Cayman Islands, Caribbeanand International News
Monday, Jul 15, 2024

Number of UK households with large debts rises by a third

Number of UK households with large debts rises by a third

Exclusive: Britons struggled even before winter rise in energy prices and benefits cut, research shows

The number of UK households struggling with large debts increased by a third in 2021, even before the winter rise in energy prices and the removal of the £20 uplift in universal credit payments, research suggests.

Analysis of Bank of England research carried out by the Jubilee Debt Campaign found that in September 2021 almost 10% of households reported that loan and interest repayments were a heavy financial burden, a 35% increase on the previous year’s figures.

Households also reported that their average monthly loan repayments reached a record £373 in 2021, up 22% on the year before and the highest figure for at least a decade.

The campaign group’s analysis is based on a survey of more than 6,000 households which was carried out in September 2021. Since then, millions of households have seen energy bills rise and are due to see a further increase next month.

The rise in Ofgem’s price cap in October and the failure of a number of low-cost energy suppliers led to some customers seeing bills increase by hundreds of pounds. On 1 April, an increase in the price cap means the average household will experience a 54% rise in bills.

The temporary £20 a week increase in universal credit introduced at the start of the pandemic was phased out at the end of September.

Surging food and petrol costs have added to the strain on finances since the research was done, and the Jubilee Debt Campaign said the rising cost of living threatened “to push people who are already living on the edge further into debt and poverty”.

The increase in the number of households reporting that their debts were a heavy financial burden followed two years of falls, but the campaign group said it suggested that measures to ease the impact of the pandemic had not helped everyone.

The data for loan repayments comes from analysis of households’ reports of repayments on unsecured debt, so does not include mortgages. It showed that in nominal terms and when inflation was adjusted for, these were running higher than over the past decade.

Citizens Advice said 5 million people had indicated that they would not be able to afford April’s energy price rises.

Separate research carried out last week showed families are already concerned about falling into debt as a result of higher living costs. Citizens Advice said 5 million people had indicated that they would not be able to afford April’s energy price rises, while in a survey by the Money Advice Trust one in five adults said they were likely to borrow or use credit in the next three months to cover essentials.

Dean Burn, 62, is involved with the Jubilee Debt Campaign in Manchester and worked for 41 years before losing his job during the Covid pandemic. He said: “I’m always juggling debts – this month I got my TV licence bill, so I’ve been unable to pay back my housing benefit overpayment.

“I’ve relied on food banks these past 12 months to get by and I can’t afford to even pay for the bus sometimes. I’ve been keeping just one light on in the house at a time and I’m now worried about being able to afford to heat my home.”

Joe Cox, the senior policy officer at Jubilee Debt Campaign, said Rishi Sunak needed to announce a serious plan to address the situation when he delivers the spring statement on Wednesday.

He said: “The worsening debt crisis is toppling households up and down the country … The government should target support to help those struggling with rising bills and mounting arrears and provide a ‘fair debt writedown’ to give people with high levels of debt a fresh start.”

Cox added: “We also need to see significant policies to deliver rising incomes and a decent universal minimum income floor to prevent these chronic debt crises from happening again.”

Citizens Advice said it had analysed the impact of the removal £20 universal credit uplift on clients using its services, and found that in more than a quarter of cases where an adviser referred someone to a food bank that was given as the reason.


