Problem debt is on the rise in Yorkshire and beyond as cost-of-living woes continue: Vikki Brownridge
It’s no exaggeration to say that for us at debt change charity StepChange, Yorkshire is our home. While we help people struggling with debt across every corner of the UK, our organisation was founded here in Yorkshire over thirty years ago, and our headquarters sit in Leeds city centre, home to around 700 colleagues.
After three decades, we are now the largest provider of debt advice and solutions in the UK and last year we supported almost ten thousand people in Yorkshire alone through financial difficulty – which got me thinking.
Every year, we launch two reports looking at the debts and demographics of our clients across the UK and separately, Scotland.
With “Awful April” dominating the headlines, I thought it worthwhile to assess the state of personal debt and finances in Yorkshire, and the true depth of the cost of living crisis can be seen on our charity’s doorstep, with a ‘Yorkshire in the Red’ review.
And the reality is that in Yorkshire the findings are stark.
In the year to date, the most common kind of debt in Yorkshire, credit card debt, stands at well over £2,000 on average per client, as over one in six in the region tell us they face debt due to the cost of living increase.
What’s more, the most common type of arrears, council tax, also stands well above £1,800 per client on average, and this kind of debt affects over 1,000 clients in the region alone – especially worrying when our research shows the heavy-handed nature with which council tax debt is escalated and how quickly a knock on the door from a bailiff can follow.
Perhaps most concerning is the impact on homeowners – who make up a smaller proportion of our client base but have been acutely affected by financial turmoil in recent years.
Rapid interest rate rises have placed considerable pressures on homeowners, and mortgage arrears have ballooned, now standing at over £9,000 per client, up well over a thousand pounds since last year.
These stats show us a few things.
Firstly, that the prevalence of problem debt is much higher than people realise – and your neighbour, friend, or family member may be struggling – and that speaking out or advising them to seek debt advice can go a long way to getting people back on their feet.
Secondly, they show us that whilst on the surface things seem to be improving, as inflation has come down, interest rates drop, and food inflation slows, the reality is the increase in everyday costs is placing pressure on households from Hull to Huddersfield and it’s not something Government can ignore.
We need to see more support to manage the essentials through measures that keep the cost of bills like housing, energy and council tax down and ensuring benefits keep up with living costs.
And for those struggling the most we need investment in local crisis support like emergency grants and affordable, low-cost credit so that people facing unpredictable costs are not forced into desperation borrowing that pushes them deeper into debt.
Finally, they show us that the cost of living pressures do not discriminate by region.
Yorkshire is not an outlier with our UK stats and is broadly in line – a perspective that may once have been reassuring but is now worrying.
Vikki Brownridge is CEO of StepChange