The number of individual insolvencies in England and Wales in the first three months of 2011 was 30,162, a decrease of 15.5 per cent on the same period last year.
There was a significant increase in the number of debt relief orders, which rose by just over a fifth to 6,788 compared to the first quarter of 2010.
Levels of personal insolvencies have been reducing throughout 2010 but many insolvency practitioners believe that we may be on the verge of seeing levels rise again to around 130,000 by the end of 2011.
As the Government’s austerity measures (introduced in April 2011) begin to bite these can take months for the effect to be felt in people’s wallets.
There were 12,539 bankruptcies in the first quarter of 2011, a decrease of 30 per cent on the same quarter the previous year.
Pat Boyden, partner in PwC’s insolvency team, said: “Although debt levels remain fairly high, this downward trend is being driven by the lack of available credit in the market and a fall in uncontrolled debt”.
He added: “Evidence suggests that people are struggling more with their day to day financial pressures such as utility bills rather than their levels of existing debt.”
Individual Voluntary Arrangements (IVAs) were down 8 per cent compared to last year with a total of 10,835 being arranged.