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Saturday, July 11, 2020

The Burden of Debt

  • 24% of people are concerned about paying utility bills
  • 26% are concerned about paying rent
  • 19% are concerned about mortgage repayments
  • 20% are concerned about paying for food and essentials
  • 21% are concerned about council tax
  • 35% are concerned about their income levels in general

Scotland could be facing a “personal debt time bomb” due to the Covid-19 pandemic, according to Citizens Advice Scotland. It warned as the furlough scheme is reduced, debt payment holidays end, and job losses become more significant, it could cause a large increase in the number of people being unable to manage their debts.

CAS financial health spokesman Myles Fitt said: “The issue is most often a result of insecure or low incomes which are simply not able to keep pace with the cost of living.
“While concerns about unemployment have understandably replaced it for the time being, the issue of personal debt will become a real challenge in the coming months and years.
“An income shock from a job loss or reduced pay, combined with the cost of arrears such as council tax, housing or energy bulls built up due to Covid-19 payment holidays, will put individual and household finances under extreme pressure.
“Our fear is that many households will fall into unmanageable debt, causing financial hardship and pushing more people into poverty, or exacerbate existing poverty.”
Mark Diffley, who conducted the poll, said: "Once again, it is apparent that the highest levels of concern are recorded from those in the poorest socio-economic groups who are least likely be able to bear the financial burdens which they are facing as a result of the virus.”

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