Millions of British households face financial disaster if their incomes dry up. More than 6.5 million households are in debt, or face the prospect of falling into debt within a month, should they lose their jobs, according to new research from The Equality Trust. The richest 10 per cent of households have almost £50,000 set aside in savings, while the poorest 10 per cent have an average of just £100.
More than 40 per cent of working households have too little saved to pay even a month’s worth of household bills, let alone cover one-off bills such as the typical £540 cost of a replacement boiler.
“Over a third of households owe more in debt that they have saved, and millions more face falling into trouble in the event of a financial shock they cannot avoid," Dr Wanda Wyporska, executive director of The Equality Trust, has warned. "Many households are barely clinging on, with high costs, low incomes, and reduced government support. We only need to look around to see that the scale of economic inequality in this country has reached dangerous levels." Dr Wyporska added. "This is not just a financial issue, we know that inequality means that our trust in others is lower, as well as worse levels of physical and mental health for us all. It even holds back our economy.
Many UK households will start the cold weather period already owing £100m in electricity and gas bills. 900,000 homeowners owe their gas and electricity supplier money in unpaid energy bills. Households that are behind on their bills – around 5 per cent of the UK population, according to Gocompare.com, owe an average of more than £120 each, despite these bills typically relating to the summer period of relatively low energy costs. With the majority of homes expected to turn up the heating, switch on lights earlier, use the tumble dryer more and other energy-using action the debt to energy providers is set to increase. Despite this, barely one in ten of those struggling to make up the arrears has contacted their supplier to discuss the problem, the price comparison site estimates, with almost a fifth saying they ignore the debt, hoping it will sort itself out over time. Others report being pressurised by their supplier to pay up and a fifth of consumers said their supplier was unsympathetic to their circumstances.
According to data from Halifax, house prices have risen on average 551 per cent - a monthly increase of £905 - in the surrounding towns since the M25 motorway opened in 1986. At Junction 23, Barnet is the Hertfordshire town that has seen the biggest hikes, with a huge increase of 674 per cent taking house prices from an average of £70,000 to £540,000 in the past 30 years. Prices in the leafy north London town, which also sits across travel Zones 5 and 6, have risen by £135,000 in the last five-years alone.
Prices in neighbouring St Albans have risen almost as quickly - from £67,000 to £502,000 - representing growth of 647 per cent. Ricksmansworth, which has average house prices of £552,000. In contrast, when the motorway opened 30 years ago, Leatherhead in Surrey held top position with average house prices of £88,000.
House prices along the M25 have grown faster than the UK average, however haven't kept up with the pace of growth throughout inner London.