London Daily

Focus on the big picture.
Tuesday, Aug 11, 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
UK Manufacturing Output Records Fourth Straight Month of Growth
UK Condemns Russian Torture of Ukrainian Prisoners and Recruitment of Foreign Nationals
Long-Lost Royal Navy Warship HMS Tiger Found in English Channel After 118 Years
Northern Ireland Finance Minister Seeks Urgent Treasury Talks Over Regional Budget Pressures
UK Government Targets Subscription Traps and Misleading Discounts in New Consumer Rules
Alleged Cartel Boss Daniel Kinahan Extradited From Dubai to Face Criminal Charges
AI Chatbots Challenge Traditional News Consumption and Raise Job Concerns
Andy Burnham Government Promises Crackdown on Exploitative Business Practices
UK University Funding Model Faces Growing Pressure From Unsustainable Student Debt
Government Urged to Subsidise Energy Bills for Vulnerable UK Households
UK Military Spending Plans Threaten to Deepen Infrastructure Funding Gap
Israeli Government Rejects US Peace Framework for Gaza
New Labour Government Signals Closer Economic and Strategic Ties With European Union
Amber Heat-Health Alerts Issued Across England as Temperatures Threaten 36 Degrees
UK Economy Expected to Grow Despite Energy and Supply Chain Shock From Iran Conflict
Foreign Social Media Accounts Drove Disinformation During Belfast and Southampton Riots
Record Number of Migrants Cross English Channel in Single Vessel as Smugglers Deploy Mega-Dinghies
Russia’s A7 Builds a State-Linked Payments Network Beyond Western Sanctions
Reports of Mark Zuckerberg-Linked Superyacht Declining Rescue Assistance Draw Maritime Scrutiny
Preserving Three Banksy Artworks in London Has Cost Taxpayers Nearly £150,000
Four Ugandan Athletes Disappear From Delegation After UK Sporting Events
French Authorities Report Channel Interventions as Cross-Border Migration Dispute Continues
Home Office Admits Error in Settled Status Case Involving Long-Term Italian Resident
Unite Calls for Independent Review of UK Budget Watchdog's Fiscal Forecasting Rules
Thinktank Calls for £175 Annual Energy Bill Cut for Low-Income Households
Foreign-Linked Social Media Accounts Amplified Recent Unrest in Belfast and Southampton, Analysis Finds
London Mayor Sadiq Khan Orders Westminster to Drop Proposed Soho and West End Hospitality Ban
Royal Navy Deployments to Monitor Russian Activity in UK Waters Rise 25 Percent
UK Economy Expected to Grow 0.4 Percent in Second Quarter Despite Geopolitical Pressures
Andy Burnham Launches Cost-of-Living Measures Targeting Subscription Traps and Misleading Discounts
Hyper-Realistic Reborn Dolls Draw Collectors Seeking Comfort and Craft
Gen Z Cuts Back on Dating as a Night Out Nears $200
Patients Turn to Artificial Intelligence for Therapy as Psychiatrists Warn of Privacy and Clinical Risks
Couples Embrace ‘Sleep Divorce’ to Protect Rest and Reduce Tension
Meta Ordered to Pay $567 Million and Change Facebook and Instagram Safeguards for Children
Up to only 10 Months in Prison for Swedish Officer’s Murderer Sparks Anger
Success: Nvidia Turned Gaming Chips Into the Engine of the AI Boom
Jorge Messi, Lionel Messi’s Father and Longtime Agent, Dies at 68
AI’s Next Bottleneck Is Power, Not Just Nvidia Chips
Advertising trick: Pepsi’s Harrier Jet Commercial Led to a $700,000 Court Fight
Meta Raises AI Spending Target to as Much as $145bn Despite Pressure Over Returns
Danube Drought Exposes Nazi Wrecks and Pushes Central Europe’s Power System to the Brink
Joe Biden’s Cancer Has Spread Beyond His Bones, Hunter Biden Says
Air Traffic Control Outage Grounded Flights Across the Midwest
Why 2027 Could Be a Strong Year for Stocks—and Why the Forecast Is Fragile
Why Markets May Look Quiet in August After Big Tech Earnings
Partial Solar Eclipse Expected to Draw Interest Across Southwestern UK
UK Graduate Job Postings Fall 7% as Entry-Level Opportunities Remain Scarce
UK Private Sector Returns to Growth as July Activity Reaches Highest Level Since April
UK Summer Drought and Wildfires Raise Pressure for Stronger Environmental Measures
×