Pages

Pages

Wednesday, July 20, 2011

Taking the pain

A report showed 43% of Scots say they struggle to make it to pay day.
The report by insolvency trade body R3 showed that, over the past three months, 539,000 Scots have taken on additional debt through credit cards, loans and increased overdraft facilities. According to the quarterly personal debt snapshot that equates to 13% of the Scottish population.

More than 200,000 Scots had taken out a high interest payday loan in the last year. But one in five Scots say that after receiving payday loans they then struggle to repay them.

R3 Scottish council member John Hall said: “It is extremely worrying that such a large percentage of people are struggling to make it to pay day and that many are using pay day loans to bridge the gap. These loans tend to have high interest rates and often those who use this type of credit find themselves in a vicious debt cycle, especially if they then experience a sudden job loss.”

John Dickie, head of the Child Poverty Action Group in Scotland, said: “With Government policies slashing family incomes and food and fuel prices soaring it’s not surprising that Scots are racking up more debt."

The Scottish anti-poverty network, Poverty Alliance, said there were issues surrounding the 400,000 Scots who are earning less than what is considered a living wage, estimated to be around £7 per hour, at a time when living costs are rising. Eddie Follan of Poverty Alliance said: “It is clear that increasing numbers of Scots are under pressure to make ends meet as the price of essentials like food and energy continue to rise. At the same time low pay continues to be a blight on too many of our citizens. The number of people who are in work and live in poverty is increasing.” He said those on low pay were “no doubt supplementing their low incomes with unsustainable and expensive debt”.

CAS chief executive Lucy McTernan said: “Our evidence shows that across Scotland, debt levels increased by 50% over the period of the recession, with the average debt among our clients reaching more than £20,000.”

Citizens Advice Scotland says four out of five young Scots have been in debt by the age of 21, and a third have owed more than £5000.

No comments:

Post a Comment