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Struggling Sunderland families owe £9million in unpaid bills and loans

Debt advisor David Brass at the Pallion Action Group.

Debt advisor David Brass at the Pallion Action Group.

THOUSANDS of Sunderland children are living in families trapped by debt, a new report says.

The figures, released by The Children’s Society and debt charity StepChange, show a third of households in Wearside are forced to borrow money to pay for essential bills.

More than 5,200 families in the city – 15 per cent of the total – are failing to keep up with household bills and loan repayments.

It means an estimated 7,471 Sunderland children are living in families with problem debt, with each struggling family behind on payments by an average of £1,669.

Across the city, families owe a total of £8,716,944 in bills and loans.

In Durham City and Easington, the problem affects 2,957 families, with 4,970 children, and a total of £4,934,526 is owed in debts.

The charities’ report, The Debt Trap: Exposing the impact of problem debt on children, claims family debt causes youngsters to suffer from worry and anxiety, experience bullying and miss out on essentials.

The Children’s Society chief executive, Matthew Reed, said: “This research exposes the shocking reality of parents lying awake at night worrying and unhappy children going without.

“Many families are feeling the squeeze, and parents struggling on low wages are battling just to pay the bills.”

In Sunderland, Pallion Action Group has seen a surge in requests for debt advice since the welfare reform capped benefits at £26,000, and now helps between 100 and 175 people each month.

Money and debt advisor David Brass said the majority of those he deals with owe money to utility companies or have rent and council tax arrears.

He said: “We don’t see so many with credit cards, store cards and loans anymore. What we are seeing is people who cannot pay their gas or electricity bills.”

Most advice he gives involves identifying priority debts, like rent and council tax, over general credit debts, then working out a budget and sticking to it.

“Luxuries go out the window,” he said. “That means losing your Sky TV and non-essentials like home insurance. They have to try and maximise their income and minimise expenditure.

“As long as they keep a roof over their head and food on the table, that’s our job done. We give food parcels out as well. A loaf of bread can make a big difference to someone who is desperate.”

The centre gives out about 25 food parcels a week through its partnership with Sainsbury’s, Mr Brass said.

He said he would encourage parents to tell children, especially teenagers, about money problems, as muns and dads are often under pressure to buy expensive gadgets or designer clothing.

“Many parents get into debt because they do not want to see their children go without, so it is important that they understand the pressures,” he added.

“Most parents always make sure children are clothed and have school uniforms. There are one or two who really struggle who can’t afford the uniforms.”

The Children’s Society and StepChange are calling on the Government to consider a “breathing space” scheme to give struggling families an extended period of protection from additional charges, further interest and enforcement action.

Also, review whether the protection for children against the harm caused by debt collection is working; provide earlier and wider access to debt support and advice, and impose tighter restrictions on advertising loans to youngsters.

 

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