British household debt now more than a third of a trillion pounds, according to a TUC report Britain in the Red.  Last year almost half the UK population had some form of unsecured debt. 

 

At the end of 2015, 3.2 million households or 7.6 million people were in debt, a rise of 700,000 or 28% since 2012.  

 

1.2 million low-income households are estimated to be in “extreme problem” debt. This is defined as households who have to pay out more than 40% of their gross household income on unsecured debt repayments. 

The increase in debt since 2012 is in part due to the major extension of student loans. 

 

The largest growth of indebtedness is among low-income households that are in employment. In 2015, 9% of these were “extremely over-indebted,” up from 5% in 2014. 

This situation has worsened markedly over the course of the past year for working households with incomes of £30,000 or less. Nearly three quarters (72%) of these households hold unsecured debts, and the report finds there has been an increase, from 10-14%, in the number of these who are over-indebted during the past year. 

Many more young people are in debt. Student loan debt has grown from £15 billion in 2004 to £86 billion at the end of 2015 – mostly due to university fees. 

Mortgages for indebted, lower-income, working households have fallen by one-third. In contrast, the percentages of these households living in either social or private rented accommodation have doubled.