MercoPress. South Atlantic News Agency

Recession plunges record number of people into insolvency in 2009

Company failures soared to the highest level in 16 years

Britain's longest- and deepest-ever recession plunged a record number of people into insolvency last year, new figures show. A total of 134,142 people went bankrupt or took out an Individual Voluntary Arrangement (IVA) or Debt Relief Order during the year, according to the Insolvency Service.

The figure dwarfed the previous record of 107,288 personal insolvencies set in 2006.

Meanwhile company failures soared to their highest level for 16 years in 2009 after more than 19,000 firms succumbed to the recession. However, the number of businesses that went under during the final quarter of the year was lower than both the previous three months and the same quarter of 2008.

The trend for personal insolvency was more alarming. The number of individuals declared insolvent accelerated during the final three months of the year at 35,574 people - the highest level since records began in 1960.

Just over 17,000 people went bankrupt, 7% less than in the previous quarter. But a record 13,219 people took out IVAs, under which interest on debt is frozen in exchange for a set amount being repaid each month.

Experts said the 2009 figure could be the tip of the iceberg, with the possibility of a double-digit rise in personal insolvency this year.