HARD-UP people in the North-East are being declared insolvent faster than anywhere else in the country, according to new figures.

Data from the Insolvency Service showed that the North-East had the highest number of people unable to keep up with debts.

About 38.1 people per 10,000 adults in the North-East were declared bankrupt, took out an individual voluntary arrangement, or began a debt relief order during the year – almost double London’s 19.6 per 10,000.

Sean Hamilton, insolvency expert at PriceWaterhouseCoopers in Newcastle, said the figures could reflect the carefree lifestyles of the region’s residents.

He said: “We in the North-East are good at enjoying ourselves, and perhaps we have been taking advantage of the available credit.

“People have taken more credit than they could conveniently service. That is partly their fault and partly the fault of the providers of finance.”

Steven Law, president of insolvency trade body R3, offered a different interpretation, and issued a stark warning that the figures were likely to increase.

He said: “Prior to the recession, the North-East had a higher than average unemployment rate and the region’s construction industry was badly hit during the economic downturn, so it is understandable that personal insolvencies are more common there.

“Unfortunately, with the announcement of public sector job cuts, it is likely that the figures will worsen, especially in areas such as the North-East where public sector employment is high.”

After the North-East, residents of the South-West were the next most likely to be declared insolvent at 35.9 per 10,000, followed by those in the East Midlands at 35.3.

The South-East had the second lowest figure followed by the North-West, at 29 and 30.6 per 10,000 respectively.

The North-East had the highest increase in insolvency numbers compared with the previous year, while London had the smallest jump.

Across the whole of England and Wales 31.1 people per 10,000 were declared insolvent last year – up from 24.9 per 10,000 in 2008.

A record 134,142 people went insolvent last year, and financial experts expect the total to be higher at 150,000 this year.

The number of people declared insolvent has been rising steadily since the final quarter of 2007, as the combination of the credit crunch, rising unemployment and increases in the cost of living have left growing numbers unable to keep up with their debts.