StepChange Debt Charity response to TUC debt report

8 September 2015

In response to ‘Britain in the Red’, a TUC and Unison-commissioned report into the rising levels of families with problem debt, Mike O’Connor, Chief Executive of StepChange Debt Charity said:

“Sadly, today’s report comes as little surprise. These findings should serve as a stark warning that problem debt is an issue that requires urgent attention. At StepChange Debt Charity we have seen enormous increases in the numbers of people accessing our services. In 2014 alone we helped nearly 600,000 people deal with serious debt problems, an increase of 56% since 2012. While the average unsecured debt we see is about £15,000.

“Temporary financial difficulties can strike almost anyone at any time. We need better protections for people who fall into debt to ensure that temporary difficulties do not become long-term intractable debt problems. People need help to get back on their feet. And we need better incentives and mechanisms to help people save and insulate households from debt problems when inevitable changes in circumstances happen.

“Earlier this year the government announced its plan to consult on proposals that would give those people seeking help with their debts ‘breathing space’, through guaranteed freezes on interest and charges and a halt on enforcement action when they commit to taking action to tackle their debt. We hope the new government will commit to ensuring that this review goes ahead.”

Facts and figures

• Problem debt cost the UK £8.3bn¹
• £1,000 in precautionary savings would protect 500,000 families from falling into problem debt²
• The amount of single parents contacting us has increased by 105% over the last three years, from 30,370 to 62,259. They represent 18.3% of our clients, but only 3.8% of the national population³
• The number of 16-24 year olds contacting has increased by over 400% in the last five years⁴
• Self-employed people owe, on average, £5,000 more than any other employment status and more than double those who are unemployed²
• 39.8% of all our clients are in arrears on at least one essential household bill (Council Tax, rent, energy)⁵

References

1. The £8.3bn Challenge – StepChange Debt Charity (October 2014)
2. An Action Plan on Problem Debt – StepChange Debt Charity report (January 2015)
3. Statistics Yearbook 2014 - StepChange Debt Charity report (March 2015)
4. Ibid
5. Ibid