UK households have fallen behind on essential bills such as council tax and electricity by as much as £18.9bn, according to Citizens Advice, which says it helps someone with bailiff-related problems every three minutes.
The total outstanding debt includes almost £7.5bn in tax credit overpayments, £2.84bn owed in council tax and £2.2bn owed to water companies.
Household debt has now overtaken consumer credit as the main money problem people contact Citizens Advice about, and the charity said that falling behind on household bills “has more severe consequences than missing consumer credit repayments”, such as overdrafts and personal loans.
“People can face having their essential services cut off, be kicked out of their home due to rent arrears or even face prison if they get behind on their council tax,” Citizens Advice warned.
The charity said it had seen a 24 per cent increase in bailiff problems since the government introduced reforms in 2014 that were meant to protect people from unfair bailiff practices.
The findings coincide with calls from Child Poverty Action Group (CPAG) to increase the government’s so-called national living wage to give families the chance to provide a level of living for children that is acceptable to the public.
With parents on minimum wage struggling to provide their children with the most basic lifestyle, the charity says rising prices of essentials, benefits and tax credit freezes, the bedroom tax and the roll-out of Universal Credit have ‘hit family budgets hard’.
Chief executive Alison Garnham said: “There is strong public support for Government topping up the wages of low-paid parents and investing in children is the best long-term investment we can make.
“By using the forthcoming Budget to unfreeze benefits and restore work allowances, the Government can take steps towards making work really pay.”
But there is little hope of that happening. With the government distracted by the Brexit process all signs indicate that borrowing will continue to rise faster than workers’ pay, with high inflation pushing up the cost of living and government benefit cuts adding to the squeeze on households.
As Gillian Guy, chief executive of Citizens Advice, said: “Families are living in fear of a visit from the bailiffs, and small missed bills can skyrocket through excessive enforcement fees.
“Our evidence shows aggressive tactics by bailiffs cause huge distress and can even push people further into debt.
“Families are going without essentials like food or electricity to meet their payments.”
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