By Jason Theodorou

The number of people being declared insolvent has fallen in England and Wales for the first time in years, with a 3% drop in personal insolvencies in the second quarter of the year. This represents the first fall in personal insolvencies since 2007.

At least 34,743 personal insolvencies were registered in the second quarter of this year, many of these involving bankruptcies and debt relief orders. The number of firms falling into insolvency decreased by 2% from the previous quarter.

There was an increase in individual voluntary arrangements, where individuals have the interest frozen on their debt provided that they repay a set amount on a monthly basis.

Insolvency experts received the figures cautiously, saying that a decrease in government spending was likely to drive more people into insolvency as swingeing cuts hit the job market and impacted those struggling to keep up with their debts.

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