Cable: Rise in personal debt as insolvencies reach 5-year high

Vince Cable has warned that a rise in personal debt and insolvencies will get worse if the Bank of England goes ahead and raises interest rates. It comes as figures showed that the number of people registering as insolvent in England and Wales hit a five-year high in the three months to September. In total 27,807 people in England and Wales registered as insolvent between July and September, the biggest total since the third quarter of 2012. Applications for individual voluntary arrangements (IVAs) – a way to manage personal debt – reached a record high of 15,523. Liberal Democrat Leader Vince Cable commented: "These worrying figures demonstrate the unsustainable situation we find ourselves in, with personal debt growing many times faster than the wider economy. “Pay packets are falling behind rising prices, leading to increased borrowing. "Now growing numbers of people are simply unable to pay back that debt, with all the financial and psychological difficulty that entails. “If the Bank of England does indeed raise interest rates as expected, this will only exacerbate the problem. “This underlines the need for the government to urgently implement proposals for a breathing space to help those in serious debt.”