Tag: AFSA

The Australian Financial Security Authority (AFSA) released regional personal insolvency statistics for the March quarter 2019.

The exception was Greater Darwin, and WA continues to experience high levels of insolvency.

In the March quarter 2019, debtors who entered a new personal insolvency in Greater Sydney fell by 156 (-12.6%) to 1,082; Wyong (60) was the region with the most new debtors. The rest of New South Wales fell by 35 (-4.6%) to 728; Newcastle (46) was the region with the most new debtors.

In the March quarter 2019, debtors who entered a new personal insolvency in Greater Melbourne fell by 30 (-3.5%) to 830; Wyndham (65) was the region with the most new debtors. The rest of Victoria fell by 20 (-6.4%) to 294; Geelong (40) was the region with the most new debtors.

In the March quarter 2019, debtors who entered a new personal insolvency in Greater Brisbane fell by 92 (-9.3%) to 894; Springfield – Redbank (68) was the region with the most new debtors. The rest of Queensland fell by 41 (-3.8%) to 1,035; Townsville (110) was the region with the most new debtors.

In the March quarter 2019, debtors who entered a new personal insolvency in Greater Adelaide fell by 15 (-4.7%) to 301; Salisbury (48) was the region with the most new debtors. The rest of South Australia rose by 43 (51.8%) to 126; Murray and Mallee (39) was the region with the most new debtors.

In the March quarter 2019, debtors who entered a new personal insolvency in Greater Perth fell by seven (-1.0%) to 725; Wanneroo (87) was the region with the most new debtors. The rest of Western Australia rose by 10 (6.8%) to 157; Bunbury (33) was the region with the most new debtors.

In the March quarter 2019, debtors who entered a new personal insolvency in Greater Hobart fell by five (-8.8%) to 52; Hobart – North West (21) was the region with the most new debtors. The rest of Tasmania fell by 17 (-16.8%) to 84; Launceston (28) was the region with the most new debtors.

In the March quarter 2019, debtors who entered a new personal insolvency in Greater Darwin rose by four (7.5%) to 57; Palmerston (25) was the region with the most new debtors. The rest of Northern Territory fell by eight (-30.8%) to 18; Alice Springs (12) was the region with the most new debtors.

In the March quarter 2019, debtors who entered a new personal insolvency in Australian Capital Territory fell by four (-5.3%) to 71; Tuggeranong (21) was the region with the most new debtors

The Australian Financial Security Authority today released the personal insolvency activity statistics for 2017–18 and the June quarter 2018.

Total personal insolvency activity in Australia: % change compared to the previous year

Personal insolvencies in 2017–18

There were 31,859 new personal insolvencies in Australia in 2017–18. This was an increase of 5.6% compared to 2016–17. Total personal insolvencies have risen for three consecutive years but remain below the record level of 36,539 set in 2009–10.

Debt agreements increased to an annual record of 14,834 in 2017–18, which was a 9.1% increase compared to 2016–17. They have now reached record levels for six consecutive years. There were record levels of debt agreement in all states and territories except Tasmania.

Bankruptcies increased by 3.0% to 16,811 in 2017–18. Despite this increase, they remained below the record level of 27,520 set in 2008–09. Bankruptcies reached a record high of 158 in Northern Territory in 2017–18.

Annual levels of personal insolvency agreements are small compared to the other types of personal insolvency. There were 214 personal insolvency agreements in 2017–18 after an annual fall of 12.3%.

Spotlight on the June quarter 2018

There were 8,177 total personal insolvencies in Australia in the June quarter 2018. This was a rise of 7.4% compared to the June quarter 2017. By type of personal insolvency:

• bankruptcies increased by 13.1%
• debt agreements increased by 1.5%
• personal insolvency agreements decreased by 5.2%.

Total personal insolvencies rose in all states and territories except Victoria, where they fell by 1.0%. They reached record highs in Northern Territory (95 personal insolvencies) and Western Australia (1,046 personal insolvencies).

