The burden of debt

The Centre for Social Justice, a Conservative-leaning think tank which helped shape the 2010 Tory manifesto, says the average UK household has debts of £54,000, including mortgages - nearly twice the level of a decade ago.

It says the poorest 10% of households have average debts that are more than four times their income. The average debt repayments of people in that group were nearly half of their gross monthly income.

Centre for Social Justice director Christian Guy said: "Years of increased borrowing, rising living costs and struggling to save has forced many families into a debt trap that is proving very difficult to escape.” He explained the poorest people in the UK were "cut off from mainstream banking and have no choice now but to turn to loan sharks and high-cost lenders".

The report says payday lenders have increased business from £900m in 2008/2009 to more than £2bn in 2011/2012.

The  former Labour work and pensions minister Chris Pond who led the Maxed Out report, said  that "with falling real incomes and increasing costs of basic essentials, many, especially the most vulnerable, are sliding further into problem debt".

26,000 UK households have been accepted by councils as homeless in the past five years because of mortgage and rent arrears.