Low pay, insecure work and austerity are feeding a growing debt crisis, the TUC has warned today (Thursday).
New TUC analysis published today shows that:
The TUC believes that persistent low pay is the key driver of household debt. Real wages are still lower than they were before the 2008 crisis and working families are struggling to make ends meet without going into the red.
Today’s analysis also shows that of those households with unsecured debt:
TUC General Secretary Frances O’Grady said:
“Our broken economy is forcing working families deep into debt.
“Low pay, insecure work and austerity have pushed millions of households to the financial cliff edge. Big corporations are raking in huge profits at working people’s expense. And successive governments have done nothing to avert the crisis.
“It’s time to reset the balance of power in our workplaces and our economy. Government must make more employers negotiate pay and conditions with unions. That will lift wages for everyone and stop working families having to rely on credit cards and overdrafts to get through the month.”
- The TUC has published new proposals to ensure that workers get the chance to negotiate better pay and conditions through trade unions. These include:
- unions having access to workplaces to tell workers about the benefits of trade union membership, following the model in New Zealand
- new rights to make it easier for unions to gain the right to negotiate at workplace level
- new rights for unions to negotiate right across sectors, starting with hospitality and social care
- The TUC is also calling for:
- Unsecured debt includes bank loans, payday loans, credit cards, store cards, purchase loans and student loans, but excludes mortgages. The figures are derived from the balance sheet for the household sector, subtracting loans secured on dwellings (NNRP) from total liabilities (NNRE). This leaves short-term loans issued by UK (NNRG) and overseas (NNRK) banks and building societies and ‘other (i.e. non-mortgage) long-term lending issued by UK residents’ (NNRU). Disposable income is an annual figure calculated using the latest four quarters of household disposable income (QWND). So, for example, disposable income for 2019 Q1 is calculated using the quarterly figures for Q1 2019 and Q2, Q3, Q4 2018.
- Data sources: UK Economic Accounts, tables 6.1.4 (for income) and 6.1.9 (for debt), Office for National Statistics. Household figures are based on the ONS projections issued 16 May 2019. https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationprojections/datasets/householdprojectionsforengland
- Figures for the percentages of households reporting unsecured debt, the burden of this debt, and the age groups most affected by this, are from a TUC analysis of the 2018 Bank of England/NMG Households Survey: https://www.bankofengland.co.uk/statistics/research-datasets
- Congress 2019 will be held in the Brighton Centre from Sunday 8 September to Wednesday 11 September. Free media passes can be obtained by visiting www.tuc.org.uk/applying-media-or-external-visitor-credentials and completing an online form. Applications must be in by noon on Tuesday 27 August. Any received later than that will be processed in Brighton and will cost £75 +VAT.
- The Trades Union Congress (TUC) exists to make the working world a better place for everyone. We bring together more than 5.5 million working people who make up our 48 member unions. We support unions to grow and thrive, and we stand up for everyone who works for a living.
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