Numbers going bust edges up by 3pc

Some 25,717 individual insolvencies were recorded, showing a three per cent increase on the previous three months, although this is still six per cent lower than the same period last year, the Insolvency Service’s report said.

The overall figure masks a decline in bankruptcies, which fell by three per cent on the previous quarter and remained at their lowest levels for more than a decade.

Some 6,469 bankruptcy orders were recorded in the second quarter of this year, putting them one fifth lower than a year ago.

Bankruptcies are often seen as a “last resort” and their use has generally dropped off since the introduction of a newer type of insolvency called a debt relief order (DRO). DROs, which are often dubbed “bankruptcy light”, fell back to their lowest levels in more than two years with a one per cent fall.

Around one quarter of bankruptcy orders involve people who are self-employed, a bigger proportion than in previous years.