Dubbo has one of the highest rates of personal bankruptcy in Australia, with 74 people in the city declared bankrupt in 2017.
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Statistics from the Australian Financial Security Authority and data research agency illion placed Dubbo eighth in Australia, and third in NSW, for suburbs with the highest concentration of bankruptcies.
Despite the high result it was a 6.3 per cent drop compared to 2016 for the city and represents a trend that could get worse, Money Magazine editor Effie Zahos said.
“Unfortunately we are seeing a rising trend in people entering debt problems and bankruptcy and it is probably going to get worse,” Ms Zahos said.
“Talking to illion, they found in a lot of cases it was people extending themselves too far and it was people with a low socioeconomic status.
“These problems seem to have come because of a ridiculous amount of personal debt. There is easy credit available and people are living a lifestyle that they can’t afford.”
Rob Campbell, a consultant at Worrells – Solvency and Forensic Accountants, said a detailed breakdown of insolvency wasn’t available.
Based on long-term data he said “only 16% of debtors declare bankruptcy for business-related reasons and therefore 84% are for non-business-related insolvency.”
“Of the non-business-related insolvency, such as credit card debt, the two major causes are excessive use of credit and unemployment/loss of income,” he said.
Orange was ranked seventh in Australia, with 74 bankruptcy declarations for the year. Bathurst was substantially lower with just 24.
Ms Zahos said it was difficult to understand why Bathurst was so much lower, but said Orange and Dubbo’s numbers weren’t excessively high.
She said the challenges in regional areas were different to those in the city, where high property prices and living costs were the main challenges.
“The regional areas have had a pretty hard time. Some sectors have cut jobs and that leads to a ripple effect that can last several years,” Ms Zahos said.
“If people aren’t spending money it puts pressure on businesses and it becomes a vicious circle.”