FEWER Warrington residents fell into debt last year amid ‘enhanced’ financial support from the Government, new figures show.

The Money Advice Trust said these measures offered a ‘lifeline’ to many during the Covid pandemic, but it warned insolvency levels might rise again this winter.

People who take out formal insolvency solutions, such as bankruptcy or a voluntary arrangement to pay off their debt, are added to the Individual Insolvency Register – meaning they are formally in debt.

Insolvency Service data shows 395 people fell into debt in Warrington in 2020.

This was 30 per cent fewer than the year before, when 568 people were insolvent.

Of the cases of insolvency in Warrington last year, most (288) saw the person enter into an individual voluntary agreement with their creditors, while 36 went bankrupt.

A further 71 applied for a debt relief order, which allows those who cannot afford to pay their debt to stop paying them for a period, after which the debt is written off.

Across England and Wales, 111,400 people went insolvent in 2020 – down from 121,900 in 2019, and the first annual fall in five years.

The Insolvency Service said this was likely to have been partly driven by ‘enhanced financial support’ put in place by the Government during the pandemic.

But Jane Tully, director of external affairs and partnerships at The Money Advice Trust, warned: “With many facing a difficult winter ahead, and with the full impact of the pandemic still to materialise on household finances, it is likely insolvency levels will rise again.

“It is therefore vital that people are able to access safe routes out of problem debt.”

Insolvency rates decreased from 2019 for all age groups across England and Wales, except for those aged 18 to 24.

In Warrington, 26 residents aged between 18 and 24 became insolvent last year.

At a rate of 18 in every 10,000 people in that age group in the area, this was down from 20 per 10,000 the year before.

StepChange said young people are some of the worst affected because they tend to have higher living costs, be in less secure work and are more likely to rent their home.

As support is withdrawn, Peter Tutton, head of policy at the debt charity, said he expects to see rising numbers of people – particularly the young – pushed into ‘unmanageable financial situations’.

Insolvency solutions will be the only option for some of them, but targeted support will be necessary for others, he added.