Huge rise in redundancy and debt concerns

Woman looking concerned

Citizens Advice has reported a sharp rise in the number of people contacting it with debt and employment concerns over the past 12 months.

The charity says that it advised on six million new problems between April last year and March 2009, of which 1.93 million related to debt, and saw nearly two million clients. Its advice website also saw 8.8 million visits during the period as struggling consumers sought out information during the recession.

While debt was the main concern brought to its door during the year, Citizens Advice also reports a 114% increase in redundancy enquiries and a 61% rise in people looking for information about Jobseeker’s Allowance.

Fears about mortgage and secured loan debt also rose over the year, with 95,342 new enquiries – nearly a 50% rise.

Bankruptcy, fuel debt and council tax arrears increased 24%, 19% and 15% respectively.

David Harker, chief executive of Citizens Advice, says: “These new figures show the human impact of the recession as more people are coming to the Citizens Advice service for help. In particular we are seeing an enormous rise in the number of people turning to us for help because they have lost their job, or are struggling with debts or having problems keeping up with their mortgages.”

Citizens Advice, which was awarded £10 million additional funding earlier this year, says its average client owes around £16,971, an amount it would take 93 years to repay. While low incomes, illness and job losses were the chief reasons for people accruing this level of debt, irresponsible lending, poor financial skills and increases in the cost of living have also played a significant part.