StepChange reacts to Autumn Statement

StepChange Debt Charity has reacted to the Chancellor’s Autumn Statement. The measures announced to support households in receipt of means-tested benefits are welcome, however with a higher energy price cap from April, millions will still struggle to make ends meet amid soaring essential bills.

Richard Lane, Director of External Affairs at StepChange Debt Charity, said:

“After weeks of uncertainty, confirmation from the Chancellor today that benefits will be uprated in line with inflation, and cost of living support will continue beyond April will be welcomed by millions of households facing a difficult winter. With the news that inflation has now reached 11%, this support will soften the impact, particularly as the current cap on typical household energy bills is due to be lifted from the spring. The rise in the living wage will also go some way to offset soaring inflation which tends to affect those on the lowest incomes most acutely.

“While the government’s announcements are welcome, it’s far from clear that the support offered will be enough to prevent rising financial difficulty and hardship this winter. Those who receive means-tested benefits are facing the biggest fall in real income and will be exposed to hardship and destitution. The Government can ease pressures on these households by stopping unaffordable deductions from Universal Credit for government debts like historic tax credit overpayments.

“While we support a targeted approach, many low to middle income households will also be left vulnerable to problem debt as the energy price cap increases without further Government support.

“With Council Tax one of the most prevalent debts that StepChange clients struggle with, a possible rise in Council Tax is concerning. Councils are often quick to escalate Council Tax debts to enforcement action, without considering whether this is appropriate. Among our clients those with additional vulnerabilities are more likely to be referred to bailiffs than those without. When increasing the ease with which councils can raise Council Tax, the Government must consider affordability and how they are going to reduce harm for financially vulnerable households.”