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'Broken' household budgets could push demand for debt help to five-year high

PUBLISHED: 08:36 03 September 2018 | UPDATED: 08:36 03 September 2018

Charity National Debtline says an increasing number of callers to its advice line are struggling to cover everyday household bills. Picture: Thinkstock/AntonioGuillem

Charity National Debtline says an increasing number of callers to its advice line are struggling to cover everyday household bills. Picture: Thinkstock/AntonioGuillem

AntonioGuillem

A charity has warned that demand for debt help could reach a five-year high across 2018 as people increasingly find themselves struggling to cover essential spending.

National Debtline, run by the Money Advice Trust (MAT), predicts it will have received 189,000 calls by the end of 2018.

It said callers were increasingly struggling with arrears on everyday bills, with people facing smaller but trickier debts to deal with.

Half of callers to National Debtline are now struggling to repay debt of £5,000 or less – up from less than a quarter (22%) in 2008.

Three in 10 callers have council tax arrears, up from about one in six (15%) in 2008, with the proportion of callers with rent arrears rising from 6% to 17%, and energy arrears from 9% to 14% in the same period.

People contacting National Debtline increasingly have more money going out on essential spending than they have coming in, it said. Nearly half (48%) of callers now have a budget deficit – up from 27% in 2009, it said.

The charity said it wants to see a single approach across different bodies to reduce problem debt.

MAT chief executive Joanna Elson said: “We need to change how we think about problem debt in the UK.

“Ten years ago a typical caller to National Debtline was struggling to pay credit cards and personal loans.

“Today, callers are struggling with smaller but trickier debts, usually on everyday household bills – and often caused by broken budgets, where the money coming in is simply not enough to cover their essential spending.”

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