London Daily

Focus on the big picture.
Wednesday, Mar 04, 2026

Number of UK households with large debts rises by a third

Number of UK households with large debts rises by a third

Exclusive: Britons struggled even before winter rise in energy prices and benefits cut, research shows

The number of UK households struggling with large debts increased by a third in 2021, even before the winter rise in energy prices and the removal of the £20 uplift in universal credit payments, research suggests.

Analysis of Bank of England research carried out by the Jubilee Debt Campaign found that in September 2021 almost 10% of households reported that loan and interest repayments were a heavy financial burden, a 35% increase on the previous year’s figures.

Households also reported that their average monthly loan repayments reached a record £373 in 2021, up 22% on the year before and the highest figure for at least a decade.


The campaign group’s analysis is based on a survey of more than 6,000 households which was carried out in September 2021. Since then, millions of households have seen energy bills rise and are due to see a further increase next month.

The rise in Ofgem’s price cap in October and the failure of a number of low-cost energy suppliers led to some customers seeing bills increase by hundreds of pounds. On 1 April, an increase in the price cap means the average household will experience a 54% rise in bills.

The temporary £20 a week increase in universal credit introduced at the start of the pandemic was phased out at the end of September.

Surging food and petrol costs have added to the strain on finances since the research was done, and the Jubilee Debt Campaign said the rising cost of living threatened “to push people who are already living on the edge further into debt and poverty”.

The increase in the number of households reporting that their debts were a heavy financial burden followed two years of falls, but the campaign group said it suggested that measures to ease the impact of the pandemic had not helped everyone.

The data for loan repayments comes from analysis of households’ reports of repayments on unsecured debt, so does not include mortgages. It showed that in nominal terms and when inflation was adjusted for, these were running higher than over the past decade.

Citizens Advice said 5 million people had indicated that they would not be able to afford April’s energy price rises.


Separate research carried out last week showed families are already concerned about falling into debt as a result of higher living costs. Citizens Advice said 5 million people had indicated that they would not be able to afford April’s energy price rises, while in a survey by the Money Advice Trust one in five adults said they were likely to borrow or use credit in the next three months to cover essentials.

Dean Burn, 62, is involved with the Jubilee Debt Campaign in Manchester and worked for 41 years before losing his job during the Covid pandemic. He said: “I’m always juggling debts – this month I got my TV licence bill, so I’ve been unable to pay back my housing benefit overpayment.

“I’ve relied on food banks these past 12 months to get by and I can’t afford to even pay for the bus sometimes. I’ve been keeping just one light on in the house at a time and I’m now worried about being able to afford to heat my home.”

Joe Cox, the senior policy officer at Jubilee Debt Campaign, said Rishi Sunak needed to announce a serious plan to address the situation when he delivers the spring statement on Wednesday.

He said: “The worsening debt crisis is toppling households up and down the country … The government should target support to help those struggling with rising bills and mounting arrears and provide a ‘fair debt writedown’ to give people with high levels of debt a fresh start.”

Cox added: “We also need to see significant policies to deliver rising incomes and a decent universal minimum income floor to prevent these chronic debt crises from happening again.”

Citizens Advice said it had analysed the impact of the removal £20 universal credit uplift on clients using its services, and found that in more than a quarter of cases where an adviser referred someone to a food bank that was given as the reason.

