Nadia on... Debt

Words: Nadia Whittome
Photos: Fabrice Gagos
Tuesday 04 January 2022
reading time: min, words

In her regular column, Nadia Whittome takes a look at the impact of debt on people in Nottingham and beyond...


Christmas is meant to be a time for celebration - a moment when the pressures of everyday life are put on hold while we have fun with our loved ones. But for many families, the festive season and its aftermath are also a time of worry. The debt help charity StepChange found that almost one in four of those celebrating Christmas struggled to afford it this year.

In the pandemic, many people have seen their incomes plummet from losing 20% of their pay while on furlough, have had their businesses go under, or have been made redundant. 28,000 households are now on Universal Credit in Nottingham.

In January 2021, the Resolution Foundation found that 45% of families who were new to claiming Universal Credit had seen their disposable income fall by at least a quarter in the pandemic. A third had seen it fall more than 40%. Now £20-a-week has been brutally cut from their payments, and at the same time costs of food and energy are soaring, with inflation calculated at 5.1%.

Unsurprisingly, many families have been forced to borrow money and now face mounting debt. A survey by Stepchange found that between the start of the pandemic and January 2021, 10.6 million people borrowed to make ends meet.

St Ann’s Advice Centre is one of the places people in Nottingham turn to when they are struggling financially. Recently, their debt helpline inbox received 455 emails in one week - this is worse than they have ever seen. St Ann’s Advice is a lifeline for people in poverty. It provides debt advice and support, but also helps people find employment, runs a food bank, and sources furniture and clothes. It’s a one stop shop that joins the dots between the different problems people are facing and tries to address them all.

28,000 households are now on Universal Credit in Nottingham

But the support it provides is under threat because of changes to the way that debt advice is funded. Nottingham as a whole currently has eleven-and-a-half full-time debt advisers, but this could fall to as few as three. St Ann’s is set to lose all three of its advisers.

The Money and Pensions Service, who provide the funding for debt advice in England, argue that, while community-based face-to-face debt advice services are being cut, more money is being put into a centralised digital and telephone-based system.

But this change will take away an entire support network. When people come through the door at St Ann’s for debt advice, they can also get help with a whole range of other issues tailored for them locally, they can leave with a food parcel - this cannot be replaced on the internet or over the phone.

Some people also struggle to get the help they need with their debt issues digitally. According to frontline debt advisers working on webchat, about 50% of all clients either disengage or need to be directed to face-to-face services to ultimately have their problems resolved. Disabled people, elderly people, those who require translation or who lack regular access to a phone or the internet due to homelessness or poverty — these groups will suffer.

I spoke in Parliament against these changes and will continue to lobby for our community debt advisers to receive the funding they need. This cut would be wrong at any time, but to implement it during a pandemic and a cost of living crisis is inhumane.

If you’re struggling with debt, you can contact St Ann’s Advice Centre on 0115 950 6867 or email them at [email protected], or Citizens Advice Nottingham on 0115 945 3989.

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