Londoners struggling with debt

Treading Water is the evocative title of a new report that has been published by the London Debt Strategy Group. The report examines the levels of debt affecting people in England’s capital, and shows that, in the last 3 years, there has been a 75% increase in the number of young Londoners struggling with debt. In 2008, 17-24 year olds owed an average of 3,500 – that figure has now risen to nearly 6,000. The fact that people are finding their debts problematic is clear, and illustrated by data from the Legal Services Commission which shows that, between November 2007 and December 2009, there was a 140% increase in the number of young people seeking debt advice.

London has more people in arrears than any other region – 13%, compared to a national average of 10%. Increasingly, debt problems are having a negative impact on the mental health of the population, which is making it harder for people to find work or hold down a job.

On average, people suffering from long-term illness or disability experience three times the level of debt problems compared with the wider population. People already suffering from mental health problems, as well as lone parents, minority ethnic communities and other disadvantaged groups have been identified as being most in need of good debt advice.

When the recession was biting hard in 2009, Deputy Mayor of London Richard Barnes set up the London Debt Strategy Board. He appreciated that debt was going beyond simply being a financial problem (it was starting to impact on public health), and he wanted to investigate how London’s debt services and debt advice facilities might be improved.

The Treading Water report, which is focused on ensuring that the help, advice and support available London’s debt-bound population is as good as it can possibly be, contains various practical recommendations such as increased lobbying for funding for free debt advice and better cooperation between agencies offering debt advice.

Get more information on debt management.