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Scottish insolvencies for second quarter 2012-13
Scottish insolvencies for second quarter 2012-1324 October 2012
Accountant in Bankruptcy (AiB) today released official figures reporting personal and company insolvencies in Scotland for the second quarter of the financial year 2012-13. There were 4,063 personal insolvencies, which include bankruptcy awards and protected trust deeds, for the period – a 27.5 per cent decrease on the previous quarter and a 24.5 per cent decrease on the same period in the previous year.
AiB’s fees structure was changed as of 1 June 2012, with the fee for debtors applying for their own bankruptcy being raised. This is likely to have contributed to a higher than expected number of debtors making applications in May and subsequent comparisons with the first quarter of 2012-13 may be affected as a result. In total there were 1,859 awards of bankruptcy, showing a decrease of 43.8 per cent on the previous quarter and a 34.9 per cent decrease on the same period from the previous year. The number of protected trust deeds (PTDs) recorded was 2,204 in total, a decrease of 3.8 per cent on the previous quarter and a decrease of 12.7 per cent on the corresponding quarter of last year.
There were 1,440 awards of bankruptcy by debtor application for the quarter, down by 50.6 per cent on the previous quarter and by 38.7 per cent on the same period of the previous year. Figures for the Debt Arrangement Scheme (DAS) show that the number of debt payment programmes approved under the Scheme were 1,110 for the second quarter, a decrease of 24.9 per cent compared to the previous quarter but an increase of 29.7 per cent compared to the same period of last year. Promotion of the Scheme to raise awareness of the Scottish Government-backed debt management tool and its benefits has resulted in the number of approved programmes being higher in the second quarter of 2012-13 than in any quarter of 2011-12.
AiB received 274 notices of Scottish registered companies becoming insolvent or entering receivership in the first quarter of 2012-13 – a 34.8 per cent decrease on the previous quarter and a 24.1 per cent decrease on the same period in the previous year.
- 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 their 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 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. Further information on DAS, including a register of debt payment programmes, is available at http://www.dasscotland.gov.uk
- Details of bankruptcies, PTDs, liquidations and receiverships are found on the register of insolvencies, which is maintained by Accountant in Bankruptcy and can be found at http://roi.aib.gov.uk/roi
- 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.
- Further information regarding insolvency in Scotland, including legislation, can be found on the Accountant in Bankruptcy’s website at www.aib.gov.uk