Statutory Debt Solutions Statistics Update
The Accountant in Bankruptcy (AiB) has released its official statistics reporting statutory debt solutions and company insolvencies in Scotland for the third quarter (October to December 2022) of the financial year 2022-23.
While these figures demonstrate that, over this period, personal insolvencies decreased, and Debt Payment Programmes (DPP’s) under the Debt Arrangement Scheme (DAS) increased, overall personal insolvencies remain higher than DPPs under DAS. * See Chart 1
Corporate insolvencies continue to increase, mirroring what our business recovery team at Thomson Cooper are seeing in the current market.
Continued pressure on living costs
With the continued energy price shock, the increase in the base rate of interest to 4%, and the BOE’s prediction that the UK economy will enter a shallow recession later this year, a further impact on business and individuals’ finances seems inevitable.
Our expectation is that we will begin to see a further rise in personal and corporate insolvencies, as well as the use of the Debt Arrangement Scheme, which can help people repay their debts and protect their homes.
On a more optimistic note, this is expected to be the last interest rate rise for some time as it is hoped that the economy has turned a corner and inflation has now peaked and will begin to fall again.
Collectively, there were 1,966 personal insolvencies (bankruptcies and protected trust deeds (PTDs)) in Scotland in 2022-23 Q3, almost 5% fewer than in the same quarter in the previous financial year. Individually, bankruptcies decreased by 10% and PTDs by 2.6%.
A total of 490 bankruptcy awards were made following applications submitted to the AiB, all through the revised fee structure. Of this total, 70% of applicants were not required to pay any fee at all.
There were 785 applications for moratoria granted in 2022-23 Q3, representing a 6% increase on the previous year. Completed Debt Payment Programmes (DPPs) under the Debt Arrangement Scheme (DAS) increased 16%. There were 283 DPPs revoked in 2022-23 Q3, around half that revoked in the same quarter last year.
The number of Scottish registered companies becoming insolvent or entering receivership rose by just over 13% compared to the same period last year.
At Thomson Cooper, we are always happy to assist. Whether with corporate or personal insolvency or the Debt Arrangement Scheme, we will help you find the right solution to suit your circumstances.
If you or anyone you know needs help dealing with problem debt, for free confidential advice please contact:
Contact:
Ian Brown
Senior Insolvency Manager
ibrown@thomsoncooper.com
Phone: 01383 628800
Mob: 07519 124657
Richard Gardiner
Partner
rgardiner@thomsoncooper.com
Phone: 01383 628800
Mob: 07872 376105
Maureen Walls
Senior Insolvency Manager
mwalls@thomsoncooper.com
Phone: 01383 628800
About the author
Ian Brown
Ian is an expert in the Debt Arrangement Scheme and Business Debt Arrangement Scheme, assisting individuals, sole traders and partnerships.
He also advises on personal debt solutions recommending the best option to resolve problem debt issues.