More people have petitioned for bankruptcies in this quarter than in any three month period in the last 10 years, while company collapses have risen more than 25% year-on-year, Insolvency Service figures have shown.

Bankruptcy filings increased by 12.1% on the previous quarter, a total of 17,341, and a hike of 9.5% on the same period in 2007.

Pat Boyden, insolvency partner at PricewaterhouseCoopers said: ‘This is a substantial jump. We did think that personal insolvencies would increase, but not this much.’

‘Obviously this is due to the economic climate and budgets being squeezed but also the rising rate of unemployment,’ he added.

Creditors are clawing their money back too, according to the statistics, which showed an increase in creditor petitions for bankruptcy of 10% on the last quarter.

Louise Brittain, insolvency partner Baker Tilly, said: ‘Since the last quarter, creditors are becoming more aggressive.’

Brittain predicts this is just the tip of the iceberg, with insolvencies set to rise until at least next year.
A 26.4% rise in company failures shows UK businesses are starting to feel the full effects of the economic slump as the financial upheaval feeds through to them.

There were more than 4,000 compulsory liquidations and creditors’ voluntary liquidations in total in England and Wales in the third quarter of 2008. In the last few months, companies across a diverse range of sectors have had no option but to call in the administrators.

Estate agent Humberts, textile retailer Roseby’s and celebrity chef Tom Aitken’s eateries have all gone into administration recently.

Catherine Matthews, partner at licensed insolvency practitioners Tomlinson’s said: ‘They underline just how tough things are for the moment for companies, and that the recession is really starting to bite.

‘A 26% rise on the same period last year, and a steady increase quarter-on-quarter, simply can’t be ignored. These are desperate times for many businesses.’