In the June quarter 2018, 17.6% of new debtors entered a business related personal insolvency. Where we could identify a specific cause:

• economic conditions (363 debtors) was the most common business related cause
• excessive use of credit (2,407 debtors) was the most common non-business related cause.

New data from the Australian Financial Security Authority shows that in 2016–17, the most common non-business related causes of debtors entering personal insolvencies were:

• excessive use of credit (8,870 debtors)
• unemployment or loss of income (8,035 debtors)
• domestic discord or relationship breakdown (3,222 debtors).

However, employment related issues figured first in WA and SA. Here is an extract from their report:

Non-business related causes of personal insolvencies, 2016–17

While these were the three most common causes of debtors entering non-business related personal insolvencies in every financial year from 2007–08 to 2015–16, excessive use of credit overtook unemployment or loss of income as the single most common cause in 2016–17.

Non-business related debt agreements have increased since 2007–08

The shift towards excessive use of credit is associated with the growing number and proportion of debt agreement personal insolvencies year by year (both at a record level in the June quarter 2017; see personal insolvency statistics and business and non-business statistics for further information). In the period from 2007–08 to 2016–17, debt agreements have increased from 22.9% of non-business related personal insolvencies to 50.1%. In non-business related debt agreements, excessive use of credit has been the most common cause in every year since 2011–12.

Bankruptcies comprised 49.2% of non-business related personal insolvencies in 2016–17, and personal insolvency agreements comprised 0.7%.

The most common non-business related causes of personal insolvencies are similar for all states and territories

In 2016–17, excessive use of credit was the most common non-business case of new personal insolvencies in Australia. This was also the most common cause in 2016–17 in all states and territories except Western Australia, South Australia and Tasmania. Unemployment or loss of income was the most common cause in Western Australia and South Australia. In Tasmania, an equal number of debtors entered into personal insolvencies due to excessive use of credit and unemployment or loss of income. In all cases (as for Australia), the third most common cause was domestic discord or relationship breakdown.

State or territory	Most common non-business cause	Number of new debtors	% total new debtors in a non-business related personal insolvency
New South Wales	Excessive use of credit	2,660	36.4%
Australian Capital Territory	Excessive use of credit	126	37.6%
Victoria	Excessive use of credit	1,696	35.5%
Queensland	Excessive use of credit	2,627	35.4%
South Australia	Unemployment or loss of income	530	33.8%
Northern Territory	Excessive use of credit	104	41.3%
Western Australia	Unemployment or loss of income	994	35.8%
Tasmania	Excessive use of credit / Unemployment or loss of income	217	34.0%
Australia**	Excessive use of credit	8,870	35.2%

*Includes other and unknown state or territory

Most debtors entering non-business related personal insolvencies are male

In 2016–17, 13.3% more men than women entered new non-business related personal insolvencies. This disparity extended across most non-business related causes of personal insolvency. The cause with the highest sex ratio (that is, the ratio of men to women in the debtor population) was gambling or speculation (2.3). More women than men cited ill health and domestic discord or relationship breakdown as causes of new non-business related personal insolvencies (sex ratios of 0.9 and 0.7 respectively).

Non-business related causes by sex, 2016–17*

Main non-business related cause of personal insolvency	Number of male debtors	Number of female debtors
Excessive use of credit	4,566	4,299
Unemployment or loss of income	4,311	3,707
Domestic discord or relationship breakdown	1,376	1,843
Ill health	874	950
Gambling or speculation	363	161
Adverse legal action	238	148
Liabilities due to guarantees	132	100
Other non-business reason or unknown	1,519	602
Total	13,379	11,810

*Excludes records where debtors did not disclose their sex.

The median age of debtors entering non-business related personal insolvencies varies by cause

In 2016–17, the highest median age of debtors entering new non-business related personal insolvencies was among those who cited the causes adverse legal action and liabilities due to guarantees (both 46 years). Those who cited excessive use of credit had the lowest median age of 36 years. The median age of all new debtors entering non-business related personal insolvencies was 38.

