Archive for December 8th, 2012

Guest Post:  Marriage, the State of the Economy and the Divorce Time Bomb

Rob Killeen, family barrister and finance broker at Capital Fortune examines declining marriage, the incidence of UK divorce and the state of the economy and considers whether we can import any lessons from abroad to avoid a growing time bomb.

This week saw research published by the Eurostat statistical office confirming Britain has the highest divorce rate of all member countries within the European Union. The incidence of UK divorce now stands at 2.8 per 1,000 of the population compared to Luxemburg at 0.6%. In simple terms, this equates to nearly 5 times more couples getting divorced in the UK than a country situated less than 300 miles away.

The scale of the ‘epidemic’ has not gone unnoticed. Sir Paul Coleridge, a High Court judge, not previously known for outspoken views, agreed last week with judicial watchdogs, to keep a ‘lower profile’ following his public references to marital breakdown being one of the “most destructive scourges of our time.”

There remains an obvious lag in the reporting of official numbers, but latest figures from the Office of National Statistics show a 4.9% increase between 2009 and 2010, despite worrying wider reports that the economic climate is causing many couples to postpone break-up plans.

Women in their late twenties and men in their early thirties were found to be amongst the most likely candidates to divorce with the gender gap narrowing for both men and women in the 40-44 age bracket. The average length of a UK marriage is now 11.5 years and whilst we may become de-sensitised to facts and figures, it is important to note that 50% of divorcing couples have a least a child of the family.

The cost is not only emotional and personal. The Relationships Foundation has estimated that the financial impact of marital breakdown costs the British taxpayer some £42 billion per year.

A matrimonial survey published by Grant Thornton found that the highest number of divorce proceedings were brought between 11-20 years of marriage. The report suggests evidence of a divorce time bomb, given 82% of survey respondents, indicated separation had been delayed, due to the lack of value and liquidity of some assets and the state of the UK economy. In addition, it found that within a third of all divorces, the average value of the party’s assets, available for distribution, was between £500k and £1m. When the stakes are so high, it is understandable why many litigants rush to the arms of lawyers.

The national statistics are disappointing particularly as 80% of couples now ‘try before they buy’ and cohabit together for a considerable period, before tying the knot. The trend towards cohabitation may account for the decline in marriage numbers. In contrast, only 1% of couples lived together in the 1950’s prior to marriage, when to do so was deemed ‘socially deviant.’ The increased social acceptability of cohabiting raises an interesting paradox as with few people choosing to marry, fewer people should be getting divorced. This may indicate an overall more fundamental and worrying trend given the change in societal values towards marriage and for those that do, a greater propensity to divorce.

A move towards cohabitation has produced its own studies which found that of all couples living together on their 10th anniversary,  only half had married, 40% had split, with one in ten remaining content with the situation.
There still remains enormous support for the institution of marriage despite the long term decline in the numbers choosing the altar. Recent Government proposals and David Cameron’s personal support to extend marriage to same sex partners, whilst likely to be divisive, may at least turn the numeric tables.

The implications of both marriage and divorce can be significant and it is clear that as well as the underlying human and emotional commitment, there are the current and future financial ties between the parties. London Mortgage Brokers Capital Fortune have recently reported a fourfold increase in their court report service, used by family solicitors seeking to resolve disputes over the independent mortgage borrowing capacity of the husband or wife. The demand for these reports may indicate that the financial implications of separation on an individual’s own mortgage borrowing, in the current economic climate, is less than clear.

The future of UK divorce trends does not make easy reading whether through official statistics or the glossy pages of Hello! magazine.  The incidence of celebrity divorce is in fact worse with high profile marriages, twice as likely to end in tears than for us mere mortals.  Perhaps the time has now come to learn some lessons from our Luxemburg brethren given their close proximity. With EU nations receiving some 75% of Luxemburg’s exports perhaps a little of their understanding on marriage may not go a miss.

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