fbpx Skip to main content
Ethical Insurance, Supporting the work of
The Salvation Army
0300 030 1865

Requests for Debt Advice Soar



“Pandemic poverty” is a new phenomenon that refers to the devastating effect COVID-19 has on people’s finances. Not only has unemployment increased, but in-work poverty has also rocketed. This means that while people are grateful that they are still employed, their income or work hours have been cut to the extent that they can no longer make ends meet. Many people have dropped from living just above the breadline to outright poverty. The Salvation Army wants to change that. 

Record number of requests

The Salvation Army has 22 FCA approved debt advice centres across the UK. Over the past year requests for help increased by 28%. 

The debt centres do more than provide financial advice; they provide emotional support and practical help to everyone who enters the doors. 

For example, someone may come in because they can’t pay their rent and the advisor will negotiate with their landlord to work out mutually beneficial terms. 

To cope with the rising numbers, The Salvation Army has had to extend debt advice services across East Scotland, the Isle of Man, Birmingham, Middlesbrough, and Exeter. The teams at these centres are also working longer hours.

Commenting on the pandemic poverty phenomenon, Lorraine Cook, Financial Inclusion Development Manager said, “The Government took swift action to cushion the country from the economic fall out of the pandemic. This action safeguarded the livelihoods of millions of people. Schemes like the Universal Credit uplift and furlough were lifelines, but for many it wasn’t enough to prevent a slide into debt.

“It’s not just people who have lost jobs, nearly a fifth of those who got in touch with us last year cited low income as the main source of their debt, reflecting the rise of in-work poverty which now affects one in eight families in the UK.”

Recommendations to Government

The Salvation Army believes that the following measures will help bring down the numbers and give those already caught up in the problem some breathing room and enable them to manage their debt in a healthy and responsible manner. 

  • Universal Credit (UC) loans, (Advance Payments) included in the Debt Respite Scheme when it launches in May.
  • A longer-term plan to support those people reliant on the £20 UC uplift when the extension ends in September.
  • Ensuring those who have not yet transferred into the UC system (known as receiving ‘legacy benefits’) are also eligible for the £20 UC boost.

Holistic approach to debt management

Lorraine Cook says that it takes more than repaying debts to actually manage debt. This is why letters to creditors is part of the service, as well as provision of food parcels. Team members link the people they help with the local branch of The Salvation Army. Together they provide ongoing financial and emotional support, which is essential to help people through very dark and difficult times.

“The mental strain of being unable to pay basic bills is often overlooked. I fear we will see more relationships break down and more people feeling suicidal as they face potential eviction,” said Lorraine Cook.

Here are two examples of the difference The Salvation Army makes:

Devon and Cornwall Debt Advisor, Nadine retells a case that moved her:

“A man in his 60s came to us having been made redundant after 40 years in employment and he was living on the breadline. He couldn’t afford food, wasn’t able to pay for basic bills and was facing the prospect of living in his car as he was unable to pay for rent.

“Thankfully we were able to intervene. We gave him a food parcel, ensured he had an energy supply and advised him on how to apply for Universal Credit and other benefits. We negotiated with the landlords, explained to him his legal rights and the processes to get help with housing”.

“I don’t know what would have happened to him if he hadn’t sought our help, but nobody can survive without food and live in a car during winter”.

Lucy, helped by a Salvation Army debt advice centre recalls:

“There were times I felt like I had no-one who I could call and because I’m ill, it was all too much. I thought I would kill myself. But I thought who would my son turn to? I realised I would be running away from my problems.

“The Salvation Army has helped me and shown me there is a way. Before I couldn’t see a way through it, but now I can. I felt hopeless before, but they’ve shown me there is a path”.