Official Statistics

Commentary - Breathing Spaces by Location, Age and Money Advisor Organisation, 4 May 2021 to 30 April 2022

Published 29 June 2022

Applies to England and Wales

Released

29 June 2022

Next release

March/April 2023 as part of the Individual Insolvencies by Location, Age and Gender statistics release

Media enquiries

Steven Fifer

+44 (0)30 3003 1568

Statistical enquiries

David Webster (responsible statistician)

[email protected]

1. Main Messages for England and Wales

• In the first year of the Debt Respite Scheme, from 4 May 2021 to 30 April 2022, one in 736 adults (a rate of 13.6 per 10,000) in England and Wales entered a breathing space. The total number of breathing space registrations was 63,864.

• The North East was the region with the highest breathing space registration rate, at 17.9 per 10,000 adults, while London had the lowest, at 9.8 per 10,000. These are also the regions that had the highest and lowest rates of adults entering formal insolvency procedures each year between 2016 and 2021. Breathing space rates were also above average in the North West and Yorkshire and the Humber, and below average in the South East and South West. All other regions had rates within 1 per 10,000 adults of the England and Wales average.

• Breathing space rates varied by local authority from 5.9 per 10,000 adults (one in 1,682) in Camden to 55.8 per 10,000 adults (one in 179) in Halton.

• The local authorities with the highest breathing space rates were mainly in the North West, North East and Yorkshire and the Humber, although there were exceptions, such as North Devon and Gosport, which were both in the top ten. Eight of the ten local authorities with the lowest breathing space rates were in London or the South East, although Broxtowe and Ceredigion were also in the top ten.

• Local authorities with higher individual insolvency rates in 2021 tended to also have higher breathing space rates during the first year of the scheme.

• Breathing space rates were highest for adults between 25 and 44 and lowest for adults aged 65 and over. Three-quarters of individuals entering breathing spaces were aged between 25 and 54, despite this group making up only half of the adult population.

• StepChange Debt Charity registered 67% of all breathing spaces during the first year of the scheme. Citizens Advice registered 15%, meaning that more than four-fifths of breathing spaces were registered by these two organisations. Ten money advisor groups registered 93% of breathing spaces.

2. Things you need to know about this release

This statistics release contains data on breathing space registrations under the Debt Respite Scheme between 4 May 2021, when the scheme started, and 30 April 2022. Breathing spaces give people with problem debt legal protections from creditors, including pausing most enforcement action and contact from creditors and freezing most interest and charges on their debts. Standard breathing spaces last 60 days and can be entered into once in a 12-month period. Because problem debt can be linked to mental health issues, these protections are also are available to those receiving mental health crisis treatment and last for the duration of a person’s mental health crisis treatment, plus 30 days. There is no limit to the number of mental health crisis breathing spaces a person can have.

This release provides the number of breathing space registrations in England and Wales, broken down by location, age and money advisor organisation. It is possible for people to have more than one breathing space in the period covered in this publication if at least one of them is a mental health breathing space. While the data used for this publication does not allow determination of whether an individual had multiple breathing spaces, this is likely to be relatively rare, because mental health breathing spaces make up less than 2% of the total number of breathing spaces. In this commentary we therefore refer to numbers of breathing spaces and individuals interchangeably.

The total number of breathing spaces presented in this publication matches the May 2022 Monthly Insolvency Statistics, which provides monthly breakdowns of the number of standard and mental health breathing spaces.

Details of breathing space registrations are sourced from the Breathing Space Register, which is administered by the Insolvency Service. Extracts from these records, including postcode at date of registration, date of birth and date of registration, were used to derive the breakdowns used in this publication. Information on gender is not recorded.

Postcode data were matched against the National Statistics Postcode Lookup (NSPL), to determine the region and administrative area of each individual. These data were then aggregated to produce counts of breathing spaces in each geographical area. The NSPL is derived from data from the Office for National Statistics and Ordnance Survey. Note that due to small numbers, the Isles of Scilly has been merged with Cornwall and the City of London has been merged with Westminster.

