Get documents about "Debt Dashboard Rises in the costs of gas and
Document Sample
Debt Dashboard
Q2 2006
Rises in the costs of gas and electricity are already taking a £380 bite out of the
budgets of those struggling to repay debts according to the latest quarterly
statistical analysis released today (July 25) by the UK’s leading debt charity,
Consumer Credit Counselling Service (CCCS).
Because average incomes are generally static, higher utility bills impact heavily on
the budgets of CCCS clients. Analysis of the figures shows that the average
monthly council tax, water, gas and electricity bills of CCCS clients living in
England and Wales have increased by six percent in the first half of 2006
compared to 2005.
The average client living in England and Wales already pays around £32 more a
month on utilities and council tax than in 2003. The largest increases are in
council tax, which has gone up by over £11, and in gas, which has increased by
more than £9 on average.
As these figures do not include the latest round of price rises as statements and
payments are often made quarterly or annually, CCCS expects the increases in
utility bills to be much higher by the end of the year.
The CCCS Repayment Difficulty Index has remained on a downward trend as a
result of the thorough counselling and budgeting processes that takes place at the
outset. This suggests that clients on Debt Management Plans have been able to
deal with price increases so far. The impact will have been more serious on those
already less able to cope.
Commenting on the figures, chairman Malcolm Hurlston said:
“For those on the brink of debt problems, any substantial increase in utility bills or
council tax can have dire consequences and push them over the edge.
“If these increases have yet to impact negatively on our clients it is because our
counselling centres have provided realistic debt management budgets.
"Utility companies should consider freezing price increases for people who are on
Debt Management Plans and jointly publicise the hardship funds and other forms
of help that they provide widely to their customers who are having problems
dealing with higher prices.”
Council Tax and Utility bill data:
England & Wales 2003 2004 2005 2006*
Council Tax £80.05 £85.10 £91.20 £91.75
Gas £32.95 £34.05 £36.71 £42.30
Electricty £34.44 £35.05 £37.01 £40.82
Water £24.84 £25.89 £27.88 £29.23
Total £172.28 £180.09 £192.80 £204.10
y/y increase 4.5% 7.1% 5.9%
Scotland 2003 2004 2005 2006*
Council Tax £105.11 £106.46 £110.80 £103.59
Gas £35.98 £36.45 £38.99 £43.21
Electricty £41.70 £44.25 £44.66 £46.45
Water £24.06 £20.94 £27.50 £18.17
Total £206.85 £208.10 £221.95 £211.42
y/y increase 0.6% 6.7% -4.7%
Northern Ireland 2003 2004 2005 2006*
Council Tax £48.21 £51.36 £56.38 £58.56
Gas £30.63 £32.51 £36.52 £43.73
Electricty £44.99 £45.95 £45.67 £49.42
Water £19.25 £10.00 £17.00 n/a
Total £143.08 £139.82 £155.57 £151.71
y/y increase -2.3% 11.3% -2.5%
* Figures for 2006 represent the average from January to June.
Average debt levels of CCCS clients increased
by nearly 10 percent in Q2 2006 • In Q2 2006, the index of CCCS DMP debt
CCCS DMP UK unsecured debt increased by 9.6 percent year-on-year, much
12%
quicker than the increase in total unsecured
10% debt in the UK. The average debt level of
8% CCCS clients now stands at £30,800.
6%
4% • The CCCS repayment difficulty index
2% continues to decline. This means there are
0% fewer clients on DMPs who are defaulting
Q2 2002 Q2 2003 Q2 2004 Q2 2005 Q2 2006 their monthly payments.
Fewer clients are defaulting their monthly payments,
The macro-economic climate remains benign
despite higher prices
Tax and Price Index Repayment Dif f iculty Index Unemployment index Index of average earnings
150 150
125 125
100 100
75 75
50 50
Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2
2001 2002 2003 2004 2005 2006 2001 2002 2003 2004 2005 2006
Average utility and council tax bills are up £380 a year • The slight increase in unemployment has not
Average monthly utility & council tax bills, England & Wales
Council Tax Gas Water Electricty
impacted on the macro-economic climate
£2,500 whose outlook remains positive.
£2,000
• Data from over 150,000 counselling sessions
£1,500 (since 2003) show that the average utility and
council tax bills have increased by around
£1,000 £380 since 2003. These figures will not
include many of the recent price increases
£500
announced by utility companies which have yet
£0 to impact on consumers.
2003 2004 2005 2006*
Debt Dashboard data – Q2 2006
Index of average Index of ILO Repayment Index of average Index of average
DMP debt Tax and Price Index Unemployment rate difficulty index earnings UK unsecured debt
(Jan 1999 = 100) (Jan 1999 = 100) (Jan 1999 = 100) (Jan 1999 = 100) Base rate (Jan 1999 =100) (Jan 1999 =100)
2001 Q2 120.9 104.4 80.6 69.3 5.25% 111.1 127.9
2002 Q2 126.6 105.6 83.3 71.1 4.00% 115.2 142.4
2003 Q2 131.6 109.7 81.2 78.0 3.75% 118.7 154.6
2004 Q2 138.1 112.6 77.4 74.0 4.50% 124.1 167.8
2005 Q2 150.7 115.9 76.3 65.3 4.75% 128.9 182.7
2006 Q2 165.1 118.9 81.7 62.2 4.50% 133.4 186.6
Notes on Debt Dashboard:
1. Debt Dashboard is produced quarterly and based on data from some 52,000
people spread throughout the United Kingdom. It juxtaposes clients’ levels of
debts and ability to repay with broader economic variables.
2. CCCS clients in this press release are people making repayments on a debt
management plan
A total of seven variables are covered:
• Repayment difficulty index
The repayment difficulty index reflects problems reported by people on
repayment plans. These plans are based on affordable payments agreed with
creditors.
• Index of average DMP debt
This refers to the average level of unsecured debt being paid back by DMP
clients (i.e. original debt) at any time. Because the aggregate is made up of
DMPs established at various times, it is not possible to weight the data for
inflation. The debt does not include mortgages or other secured sources of
credit. These are defined as priorities by the CCCS and are taken into account
in deciding an affordable monthly repayment plan.
• Tax and prices index
The Tax and Price Index takes into account taxes and prices in calculating the
RPI basket of goods. This means that it is a truer indication of disposable
income. More information can be found on the TPI index at the Office of
National Statistics, which releases the figures on a monthly, quarterly and
annual basis, we have adjusted the figures with January 1999 as the base.
• Index of ILO unemployment rate
• Index of average earnings
• Index of average unsecured debt in the UK
• Base rate
For further information contact Frances Walker on 020 7636 5214
or email: fwalker@hurlstons.com
Related docs
