Warning that cost-of-living crisis is far from over

Debt advice specialist, Money Wellness has warned the cost-of-living crisis is far from over despite the topic falling down news agendas in recent months.

The organisation reiterated the warned after referring more than 21,000 people to food banks during the first six months of the year – up from 10,622 in the last half of 2023.

During the six months to June, Money Wellness also helped over 130,000 people who were struggling with an average debt of £12,742.

Four in ten (39%) of those seeking debt support this year have been in arrears with their energy provider. This is in line with Ofgem’s figures that show energy debt has increased to £3.1bn during 2024, with the average amount of debt per household increasing by 50% and the total number of households struggling growing by 20%.

Ian Somerset, managing director at Money Wellness, said “Inflation has hit the Bank of England’s 2% target for two consecutive months, but this only means prices are rising more slowly and conceals the bigger picture. That being the cost-of-living crisis is far from over. The reality is the number of households in debt because of unaffordable living costs is rising.

“We support around 1,000 people a day, many of whom are behind on rent or mortgage payments and other priority debts. This is only going to get worse as we head towards winter – the first without any additional cost-of-living support since the crisis began – and bills creep up further.

“We had great hopes that a new government would introduce more assistance. But Rachel Reeves’ statement last month about a £22bn funding black hole suggests that little – or no – extra help is on the horizon. As a result, we’re preparing to see a rise in demand this winter for free debt support from the 14.6 million households who aren’t coping with rising living costs.”