figures of the previous quarter.
"The Scottish Government remains committed to helping those struggling to deal with debt and work is ongoing to bring the Home Owner and Debtor Protection (Scotland) Act 2010 into force later this year. The Act will offer greater protection for homeowners faced with repossession and allow access to bankruptcy for a wider group of people who need this form of debt relief.
"Encouragingly, Debt Payment Programmes (DPPs) under the Debt Arrangement Scheme, which allow people to repay their debt over an extended period of time, have increased by 60% compared to the same quarter of last year. This rise, along with lower numbers in personal bankruptcies is a possible indication that people are seeking advice at an early stage and choosing a debt solution appropriate to their circumstances.
"I also note that the number of businesses entering liquidation or receivership has increased when compared to both the previous quarter and last year's corresponding figures. We will monitor these figures closely."
Statistics in brief:
- 5,378 personal insolvencies in Scotland, for the first quarter of 2010/11; an increase of 4 per cent on the previous quarter and a decrease of 15 per cent on the same period in the previous year
- 3,139 were awards of bankruptcy; showing no change on the previous quarter and a decrease of 16 per cent on the same period in the previous year
- 2,239 protected trust deeds (PTDs) were recorded; up 10 per cent on the previous quarter and a decrease of 13 per cent on the corresponding quarter of last year
- 2,500 awards were made as a result of debtor applications to AiB; an increase of 1 per cent on the previous quarter and a decrease of 17 per cent on the same quarter last year. Of these, 1,897 were awarded bankruptcy through LILA
- 562 awards resulted from petitions to the courts by creditors; a 1 per cent decrease on the previous quarter and a decrease of 9 per cent on the same quarter last year
- 77 awards were made as a result of petitions to the court by trustees in a trust deed; a 13 per cent decrease on the previous quarter and a 21 per cent decrease on the same quarter last year
- 495 Debt Payment Programmes approved under the Debt Arrangement Scheme (DAS) in this quarter; an increase of 19 per cent on the previous quarter and an increase of 60 per cent on the same quarter in the previous year
A full statement of Scottish insolvency statistics for the first quarter of 2010/11 is now available.
Notes
- The Accountant in Bankruptcy supervises all personal insolvencies in Scotland and administers those bankruptcies where appointed. Insolvent individuals in Scotland are subject to bankruptcy (sequestration) or enter Protected Trust Deeds (PTDs) under the Bankruptcy (Scotland) Act 1985. The 1985 Act was amended by the Bankruptcy (Scotland) Act 1993 and on 1 April 2008, part 1 of the Bankruptcy and Diligence etc. (Scotland) Act 2007 came into force making significant changes to some aspects of bankruptcy in Scotland. Changes included the introduction of LILA, a route into bankruptcy for people with low income and low assets. The changes also took a number of processes out of the Scottish Court system, reducing costs and freeing up court time.
- PTDs are voluntary arrangements, where the debtor passes his estate to an insolvency practitioner who arranges to repay part of the debt to creditors on the debtor's behalf. This is similar to Individual Voluntary Agreements (IVAs) in England and Wales, although there are important differences in the way they are set up and administered.
- The Debt Arrangement Scheme (DAS) is administered by the Accountant in Bankruptcy. Debt Payment Programmes approved under DAS allow individuals to repay their debts in full over an extended period of time whilst providing protection from enforcement by their creditors and safeguarding their home as long as mortgage payments are maintained. The legislation relating to DAS is contained in the Debt Arrangement and Attachment (Scotland) Act 2002 and subsequent regulations.
- The Accountant in Bankruptcy is also responsible for receiving, extracting and recording information from certain forms relating to company liquidations and receiverships. The legislation appropriate to liquidations and receiverships is contained in the Insolvency Act 1986 and the Insolvency (Scotland) Rules 1986.
Details of bankruptcies, PTDs, liquidations and receiverships are found on the register of insolvencies, which is maintained by the Accountant in Bankruptcy. Further information on DAS, including a register of DPPs, is available at www.moneyscotland.gov.uk
Further information regarding insolvency in Scotland, including legislation, can be found by navigating the tabs on this website.