The UK household debt has reached a new high as the result of the Tory government’s failing economic policies, a new research shows.
The total amounts owed by British households rose to a combined £428 billion in the third quarter of 2018, according to the Trades Union Congress (TUC), which represents the majority of trade unions in England and Wales.
This means, excluding mortgages, each UK home owed an average of £15,385 to credit card firms, banks and other money lenders, up £886 in 12 months.
The new household debt figure is well above the £286 billion record in 2008, right before the financial crisis, the TUC said, indicating that working families were on average worse off today than they were before the financial crisis.
While the gov had been reducing the national debt for us the national debt has doubled and households are in more debt than ever. Average UK household debt now stands at record £15,400 https://t.co/MHHIEjtLLk
— Name cannot be blank (@Treeiup) January 8, 2019
According to the organization, public spending cuts, which have become known as austerity measures, and years of wage stagnation under the ruling Conservative government were two key reasons behind the increase in unsecured debt.
“Household debt is at crisis level. Years of austerity and wage stagnation has pushed millions of families deep into the red. The government is skating on thin ice by relying on household debt to drive growth. A strong economy needs people spending wages, not credit cards and loans,” said Frances O’Grady, the TUC general secretary.
She called for the minimum wage, which currently stands at £7.83 an hour for employees 25 and above, to be raised to £10 “as quickly as possible.”
O’Grady also demanded freedom for trade unions to enter all workplaces and help workers bargain for higher wages.
The TUC warned that its latest debt figures were expected to go even higher as they did not include debts incurred over Christmas.