A new UNISON survey reveals it will take on average until next November for low-paid workers to repay their Christmas debt as 41% admitted they had to turn to credit cards, banks or payday loans.
At the start of National Debt Awareness week, the union is warning that the paper-thin finances of families across the UK are in danger of being torn apart by the next big energy or unexpected repair bill.
The snapshot survey shows that two thirds (67%) of respondents had reduced their spending by cutting back on food, drinks and presents. Despite this, one in two are worried about their ability to pay off their debt.
UNISON General Secretary Dave Prentis said:
“There are too many families whose finances are spiralling out of control. Public service workers have been hard hit by the Government’s freeze and squeeze on their pay. This has plunged many into debt making them a target for loan sharks. The poorest are paying the price for the Government’s austerity agenda and that’s very unfair.
“With rises in household bills, transport costs, housing and childcare low-paid households are only one bill away from falling into a vicious cycle of debt. Unexpected expenses such as a washing machine that needs replacing can be enough to tip families over the edge.
“The Government needs to start listening and take action to help those on the lowest pay. Thirteen million people in the UK live below the povertyline. In-work poverty is a growing issue with the rise in zero hour contracts and under-employment. We may be the 6th richest nation on the planet but last year 346,992* people turned to food banks to help feed their families.
“Workers continue to see a squeeze on their pay and the situation will not improve as long as pay continues to rise slower than inflation. Raisingwages is an imperative that would boost the economy. Britain needs a pay rise.”
Notes to Editors
* Trussell Trust