THE number of people falling into insolvency in Yorkshire fell last year, according to latest figures.

But the region still ranked fifth highest for individual insolvencies in the UK and fourth highest for bankruptcies in the figures compiled by the Insolvency Service.

Individual insolvencies in Yorkshire fell to 12,255 in 2011 from 13,466 the previous year while bankruptcies stood at 4,317 last year.

Chris Wood, Yorkshire R3 committee member and partner at Clough Corporate Solutions in Cleckheaton, said: “The decrease in personal insolvencies is encouraging news given the challenging economic environment that individuals are having to deal with, although the level in the region remains relatively high.”

But he said: “An average decrease across the country does not necessarily indicate that individuals are becoming better at dealing with their personal finances.

“Instead, we believe it indicates the emergence of habitual debtors who are paying off interest, but failing to make any inroads into reducing the debt itself.

“This suggests that many people are just hanging on, but with wages remaining stagnant and utility bills rising, many may not be able to cope for much longer.

“We have every reason to believe that 2012 is going to be tougher than 2011, so those who are struggling with their personal finances, should seek advice now to prevent it becoming insurmountable.”