In the red

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In the red

More and more people in Bristol are seeking help and advice about rising levels of debt, according to Bristol's specialist debt advice charity. Eugene Byrne reports.

The thing that strikes you is the banal, everyday things. Household items that most of us take for granted take on a massive, all-consuming importance if you're living in poverty:

I am struggling to cook nutritional meals for myself and my children as the cooker I own works intermittently. Three of the four rings work, but not all the time, and often they do not get hot enough to cook anything at all.

Single mother, Bristol

I really need a tumble dryer as there is no outdoor space to dry my washing as I live in a second-floor flat. My clothes do not dry well on the clothes horse I have bought and they stay damp and begin to smell.

Single father, Bristol

And if you're in debt too, your problems can become life-threatening.

Bristol Debt Advice Centre (BDAC), the city's only specialist debt advice charity, celebrates its 21st birthday this year. It began life in the basement of a house in Redland in 1990, at the height of the last major economic downturn. Now, in 2011, and working out of a proper office in Old Market, its services are more in demand than ever.

Unlike, say, the Citizens Advice Bureau, which offers help on a wide range of issues (including expert debt advice), BDAC specialises solely in debt. They offer (free) advice, financial education and carry out social policy work. They also have an Energy Advice Team to help people deal with and reduce gas and electricity bills.

BDAC was approached for help by around 8,000 people last year, of whom they took on 3,000 as full casework. This means they'll negotiate with creditors over repayment levels, and help deal with the complex form-filling involved in dealing with a wide variety of firms and agencies. Where appropriate they'll help with debt relief orders or bankruptcy, or with applications to various different funds and trusts for help with, say, energy bills or domestic appliances.

BDAC's workload has increased by 23% in the last 12 months and, they say, the demographic of its clients is rising. Virtually all their clients in the past lived in council, social or rented accommodation. Now they're starting to see a few people with mortgages as well.

There's also something new about the current downturn. While about 2.5 million working-age adults in the UK are unemployed, the Joseph Rowntree Foundation estimates that over three million more are either not actively seeking work but would like to work (e.g. students) or are in part-time or casual jobs and unable to find full-time work. Which is to say, almost six million working-age Britons are underemployed (See tinyurl.com/35fp8c7 for more). So while almost two-thirds of BDAC's clients are living solely on benefits, around a third are either living on earned income or a combination of earnings and benefits.

A characteristic case will be someone on benefits or minimum wage, just managing to get by. "The official poverty line for a single person at the moment is £124 a week," Joanna Gooding, one of BDAC's fundraisers, explains. "Someone on JSA is getting £67.80 a week if they're over 25, so anyone who's on benefits is well below the poverty line. It's just not a sustainable way to live. It's difficult to get access to mainstream banks, they'll be using high-interest lenders, things like Brighthouse [a rent-to-own retailer which charges very high interest rates] where you end up paying a lot more. You're excluded from all the things that someone with a better income level can access."

While some people get into financial trouble through fecklessness – the credit-card fuelled shopping addiction of popular stereotype – this simply isn't true of the great majority of cases. Most of the people that BDAC sees have been careful with the little money they have.

Joanna Gooding: "There are debt-triggers, such a losing work, falling ill, or needing to pay for a big one-off item, such as the car breaking down. You get out credit for that, struggle to make the payments... People then find themselves in a cycle which can lead to depression, anxiety, stress and at the point where people come to us they're usually at the end of their tether."

There are odd little cultural contributions to the debts racked up by a handful of BDAC's inner city clients. "Obviously people who have emigrated or are refugees can have problems understanding how bills work, and there can be cultural differences as well. Some people like to have their curtains closed and the lights on, even in daytime, and that has implications for their electricity bill. Some like to sleep with just sheets rather than duvets, so they might have the heating on all night."

There is, inevitably, pressure on funding. At the moment, the bulk of BDAC's money comes from the Legal Services Commission – it's Legal Aid, basically – and some from other central and local government agencies as well as from energy companies and trusts and charities. Some of the government funding ends next year, so new sources and donations are welcome.

"There's a lot of talk about increasing internet or telephone advice, which is good," says Joanna, "but in a lot of cases it's hard to get to the crux of someone's problems if you're not in a room with them. Many of our clients struggle with technology and computers.

"Most of the people we see are on a very low income and their problems are related to quite a lot of injustices that are inherent in the social system. People have come from poor backgrounds, have not had a good education, and that makes it harder to find well-paid work. All the time I see people who are desperate to improve their situation."

Drowning in debt

Lucy, from Bedminster was at the end of a 20-year marriage a few years back. Her ex-husband had been abusive towards her and her children and she found it difficult to cope with the after-effects.

"I became alcohol-dependant and lost my job as a secondary-school teacher. I began a new relationship but this also became abusive and my children witnessed violence against me.

“Social services intervened and I lost care of my children who moved in with my ex-husband, Losing my children is the hardest and most traumatic thing I have ever had to deal with. I found it increasingly difficult to cope and gained help from a mental health charity. Then my partner was imprisoned for violence against me. After this I went through a home detox and with the help of a specialist NHS unit became dry.

“I was left with a huge amount of debt after the marriage breakdown and am now in housing association housing. My only income is currently incapacity benefit and low-rate mobility care. I quickly began to struggle with bills and rent... I was also being chased for the old debts.

“The events of the last few years have been traumatic and I've found it difficult to cope. Now I want a chance to move forward and put these events behind me. I am trying to turn my life around and I hope that in the next year I can gain access to my children again.”

Rose, from St George is a single mother of two children with learning difficulties. The family lives on benefits, and she got into trouble with her heating bill during a cold spell last winter.

“I have tried to stop using my gas where possible. I live in a large property but this helps me care for my children as one of the rooms is set up as a soft play area to protect my older son from knocking his head against the wall.

“I have always cleared my gas bill each quarter in full. This time around my car broke down and needed a replacement gearbox. This had to be fixed as without the vehicle I am unable to transport my children to school and after-school activities.”

Names and some details have been changed

Personal debt in the UK

Britons as individuals owed £1,452 billion at the end of April 2011, up 0.8% on the previous year. We collectively owe as much money as the entire country produced in the whole of 2010.

Average household debt in the UK is £8,121 (excluding mortgages). If you include mortgages, it's £55,854. If you add government debt as well, each household in the country owes £106,470.

One person is declared insolvent or bankrupt every minute of each working day in the UK.

The average cost of raising a child from birth to the age of 21 is £27.50 per day.

100 properties were repossessed every day in the first three months of this year

Source: Credit Action (www.creditaction.org.uk)