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OVERSPENDING, UNEMPLOYMENT AND RISING COSTS FUEL PERSONAL
INSOLVENCIES
THE number of
personal insolvencies in England and Wales has reached new highs
with 27,644 individuals going into a bankruptcy or an IVA
(Individual Voluntary Arrangement) during the 3rd quarter of 2006,
according to figures issued by the DTI and analysed by Grant
Thornton's Recovery & Reorganisation practice.
The rise represents
an increase of 5.7% on the previous quarter and a massive 55.4% on
this time last year. The number of IVAs in particular (12,228)
is going through the roof (up 9.8% on the previous quarter and
117.9% on this time last year), signalling a growing trend in
resolving serious debt problems through the use of this practice.
"The seemingly never-ending rise in the number of UK personal
insolvencies continues apace, sustained by the side effects of the
buy-now-pay-later generation. Individuals with credit card debts in
excess of £50/60,000 are not at all uncommon, while the overall age
of those affected appears to be on the decrease with a larger
proportion of women also noticeable.
Despite
a far slower annual growth rate in consumer credit, which now stands
at 6.3%; in the past year alone UK consumers have managed to rake up
a further £21bn in unsecured credit, typically on credit and store
cards, which now tops £212bn. While the vast majority of this debt
is paid back on time and without fail, it is unsurprising that with
so many individuals borrowing so much money, increasing numbers are
defaulting on their payments and getting into financial trouble.
Consistently, the most common reason which tips people over
the edge financially is that of ignoring bills and letting interest
rates turn a pile of debt into a debt mountain. Individuals who are
financially overstretched need very little to turn a financial
problem into a financial crisis. On a national scale, high utility
bills, rising council tax, unemployment rates which have increased
by 276,000 to 1.70 million in the past year alone, and higher
interest rates on increasingly large mortgages have all played a key
part in fuelling personal insolvencies.
Back in 2000 around 22% of all bankruptcies comprised those
unemployed or with no occupation. In 2006 so far, the figure has
jumped to 38%. The reasons for this substantial rise are multiple
with unemployment rises and more senior citizens struggling to make
ends meet among the possible causes." said Les Ross,
personal insolvency partner at Grant Thornton.
Ross pointed to the rising number of house repossessions as evidence
that debt problems are having a lasting effect on UK families.
"Based on our analysis of Council of Mortgage Lenders statistics
for 2006 so far, we believe that upwards of 12,000 homes will be
repossessed this year", said Ross.
Mark Allen head of IVAs at Grant Thornton predicted that IVAs will
soon be the preferred method of dealing with bad debt. "Last
year the number of IVAs doubled on the previous year and in 2006
IVAs have accounted for around 45% of all personal insolvencies. Any
quarter now and IVAs will outnumber bankruptcies. While they
have been around since 1986, IVAs only recently shot to prominence,
mainly thanks to the advantages they bring, not least the freezing
of the debt which debt consolidation and management plans do not
offer, and the prospect of becoming free of debt within a set time -
typically 5 years. I expect that lenders will increasingly need to
focus on debt collection, including automated procedures to speed
and improve efficiency of current procedures and work with the IVA
industry to obtain a better rate of return, typically 30 to 40p in
the pound, which is superior to most other solutions",
concluded Allen.
Ross continues:- "Corporate insolvencies have remained
consistent for the past two years but next quarter we expect to see
a jump of around 25% on 2005 - fuelled by our recent appointment as
administrators of 844 companies - the largest ever single
administration application (by number of separate limited companies
involved) in UK corporate insolvency history. Aside from this
case which will fuel the stats, we expect corporate insolvencies to
remain broadly in line with previous months, although the proportion
of retailers experiencing financial trouble either side of Christmas
is likely to increase", he concluded. |
Boozy Britons could cause mouth cancer cases to soar
THE UK’s
leading oral health charity has warned that Britain’s increasing
drinking culture could cause the number of mouth cancer cases to
spiral to new levels.
The British Dental Health Foundation was speaking after government
statistics revealed the number of alcohol related deaths in the UK
has almost doubled since 1991.
In the UK one person is killed every five hours by mouth cancer,
while people who drink alcohol to excess are four times more likely
to develop the condition. Furthermore, heavy drinkers who also smoke
are a staggering ‘up to 30 times’ more likely to
develop mouth cancer.
Dr Nigel Carter, chief executive of the Foundation, commented:-
“Most people are aware that smoking increases your cancer risk
but not everyone realises just how dangerous excessive alcohol
consumption can be.
People are drinking more and more these days and, with many so
called ‘social smokers’ having a cigarette while they drink the
likelihood is that the number of mouth cancer cases will continue to
rise until people are forced to take notice.”
The Foundation’s warning came in advance of Mouth Cancer Awareness
Week (12 November 2006 to 18 November 2006). The campaign is being
launched on Monday (13 November 2006) by chief dental officer Barry
Cockroft and aims to halt the continued rise in the number of people
suffering with mouth cancer.
The campaign is using the tagline ‘If in doubt, get checked
out’ to persuade people to check their mouths regularly for
any changes.
Dr Carter continued:- “The first sign of mouth cancer can
often be something seemingly harmless such as an ulcer that won’t
heal, a lump or a red or white patch in the mouth.
Early detection of the condition increases survival chances from
just one in two to nine out of 10.
While people with these symptoms should not panic as often these
things will have a perfectly harmless explanation, but anyone
noticing changes in their mouth should see their dentist or doctor
immediately to put their mind at rest.”
Letters To Editor:- "Documentary on Chewits Closure."
"I'm an
assistant producer/researcher working at an independent film company
in London (Special Edition Films) and I am looking for people to be
interviewed for a documentary we are making on nostalgia and places
which have a very British brand name sadly closing down around the
UK, one of them being The Chewits Factory and Pleasureland
Southport. (Others we are including are Pontins and HP Sauce)
As you know, they have both been closed recently (Chewits officially
in the next couple of weeks) and we would like to speak to anyone
who worked in both these places in the last 40 years, has any
connection to them, which tells a good story and how they feel about
the closures.
We are actually coming down to film at the last day weekend of the
24 November. So if anyone is available that weekend please get in
touch as soon as possible!" Charlotte Arden.
Letters To Editor:- "Looking for great-grandfather."
"I am seeking
assistance in finding information about the Grugal family name. My
great-grandfather was named Robert Grugal. His father was a book
binder in Everton England. My great-grandfather and his brother
immigrated to Nova Scotia where they were taken in by two brothers
and two sisters named MacLeod. Although never formally adopted, they
assumed the MacLeod family name. Over the years, some members of my
family have tried to find out more information about the family name
and our heritage and met with limited success. The only information
we could find was my great-grandfathers birth information. I believe
my great-great-grandfather's name was either James Robert Grugal or
Robert James Grugal, but I do know that my great-great-grandmother's
name was Anna Grugal." Scott.
rscottanderson@eastlink.ca - 111 - 18 Churchill
Drive, Dartmouth, Nova Scotia, Canada |
