Bankruptcy Filings In Canada

Every month the Office of the Superintendent of Bankruptcy (the "OSB") publishes statistics on the number of bankruptcies and proposals filed in Canada. For the twelve months ended November 30, 2008 total bankrupcy filings in Canada have increased by 9%, with the largest increases in Alberta - 18%, Ontario - 10% and Quebec -9.5%. Filings in Saskatchewan, my own province, have actually dropped on a year over year basis. Total filings in Canada were just over 94,000 in that one year period. For the same period total proposal filings rose by almost 14% with the largest increases in the same three provinces. Total proposal filings in Canada were almost 26,000 in that year. While a small percentage of these filings were by corporations, this indicates that a total of almost 120,000 individual Canadians made use of the Bankruptcy and Insolvency Act during that twelve month period. In my experience, Bankruptcy and Proposal filings are usually a lagging indicator of the state of the economy as people tend not to file immediately on losing a job, but often wait many months before taking this route. Indeed, one of the triggers for seeing a trustee is often the threat by creditors of garnisheeing wages at a new job, once the individual is finally employed again. I am hopeful that Canada will weather the current economic storm better than most countries in the world but I suspect to see these numbers rise over the next twelve to twenty-four months. Filings in Western Canada are still below the national average, but I would expect to see that increase here too as, for example, various oil sands projects are cancelled and the forestry industry suffers due to the significant drop in housing construction. Ian Schofield MNP Regina