Fife in the red

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Yesterday in Parliament I met with StepChange Debt Charity as they launched their Scotland in the Red research report. The report found that Scotland has the highest volume of payday lending among Stepchange Debt Charity clients in the UK. It shows that over 10% of total client debt in Scotland was the result of payday loans, and almost 20% of clients had at least one payday loan.

In Fife, Cowdenbeath and Dunfermline’s average debt was much higher than the Scottish average by £6,778 and £1,700 respectively. Both areas also join with North East Fife in having an above average payday loan debt. Kirkcaldy is also a cause for concern with more people there taking out a pay day loan than average across Scotland.

This report should be a wakeup call for the Scottish Government that the cost of living crisis is hitting families hard across Fife. People from across the Kingdom are struggling to pay to heat their homes, pay their bills and are accruing so much debt they are being forced to take out payday loans.

Other areas of concern include above average rent arrears, mortgage areas, gas and electricity arrears and council tax arrears and the areas causing most concern are;

  • Fife constituencies with above average rent arrears: North East Fife, Kirkcaldy, Dunfermline and Cowdenbeath
  • Fife constituencies with above average mortgage arrears: North East Fife, Mid Fife and Glenrothes and Dunfermline
  • Fife constituencies with above average gas and electricity: North East Fife, Mid Fife and Glenrothes, Kirkcadly and Dunfermline
  • Fife constituencies with above average council tax arrears: Mid Fife and Glenrothes, Kirkcaldy and Dunfermline
We are also seeing an increasing demand in food banks and it is becoming increasingly clear that welfare changes and Government cuts are beginning to really hit households across Scotland and particularly in Fife.
With families being forced into making difficult decisions as they struggling to make ends meet it is important that we see action being taken by the Government to try and address these problems. At the very least, the Scottish Government should agree to rolling out further advice to warn people of the risk of pay day loans.

The report was an analysis of debts held by clients of the charity in Scotland since 2010. The data shows large increases in priority debt arrears such as rent, mortgage, gas and electricity, particular in the last six months. Moreover clients in Scotland had the highest value of Council Tax arrears in 2012 – nearly double the UK average at £1,312.