Personal Insolvencies and DPPs Increase
1 April 2012

Figures published by the Accountant in Bankruptcy showed a significant increase in both personal insolvencies and debt payment programmes approved in the first three months of 2012.

There were a total of 4856 personal insolvencies in that period, a 4% increase on the previous quarter and a 14% increase on the same quarter last year. Bankruptcy wards, totalling 2609 awards, showed a slight decrease, 0.2% against the previous quarter and a 3% decrease on the same quarter last year.

The bulk of the awards of bankruptcy, 2142, were granted as a result of debtor petitions. Almost half, 1060, were awarded through the Low Income Low Asset route.

Fergus Ewing, Minister for Energy, Enterprise and Tourism put the risein personal insolvencies down to an increase in protected trust deeds. There may be some good news in the figures for creditors as they will tend to get a higher return from protected trust deeds.

942 Debt Payment Programmes (DPPs) under the Debt Arrangement Scheme (DAS) were approved in the first quarter of 2012. This was an increase of 7% on the previous quarter and a 97% increase in the same quarter of 2011. This does appear to show a greater uptake of DPPs after a number of changes made by the Scottish Government. Creditors will clearly need to take more care in checking the DAS register prior to taking court action or instructing diligence. AMA will undertake these checks on creditors behalf when instructed.