A leading charity says it's seeing increasing amounts of everyday people unable to afford the basics, skipping meals, going without heating and falling into debt to cover essential bills.
New figures published today by Christians Against Poverty (CAP) reveal that a third of its Northern Ireland debt clients don't have enough income.
CAP’s debt advice experts work to create tailored budgets for each person, with a focus on covering basic needs.
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But the debt and budgeting help charity found that 35% of people here have unsustainable budgets with the average person £233 short each month.
Its 2023 Client Report published today reveals the stark reality of rising costs and low incomes on people’s lives.
However, the charity says rising costs and low pay is leading to an increase in clients’ incomes not being sufficient to cover their expenditure, even after expert debt advice and reducing all non-essential spending.
This has led to an issue with budgets that are just not sustainable. In 2022 over a third (35%) of budgets advised by CAP in Northern Ireland fell into this category.
This means that no matter how much debt advice someone receives, and regardless of them doing everything to maximise their income, they will not have enough money to live on.
As a result, CAP says it has seen a dramatic increase in the number of clients using credit to pay for essentials.
In 2021 a third of CAP NI clients (36%) said they had borrowed money to cover household bills they couldn’t afford.
But last year, 53% of CAP clients here said they had used credit to cover household bills while 56% also borrowed to pay for food, clothing, and other essential living costs.
In Northern Ireland, the average amount of debt owed among people seeking help from CAP is £12,232 per household.
Taking into account average income, this means that, without debt help, it would take 12 years on average to repay the debt they owed, with one in five (18%) here needing more than 100 years.
Last year, just over a third of the budgets created for clients here were unsustainable, meaning households did not have enough income to cover their basic needs, even after debt advice.
Over half of those surveyed have skipped meals (54%) and over half have been unable to afford to heat their homes (51%) - both of which are up from last year.
And the impact is not just financial as over half (55%) admitted having mental ill-health issues, showing the impact of poverty on people’s wellbeing.
James Myles, Belfast Central Debt Centre Manager for CAP told Belfast Live: "A few years ago pre-Covid people were contacting us over their worries around debt relating to credit cards, catalogues and payday loans.
"Now people are using their credit cards to pay for basics such as food, clothing and other essentials because they can't afford to buy these things any other way.
"The current cost of living crisis means that the debt we would normally have been dealing with has been pushed down the pecking order and now it's about survival for most people."
He added: "At CAP, part of our role is to help people manage their money better and get them out of debt. At the end of that journey, we want them to be able to manage their money better and live within their means so they don't get into debt again.
"Now we're having to increase the amount of money we allow them for food - for a single person that was £50 a week but now that's up to £70. Gas and electricity might have been £10 or £15 a week but now that needs to be £50 a week.
"If your income hasn't increased or you have no other means of bringing money in, then the budgets are very tight and there's very little left to start paying off debts."
Jacqui Robb, CAP's Carrickfergus Debt Centre Manager added: “Some of my clients were already holding onto their homes by their fingertips and, now that interest rates on their mortgages have increased five times in the past 12 months, they are having to cut back even more on food and heating costs just to keep a roof over their head.
“The cost of living has increased the price of every item in our shopping trolleys and, due to this, more and more clients are turning to the local food bank for help on a more regular basis.”
CAP’s Head of NI Alison Flanagan said: “We are seeing increasing amounts of everyday people unable to afford the basics; skipping meals, going without heating, falling into debt to cover essential bills and feeling completely hopeless.
“It’s heart-breaking for us all at CAP every time one of our local Debt Centre Managers walks into a new client's home to find an empty fridge and cupboards, dark and cold rooms and piles of bills that the person simply can’t afford.
“At CAP we believe that everyone should have access to the basics they need to live. That’s why we continue to help people to break free from poverty with our free debt help, budgeting support and job clubs.
“But charities like us can’t win this fight against poverty alone. We need to ensure free debt help, like the service we and others provide, is available to all who need it.
“We need more people to raise awareness of how poverty devastates lives. And we all must do more to promote where to find free debt help from organisations like CAP.”
She added: “Politicians from all parties, locally and across the UK, must also show more commitment to facing up to poverty. We need more short term support to help those on the lowest incomes to cope with rising costs, as well as longer term commitments to tackling some of the root causes of poverty.
“Poverty is winning the fight right now. Only together will we be able to turn the tide and start to eradicate this evil that’s harming our friends, families, neighbours and communities.
“At a UK level we want the Government and major opposition parties to make tackling poverty a key priority in their manifestos to show their commitment to helping people recover from the current cost of living crisis.
“Locally, to address rising levels of poverty we need Stormont to play its part. CAP is calling for an urgent return to a functioning executive and all parties to prioritise tackling poverty and deprivation in Northern Ireland.”
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