2007 starts with 15% more debt problems than 2006

National charity Citizens Advice says a survey of bureaux has revealed they were approached for help with 15% more debt problems in January 2007 than in January 2006. The number includes debt problems relating to everyday living expenses such as fuel and council tax, which have increased more sharply.

A survey of half of all Citizens Advice Bureaux in England and Wales reported that they dealt with more than 83,000 new debt problems in January 2007 alone, the equivalent of more than 3,700 debt problems every working day. This is a rise of 15% from the 72,000 new debt problems in January 2006. The problems showed increases in problems relating to basic essentials such as fuel and housing costs.

The increase in fuel debt problems reflects recent rises in prices and people’s difficulty in keeping up payments. People also brought more debt problems relating to council tax arrears, telephone debts and water supply and sewerage costs.

Teresa Perchard, Director of Policy for Citizens Advice said; “Our bureaux are reporting a continuing increase in the number of debt problems people need help with. The combination of people experiencing increases in fuel bills, and rising housing costs puts additional pressure on people’s finances which were already stretched to the limit.“

In the financial year 2005/2006 Citizens Advice Bureaux dealt with 5.5 million new problems, 1.4 million of which concerned debt. Indications show that debt problem numbers dealt with in 2006/2007 will exceed that figure, overtaking benefits as the largest area of problems that bureaux deal with.

Debts relating to credit, store and charge cards still remain high, with the survey bureaux reporting more than 19,000 new consumer credit debt problems in January. Bank and building society overdraft problems increased by 15%, with bureaux reporting more then 6,000 new debt problems.

“If people have debt problems they must seek help straight away. We cannot stress enough the importance of telling your creditors as soon as you have difficulties in paying - they should treat you sympathetically. Get advice from an independent advice agency who can help you work out payment plans for your debts and explain what options there are. You can also make sure that you are claiming all the benefits you are entitled to. You may be missing out on money that could help off-set your costs.“