Sunday, 18 November 2012

The Adverse Consequences of Debt.

The Fraser of Allander Institute have recently published a study into the economic benefit of the Citizens Advice Service in Scotland:
The report outlines that the Citizens Advice Service contribute a total benefit to the common good in Scotland of £166.2 million. This a massive return on the investment of around £21 million which is currently spent on running the service across Scotland. The contribution to the common good includes:
  • Client financial income of £63 million which leads to a further £27.4 million in wages and 1,246 jobs supported by this income
  • Savings to the taxpayer of £42.7 million (£14.5m in health care costs, £12.9m in JSA savings, and £15.3m in homlessness prevention)
  • Contribution to economic growth of £19.5m (as a result of clients not losing their job and remaining in productive employment)
  • Employment and wages supported by CAS/CAB as employers and purchasers of services and goods which support a total of 1,092 jobs and £13.6m wages in Scotland
The £63m figure in income is gained direct for clients and is therefore income that will be going directly into the pockets and purses of people across Scotland who then spend that money in their local communities on goods and services.
What struck me when reading this report was the % of clients to Citizens Advice who experienced the following adverse consequences as a result of having a debt problem

  • Physical Ill-health                  6.1%
  • Stress Related Illness            29.6%
  • Relationship Breakdown       3.8%
  • Personal Violence                 0.4%
  • Property Damage                 1.2%
  • Had to move house               0.4%
  • Loss of Employment              0.4%
  • Loss of income                      11.6%
  • Loss of confidence                 13.4%
That is a lot of lives which could be a lot more productive if they didn't have an unmanageable debt burden hanging round their necks.

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