The percentage of bankrupts who are retired has more than doubled in the past five years because of banks offering easy credit and rising fuel and food prices.

The number of old age pensioners failing to meet their debts has risen to 7,900 this year, up from 900 five years ago, according to a study by Wilkins Kennedy, the accountant. Of the total number of people applying for bankruptcy this year, 7 per cent were at retirement age or over, compared with 3 per cent in 2002.

Keith Stevens, an insolvency specialist at Wilkins Kennedy, said that pensioners fell behind on their repayments after their income shrank on retirement. Gordon Brown’s complicated tax system and the pension credits system introduced in 2003 had left many pensioners unaware of the benefits to which they could be entitled.

He expected the trend to worsen as banks tightened their lending criteria in the wake of the Northern Rock crisis and credit freeze: “Even before the Northern Rock crisis, banks were already tightening up their lending criteria and raising their mortgage rates as the credit crunch took hold,” Mr Stevens said.

“However, pensioners are still being offered high levels of credit and may take on unmanageable levels of debt without considering how they will make repayments when their income falls back on retirement. This could signal financial disaster for those who have refused to rein in their spending despite all the warning signs.”

Help the Aged, the charity, has said that 50 per cent of pensioners are failing to claim about £2 billion of benefits due to them each year.

The Consumer Credit Counselling Service, the debt charity, said yesterday: “We have also seen that people over 60 are more likely to have a bankruptcy recommendation than other people in the population. We expect this number to grow.”

A spokesman for the Department for Work and Pensions said that pensioners’ incomes were rising faster than increases in the price of fuel and food. “Average pensioner net incomes, after housing and council tax costs have been paid, have been rising faster than earnings. There has been an increase of 29 per cent since 1996-97 in real terms, compared with a 16 per cent increase in earnings over the same period,” he said.

“Pensions and benefits remain the property of the bankrupt and are excluded from assessments as to whether there is sufficient surplus income to pay creditors. It is, therefore, very unlikely that a bankrupt who is retired will be asked to make any contribution from their income.”

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