Number of Cornwall residents unable to pay their debts revealed
Hundreds of people across Cornwall are unable to pay their debts on time. In 2021, 1,253 people in the county were classified as insolvent. This number is higher than the national average
According to data released by the Insolvency Service, the number of insolvent people has fallen during the pandemic, as 1,657 people were insolvent in 2019. Despite the fall, huge increases in the cost of living are expected to push many more struggling families. in insolvency.
In Cornwall, the insolvency rate has fallen from 36 people per 10,000 people to 27. However, this is still higher than the national insolvency rate of 23 people per 10,000 people in England and Wales.
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The Insolvency Service says the fall will likely be at least partly due to financial support programs put in place by the government to help people pay their bills during the pandemic. But all of those support programs have now come to an end – while household incomes have been hit by an unprecedented cost-of-living crisis that has seen bills for food, fuel and other daily expenses soar, along with tax increases.
David Samson, social benefits project manager at Turn2us, said: “The last two years have had a profound impact on people’s incomes and for many the support schemes introduced at the start of the pandemic would undoubtedly have contributed to keep them afloat during this financial storm. . However, with the cost of living soaring as wages and benefit levels continue to stagnate, we fear that more people than ever are facing mounting debt and even insolvency.
“If you are worried about money, we urge you to seek advice from a debt specialist as soon as possible. You can perform a handy financial health check using our benefits calculator to check the benefits you can get You can also use our grant finder to find out if there are any grants you may be eligible for.”
Last year there were also 117 new bankruptcies in Cornwall, down 51% from 238 before the pandemic.
Bankruptcy is the legal process when a person has been declared insolvent, often taking place when less formal arrangements to improve the individual’s finances have failed.
Another option is a debt relief order, which freezes repayments and interest for 12 months. If the individual’s finances have not improved at the end of this period, the debt is written off. In Cornwall, 255 debt relief orders were issued in 2021, down 51% from 516 in 2019.
However, individual voluntary arrangements – a legal agreement made with creditors, which allows someone to repay their debts over a set period of time – have remained relatively stable, with 903 before the pandemic, and 881 in 2021, a slight decrease of 2%.
Across England and Wales, the number of individual insolvencies had risen steadily before the coronavirus, rising by 49% between 2015 and 2019. But the number of people unable to pay their debts fell by 9% during from the first year of the pandemic, and another 1% last year, down to 110,022 people in 2021, from 122,155 before Covid-19.
Nicky Fisher, assistant vice-chairman of commercial insolvency and restructuring body R3, said: ‘The fall in insolvencies cannot hide the fact that the last 12 months have taken a toll on people’s finances in England and the Country. of Wales, or the worry many have about their financial future.
“There is a good chance that the triple whammy of rising energy prices, rising inflation and economic problems caused by the pandemic and the war in Ukraine could lead to an increase in personal insolvencies. , but much depends on an individual’s situation, and whether they seek advice at a time when it can be improved or whether they wait until an insolvency process is their only option.
Of all parts of England and Wales, people were most likely to be struggling with debt in North East Lincolnshire, where 47 in every 10,000 people are insolvent. This was followed by Hull (44 per 10,000 population), then Halton in Cheshire, Mansfield in Nottinghamshire and Burnley in Lancashire (all with rates of 41 per 10,000 population).
The six main areas with the lowest levels of insolvency are all in London. The City of London was followed by Westminster (10 per 10,000 population), Richmond upon Thames (10 per 10,000 population), Camden (11 per 10,000 population), Kensington and Chelsea (11 per 10,000 population) and Wandsworth (11 per 10,000 inhabitants).
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