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Unsecured debt hits peak of £14,540 per household, says TUC

The average household debt is now 31 percent above its peak before the financial crisis, according to figures from the Trade Union Congress (TUC).

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The trade union’s figures, based on data from the Office for National Statistics and the Bank of England, show that household debt rose sharply over 2019, with unsecured debt reaching record highs:

  • Unsecured debt per household rose to £14,540 in the third quarter of 2019, which is up £430 on a year earlier
  • Total unsecured debt rose to £407bn in the third quarter of 2019 – the first time it has gone over £400bn and well above the £286bn peak in 2008 ahead of the financial crisis
  • Unsecured debt as a share of household income is now back to the same record high of 27.5% that it reached in 2008 at the outset of the financial crisis

The TUC attributed the debt levels to government austerity, the rise of insecure work and years of wage stagnation.

 

It argued real wages are on average lower today than before the financial crisis, pushing many working households towards borrowing.

 

TUC general secretary Frances O’Grady said: “It’s not about keeping up with the Joneses. This is hard-up families borrowing just to scrape by. It’s for paying the rent, heating the home and feeding the kids.

 

“The reason we’re seeing this is bad management of the economy. Wages are still worth less than a decade ago. Too many people have insecure jobs with uncertain hours. And vital support like working tax credits has been cut.

 

“No more excuses – the government must put together an urgent plan to improve living standards and to help families struggling with dangerous levels of debt.”

 

UK unsecured borrowing in total and per household, 1989-2019

Annual quarter

Unsecured borrowing £bns

Disposable income (rolling annual sum)

£bns

Debt to income

percentage

Number of households

Debt per household

£

1989 Q3

83

373

22.3

22,316

3729

1990 Q3

91

418

21.9

22,544

4053

1991 Q3

95

461

20.7

22,863

4170

1992 Q3

92

495

18.6

23,008

4007

1993 Q3

89

524

17.0

23,140

3845

1994 Q3

94

549

17.0

23,268

4020

1995 Q3

101

576

17.5

23,431

4297

1996 Q3

108

616

17.5

23,583

4564

1997 Q3

117

643

18.1

23,728

4915

1998 Q3

130

662

19.7

23,882

5457

1999 Q3

143

692

20.7

24,067

5961

2000 Q3

158

740

21.3

24,281

6498

2001 Q3

173

776

22.3

24,486

7066

2002 Q3

200

802

24.9

24,609

8121

2003 Q3

208

828

25.1

24,729

8401

2004 Q3

230

865

26.5

24,856

9235

2005 Q3

245

904

27.1

25,060

9778

2006 Q3

258

950

27.1

25,235

10,207

2007 Q3

270

1,002

27.0

25,420

10,634

2008 Q3

286

1,044

27.3

25,632

11,141

2009 Q3

277

1,067

25.9

25,824

10,723

2010 Q3

280

1,096

25.5

26,038

10,742

2011 Q3

275

1,113

24.7

26,313

10,463

2012 Q3

271

1,157

23.4

26,539

10,206

2013 Q3

277

1,198

23.1

26,723

10,354

2014 Q3

281

1,245

22.6

26,947

10,425

2015 Q3

301

1,308

23.0

27,166

11,077

2016 Q3

331

1,341

24.6

27,398

12,065

2017 Q3

362

1,368

26.4

27,594

13,102

2018 Q3

392

1,436

27.3

27,793

14,107

2019 Q3

407

1,482

27.5

27,985

14,540

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