Urgent action must be taken now, Patrick O’Dowd from Caritas Salford has said in reaction to the news that around one in five adults were finding bills and credit commitments a heavy burden by the start of this year.
The number of adults struggling this way is estimated to have increased by 3.1 million since May 2022, the Financial Conduct Authority (FCA) said, jumping from around 7.8 million (15%) in May last year to 10.9 million (21%) in January 2023.
The number of UK adults who had missed bills or loan payments in at least three of the previous six months is also estimated by the regulator to have increased by 1.4 million, from 4.2 million (8%) in May 2022 to 5.6 million (11%) in January 2023.
Patrick O’Dowd was not surprised at the news.
“On the ground we are seeing people who are increasingly struggling to make ends meet, many from families where both parents are working one or two jobs,” Mr O’Dowd told the Universe.
“Hearing the new figures from the FCA is tragically no surprise to our charity. Urgent action needs to be taken before this crisis deepens irreparably.”
The regulator released the latest figures after gathering more than 5,000 responses as part of its UK-wide survey of people aged 18 and over. Researchers also found that 29% of adults with a mortgage and 34% of renters had experienced payment increases in the six months to January this year.
One woman told the survey she had used credit to pay for car repairs, home insurance and food shopping. Another said she had used all her savings to fill her oil tank and she relied on oil to heat her home.
Mr O’Dowd confirmed that such stories were typical of his work at Caritas Salford, whose mission is to help people across Greater Manchester and Lancashire who are experiencing poverty, disadvantage and discrimination to transform their lives with dignity.
“As a charity that supports people across Greater Manchester and Lancashire who are experiencing poverty, disadvantage, isolation and homelessness, we know the severity of these pressures on the lives of normal people is very, very real. Poverty and homelessness can happen to anyone at any time, and sadly demand for our services has arguably never been more acute,” he said.
“It’s 2023 and people can’t afford to eat every day. People can’t keep warm. People are sofa surfing as they have faced forced eviction from landlords who aren’t able to pay their mortgages.”
The FCA is reminding borrowers that they can get help from their lenders if they are struggling to keep up with payments, but Patrick O’Dowd believes that a policy of exploring the issues which have enabled people to end up in ‘untenable positions’ is urgently required.
“This is difficult physically but also mentally – people are plunged into outrageously difficult situations and often can’t see a way out, especially when decision makers and people in power are reporting that costs of everyday items and groceries looks set to remain ‘stubbornly high’,” he said.
“This has to stop. Talking about potential initiatives or offering people advice on debt management is okay, but we need to be addressing the issues which have led to them being in these untenable positions first and foremost before it’s too late. The time to act is now.”
Pictures: Patrick O’Dowd from Caritas Salford