Australians are going broke at the fastest rate since the GFC

Sculpture By The Sea in Perth. Photo: Paul Kane/Getty Images

Personal insolvencies rose 2% in the March quarter, the fourth increase in a row, mainly due to bad debts in the mining states of Western Australia and Queensland.

This is the first time there have been four consecutive quarterly rises since 2009, according to the Australian Financial Security Authority.

Queensland and Western Australia, where debt agreements are now at the highest on record, accounted for most of the national rise in personal insolvencies.

The mining states are starting to feel the squeeze of a declining resources industry as jobs evaporate, wages fall and house prices slide.

Moody’s expects delinquencies on home mortgages in Western Australia, the Northern Territory and parts of Queensland to rise slightly this year from current low levels.

Today the Australian Financial Security Authority said the number of personal insolvencies was 7,129 in the March quarter across Australia compared to 6,989 in the same period in 2015.

Bankruptcies fell by 5.8% to 4,123 but debt agreements increased by 15.6% to 2,968. Personal insolvency agreements dropped by 9.5% to 38.

This chart shows the percentage change by quarter in personal insolvencies in Australia:

Source: The Australian Financial Security Authority

Insolvencies only increased in Western Australia, Queensland and the Northern Territory. They fell in the other states and territories:

    Western Australia (up 26.0%)
    Northern Territory (up 11.8%)
    Queensland (up 8.9%)
    Tasmania (-16.5%)
    Australian Capital Territory (-11.0%)
    New South Wales (-5.5%)
    Victoria (-2.2%)
    South Australia (-0.5%)