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"Debt Relief Orders being at record highs shows that a vast number of people are relying on debt to live"

ended 19. November 2024

8,952 individuals entered insolvency in England and Wales in October 2024, according to The Insolvency Service. This was 14% lower than in September 2024, but similar to October 2023. The individual insolvencies consisted of 596 bankruptcies, 3,793 debt relief orders (DROs) and 4,563 individual voluntary arrangements (IVAs). Monthly DRO numbers between April and October 2024 were at record highs. This followed the removal of the £90 administration fee to obtain a DRO from 6 April 2024. The number of IVAs registered in October was lower than the average monthly number seen over the past 12 months. Bankruptcy numbers remained at about half of pre-2020 levels and were also lower than in October 2023.

Meanwhile, the number of registered company insolvencies in England and Wales was 1,747 in October 2024, 10% lower than in September 2024 (1,950) and 24% lower than the same month in the previous year (2,293 in October 2023). However, the number of company insolvencies remained much higher than those seen both during the COVID-19 pandemic and between 2014 and 2019. Newspage asked experts for their views, below.

8 responses from the Newspage community

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Michelle Lawson
Director at Lawson Financial
Debt Relief Orders being at record highs shows that a vast number of people are relying on debt to live. For many, it is becoming unmanageable. With rising interest rates and the cost of living increasing, these figures are likely to get worse as people turn to the last resort. Sadly the result for some families will be the loss of a family member as people lose hope altogether. A dire situation.
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David Stirling
Independent Financial Advisor at Mint Wealth
This data from the Insolvency Service should come as no surprise as households have been coming off sub-2% mortgage interest rates in the midst of a cost of living crisis coupled with high energy prices. With mortgage payments doubling in some cases, the pressure on home economics will be forcing more and more people down the route of debt management planning. Next up for 2025 is increased unemployment as businesses can no longer take a punt on new recruits and redundancies in retail are already predicted due to the tax hikes on employers.
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Emma Jones
Managing Director at Whenthebanksaysno.co.uk
Debt taken out while interest rates were so low is really starting to bite now. Higher interest rates are hitting households really hard. The speed at which rates rose after well over a decade of being ultra-low has left many people in an impossible position. The cost of living crisis may be over technically but for many it simply doesn't feel that way. We lived in an artificial interest rate world for many years after the Global Financial Crisis but financial reality has now set in and for many it is real, and it is sadly too much. Statistics are cruel as they do not relay the human suffering in play. Behind all of these statistics are people, their businesses and their lives, which have all been through huge trauma for them to have fallen on such hard times.
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Patricia McGirr
Founder at Repossession Rescue Network
Households and businesses are drowning, not waving. Debt levels haven’t spiralled because people are reckless, but because survival has become a high-stakes juggling act. Soaring costs, stagnant wages and relentless tax hikes have turned balance sheets into minefields. The increase in Debt Relief Orders show just how many are on the verge of financial collapse. For small businesses, the Budget was a fiscal sledgehammer, and the cracks are already widening into 2025. The Bank of England must cut rates in December. Anything less is like clutching a life raft while watching people sink—and refusing to throw it. Debt isn’t a shameful secret anymore: it’s the grim reality for families and small businesses alike. If we keep punishing those trying to stay afloat, DROs and insolvencies will rise hand in hand, taking lives and livelihoods with them. It’s time to stop tinkering and start fixing the system before it breaks everyone in it.
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Aaron Strutt
Product and Communications Director at Trinity Financial
We have been speaking to lots more people who have missed mortgage repayments or credit card payments over the past few months. Many of them are trying to move home or remortgage and we have to tell them that it is going to be hard to get them a mortgage especially with a reasonable rate. If you miss a payment or two then the biggest lenders can make it really hard to get a mortgage so borrowers have to go to the specialist part of the market, which means they then have to pay more. It does seem like we will be speaking to more people with financial issues who have missed payments next year.
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Daniel Hobbs
Managing Director at New Leaf Distribution
Households and businesses have been absorbing countless blows for a number of years now. Brexit, a global pandemic, double-digit inflation and significantly higher interest rates have piled on huge amounts of financial pressure. A growing number of people and firms simply aren't able to cope any more. Looking forward, the Government's Budget will pile even more pressure on businesses and those that both own or work for them. 2025 is shaping up to be an annus horribilus. More businesses and households will hit a wall financially.
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Darryl Dhoffer
Founder at The Mortgage Geezer
Who would've thought? People are actually struggling to make ends meet in this booming economy. It's almost as if the government's brilliant economic policies have had no unintended consequences whatsoever. It's a real shame that the government's compassionate tax hikes haven't stimulated the economy as intended. Perhaps they should consider a few more rounds of these brilliant policies to truly optimize financial hardship. After all, what's a bit of economic pain compared to the long-term benefits of a government that clearly knows best?
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Riz Malik
Independent Financial Adviser at R3 Wealth
We're not even six months in and it is very clear the current administration does not have the ability to manage the country. We were hoping things could only get better but that is far from the situation that many households and businesses now find themselves in. With companies shelving expansion plans and looking to reduce costs as a result of the Budget, the situation for many households will only get worse.