Back in April it was reported that in Scotland, whilst insolvencies, (where the individual has no means to repay debt), fell by 7% in the first 3 months of the year, there was an 8% increase in the number of people declared bankrupt (where there are assets to sell in order to pay off the debt).

There was also an increase of 11% in the number of companies that went bust compared with a 4% increase a year ago.

Though the number is down 1% compared with the same period last year, more than 5000 people were declared bankrupt between April and June, up 25% on the previous 3 months. The number of companies declared insolvent also rose by 17% in this period.

The number of people opting for a voluntary protected trust deed, an alternative to bankruptcy involving monthly payment arrangement with some creditors and often involving some of the debt being written-off, rose by 51%.

Enterprise Minister Fergus Ewing was encouraged that, while these new figures marked an increase in personal bankruptcies this quarter, there had been reduction on levels when compared to this time last year.

He thought that the recent increase in individual bankruptcies was perhaps explained by the success of the Certificate for Sequestration, introduced in November last year through the Home Owner and Debtor Protection Act, to help people in need of debt relief who previously didn't qualify.

Bryan Jackson, corporate recovery partner with accountants PKF, said it appeared that the better-off were now being hit hardest and that whilst the savings on mortgage payments had undoubtedly delayed the rise in bankruptcies among more affluent Scots, it was clear that many had been simply treading water, only barely able to keep afloat financially.

He went on say that very high increases in the numbers being made bankrupt were likely to be seen among those who have had severe debts which they have been maintaining but not reducing as increased living costs pushed them over the edge.

He predicted that the number of bankruptcies would continue to rise for some time, adding that given the full implementation of public sector job cuts, these figures would tend to indicate the start of a trend rather than the end.