Fall in inflation of little comfort to financially vulnerable families

17 June, 2014

In response to today’s Consumer Price Inflation (CPI) figures, StepChange Debt Charity Director of External Affairs, Francis McGee, said:

“Inflation may be down, but it remains well above the level of average earnings, which grew just 0.7% in the 3 months to April. Family finances are still dangerously exposed to risks of problem debt – 7 million people are so financially vulnerable that they do not have the savings to survive even a week if their income was to drop by a quarter. As the overall economy looks to recover, and interest rates inevitably rise, we must make sure that safety nets are put in place to make sure these families are not forced to turn to high-cost credit to make ends meet.”

Rising arrears on household bills

The impact of low wage growth and high living costs is reflected in the increased numbers of StepChange Debt Charity clients with arrears on essential household bills. Over 45,000 people sought the charity’s help with council tax arrears in 2013 – 78 percent more than the year before. The number of people seeking help with electricity and gas bills also went up by more than 50 percent from 2012.