Personal insolvencies fall

There were 26,956 individual insolvencies in England and Wales in the second quarter of 2007 on a seasonally adjusted basis, according to the Insolvency Service. This was a decrease of 8.1% on the previous quarter and an increase of 4.2% on the same period a year ago.

This was made up of 16,258 bankruptcies, a decrease of 2.9% on the previous quarter and an increase of 7.7% on the corresponding quarter of the previous year, and 10,698 Individual Voluntary Arrangements (IVAs), a decrease of 15.1% on the previous quarter and a decrease of 0.7% on the corresponding quarter of the previous year.

Financial education charity the ifs School of Finance has responded by calling on policymakers to put Personal Finance on an equal footing with Geography, History & Modern Foreign languages in schools to ensure future generations have the skills to manage their money effectively and avoid unaffordable debt problems. This would mean adding Personal Finance to the core curriculum i.e. it would be compulsory for schools to offer such a subject but not compulsory for students to study it.

Rod McKee, Head of Financial Capability at the ifs School of Finance said, “The insolvency figures released today again highlight the need to ensure people have sufficient financial skills to make informed financial decisions. Equipped with such skills the number of people who find themselves facing unmanageable debt problems will reduce considerably.

As the 200+ schools already offering a GCSE equivalent in Personal Finance have shown, students who take a standalone course in Personal Finance make positive changes to their financial behaviour and are able to manage their own finances effectively. We’d like to see every school offering their students the opportunity to gain these skills but achieving this requires Government action.”