Related Articles

Paper straws found to contain long-lasting and potentially toxic chemicals - study
FTX's Bankman-Fried headed for jail after judge revokes bail
Blackrock gets half a trillion dollar deal to rebuild Ukraine
Israel: Unprecedented Civil Disobedience Looms as IDF Reservists Protest Judiciary Reform
America's First New Nuclear Reactor in Nearly Seven Years Begins Operations
Southeast Asia moves closer to economic unity with new regional payments system
Today Hunter Biden’s best friend and business associate, Devon Archer, testified that Joe Biden met in Georgetown with Russian Moscow Mayor's Wife Yelena Baturina who later paid Hunter Biden $3.5 million in so called “consulting fees”
Singapore Carries Out First Execution of a Woman in Two Decades Amid Capital Punishment Debate
Google testing journalism AI. We are doing it already 2 years, and without Google biased propoganda and manipulated censorship
Unlike illegal imigrants coming by boats - US Citizens Will Need Visa To Travel To Europe in 2024
Musk announces Twitter name and logo change to X.com
The politician and the journalist lost control and started fighting on live broadcast.
The future of sports
Unveiling the Black Hole: The Mysterious Fate of EU's Aid to Ukraine
Farewell to a Music Titan: Tony Bennett, Renowned Jazz and Pop Vocalist, Passes Away at 96
Alarming Behavior Among Florida's Sharks Raises Concerns Over Possible Cocaine Exposure
Transgender Exclusion in Miss Italy Stirs Controversy Amidst Changing Global Beauty Pageant Landscape
Joe Biden admitted, in his own words, that he delivered what he promised in exchange for the $10 million bribe he received from the Ukraine Oil Company.
TikTok Takes On Spotify And Apple, Launches Own Music Service
Global Trend: Using Anti-Fake News Laws as Censorship Tools - A Deep Dive into Tunisia's Scenario
Arresting Putin During South African Visit Would Equate to War Declaration, Asserts President Ramaphosa
Hacktivist Collective Anonymous Launches 'Project Disclosure' to Unearth Information on UFOs and ETIs
Typo sends millions of US military emails to Russian ally Mali
Server Arrested For Theft After Refusing To Pay A Table's $100 Restaurant Bill When They Dined & Dashed
The Changing Face of Europe: How Mass Migration is Reshaping the Political Landscape
China Urges EU to Clarify Strategic Partnership Amid Trade Tensions
Europe is boiling: Extreme Weather Conditions Prevail Across the Continent
The Last Pour: Anchor Brewing, America's Pioneer Craft Brewer, Closes After 127 Years
Democracy not: EU's Digital Commissioner Considers Shutting Down Social Media Platforms Amid Social Unrest
Sarah Silverman and Renowned Authors Lodge Copyright Infringement Case Against OpenAI and Meta
Italian Court's Controversial Ruling on Sexual Harassment Ignites Uproar
Why Do Tech Executives Support Kennedy Jr.?
The New York Times Announces Closure of its Sports Section in Favor of The Athletic
BBC Anchor Huw Edwards Hospitalized Amid Child Sex Abuse Allegations, Family Confirms
Florida Attorney General requests Meta CEO's testimony on company's platforms' alleged facilitation of illicit activities
The Distorted Mirror of actual approval ratings: Examining the True Threat to Democracy Beyond the Persona of Putin
40,000 child slaves in Congo are forced to work in cobalt mines so we can drive electric cars.
BBC Personalities Rebuke Accusations Amidst Scandal Involving Teen Exploitation
A Swift Disappointment: Why Is Taylor Swift Bypassing Canada on Her Global Tour?
Historic Moment: Edgars Rinkevics, EU's First Openly Gay Head of State, Takes Office as Latvia's President
Bye bye democracy, human rights, freedom: French Cops Can Now Secretly Activate Phone Cameras, Microphones And GPS To Spy On Citizens
The Poor Man With Money, Mark Zuckerberg, Unveils Twitter Replica with Heavy-Handed Censorship: A New Low in Innovation?
Unilever Plummets in a $2.5 Billion Free Fall, to begin with: A Reckoning for Misuse of Corporate Power Against National Interest
Beyond the Blame Game: The Need for Nuanced Perspectives on America's Complex Reality
Twitter Targets Meta: A Tangle of Trade Secrets and Copycat Culture
The Double-Edged Sword of AI: AI is linked to layoffs in industry that created it
US Sanctions on China's Chip Industry Backfire, Prompting Self-Inflicted Blowback
Meta Copy Twitter with New App, Threads
The New French Revolution
BlackRock Bitcoin ETF Application Refiled, Naming Coinbase as ‘Surveillance-Sharing’ Partner