700,000 Scots have problem debts or are on the verge of plunging into financial distress

As reported by Scottish Financial News: LINK


Debt charity StepChange has today released figures showing that almost 700,000 people in Scotland have problem debts or are at risk of having them, with thousands struggling with essential household bills – especially Council Tax.

In its report, Scotland in the Red, published today, the charity reveals that it alone was contacted by over 30,000 people last year seeking debt help, across every constituency in Scotland.

Stepchange Debt Charity Scotland said it is now seeing more clients in Scotland with Council Tax arrears, with 46 per cent of clients having Council Tax arrears with an average value of £2,017.

And the average amount of money clients had left over after meeting housing costs, paying to heat their homes and paying Council Tax was just £12.64 a month, leaving more Scots falling behind their household bills.

Nearly 1 in 5 who appealed to the charity for help in 20118 were behind on their electricity bill, a 4 per cent jump on 2017. They owed an average of £826, a 10 per cent increase in just one year.

Stepchange said more of its clients in Scotland are in debt because of reductions in income or benefits, and in 2018 25 per cent of clients said that a reduction in income or benefits was the reason for their debt, an increase of 7 per cent in just one year.

Sharon Bell, head of StepChange Debt Charity Scotland, said: “The vast majority of StepChange clients are in problem debt due to circumstances they could not have prevented or planned for such as unemployment, ill-health or reductions in income. I am increasingly alarmed by the increases in the proportion of our clients who are struggling with household bills, particularly Council Tax. Our research shows that our clients in Scotland are significantly more likely to have Council Tax arrears compared to elsewhere in the UK.

“We are seeing a record level of demand for help with problem debt with over a third of our clients having an additional vulnerability, such as illness. We need more signposting to free debt advice, as the earlier someone gets debt advice the greater their options may be and the less harm they could experience.”