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Debt charities' warning of rising fuel poverty 16 September 2011

The Consumer Credit Counselling Service (CCCS) revealed that almost a third of people contacting it are already in fuel poverty after 19,437 of the people seeking its help with debts in the first six months of this year reported problems with energy bills.

Their average combined gas and electricity bill was £136 a month, a significant chunk out of their average net monthly income of £847.

The burden of their energy bill was one of the reasons that these clients were, on average, £302 short of the amount needed to cover their basic living expenses each month.

This shortfall meant they were not in a position to repay their debts, which averaged £15,759 in unsecured debt for this group. CCCS has subsequently warned that this shortfall could grow even larger if energy bills continue to rise.

Delroy Corinaldi, CCCS director of external affairs, said: "The finances of people in fuel poverty are already significantly overstretched – and we are extremely concerned that the current round of energy price rises could plunge them even further into debt."

The warning comes after Money Advice Trust (MAT), another debt advice charity, warned that one in eight people sacked or made redundant will experience severe debt problems.

The MAT warned that 180,000 unemployed people were already struggling to cope financially, and said its research indicated that of the 80,000 people who have become unemployed in the three months leading to July, more than one in eight will experience severe debt problems as a result (12.9%).

Joanna Elson OBE, chief executive of the Money Advice Trust, said: "Unemployment is one of the key drivers of debt problems in this country. A family can be managing their household budget just fine until unemployment brings a sharp drop in income. Suddenly every bill becomes a big problem and things can quickly spiral out of control."



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