Debts

Treasury written question – answered on 5th November 2018.

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Photo of Jo Stevens Jo Stevens Labour, Cardiff Central

To ask the Chancellor of the Exchequer, what assessment his Department has made of trends in the level of personal debt over the last five years.

Photo of John Glen John Glen Minister of State (Treasury) (City), The Economic Secretary to the Treasury

The household debt-to-income ratio has stabilised over the past year and was 140% in Q2 2018, down from a high of 160% in Q1 2008. Almost three quarters of household debt is secured against housing. Unsecured debt as a share of household income is now 35% (Q2 2018), down from its peak of 41% before the financial crisis (Q1 2007).

Although the level of consumer credit remains high, when adjusted for inflation, the level of outstanding consumer credit stands 17.7% below its January 2008 peak.

The Budget 2018 announced new policies to help households manage unexpected costs by increasing access to fair and affordable credit, as well as a consultation on a breathing space scheme for people who fall into problem debt.

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