According to the latest government statistics, the number of bankrupt companies in England and Wales rose by 4.7% in the three months to September compared with the same period last year.

A total of 3,300 companies were unable to repay their debts in the last quarter according to the official figures.

Some 6,138 individuals were also reportedly made bankrupt by the economic gloom, a rise of 3.5% on the previous quarter and 0.1% on the same period last year.

Official data also showed an increase in winding-up petitions in England and Wales.

UK chancellor Gordon Brown has forecast that economic growth will slow significantly in 1999 and the Bank of England cut the cost of borrowing by 0.5% on Thursday in an effort to boost flagging output.

There are fears that rising bankruptcies will lead to a sharp increase in unemployment in the UK.