Median age of debtors entering non-business related personal insolvencies in 2016–17 by cause, Australia

Main non-business related reason for entering a personal insolvency	Median age of new debtors*, 2016–17 (years)
Adverse legal action	46
Liabilities due to guarantees	46
Ill health	43
Gambling or speculation	40
Domestic discord or relationship breakdown	38
Unemployment or loss of income	37
Excessive use of credit	36
Total	38

*Where an age was recorded

 

The Australian Financial Security Authority (AFSA) released regional personal insolvency statistics for the June quarter 2017.

There were 7,729 debtors who entered a new personal insolvency in the June quarter 2017 in Australia. This is a fall of 311 debtors (3.9%) compared to the March quarter 2017. Victoria and Queensland had the strongest falls, falling by 131 and 111 debtors respectively. Both of these states had falls in the number of debtors in both the capital city and the rest of the state.

Regional Queensland has the highest relative proportion of debtors, and the were also more in regional NSW compared with those in the City.

Personal insolvency in Australia: capital cities compared to rest of state

New South Wales

There were 1,297 debtors who entered a new personal insolvency in Greater Sydney in the June quarter 2017. The regions with the highest number of debtors were Campbelltown (83), Wyong (74) and Penrith (71).

There were 892 debtors who entered a new personal insolvency in rest of New South Wales in the June quarter 2017. The regions with the highest number of debtors were Newcastle (43), Tamworth – Gunnedah (42) and Shoalhaven (42).

Victoria

There were 1,045 debtors who entered new personal insolvencies in Greater Melbourne in the June quarter 2017. The regions with the highest number of debtors were Casey – South (76), Wyndham (71) and Whittlesea – Wallan (70).

There were 410 debtors who entered a new personal insolvency in rest of Victoria in the June quarter 2017. The regions with the highest number of debtors were Geelong (59), Ballarat (45) and Bendigo (29).

Queensland

There were 1,023 debtors who entered a new personal insolvency in Greater Brisbane in the June quarter 2017. The regions with the highest number of debtors were Springfield – Redbank (71), Browns Plains (70) and Ipswich Inner (55).

There were 1,272 debtors who entered a new personal insolvency in rest of Queensland in the June quarter 2017. The regions with the highest number of debtors were Townsville (116), Ormeau – Oxenford (95) and Mackay (91).

South Australia

There were 378 debtors who entered a new personal insolvency in Greater Adelaide in the June quarter 2017. The regions with the highest number of debtors were Onkaparinga (67), Playford (53) and Salisbury (41).

There were 115 debtors who entered a new personal insolvency in rest of South Australia in the June quarter 2017. The regions with the highest number of debtors were Eyre Peninsula and South West (29), Limestone Coast (20) and Murray and Mallee (12).

Western Australia

There were 755 debtors who entered a new personal insolvency in Greater Perth in the June quarter 2017. The regions with the highest number of debtors were Wanneroo (86), Rockingham (77) and Swan (74).

There were 161 debtors who entered a new personal insolvency in rest of Western Australia in the June quarter 2017. The regions with the highest number of debtors were Bunbury (43), Wheat Belt – North (21), Augusta – Margaret River – Busselton (18), Mid West (18) and Pilbara (18).

Tasmania

There were 84 debtors who entered a new personal insolvency in Greater Hobart in the June quarter 2017. The regions with the highest number of debtors were Hobart – North West (38), Hobart – North East (16) and Hobart – South and West (12).

There were 98 debtors who entered a new personal insolvency in rest of Tasmania in the June quarter 2017. The regions with the highest number of debtors were Launceston (33), Devonport (16) and Burnie – Ulverstone (14).

Northern Territory

There were 52 debtors who entered a new personal insolvency in Greater Darwin in the June quarter 2017. The regions with the highest number of debtors were Palmerston (19), Darwin Suburbs (16) and Darwin City (9).

There were 30 debtors who entered a new personal insolvency in rest of Northern Territory in the June quarter 2017. The regions with the highest number of debtors were Alice Springs (14) and Katherine (11).

Australian Capital Territory

In the June quarter 2017, 89 debtors entered new personal insolvencies in the Australian Capital Territory. The regions with the highest number of debtors were Tuggeranong (31), Gungahlin (22) and Belconnen (20).