Cable speech may point to debt management need

The need for Britons to seek debt management help may be greater than that in other countries as a government minister commented that the UK ran up th…

The need for Britons to seek debt management help may be greater than that in other countries as a government minister commented that the UK ran up the "highest level of household debt in relation to income in the world" in the lead-up to the credit crunch.

Such a comment was made by business secretary Vince Cable, as he addressed the Liberal Democrat party conference in Birmingham, noting that rather than Britain being hit by a "virus" from overseas, many aspects of the economic crisis have been home-grown.

Mr Cable said the current situation for consumers and the economy is a tough one with a hard time ahead and stated there is no point in politicians pretending it is otherwise.

He also stated: "Living standards are being squeezed by continued high imported inflation. And the painful truth is that Britain is a poorer country as a result of the financial crash."

While such a message may seem a gloomy one, it may also prompt those who do have debt problems to seek a debt management plan or other measures to resolve their financial issues, instead of holding out for better economic times that may be some way off.

Mr Cable's point about the high level of household debt in the UK echoes the findings of a survey published this week by Moneysupermarket.com, which showed that servicing non-mortgage borrowing alone costs consumers £9 billion a month.

This included 27 per cent of consumers having to pay out over 40 per cent of their income each month to service their debts.

Posted by Paul Thacker

 

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