The number of people declared insolvent in England and Wales in the third quarter of 2005 has hit a record high.
More people are choosing to declare themselves bankrupt
Department of Trade & Industry figures showed 17,562 personal insolvency cases, up 46% on a year ago, including 12,043 bankruptcies.
The DTI said there was no specific reason for the rise, which has now gone on for seven quarters in a row.
However, insolvency experts say it reflects the higher level of debt that has been taken on by the public.
The rising trend brings to 60,102 the total number of individual insolvencies during the past 12 months.
Individual Voluntary Arrangements
Of these, the sharpest increase has been seen in the voluntary procedure called the Individual Voluntary Arrangement.
This is an alternative to traditional bankruptcy.
Their number has nearly doubled in the past year, with 5,519 people choosing this route to resolve their debts in the third quarter.
A spokeswoman for the DTI said there was no special reason for the overall increase in insolvencies. She said it could be "peoples' circumstances, attitudes to debt or the availability of credit".
However, Pat Boyden, an insolvency expert at the accountants PricewaterhouseCoopers (PwC), suggested the figures reflected the rise in the total amount of personal debt in the UK.
"Last year we went through the £1 trillion barrier, with the amount we owe on mortgages, credit cards and personal loans. Well it is 12% more in the last 12 months."
"The increase in bankruptcies is a reflection of the amount we've borrowed," he concluded.
Before April 2004, anyone who was declared bankrupt typically had to wait at least three years before they could be discharged.
That time limit was reduced to just one year by the Enterprise Act (2002).
Philip Long, of the accountants PKF, reflected widespread opinion among insolvency experts that this has encouraged significantly more people to seek formal bankruptcy as a way out of their personal debts.
"The Act has made bankruptcy more of an option for many who would never have considered it before.
"Although being declared bankrupt will never be a pleasant experience, 12 months is a comparatively small price to pay for the relief of wiping the debt slate clean" he added.
Howard Archer at City firm Global Insight warned: "With unemployment likely to continue trending up, there is a very real danger that individual insolvencies will climb markedly further over the coming months."
The number of companies going bust is also on the rise.
In the third quarter of this year 3,389 firms in England & Wales went into liquidation
That was 14% more than during the same period last year.
According to Mike Jervis of PwC, this was because of the general economic slowdown seen over the past year.
"We did a survey of this and the reasons were the level of corporate debt, declining consumer demand for goods, increased regulation and rising costs, especially fuel," he said.