‘Not a surprise’ one in four people in Wales are intending to borrow money for Christmas
With just weeks to Christmas, one in four people in Wales are likely to borrow or use a credit card to cover the cost of presents, as well as food and alcohol to celebrate with family and friends, according to a recent survey.
The Head of Policy at the Bevan Foundation says that it is “no surprise” and that many adults are worried about their spending over the festive holidays.
A recent survey of adults across Wales by the Money and Pensions Service found:
“The holidays are an amazing time of the year" says Lee Phillips, Manager at the Money and Pension Service for Wales - but he acknowledges it can also "lead to people feeling under pressure" to spend more than they can afford.
He said: “The concerning thing is that some people will continue to have to repay borrowed money into the new year.
Mr Phillips added: “Credit is a useful tool, however, it is essential to take a minute and evaluate before you borrow.
'If things go out of control, or if you start needing credit for essential costs, maybe it’s time to ask for help”
‘One in seven people are going without essentials’
Four groups are "likely to be under stress" over the holidays according to Dr Steffan Evans, Head of Policy at the Bevan Foundation. He says “People in receipt of benefits, disabled people, renters, and parents" will find it very difficult.
Dr Evans, added: “It is not a surprise that people are going to borrow money to get through Christmas this year.
“Because one in every seven people in Wales are sometimes or often going without essentials, the pressure on people during Christmas time is even greater.”
‘Higher Costs’
Although the financial pressures have been visible for some individuals and families across the last few years, this year could be worse.
Dr Evans said: “Compared with last year, where there were countless schemes ran by the UK Government and the Welsh Government that put money in people’s pockets, many of which do not exist this year.
“Energy costs will be higher for people this year since some support has been scrapped”
The UK Government’s Energy Bills Support Scheme, which supported every household with a £400 reduction in costs, ended in March this year.
A UK Government spokesperson said: “We have protected households with support worth £3,700 over the last three years, and our national insurance cut will save the average employee £450.
"We have also increased the National Living Wage by £1,800 – the largest ever increase.
It added: “Inflation has halved, but we know some people are continuing to struggle, which is why we are committed to staying the course and getting it all way back down to 2%.”
‘More than a crisis’
Although Dr Evans appreciates the present ‘challenging’ financial situation facing the Welsh Government, he asserted that there was more that it could do.
He said: “It is a matter of prioritising, and I argue that the priority should be to ensure that the individuals on the lowest incomes have the opportunity to have a good quality of life.”
A Welsh Government spokesperson said: “We are doing everything within our power to support people through the cost of living crisis, through providing targeted support to those who need it most.
"During 2022-23 and 2023-24, this support was worth more than £3.3bn.
“This includes our Discretionary Assistance Fund, which provides emergency cash payments for people facing severe financial pressure.
“The Welsh Government is supporting credit unions with a marketing campaign to raise awareness of their affordable loans and savings that they offer this Christmas and is working with Stop Loan Sharks Wales to raise awareness of illegal lending.”
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