he number of people across England and Wales registering for “breathing space” from their debts jumped by 26% in the second quarter of this year compared with the same period in 2022, according to the Insolvency Service.
Some 21,232 breathing space registrations were recorded in the second quarter of 2023.
Within the total, 20,919 were standard registrations and 313 were mental health breathing space registrations.
A standard breathing space is available to people with problem debt and gives legal protections from creditor action for up to 60 days.
A mental health crisis breathing space is available to someone who is receiving mental health crisis treatment. It lasts as long as the person’s mental health crisis treatment, plus 30 days.
The Insolvency Service’s figures also showed the number of people across England and Wales going into personal insolvency was 11% lower than in the second quarter of 2022.
Some 26,390 personal insolvencies were recorded in the second quarter of 2023, which was also 8% lower then in the first quarter of this year.
Individual voluntary arrangements (IVAs) made up two-thirds (66%) of personal insolvencies in the second quarter of this year, with debt relief orders (DROs) making up 27% and bankruptcies the remaining 7%.
The number of bankruptcies registered in the second quarter of 2023 increased by 4% from the previous quarter and by 11% from the same quarter last year.
Bankruptcy numbers in the first half of 2023 increased from the 40-year low in 2022, the Insolvency Service said.
The number of DROs also increased compared with the previous quarter and the second quarter of 2022, while the number of IVAs fell, both compared with the previous quarter and the second quarter of 2022.
Company insolvencies rose to their highest quarterly level since 2009.
Between April 1 and June 30 2023, 6,342 company insolvencies were registered across England and Wales.
The number of company insolvencies in the second quarter of 2023 was the highest since the second quarter of 2009, 9% higher than in first quarter of 2023 and 13% higher than in the second quarter of 2022.
The number of creditors’ voluntary liquidations (CVLs), at 5,240, was the highest quarterly level since records started in 1960, the Insolvency Service said.
From the start of the Covid-19 pandemic until mid-2021, numbers of company insolvencies had been low when compared with pre-pandemic levels.
This is likely to have been driven in part by Government fiscal and other measures that were put in place to give support during the pandemic, the Service said.