The Consumer Credit Counselling Service (CCCS) has warned of a dramatic rise in the number of people seeking debt advice relating to energy bills in the first six months of this year.
Almost 20,000 people contacted the charity reporting problems with affording energy costs meaning many people are already or will be facing fuel poverty. The average combined cost of a gas and electricity bill was £136 a month, which is a significant slice of the average net monthly income of £847.
The drain on finances of energy bills was one of the main contributing factors that left the 19,437 people that contacted the CCCS, £302, on average, short on the amount that they needed to afford their basic monthly living expenses.
This deficit meant that many in this group were unable to repay debts, which averaged at £15,759 in unsecured loans and credit card bills. With energy prices expected to rise further, the CCCS warned that the shortfall being experienced could grow even larger.
Director of external affairs for the CCCS, Delroy Corinaldi, said, “The finances of people in fuel poverty are already significantly overstretched and we are extremely concerned that the current round of energy price rises could plunge them even further into debt.”
This warning from the CCCS comes after the Money Advice Trust (MAT) claimed that one in eight people who are sacked or made redundant would experience severe problems with debt.
Figures from MAT warned that 180,000 unemployed people were already struggling to manage financially, with research suggesting that of the 80,000 people who have lost their jobs in the last three months up to July, 12.9 per cent will suffer difficult debt problems because of this.
Unemployment is a key driving factor for debt problems in the UK.
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