“Annual income twenty pounds, annual expenditure nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”
These are the words of Mr Micawber in Charles Dickens’ David Copperfield, written in 1849. Both character and writer knew well the misery of debt. Micawber ended up in a debtor’s prison after failing to satisfy his creditors, while Dickens wrote from the experience of seeing his own father sent to Marshalsea Debtor’s Prison for the same offence. Indeed, such was the impact of this that Dickens went on to champion reform that resulted in the 1869 Debtors Act.
While that was over 150 years ago, there are many today feeling like they too are trapped in an impossible financial situation. If, in recent decades, personal and household debt has been attributed to poor household mismanagement and the widespread promotion and availability of store and credit cards, Covid-19 has brought into sharper focus that these are precarious times.
The global pandemic of the last two years has exacerbated a situation that has put many families and individuals in a prison-like situation not of their own making.
Some 8.5 million people are now heavily in debt and many are unable to keep up with their bills. That’s one in six adults in the UK.
This growing debt trap is exacerbating poverty, homelessness, mental health problems and family breakdown.
All it takes for a household to be financially stretched is an unplanned-for bill – a child’s lost coat, a boiler breakdown, a car repair. In other words, the sorts of everyday scenarios we can well imagine.
Imagine then, in the pandemic, furlough for the main or only wage-earner on 80 per cent of salary with no opportunity for overtime, the hospitalisation of a relative and the attendant costs of visits (when allowed) and prescriptions, the pressure cost of enabling children to learn at home instead of school, while in the meantime a private landlord hinting that the next housing increase will be above inflation.
If that weren’t enough, 2022 is bringing the additional burden of food price increases, higher council tax bills and the freezing of income tax thresholds – all this before the forecasted 50 per cent increase in energy prices and additional impact of war in Ukraine.
People who were able to keep their head above water pre-2020 are now in severe difficulty. Others, who had been just staying afloat, now face being overwhelmed by circumstances entirely beyond their control. Nineteen per cent of families had to borrow to pay for food in July 2020.
Jubilee Debt Campaign famously campaigned in the late 1990s and early 2000s for the cancellation of unfair and unpayable debt in the developing world. In the last decade Jubilee Debt Campaign’s work has expanded to include household debt in the UK. Its website says: “Nobody should fall into debt simply to put food on the table or heat their home.”
Early in the pandemic the Chancellor, Rishi Sunak, announced a weekly uplift of £20 for everyone on Universal Credit. It was a welcome gesture. While it was always intended to be a temporary measure, the widespread despair at its discontinuation cut across political divides.
Wilkins Micawber famously expected something to turn up to transform his situation. While Christians are always hopeful, effective prayer must be accompanied by action. In the North, many agencies work to alleviate the effects of poverty, homelessness, hunger. We’re often blown away by the kindness, energy and compassion evident but in the words of Desmond Tutu: “There comes a point where we need to stop just pulling people out of the river. We need to go upstream and find out why they’re falling in.” That means speaking out against unfair laws and petitioning for change.
Chain Reactions is an event taking place at Methodist Central Hall, Oldham Street, Manchester, 10am-4pm on 25 and 26 March, during National Debt Awareness Week. This drop-in event will draw awareness to issues of household debt. There will be agencies to help with signposting, practical advice, and suggested actions to effect change.
Taking part on the Friday will be representatives from Manchester City Council, CAB, Big Issue North, Acts435, GatewayM40 and Arawak Housing, while Jubilee Debt Campaign will be running a workshop on the Saturday, showing the film Bank Job and facilitating a discussion for next steps.
Deacon Pru Cahill is minister at Methodist Central Hall, Manchester and co-leader of Jubilee Debt Campaign, Manchester along with Stephen Pennells
Photo: Dickens’ Mr Micawber knew well the misery of debt. Over 150 years later his words resound