MoneyExpert: Government Accused Of Debt Complacency

The government has been accused of complacency over rising levels of personal insolvency after a report claimed that Whitehall was “making progress” in fighting debt.

The report, Tackling over Indebtedness, claimed that moves to tackle illegal lenders, increase financial education and increase the number of debt advisors were stemming the rise in bankruptcies.

Consumer affairs and poverty campaigners said that the government was failing to grasp the depth of the issues which were contributing to the crisis, however.

“Personal indebtedness is a growing problem and while there are quite a few initiatives coming from the government many of them won’t get under way for some time while others are pilot projects affecting only small areas of the country,” said Citizens Advice.

The charity told the Guardian that 360,000 of the 1.4 million debt problems it had dealt with in the past year were due to store cards and credit cards.

Difficulties in keeping up with interest payments on unsecured loans produced another 250,000 cases, with the average debt worth £13,153 – almost a third more than in 2003.

A second charity, Debt Free Direct, said that its typical client earned £20,000 a year but had loans of £46,000 on top of their mortgage payments.

This article: © Moneyexpert Ltd.

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