Population statistics are sourced from the Office for National Statistics (ONS) publication Population Estimates for UK, England and Wales, Scotland and Northern Ireland. Breakdowns are included by age and local authority, so they can be used as the denominator when calculating breathing space rates per 10,000 adults. At the time of publication, the ONS mid-year population estimates by location were not available for 2021 or 2022, therefore the mid-year population estimates for 2020 were used instead.

More detailed Methodology and Quality information has been published alongside this commentary.

3. Breathing spaces by Location

Breathing space registration rates by country, region, county and local authority can be found in the accompanying tables.

Comparisons in this section are made to individual insolvency rates in 2021, which can be found in the Individual Insolvencies by Location, Age and Gender statistics.

In the first year of the Breathing Space scheme, from 4 May 2021 to 30 April 2022, one in 736 adults (a rate of 13.6 per 10,000) in England and Wales entered a breathing space. The total number of breathing spaces was 63,864.

3.1 Breathing space rates by region

Figure 1 shows the breathing space registration rate in each region of England and Wales. Rates ranged from 9.8 per 10,000 adults (one in 1,025 adults) in London to 17.9 per 10,000 adults (one in 559 adults) in the North East.

The North East, North West and Yorkshire and the Humber had breathing space rates that were higher than the England and Wales average. These were also the three regions with the highest individual insolvency rates in 2021.

The West Midlands, Wales, East Midlands and the East of England all had breathing space rates that were similar to the England and Wales average. This is also consistent with 2021 regional individual insolvency rates.

The South West, South East and London had lower breathing space rates than the England and Wales average. The South East and London also had the lowest individual insolvency rates in 2021, but the South West had a slightly higher than average individual insolvency rate.

Figure 1: The breathing space registration rate was highest in the North East and lowest in London.

England and Wales, 4 May 2021 to 30 April 2022

Source: Insolvency Service

3.2 Breathing space rates by local authority

The local authority with the highest breathing space rate was Halton, with 55.8 per 10,000 adults (one in 179) in this local authority entering a breathing space during the first year of the scheme. This is nearly 70% higher than the 32.9 per 10,000 adults in Burnley, which was the second highest.

Of the ten local authorities with the highest breathing space rates, four were in the North West, two in the North East, two in Yorkshire and the Humber and one in each of the South West and South East. According to the 2011 ONS Area Classification for Local Authorities, all ten local authorities belonged to one of three groups; ‘Services, Manufacturing and Mining Legacy’, Manufacturing Traits’, or ‘Remoter Coastal Living’.

Table 1 shows the local authorities with the highest breathing space rates.

Table 1: Halton had the highest breathing space rate

Breathing space rate per 10,000 adults, by local authority, England and Wales, 4 May 2021 to 30 April 2022

Local Authority	Number of cases	Rate
Halton	563	55.8
Burnley	225	32.9
South Tyneside	373	30.9
Scarborough	256	28.7
Hyndburn	158	25.3
North Devon	194	24.5
Kingston upon Hull	485	24.1
Gosport	161	23.9
Redcar and Cleveland	260	23.7
Pendle	166	23.5

The local authority with the lowest breathing space rate was Camden at 5.9 per 10,000 adults (one in 1,682). Of the ten local authorities with the lowest breathing space rates, five were in London, three in the South East and one in each of Wales and East Midlands. Eight of the ten were in either the ‘London Cosmopolitan’ or ‘Affluent England’ supergroups in the ONS Local Authority Classification.

Table 2 shows the local authorities with the lowest breathing space rates.

Table 2: The local authorities with the lowest breathing space rates were mostly in London and the South East

Breathing space rate per 10,000 adults, by local authority, England and Wales, 4 May 2021 to 30 April 2022

Local Authority	Number of cases	Rate
Camden	134	5.9
Kensington and Chelsea	79	6.2
Richmond Upon Thames	95	6.2
Broxtowe	58	6.2
Epsom and Ewell	39	6.3
Guildford	78	6.4
Wandsworth	172	6.5
Waverley	64	6.5
City of London/Westminster	154	6.7
Ceredigion	41	6.8

Figure 2: Breathing space registration rates tended to be lower in local authorities in and around London than in the rest of the country

England and Wales, 4 May 2021 to 30 April 2022

Source: Insolvency Service

Figure 3 shows that local authorities with higher breathing space registration rates during the first year of the scheme also tended to have higher rates of insolvency in 2021. The Pearson correlation coefficient between the breathing space rate and total insolvency rate for local authorities was r = 0.75, indicating a strong positive correlation.

