Copyright 2006 The Debt Free Student
Rising popularity of bankruptcy
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The stated aim of the Insolvency Act 2000 was to reduce the 'stigma' of bankruptcy.
Towards the end of the 90s the average number of insolvencies was around 25,000. From 2000 onwards, this figure increased by 20% to around 30,000.
Clearly, the supposed 'stigma' of insolvency was no longer a deterrent to tens of thousands.
Amongst these were a large number of students who saw an opportunity to avoid repaying their student loan debt.
Towards the end of the 90s the average number of insolvencies was around 25,000. From 2000 onwards, this figure increased by 20% to around 30,000.
Clearly, the supposed 'stigma' of insolvency was no longer a deterrent to tens of thousands.
Amongst these were a large number of students who saw an opportunity to avoid repaying their student loan debt.
This chart shows the current situation. In the four quarters of 2005, a total of 66,500 people declared themselves insolvent, an increase of over 100%. In the first half of 2006, the total reached a staggering 50,000, with a projected figure of 100,000 for the year, an increase of 50% on last year and 300% on the 2000 figure.
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