The number of people declaring themselves bankrupt in Wales fell in the last quarter of 2007.

The latest statistics for the final quarter of 2007 show a 6% fall in people petitioning for their own bankruptcy, as opposed to being forced into bankruptcy by a creditor, from 673 cases in the third quarter of 2007 to 632 cases in the fourth quarter.

The three months ended December 31, 2007, saw a fall of 8% in the number of people making themselves bankrupt in England and Wales, and a dramatic decline in the use of individual voluntary arrangements, which dropped 12% in the most recent quarter, making a total fall of 27% over the past year.

IVAs enable individuals in financial distress to approach their creditors with a plan to restructure their debts. This typically involves the debtor making regular, affordable monthly payments for a fixed period of time, at the end of which the balance of the debt is written off.

The figures also reveal that 11,703 people in England and Wales petitioned the court to bankrupt themselves and 9,376 agreed an IVA in the quarter October to December 2007.

John Bangham, director of personal insolvency for KPMG’s Cardiff office, said, “This means that a total of 21,076 people took the potentially life-changing steps to place themselves into personal insolvency. This represents an incredible 90% of all personal insolvencies.

“After many years of quarterly increases, we have seen two consecutive falls. Bankruptcies where the debtor makes a positive decision to go bankrupt have fallen by 8% over the past quarter to 11,703.

“At the same time, the number of IVAs, where the debtor seeks to come to a deal with the creditors, has fallen by 12% to 9,376,” he added.

“One of the main reasons is the drop in the number of IVAs, which have come in for criticism following concerns about whether they are always the most appropriate course of action for the individual.”


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