Scottish personal insolvency numbers rise

The number of personal insolvencies in Scotland rose between April and June, according to new figures.

Accountant in Bankruptcy (AiB) reported 3,208 bankruptcies and protected trust deeds (PTDs) during the first quarter of the financial year.

The figure was up 11.8% on the same period last year, and 26.6% higher than the previous quarter.

PTDs rose year-on-year by 27.5% to 1,972, and were up by 34.7% from the January to March period.

A PTD is a legally binding arrangement where those in debt can make reduced payments over four years.

Meanwhile, bankruptcies fell by 6.5% to 1,238, compared with the first three months of 2017-18. However, they were up from 1,069 in the previous quarter.

The Scottish government's Debt Arrangement Scheme (DAS), which allows people to repay their debts without facing insolvency or further action, rose year-on-year by 8.5%, with 648 debt payment programmes approved.

A total of £9.5m was repaid through the scheme in the quarter, slightly more than the previous year.

AiB chief executive Richard Dennis said: "While the number of individuals entering insolvency continues to be very much lower than 10 years ago, these figures clearly illustrate personal insolvencies remain on an upward trend from the first quarter of 2015-16.

"With consumer borrowing now surpassing the levels seen before the 2008 crash, we are leading an ambitious programme of reform to make sure the debt solutions offered by the Scottish government remain relevant in today's society."

Tim Cooper, from insolvency and restructuring trade body R3, said the impact of the new, higher rates of the national minimum and living wages introduced in April would have helped many people bear higher costs for essentials like food and fuel.

However, he added that the latest insolvency numbers suggested that "for many, it may not have been enough, especially following a long period when wage growth was outstripped by inflation".

Meanwhile, the latest figures on corporate insolvencies showed a year-on-year rise, from 200 in the first quarter of 2017-18 to 245.

The number was down on the 259 reported in the final quarter of the last financial year.