Debt-ridden families are facing a bleak new year as they struggle to make ends meet, a leading rights campaigner has warned.
Mary Kinninmonth, manager at Citizen’s Advice Bureau in Dundee, said the VAT rise, increased unemployment and festive bills would put a real strain on people’s finances.
“I think probably people will face a difficult year,” she said. “The recession and the credit crunch is still biting, especially as a lot of people have lost their jobs recently or are already facing debt. It is always a struggle for people to make ends meet.
“The cost of living has also risen dramatically so it is more difficult than ever for people to get by, especially those in low-income families.
“It is difficult to tell what will happen but when you think of all the places that have closed down this year, people will be facing a lot of difficulty.
“Some of these people will have been managing absolutely fine with the income they had coming in and suddenly they have found themselves in a dramatically different situation.”
She also said excessively high overdraft charges could have a huge impact on those people already struggling to cope on their budget.
“It is those people on a low income that are hit particularly hard,” she continued. “Charges on overdrafts, which people on low incomes often have to make use of, can add up to cause even more debt for people. The charges are often disproportionate.”
Her comments follow a survey from the Scottish Citizen’s Advice Bureaux (CAB) which predicts that financial problems will continue to plague Scottish communities in 2011.
The survey reveals that over 80% of CAB staff felt banks and lenders were making things worse for those who were struggling, while over 40% were concerned debt would continue to be a major issue.
Citizens Advice Scotland chief executive Lucy McTernan said, “This survey shows that Scotland’s CAB staff believe the impact of the recession will continue to blight vulnerable people throughout 2011, and that neither the banks nor the government are doing enough to help.
“CAB workers are right at the sharp end of what’s going on in our communities. Last year the Scottish CAB dealt with over half a million new cases — that’s one for every five households in Scotland.
“While the recession may technically be over, the harsh truth is that its ongoing impact is still being felt by people in every street, in every village, town and city in Scotland, and will be for some time to come.”
Photo courtesy of Stewart Lloyd-Jones.