Qld’s damning bankruptcy figures the worst in nation

 

Queensland's three-year run as the nation's bankruptcy capital has continued with damning new figures revealing the significant number of people facing financial distress.

In the 2020 calendar year, 4458 personal bankruptcies were recorded in Queensland ahead of 4413 in NSW.

Victoria - which was locked down for four months - recorded 2724 personal insolvencies.

In Queensland Logan, Gold Coast, Ipswich and Moreton Bay South were the regions with the highest rates of personal insolvency.

The results continue Queensland's run as the nation's bankruptcy capital, however the number has steadily fallen across the state over the past five years.

Economist Marcus Smith said the number of personal bankruptcies remained a blight on Queensland.

"All states have fallen pretty significantly and while we've narrowed the gap to New South Wales we're still outright in front of them," he said.

Dr Smith said the Federal Government's JobKeeper and JobSeeker programs, the release of early superannuation and a moratorium on insolvent trading had a "significant impact" in reducing the number of people suffering financial distress across the state.

However, he said the winding up of government stimulus could mean the "honeymoon may be over" for struggling Queenslanders.

"Anecdotally, there are a lot of zombie businesses being propped up by JobKeeper," he said.

"There's a lot of pessimism because there's a lot of stimulus in the economy but it's starting to wind down now.

"The next six months will be a litmus test on whether the economy can stand on its own two feet."

As of last month $14.6bn in JobKeeper payments were made to more than 190,000 organisations across Queensland.

Treasurer Cameron Dick said the number of Queensland bankruptcies was on a downward trend.

"While bankruptcies in Queensland have been steadily declining, the Federal Government threatens to reverse that trend with a double whammy - the removal of COVID debt relief measures that ended on 1 January, and the looming end of JobKeeper this month," he said.

Dr Smith said Queensland had benefited from interstate migration and our regions are performing better," he said.

"It will be interesting to continue to monitor how these trends develop over coming quarters to gauge whether Queensland faces a hard or relatively softer landing regarding personal and business financial distress across the state," he wrote.

 

THE REGIONS

Queensland locations with the highest rates of insolvencies per capita in 2020:

Logan/Beaudesert 0.4 per cent

Gold Coast 0.39 per cent

Ipswich 0.19 per cent

Moreton Bay South 0.15 per cent

Originally published as Qld's damning bankruptcy figures the worst in nation


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