Citizens Advice Scotland have urged the UK government to re-think its welfare reforms, as figures reveal that around half a million Scots had to borrow money this summer to pay for food.
The Debt Advisory Centre Scotland (DACS) has published figures showing that 1 in 10 Scots (530,000 people) had to get a ‘food loan’ in July. The figure was twice as high for young Scots (aged 18-24).
In response, Citizens Advice Scotland’s Chief Executive Margaret Lynch says
“These figures are very worrying, and show once again the harsh reality of how people are living in Scotland today. Half a million Scots don’t have enough money to put food on the table for themselves and their families. Many of them are taking out loans which they know they won’t be able to repay. Others are having to go to foodbanks. If so many people are unable to provide something as basic as food, it’s clear that the system is failing.
“Across Scotland, CAB advisers see people every day now who are in this situation. One of our concerns is that by borrowing like this they are just storing up debts that they are unlikely to be able to re-pay, and so making their situation worse - particularly if they are using high-interest lenders like payday loans. This is how people get into the nightmare of un-controllable debt.
“Another worry is that if people can’t afford food, it’s likely that many will also be unable to afford fuel, and so will be freezing in their homes this winter. Indeed many will also struggle with their rent or mortgage payments – putting them at risk of losing their homes altogether.
“The evidence we see in CAB cases tells us that this situation is largely caused by the UK government’s reforms to the welfare system - policies like the bedroom tax. Ministers keep saying that those who are vulnerable will always receive support. but these figures show that is just not the case. 10% of Scots can’t afford to put food on the table. That’s not a small number, and it’s not a minor problem. Ministers need to take heed of all this evidence, and understand that this is the real-life impact of their welfare reforms. They need to urgently review these policies, and work to re-create a system that protects people from this sort of poverty.
“In the meantime people who are struggling with their finances should remember that help and advice is available. If you can’t afford your food or rent, then debt really is not the answer. The CAB gives expert money advice for free, and we can help you manage your finances, no matter how bad things seem. Remember too that our advice is free, confidential and impartial.”
For CAS interviews please contact Tony Hutson on 0131 550 1010 or 07774 751655. Local CAB staff can also give local information and interviews in different parts of Scotland. This number is for journalists only, for advice please call 0808 800 9060.
The figures quoted above are from a survey by DACS, which is published today (2 Oct). Their press release is re-produced in full below.
Notes to editors - click to expand/collapse
DACS PRESS RELEASE
- 10% of Scots (almost 530,000) borrowed money to buy food in July
- 18-24 year-olds most affected, with 21% borrowing to pay for food
- 4% of Scots (211,800) borrowed to settle a utility bill
More than half a million adults in Scotland borrowed money to buy food in July, according to research by Debt Advisory Centre Scotland (http://www.dacscotland.co.uk).
And nearly a quarter of a million used a credit card or loan to pay gas, electricity or water bills.
Young people are the most likely to have borrowed money for grocery shopping, with more than one in five (21%) in the 18-24 age group, and around one in six (16%) in the 25-34 age group, using some form of credit to buy food.
However, 35-44s were most likely (8%) to have borrowed to pay utility bills, followed by people in the 55--65 age group (7%).
Ian Williams of Debt Advisory Centre Scotland commented: "The cost of food, gas and electricity has soared over the past few years. Many people use credit cards to buy food every day - sometimes to benefit from loyalty schemes and sometimes just to make ends meet. But unless you pay off your credit card balance in full every month, you are likely to be paying high charges on every pound you borrow. This could easily wipe out any savings you make by shopping carefully.
"The fact that so many people are having to borrow to meet their utility bills during the summer - when heating bills are usually lower - could signal real trouble approaching this winter.
"Most of us need to borrow a little money from time to time, but borrowing to pay for essentials such as food and utilities could be a sign that you are struggling financially.
"If you are having problems making your money stretch, try drawing up a budget - the DACScotland website offers tips on how to do this (https://www.debtadvisorycentre.co.uk), helping you work out where your money is going and how you can cut costs.
"And if you are worried you won't be able to afford to heat your home this winter or are struggling to pay bills, contact your provider to explain the situation and see if they can offer you a cheaper tariff or agree a plan to spread the payments.
"If that doesn't help, then you should seek expert advice."
* Consumer Intelligence carried out online interviews between 31st July and 5th August 2013 with a nationally representative sample of 2,202 UK adults, 443 of whom were Scottish residents. Figures have been extrapolated to fit 2011 Census figures showing 5.295million adults in Scotland.
Notes to editors
Debt Advisory Centre Scotland is part of Think Money Group and offers debt solutions from leading providers Wilson Andrews (Scottish solutions including Trust Deeds and the Debt Arrangement Scheme (DAS)) and Gregory Pennington (debt management plans).
Established in 1993, the Group employs over 1,000 staff today. It has helped hundreds of thousands of people tackle their debt problems - and is currently helping over 70,000 customers get out of debt.
Gregory Pennington was a founder member of DEMSA, the Debt Managers Standards Association, whose aim is 'to encourage the highest standards within the Debt Management Industry'. Fully committed to adopting the recently released Debt Management Plan Protocol, the company remains a DEMSA member today.
A certified Investor in People, Think Money Group has made the Sunday Times' Best Companies To work Forlist in each of the past seven years. It has also been awarded accreditation by the National Skills Academy for Financial Services - 'in recognition of their excellent in-house training provision'.
For more information, visit the Debt Advisory Centre Scotland website at https://www.debtadvisorycentre.co.uk.
For further information please contact:
07855 214851 / @iwill41
02 October 2013