31st August 2009
Adelaidenow.net.au
State shows bankruptcy 'resilience'
BANKRUPTCIES in South Australia are bucking the national trend, falling 12 per cent in the June quarter while personal insolvencies elsewhere are rising.
The report by insolvency practitioners SV Partners, which uses data from the Insolvency and Trustee Service Australia (ITSA), shows there were 483 personal bankruptcies in the June quarter of 2009 in SA compared to 550 in 2008.
For the financial year, SA recorded 1944 personal bankruptcies, down 7 per cent from 2081 the year before.
In comparison, the boom states of Queensland and Western Australia recorded a year-on-year increase in insolvencies of 9 and 16 per cent respectively.
SV Partners managing director Paul Sweeney said the figures highlighted the ongoing resilience of SA compared to other states.
"The numbers of people going bankrupt (in SA) is quite a lot lower that what we see in Victoria, Queensland and New South Wales, and on a percentage basis it is a very good result,'' he said.
"It is pretty clear that debt in South Australia is not as big an issue as it is in other states and would indicate that people are managing their finances better.''
Mr Sweeney said the numbers were also a reflection of unemployment numbers which had not been as bad as anticipated.
Unemployment stands at 5.8 per cent nationally, with SA's unemployment rate at 5.4 per cent, according to the latest data from the Australian Bureau of Statistics.
Resilience in the SA economy has been widely attributed to the defence and mining sectors as well as to a good year for the rural sector.
Mr Sweeney said the mining downturn had hit the boom states of Queensland and WA particularly hard, but generally the numbers were better than expected.
"It is a pleasing result (and) the experience of SV Partners as an insolvency firm is that the downturn was nowhere near as deep as people predicted it was going to be, and that is flowing through into the personal bankruptcy figures,'' he said.
"The medium-sized firms are holding together (and) so that is having a flow-on effect to personal bankruptcies.''
The report found insolvency increased in NSW by 5.7 per cent, Victoria 4.5 per cent, ACT 14.5 per cent, and Tasmania by 11.8 per cent.
