Stanley Kershman (Darren Brown, OBJ)

The double-edged sword of higher borrowing costs and higher living costs is pushing up the number of personal and business bankruptcies in Ottawa.

Industry Canada says the number of consumer bankruptcies jumped 21.8 per cent in September to 229, and the number of business bankruptcies was up 20 per cent to 18.

So for this year, the number of local consumer bankruptcies is up 9.8 per cent, while the number of business failures is up 16.4 per cent.

Bankruptcy lawyer Stanley Kershman says consumers are being squeezed between rising interest rates which push up borrowing costs and higher prices for gasoline, heating oil and natural gas.

Consumers can't afford to finance both their rising debt costs and increased cost of living, resulting in a "bad tasting pot of soup" that consumers are throwing out by declaring bankruptcy or filing a proposal with their creditors, he says.

Mr. Kershman expects the national consumer bankruptcy picture to worsen this year, with an increase of about 1.3 per cent in the number of consumer bankruptcies across Canada and a five per cent drop in business failures.