Debt ridden families in Bath owe almost £6m in unpaid credit commitments and household bills according to a shock report from the Children’s Society.
But community financial advisors at Somerset Savings and Loans believe the real figure could be far higher.
The credit union’s General Manager Jackie Simpson believes the report – which focuses on families with children – does not reveal the true extent of the region’s debt mountain.
The report reveals that despite its worldwide reputation as a wealthy tourist hotspot an astonishing 16 per cent of Bath families are caught up in the debt trap, collectively owing more than £5.7m with 2,453 children living in debt-affected households.
Jackie Simpson said: “While we welcome the Children’s Society report for focusing attention on the plight of so many of our struggling families, it does not take into account the hundreds, perhaps thousands of pensioners, students, singles and couples who are also burdened with debt.
“Including the people without children could push this figure well beyond the £10m mark.”
She said the level of family debt revealed in the Children’s Society’s hard hitting Debt Trap report was just the ‘tip of the iceberg’ even in an apparently wealthy location like Bath.
The Somerset-based credit union said there were a number of factors behind the shock figures.
“This problem has been built up over the years through a combination of factors including reductions in benefit, static or even reduced wages and the withdrawl of crisis loans which helped people make ends meet.
“All this leaves families which were just managing to cope vulnerable to being tipped over the edge by unexpected household calamities such as having to buy a new washing machine or put the car through an MoT. They were coping and suddenly they are not coping.”
Jackie Simpson said the Children’s Society report had revealed that a staggering 97,000 families in the region – some 16 per cent of the total – were failing to keep up with household bills and loan repayments leaving an estimated 168,000 children living within families with problem debt.
The average Somerset family affected by debt is behind on payments by around £4,000. Multipled across the county debt affected families owe a colossal £396m in bills and loans.
“The sheer scale of debt levels locally underlines the fact a multi-agency approach is required – but it is important other agencies recognise why families find themselves in this level of debt.
“The idea that people have borrowed money to go on luxury holidays or bought expensive household goods is not an accurate reflection of what is happening on the ground.
“A typical Somerset Savings and Loans payment might help cover the cost of a car in order for a family member to find work.”
Jackie Simpson welcomed the Children’s Society report for highlighting the debt issues faced by so many families and the role credit unions can play in helping families out of crisis.
“We are here to help people manage their finances properly and encourage sensible saving for rainy day events like the washing machine or car breaking down.
“This shocking report will concentrate people’s minds on the problem and help us spread the message that we treat people with debt issues as individuals rather than numbers.”