In particular, local authorities with higher breathing space rates tended to have higher rates of individual voluntary arrangements (correlation r = 0.67) and debt relief orders (r = 0.61), with the relationship between breathing space and bankruptcy rates being much weaker (r = 0.19).

Figure 3: Local authorities with higher breathing space rates also tend to have higher rates of individual insolvency

England and Wales, 2021 (insolvency rates), 4 May 2021 to 30 April 2022 (breathing space rates)

Source: Insolvency Service

Each cross represents a local authority. The red cross is the overall rates for England & Wales.

4. Breathing spaces by Age

In the first year of the Breathing Space scheme, individuals aged between 25 and 34 had a breathing space rate of 22.4 per 10,000 (one in 445) and individuals between 35 and 44 had a rate of 22.7 per 10,000 (one in 440). The rate for these groups was more than twice as high as for 18-24 year olds and approximately nine times higher than the 2.6 per 10,000 (one in 3,876) for those aged 65 and over. Individuals aged between 25 and 54 make up approximately half of the adult population of England and Wales, but had three-quarters of the breathing spaces registered in the first year of the scheme.

Figure 4 shows the breathing space rates by age band.

Figure 4: Breathing space registration rates were higher for 25 to 44 year olds than for other age groups

England and Wales, 4 May 2021 to 30 April 2022

Source: Insolvency Service

The age distribution of breathing spaces was similar to that for insolvency. In 2021, insolvency rates were also highest for those aged between 25 and 44 and lowest for those aged over 65. However, differences between age groups were larger for insolvency than for breathing spaces, with insolvency rates for adults aged 25 to 44 being three times higher than for those aged 18-24 and 12 times more than for those aged 65 and over (compared to two times and nine times for breathing space rates).

5. Breathing spaces by Money Advisor Organisation

Table 3 shows a list of the ten money advisor organisations that registered the most breathing spaces in descending order of the volume registered during the first year of the scheme.

StepChange Debt Charity registered 66.5% of all breathing spaces during the first year of the scheme. Citizens Advice registered 15.1%, meaning that more than four-fifths of breathing spaces were registered by these two organisations. Ten money advisor groups registered 93% of breathing spaces.

Table 3: Ten money advisor organisations registered 93% of breathing spaces

Breathing registrations by money advisor group as a percentage of total, England & Wales, 4 May 2021 to 30 April 2022

Money advisor group	Percentage
StepChange Debt Charity	66.5%
Citizens Advice	15.1%
Totemic Limited	4.8%
Money Advice Trust T/A National Debtline	2.1%
Rethink Mental Illness T/A Mental Health and Money Advice MHMA (England)	1.5%
Financial Wellness Group	0.8%
Superior Insolvency Solutions Limited	0.7%
Pacific Financial Solutions	0.4%
UK Debt Advisors Ltd	0.4%
Christians Against Poverty	0.3%
Other	7.2%
Total	100%

6. Glossary

6.1 Key Terms used within this statistical bulletin

Term	Definition
Breathing Space	The Breathing Space scheme, launched on 4 May 2021, gives people legal protections from their creditors for 60 days, with most interest and penalty charges frozen, and enforcement action halted. Because problem debt can be linked to mental health issues, these protections are also available for people in mental health crisis treatment – for the duration of their crisis treatment plus another 30 days.
Pearson correlation coefficient	A number between -1 and 1 measuring the strength of the linear correlation between two variables. A value of 1 or -1 implies a perfect linear relationship between the two variables (i.e. if plotted, a straight line could be drawn going through all points), while a value of 0 implies no linear relationship between the two datasets. A positive value indicates that higher values in one variable are associated with higher values in the other variable.
Region	For statistical reporting purposes, England is divided into nine regions (formerly Government offices for the regions (GORs)). Each county, unitary authority and London borough is contained entirely within one of these nine regions.