“I just feel like I’m never going to end this debt,” says Universal Credit applicant Dee.
After being laid off last year, Dee worries she will have to go further into debt as the cost of living increases.
“I’m really worried now because absolutely everything is going up,” she says.
Dee is one of more than 5.8 million applicants in England, Scotland and Wales, both employed and unemployed.
According to the Trussell Trust charity, two in five people on universal credit “were forced into a downward spiral of debt this winter” because the payment failed to cover rising living costs.
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Dee, 60, has been paying off a federal debt for seven years and has another nine years to pay it back.
A five-week wait for Universal Credit applicants to receive payment meant Dee had to take an upfront payment from the government — a loan made to help people until they receive their benefit payment, to help manage important bills and utilities.
That initially left them with deductions from their benefits, compounded by an overpayment of tax credits — what happens when the benefits system mistakenly overpays.
As the cost of living has risen, she has seen the utility bills soar.
Dee, who preferred the BBC not to use her last name, now only buys basic groceries and uses the car once a week to keep costs down.
“Things are just so tight that I’m really concerned that I’m going to be forced to go into more debt just to pay my current bills,” she says.
“To think that I won’t get away from it until my retirement years are overwhelming and really getting me down.”
Unable to afford heating, people had to turn off their fridges to save on costs, the Trussell Trust said.
The charity commissioned YouGov to conduct an online survey of 1,506 adults who applied for Universal Credit between January 24 and February 15, 2022.
The poverty charity, which runs food banks across the UK, found that one in six respondents had visited a food bank at least once since the beginning of December.
One in three had more than one day without food or just one meal in the last month.
Dee also said she’s been to a grocery bank twice because the price of her weekly grocery shopping has gone up.
“I don’t have any reserves for emergencies, and lugging that debt around with you for so long is really overwhelming,” she said.
Dee also worries that she can’t afford the increase in her gas bill next month.
The research suggested that one in three Universal Credit applicants could not afford to heat their home for more than four days in the last month.
Next month, the government will increase benefits by 3.1%, in line with the consumer price index (CPI) inflation rate in September 2021.
However, the Bank of England expects inflation – the rate at which the cost of living is increasing – to be above 7% this year.
The Trussell Trust said the government’s increase was “dangerously insufficient” and called for benefits to be increased by at least 7%.
A Government spokesman said it “recognizes the pressures people are facing with the cost of living which is why we are providing £21 billion in support this financial year and beyond”.
That support includes an average of £1,000 more a year through Universal Credit changes, fuel tariff freezes and a £9.1 billion rebate on energy bills, the spokesman said.
“We are also increasing the minimum wage by more than £1,000 a year for full-time workers and our £500m Budget Support Fund is helping the most vulnerable with essential costs,” the spokesman added.
Dee said universal credit needed to be increased to accommodate the higher cost of living so she could make ends meet and avoid further debt.
The increase means her benefits will rise by £10 a month, which won’t cover her electricity bill, which is expected to rise by £14 a month, she said.
Emma Revie, chief executive of the Trussell Trust, said the rising cost of living is “forcing hundreds of thousands of families across the country into a downward spiral of debt just to make ends meet”.
“We know the situation will only get worse and we cannot wait any longer.
“That’s why we are urging the UK Government to adjust benefits in the forthcoming spring declaration to the projected rate of inflation as a bare minimum to prevent thousands more people being forced into debt and through food bank doors.”
More than 50 charities including Save the Children UK and Child Poverty Action Group have urged the government to increase benefits by at least 7%.
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