DEBT ISSUES are predicted to rise by more than 85% by spring, and there’s a coming storm, warned Citizen Advice Wokingham’s chief executive.
Jake Morrison said he is concerned the cut in the £20 Universal Credit uplift, combined with rising energy prices is going to put pressure on even more people in the borough.
Conpounded with the pressures of Christmas, Mr Morrison fears the charity could see the highest number of referrals than ever before.
Since Tuesday, April 1, he said there have been 1,196 debt issues raised for for 362 clients, and predicts this could rise to 2,392 issues for 724 clients by the end of the financial year.
He said this would be an 86% increase in debt issues, and an 84% increase in clients, compared to the 2019 and 2020 financial year.
Volunteer debt advisor, John Totman has been with Citizens Advice Wokingham for more than eight years.
He said he is seeing a more diverse range of people coming to the charity for help — many who have never needed to claim for benefits or Universal Credit before.
“These are people that were in full-time employment for a long time, and covid put them out of a job for the first time,” he said. “They aren’t used to the benefits system, and many didn’t realise they could get different types of help.”
Mr Totman said this meant many people ate into their savings first, before being “plunged into debt”.
“Some weren’t familiar with what they were eligible to receive,” he said. “But there are limits on how far back you can claim.”
This meant many people living in the borough were faced with high priority debts, such as rent and council tax payments, for the first time in their lives.
Mr Totman said for many people who were already struggling, the rising fuel costs are “quite worrying”.
“Fuel costs are a big slice of their monthly budget,” he explained.
Carefully created by the citizens Advice team, many residents receiving support from the organisation are talked through the best way to create, keep and manage a weekly and monthly budget.
This is particularly helpful for people who are repaying debts, Mr Totman said.
However these will have to be revisited now.
With the cut in the £20 per week Universal Credit uplift, Mr Totman said the Citizens Advice team are rebalancing the books to help clients manage with £80 less each month.
“I worry it will drive people back into debt who were just managing,” he said.
He fears that debt-related issues will continue to climb as more pandemic-related financial measures end.
Trainee debt adviser Miriam Barry joined Citizens Advice Wokingham during the pandemic, and said many people struggling with debts are facing a range of mental health issues.
One of Ms Barry’s clients, who first reached out in the summer, had many missed appointments due to her mental health.
She said that she has borderline personality disorder, although does not have a formal diagnosis as she is reluctant to visit her GP.
Ms Barry said a large part of the support she gave was discussing a range of mental health support.
By late summer, she had made a GP appointment and was expecting a call back.
“She said she felt a bit anxious about this but knew that she needed the GP’s support because she had been having stomach trouble and had been screaming in her sleep,” Ms Barry said. “She is continuing to engage with us and to work towards a debt solution.”
A key part of this is building a trusting relationship, and having empathy, Mr Totman said.
“As independent advisors, we are able to work out the best solution for them.”
Ms Barry said stress and anxiety can lead to many clients not opening their post, when they receive overdue payment letters.
Many, she said, will come to a face-to-face meeting with a carrier bag full of unopened debt letters.
But this can be helpful for Ms Barry, who can deal with the issues there and then, she explained.
An additional challenge of the pandemic has been shifting to remote support. If clients cannot send the relevant information over email, or print or scan documents, this can delay some support.
Mr Totman said: “Debt Relief Orders can be difficult to process for those who struggle to send us information electronically. Some only have a phone. so they can’t scan and print documents, others may find it too difficult or not have the IT skills needed.”
The duo are hopeful the organisation’s hybrid approach, offering in-person, and virtual support, as well as the new van, which has a mobile office inside, will be the best way to support all residents.
For more information or support, visit: citizensadvicewokingham.org.uk or call 0808 278 7958
