Private Debt in the UK a panel presentation by Emma Bryn-Jones to the Rosa Luxemburg Foundation / EURODAD Conference Alternative Solutions to the Debt.

Private Debt in the UK

a panel presentation by Emma Bryn-Jones to the

Rosa Luxemburg Foundation / EURODAD Conference

Alternative Solutions to the Debt CrisisFriday 7th March 2014

8.8 million over-indebted adults

2.6

2.8

3.4

low wage & benefit dependent families

optimistic young workers & worried working families

struggling students, first time workers, stretched families & uncomfortable retirees

undoubtedly vulnerable to low / reduced income

distressed, distracted and / or fi nancially vulnerable

principally distressed that risk taking has backfi red

SOURCE: MONEY ADVICE SERVICE, INDEBTED LIVES, NOVEMBER 2013

Credit Outcomes Distribution

£5,000 £10,000 £15,000 £20,000 £25,000 £30,000 £35,000 £40,000 £45,000 £50,000 £55,0000

1

2

3

ExcessDeficit

Credit agreement

17%

17%

66%

social tenant private tenant

owner occupier

Comparing tenure of over-indebted people with English Housing Survey

22%

28%

50%

social tenant private tenant

owner occupier

SOURCE: MONEY ADVICE SERVICE, INDEBTED LIVES, NOVEMBER 2013

SOURCE: COMMUNITIES & LOCAL GOVERNMENT, ENGLISH HOUSING SURVEY 2011-12

Payday loans as a percentage of unsecured lending

1%

99%payday loans unsecured lending

11%

89%

unsecured lending secured lending

SOURCE: OFFICE OF FAIR TRADING, PAYDAY LOAN MARKET INVESTIGATION, JULY 2013

total lending = fashion?unsecured lending = cosmeti cs?

“The Independent”17 October 2013

The cost of living crisis afflicting millions of Britain’s families is so bad that it is creating a personal debt crisis too. The prices families have to pay keep on rising faster and faster than the wages they are paid. And, as a result, the market in payday lending has doubled in just four years.

http://www.independent.co.uk/news/uk/politics/labour-leader-ed-miliband-declares-tax-war-on-payday-lenders-8884944.html

Gender and age of over-indebted adults

male

female

0% 10% 20% 30% 40% 50% 60% 70%

35%

64%

18-24

25-34

35-44

45-54

55-64

65+

0% 5% 10% 15% 20% 25% 30% 35%

21%

22%

32%

21%

3%

1%

SOURCE: MONEY ADVICE SERVICE, INDEBTED LIVES, NOVEMBER 2013

Experiences of debt collection by gender and age

male

female

10% 15% 20% 25% 30% 35% 40% 45% 50%

39%

43%

25-39

40-59

60+

0% 5%10%

15%20%

25%30%

35%40%

45%50%

39%

46%

26%

SOURCE: ZERO-CREDIT, THE DEBT RESOLUTION FORUM 2013 CLIENT SURVEY

Solutions

• Optimise the collective, not your bias

• Empower the collective from within

• Make market forces count