Debtors Already Struggling with Cost of Living Pressures Even Before Inflation Surge

People in problem debt across the UK were already struggling with cost of living pressures even prior to the recent steep increases in inflation and energy prices.

That’s according to a new set of figures that show huge numbers of consumers were in arrears with their energy bills and their council taxes during 2021.

Data from the debt help experts at StepChange shows that almost half a million people across the UK reached out to its advisors for guidance on their debt issues over the course of last year.

Of those people, around 28 per cent were behind with their electricity bills and 23 per cent were behind on their gas bills.

Those figures are up from 17 per cent and 13 per cent respectively compared to 2019, which gives an indication of just how much the pandemic situation added to the financial pressures facing British households.

Meanwhile, in 2019, roughly 30 per cent of people who approached StepChange for advice were in council tax arrears but by 2021 that proportion had risen to 37 per cent.

All of which is being taken as evidence that huge numbers of households were having trouble keeping pace with the cost of living last year, even before prices of goods and energy bills began to increase very sharply as they did in the early weeks and months of 2022.

The view from StepChange is that urgent government action is needed to support the people who are most at risk of falling victim to what is now being referred to as the cost of living crisis.

According to the charity, current conditions are such that a growing number of people across the country will soon find themselves in situations whereby their income does not cover their essential outgoings, which will very often lead to problem debt scenarios.

“If things go on as they are, we could see the proportion of our clients who have a negative budget rise from around a quarter to more like a half,” explained Richard Lane, StepChange’s director of external affairs.

“It’s impossible to look at the characteristics of our clients and their debts in 2021 and not conclude that more help is needed,” he added.

“When so many people are already struggling to make ends meet, a steep rise in the cost of living means debt becomes inevitable for many.”

If you live anywhere in Scotland and you are struggling with your personal debts then Scotland Debt Solutions can help. Contact us directly to arrange a FREE and confidential consultation.