This suburb has been named one of the country’s bankruptcy hotspots. According to an insolvency expert credit card debt could be to blame.
This suburb has been named one of the country’s bankruptcy hotspots. According to an insolvency expert credit card debt could be to blame.

The location going for broke as a bankruptcy hot spot

NORTHERN EXPOSURE

NORTH Lakes, north of Brisbane, has emerged as one of Australia's worst bankruptcy hot spots. According to figures from the Australian Financial Security Authority, the suburb in the heart of Brisbane's mortgage belt had the highest per capita number of personal insolvencies at the end of March.

The percentage was 0.096 per cent, meaning just under 1 in every 1,000 adults who live there are subject to some type of personal insolvency administration such as bankruptcy. The region had 49 debtors out of a population of 51,039 aged over 18.

Not a large number of people in the greater scheme of things, but according to Brendan Nixon, a partner at SM Solvency Accountants, it could be a sign of things to come as we come out of the pandemic shutdown.

On the hook
On the hook

Nixon (illustrated) is not sure why North Lakes has achieved the dubious achievement but notes it captures a relatively large number of 'middle class' and first home buyers.

Nixon told your diarist that personal insolvencies have been on the decline in the last few years as the big banks give more leeway for people to repay loans. But as Australia heads into a recession and the ranks of the unemployed grows that is set to change.

Nixon says a big culprit in personal insolvency is consumer debt with people running up huge credit card debt on discretionary items. "I have heard of cases where people have half a dozen credit cards with each owing between $20,000 and $30,000," he says.

OUT OF PETROL

ONE of Brisbane's longest established fashion boutiques has closed its doors blaming the coronavirus pandemic and the "endless options" now available to consumers.

Paula Acheson, who ran Petrol Boutique at Paddington, says the world of retail has changed dramatically since she first opened her shop more than 30 years ago.

Acheson says love of clothes and the art of dressing will always be her passion but at 67 she was looking at taking it easy. Acheson says online sales such as Black Friday had impacted bricks-and-mortar retailers who were struggling to keep people coming in their doors.

Paula Acheson has closed her boutique.
Paula Acheson has closed her boutique.

"People want everything on a discount," she says. "We were an icon at Paddington for years but with coronavirus it just became too difficult." Petrol specialised in clothing for special events such as weddings, races and parties so the pandemic shutdown had hit her business hard.

"I have worked with many designers, suppliers and agents and my business has done its part for the Australian fashion industry, employers and the economy," she says. She also is proud of the young people who have worked with her over the years as shop assistants.

Fashion retailers such as Petrol are expected to be among the hardest hit as Australia moves into a recession following the pandemic.

As many as one in six Australian small to medium sized enterprises (SMEs) could close as a result of the economic fallout from the COVID-19 pandemic, according to Ruthven Institute founder and respected economic futurist, Phil Ruthven

CAKE WALK

THE last jam sponge roll and Christmas fruit cake have rolled off the production line at Kedron's Top Taste Bakery. George Weston Foods has shuttered the 50-year-old factory after demand for cakes and other sweet treat declined and it faced increased competition from supermarket chains' own in-house bakeries.

Generations of northsiders, who grew up enjoying the smell of freshly baked cakes and biscuits wafting over their suburbs from the bakery, will not be the only people missing the bakery.

More than 120 workers have been affected by the closure, which given the economic impact of the pandemic shutdown could not have come at a worse time.

End of the road
End of the road

The company said the bakery officially completed all production at the end of May with cake and roll production concluding from April 30.

As part of the phased closure, 67 employees finished up at the end of April while an additional 40 staff worked up until the end of May. The majority of workers have accepted redundancy packages, while others had been redeployed to roles across other GWF businesses or chosen to retire.

A number of maintenance employees are working through to July as they arrange final removal of equipment from the site. Meanwhile the future of the 3.63 hectare Top Taste site, which is zoned light industry, is yet to be determined. According to real estate website Core Logic, the land was valued in June last year at $8.7 million.

SCHOOLS IN
SOME high profile appointments have been made to the Presbyterian and Methodist Schools Association (PMSA).

Following the body's annual general meeting on Monday night, PwC partner Jane Madden was named a board member as well as chair of the audit, finance and risk committee while Fair Work Commissioner Paula Spencer was appointed to the nominations and human resources committee.

Other appointments included barrister Jacoba Brasch QC and past St Margaret's principal Dr Vicki Waters who were both appointed to the PMSA's new child protection and safeguarding committee.--

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Originally published as North Lakes goes for broke as bankruptcy hot spot



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