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1384.6 - Statistics - Tasmania, 2005  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 13/09/2002   
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Contents >> Income >> Bankruptcy >> Causes

In 2000-01, the major cause of business bankruptcy was stated to be economic conditions, 41% of cases. This was followed by a lack of capital, 17% of cases, and lack of business ability, 15% of cases. This compares to 1999-2000, in which lack of business ability, with 33%, was stated as the most common cause of bankruptcies, followed by lack of capital, 23% of cases, and economic conditions, 22% of cases.

In terms of non-business bankruptcies, excessive use of credit was stated as the most common cause of bankruptcy in 2000-01, with 50% of cases, followed by unemployment, 31% of cases. This compares to 1999-2000 in which unemployment was stated to be the cause in 57% of cases and excessive use of credit the cause in 30% in cases.

The turnaround in causes of bankruptcy from 1999-2000 to 2000-01 can be partly attributed to Insolvency and Trustee Services Australia (ITSA) adopting a new method of collating information on the causes of bankruptcy. In 2000-01, debtors were given a list of causes to chose from as opposed to 1999-2000 where debtors note a description that was then interpreted by ITSA staff.

CAUSES OF BANKRUPTCY, Tasmania

1999-2000
2000-01


Cause(a)
no.
%
no.
%

Business
Economic conditions
26
22
47
41
Lack of business ability
39
33
17
15
Lack of capital
27
23
20
17
Excessive interest
2
2
8
7
Excessive drawings
5
4
9
8
Inability to collect debts
5
4
1
1
Failure to keep proper books
-
-
1
1
Seasonal conditions
2
2
2
2
Gambling or speculation
2
2
1
1
Personal reasons
11
9
4
3
Other causes not stated
-
-
6
5
Total(b)
119
100
116
100

Non-business
Unemployment
451
57
276
31
Domestic discord
25
3
76
9
Excessive use of credit
237
30
443
50
Ill health
24
3
35
4
Adverse litigation
29
4
42
5
Gambling or speculation
11
1
6
1
Liabilities on guarantees
16
2
11
1
Other causes not stated
1
-
4
-
Total(b)
794
100
893
100

- nil or rounded to zero
(a) In 1999-2000 causes were determined by debtors writing a description that was then interpreted by ITSA staff. In 2000-01, causes were chosen by debtors from a predetermined list.
(b) Respondents may have recorded more than one cause.

Source: Inspector-General in Bankruptcy, Annual Report on the Operation of the Bankruptcy Act, 2000-01 (available at the ITSA web site, http://www.itsa.gov.au)



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