THE regional gap between rich and poor was underlined by official figures showing the rate of individual insolvencies, with the North East having the highest rate in 2011.
Its rate was 35.2 per 10,000 adults – twice that of London, which was the lowest at 17.5, the Office for National Statistics (ONS) said.
The rate in our region increased five-fold between 2001 and 2011, while the combined total for England and Wales increased around four-fold to 27.1 per 10,000 adults.
David Birne, insolvency partner at chartered accountants HW Fisher & Company, said: “These figures confirm what has long been apparent – that the pain of insolvency is not being spread evenly across the country.”
The East Midlands and South West both had a rate of 30.4 in 10,000 in 2011, while the North West and Yorkshire & Humber had rates of 29.6 and 28.9 respectively, while the West Midlands had 27.9 per 10,000, the East of England 26.1 and the South East 24.3.
Total individual insolvency rates began to rise dramatically from 2004, the ONS said, following the implementation of the Enterprise Act 2002, and then again in 2008, coinciding with the start of the recession.
The Act meant bankruptcy could last for a minimum term of one year, rather than the two or three years required previously, but those who had previously been made bankrupt could face a term of bankruptcy for up to 15 years.
In 2009, there was a sharp increase in total individual insolvency rates in all English regions and Wales due to the recession.