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Many low- and middle-income households will face financial difficulties unless ministers maintain support for those who lost their jobs or experienced sharp cuts in income during the second wave of Covid-19, the Labor Party said.
Shadow Chancellor Anneliese Dodds said in a New Years message to Rishi Sunak that the Chancellor must extend a range of Covid-19 rescue measures that will be exhausted in the next three months “to protect distressed households. of financial ruin. “
A mortgage holiday plan and a ban on home repossessions should be extended beyond the Jan. 31 deadline, Dodds said, while a £ 20-a-week increase to universal credit, due April 6, it should remain in force until the crisis is over.
The Bank of England analysis in November found that 28% of households experienced a drop in income during the first wave of the pandemic, rising to 66% among the self-employed.
Dodds said: “Whether employed, self-employed, dependent on social security or a combination of the three, Britain’s troubled households face several cliffs in the first months of 2021.”
The deadlines ahead include:
• January 11: end of the ban on evictions.
• January 29: deadline for applications for the third subsidy of the self-employed income support scheme.
• Jan 31 – Mortgage Vacation Deadline, End of Home Foreclosure Ban.
• March 31: Applications for government-backed loans close.
• April 6: The government will reduce the boost of 20 pounds a week to universal credit.
• April 30: end of the layoff regime.
The price comparison website Energy Helpline said the number of UK consumers in debt to their electricity supplier peaked in five years during the pandemic and was on track to get worse.
Citing figures obtained under a freedom of information request to the regulator Ofgem, the website said that around 777,000 households had been in debt between July and September, a number not seen since the same period in 2015.
The first three quarters of the calendar year showed an increase in the number of consumers indebted to their provider compared to the same quarter of 2019, with an increase of 12% for January-March, a 5% increase in April-June and a 7%. % jump for July-September.
He called on Ofgem and suppliers to “do everything possible to help the most vulnerable consumers struggling to pay their energy bills as a result of the pandemic.”
“Today’s figures could be the beginning of an increase in energy debt across the country. Not only are consumers facing higher bills as a result of having to use more energy at home, but the pandemic is also generating a real outlook for more expensive energy in 2021, ”said Energy Helpline Chief Energy Officer Tom Lyon, it’s a statement. .
Labor said British households were among the worst prepared for a financial crisis after an analysis showed they entered the pandemic with one of the lowest levels of savings in the developed world.
UK households saved £ 3,055 less than the average for other economies in the G7 group of nations in 2019, and a quarter had less than £ 100 in savings when the first lockdown was imposed last March.
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Dodds said: “The irresponsible decisions made by the Conservatives over the past decade left many UK households without a penny in the bank as they entered this crisis. When Covid hit, they had nothing to lean on, and now some are teetering on the brink of financial ruin as several cliffs of Covid support loom.
“The Chancellor’s chaotic and last-minute approach to this crisis plunged the UK into the worst recession of any major economy, but it seems he has learned no lesson.
“Families across the country will continue to suffer if he does not repair Britain’s broken safety net and address the root causes of income insecurity across our country.”
