Scots Seeking Debt Help Up Almost 50%, Charity Warns
The UK’s largest debt charity has warned that debt is becoming “entrenched in day-to-day living” for many people in Scotland.
In four years, the number of Scots contacting StepChange rose by 47% from 13,034 in 2013 to 19,132 last year.
The report showed that the number of young people seeking help with debt also increased.
The 25-39-age bracket now makes up 36% of their clients – a rise of 6% since 2013.
Sharon Bell, head of StepChange in Scotland, said: “Over 60% of the people we help are in debt due to circumstances they could not have prevented or planned for.
“The rises in council tax, electricity, rent and mortgage arrears highlight how difficult day-to-day living has become for many Scottish households.
“Keeping a roof over your head and heating your home are basic needs, yet for too many Scottish families, these are constant worries. Even where families are not in debt, many are balanced on a knife edge, one setback away from problem debt.”
The research also showed that Scots who contacted the charity had almost 10% more debt than the rest of the United Kingdom, relative to monthly income.
The report said: “Depressed incomes and rising prices are significant factors behind the increasing need for debt advice.”
A call centre worker from Glasgow, who wished to remain anonymous, said: “Debt is everywhere – especially amongst younger people. I can’t afford to buy a property so I’m paying high rent prices with a salary that doesn’t cover it. I want to socialise, go on holidays, drive a decent car, and enjoy myself, so often I’ve turned to loans and overdrafts. I’d say taking on debt has become a necessary part of life.”
The Scottish government has taken steps to tackle the country’s debt problem.
Recent figures suggest that since the 2011 reform of the Debt Arrangement Scheme some progress has been made.
Over the last seven years, over £200m of debt has been repaid and over 6000 people have completed repayment plans through the scheme.
The process is available to Scottish residents and allows debtors to freeze and discount fees, interest, penalties and charges as long as they keep up with their monthly debt payments.
James Dornan, MSP for Cathcart said “The Scotland in the Red Report is another example of the excellent work that StepChange does, not only in the quality of research they produce, but also in the fantastic service they offer their clients. The report demonstrates the pressures that many households are facing. Scotland is leading the way in seeking to support those with debt. Scotland has the only statutory debt arrangement scheme in the UK, with breathing space that freezes interest rates and charges to allow a manageable and sensible debt repayment schedule.”
StepChange can be contacted free on 0800 138 1111