Overall, 99,196 people were declared insolvent last year, up from 90,657 in 2016. This is similar to the level seen in 2013 and 2014, but the figure had been falling since the financial crisis. One in 467 adults (0.21%) of the adult population became insolvent in 2017, up from one in 507 in 2016.

The increase was driven by individual voluntary arrangements (IVAs), which reached the highest recorded annual total. These are agreements whereby those in debt agree to make regular payments to an insolvency practitioner, who divides the money between creditors. It is a way to avoid full-blown bankruptcy and protect assets.

Alec Pillmoor, personal insolvency partner at RSM, said: “There are clearly growing levels of financial distress in some households, due in part to rising interest rates, falling wages or changes to employment status.

“Over the last two years, there’s been a 23% increase in the number of people entering an insolvency process. This is despite employment levels being at a record high. Instead, high levels of indebtedness – even for those with regular incomes –  is such that they have no option but to enter one of the insolvency routes.

“We’ve seen a notable increase in the use of IVAs which have risen by 20% in each of the last two years. This suggests many people are taking a proactive approach to resolving their financial issues.”

Although the overall number of company insolvencies increased, this was driven by two large insolvencies with lots of associated companies. The worst-affected sectors were administration and support services, plus construction groups. The Carillion problems are not yet reflected in the statistics.

The underlying number of company insolvencies decreased. Compared with 2016, administrations in 2017 fell by 6.2%, compulsory liquidations fell by 4.5% and company voluntary arrangements by 15.6%.