The Isle of Wight’s personal insolvency rate rose in 2018 compared with the previous year, ranking it 13th highest out of all local authorities in England and Wales, says insolvency trade body R3.
According to the annual personal insolvency rates released by the Insolvency Service, the 2018 statistics show there were 39.3 insolvencies per 10,000 adults, compared to 37.4 in 2017 on the Island – placing it within the top 5% of local authorities with the highest rates of personal insolvency of all 348 districts in England and Wales.
As with 2017, the most frequent type of insolvency on the Isle of Wight was debt relief orders (DROs), accounting for 48% of the total. In England and Wales overall, there were over twice as many individual voluntary arrangements (IVAs) as DROs in 2017 (61% of all personal insolvencies were IVAs, 24% were DROs, and 15% were bankruptcies).
The Isle of Wight sits third for the highest rate of DROs of all 348 districts. DROs are designed to help people with low incomes, debts and assets, while IVAs are more usually associated with consumer spending – particularly credit card debt.
The data also revealed the insolvency rate for women on the Isle of Wight had increased from 40.7 in 2017 to 43.7, higher than the rate for men of 34.7 per 10,000 adults, a more pronounced gender split than for England and Wales overall (women had a rate of 26.6 per 10,000 adults compared to 23.3 for men). Insolvencies were also highest for Islanders in the 25-34 age group, with 102.6 per 10,000 adults.
Mike Pavitt, chairman of the Southern Committee of R3 and corporate restructuring and insolvency partner at Paris Smith LLP solicitors, comments:
“It’s concerning to see that the Isle of Wight has the 13th highest level of personal insolvency out of local authorities in England and Wales in 2018, and that its rate rose between 2017 and 2018.
“The latest regional insolvency statistics follow a very established pattern where coastal areas often have higher insolvency rates than inland areas. Places like the Isle of Wight often depend on an influx of tourists in the summer months for income – they rely on the consumer pound, which has been in shorter supply of late. The seasonal nature of tourism-related work, particularly on the island, makes it hard for many residents to build up savings to last them in leaner times, leaving them vulnerable to the type of economic shock that can often trigger insolvency.
Article continues below this advertisement “A higher personal insolvency rate is a symptom of wider deprivation, and highlights the need for debt advice services to be targeted and tailored for people living in less affluent areas of the island, so they can access the help and support they need.
“Anyone who is concerned about their personal financial situation should seek advice and support from a trustworthy and regulated source, as the sooner issues are addressed, the more options are available.”
| Local Authority | Insolvencies per 10,000 adults |
| Stoke-on-Trent | 51.9 |
| Scarborough | 47.8 |
| Torbay | 45.7 |
| Plymouth | 45.2 |
| Kingston upon Hull (City of) | 44.9 |
| Blackpool | 43.8 |
| Corby | 42.1 |
| Burnley | 40.4 |
| Barnsley | 39.9 |
| Stockton-on-Tees | 39.8 |
| Halton | 39.8 |
| Weymouth and Portland | 39.6 |
| Isle of Wight | 39.3 |
I wonder if these figures are skewed by the high number of residents who have been moved to the islandby mainland councils?
Can Island Echo shed any light on the length of time these insolvents have resided on the Isle of Wight?