More families fall into debt
WHILE George Osborne is congratulating himself for guiding Britain towards economic recovery and contemplating a consequent General Election victory in a year’s time, more and more evidence is emerging that few households are sharing the Chancellor’s euphoria.10 May 2014
On the contrary, many families are in an “extremely precarious” financial position, according to a new report by the Children’s Society and the StepChange debt charity, with nearly three million households with dependent children on the brink of sliding into financial difficulties, to join the 1.4 million already there.
Of course, this is not to deny the reality of the recovery. However, with wage growth being minimal and household bills continuing to soar, many families are finding their finances deteriorating rather than improving, giving ever more credence to Labour’s claim that the link between growth and living standards is broken.
The report, as the authors insist, is a stark warning of the effect that spreading indebtedness is having on children, and a reminder that, as the Archbishop of York says, struggling families must be offered an alternative to the onerous interest rates of money-lenders.
For, even though there has been nothing wrong with the Government’s recipe for recovery – reining in public spending, cutting taxes for lower earners, removing disincentives to work and improving the education system – it will not be an election-winning strategy if more and more households are seeing their standards of living worsen.
The Chancellor has to show the electorate that this is a recovery for the many, not the few, and for the whole country, not merely the booming South East. And with the number of people dependent on food banks tripling in a year, more families sliding into debt and even the middle classes becoming increasingly squeezed, this is becoming an ever more difficult task.