Newsletter

Related Articles

0:00
0:00
Close
Trump Says UK–US ‘Special Relationship’ Is Diminished Amid Middle East Dispute
UK Economic Forecasts Face Fresh Strain from Middle East Conflict and Rising Energy Costs
UK Reaffirms Close US Ties After Trump’s Public Criticism
Reeves Stresses Stability and Fiscal Discipline in UK Budget Update as Growth Outlook Shifts
UK Deploys Royal Navy Destroyer HMS Dragon to Cyprus After Drone Strike on RAF Base
Green Party Surges Past Labour in New UK Poll as Traditional Party Support Crumbles
Majority of Britons Oppose U.S. Use of UK Military Bases in Iran Conflict
UK Intensifies Evacuation Efforts from Oman, Working with Airlines to Boost Flight Capacity
Trump Condemns UK and Spain in Unusually Sharp Rift Over Iran Military Action
Trump Repeats UK Claims That Diverge from Verified Facts Amid Diplomatic Strain
UK Arrests Prominent Figures Linked to Epstein Network as Questions Mount Over US Action
Trump Says UK ‘Took Far Too Long’ to Approve Use of Airbases for Iran Strikes
Scope of Britain’s Role in the Expanding Middle East Conflict Comes Under Scrutiny
Trump Says He Is ‘Very Disappointed’ in Starmer Over Iran Comments
U.S. Embassy in Riyadh Struck by Drones Amid Escalating Iran Conflict
Starmer Confronts Strategic Test After Drone Strike Near British Base in Cyprus
Rolls-Royce Chief Signals Openness to Germany Joining UK-Led Fighter Jet Programme
UK Stocks Slip as Escalating Iran Conflict Triggers Global Market Selloff
UK Overhauls Asylum System to Make Refugee Status Temporary
Starmer Warns of ‘Reckless’ Iranian Strikes Amid Escalating Regional Tensions
British Base in Cyprus Targeted as Drones Intercepted Amid Expanding Iran Conflict
Starmer Diverges from Trump on Iran Strategy, Rejects ‘Regime Change from the Skies’
U.S. and Israel Intensify Strikes on Iran as Conflict Expands to Lebanon and Gulf States
Violent Pro-Iranian Protesters Storm U.S. Consulate in Karachi
Missile Debris Sparks Fires at Dubai’s Jebel Ali Port Near Palm Jumeirah
Iran Strikes U.S. Fifth Fleet Headquarters in Bahrain Amid Wider Gulf Retaliation
When the State Replaces the Parent: How Gender Policy Is Redefining Custody and Coercion
Bill Clinton Denies Knowing Woman in Hot Tub Photo During Closed-Door Epstein Deposition
Former U.S. President Bill Clinton Testifies on Ties to Jeffrey Epstein Before Congressional Oversight Committee
Dyson Reaches Settlement in Landmark UK Forced Labour Case
Barclays and Jefferies Shares Fall After UK Mortgage Lender Collapse Rekindles Credit Market Concerns
Play Exploring Donald Trump’s Rise to Power by ‘Lehman Trilogy’ Author to Premiere in the UK
Man Arrested After Churchill Statue Defaced in Central London
Keir Starmer Faces Political Setback as Labour Finishes Third in High-Profile By-Election
UK Assisted Dying Bill Set to Fall Short in Parliament as Regional Initiatives Gain Ground
UK Defence Ministry Clarifies Position After Reports of Imminent Helicopter Contract
Independent Left-Wing Plumber Secures Shock Victory as Greens Surge in UK By-Election
Reform UK Refers Alleged ‘Family Voting’ Incidents in By-Election to Police
United Kingdom Temporarily Withdraws Embassy Staff from Iran Amid Heightened Regional Tensions
UK Government Reaches Framework Agreement on Release of Mandelson Vetting Files
UK Police Contracts With Israeli Surveillance Firms Spark Debate Over Ethics and Oversight
United Airlines Passenger Hears Cockpit Conversations After Accessing In-Flight Audio Channel
Spain to Conduct Border Checks on Gibraltar Arrivals Under New Post-Brexit Framework
Engie Shares Jump After $14 Billion Agreement to Acquire UK Power Grid Assets
BNP Paribas Overtakes Goldman Sachs in UK Investment Banking League Tables
Geothermal Project to Power Ten Thousand Homes Marks UK Renewable Energy Milestone
UK Visa Grants Drop Nineteen Percent in 2025 as Migration Controls Tighten
Barclays and Jefferies Among Banks Exposed to Collapse of UK Mortgage Lender MFS
UK Asylum Applications Edge Down in 2025 Despite Rise in Small Boat Crossings
Jefferies Reports Significant Exposure After Collapse of UK Lender MFS
×