It's back to the bleak 1980s in Liverpool as hard-working people are forced to sit in the dark to save on fuel bills
Food and fuel poverty is common in inner-city Liverpool, and so is debt. In fact, the two are increasingly intertwined. The cost of living pressures faced by low-income households, coupled with welfare cuts such as the bedroom tax, mean poor families are increasingly turning to payday loans to meet the cost of basics such as groceries, rent and electricity bills.
The chancellor, George Osborne, promised on Monday that "no one would get left behind". But for many residents of north Liverpool, even those in work, getting by on at least 10% less than what was not a lot to start with has left many struggling to keep up. High-interest debt is one way in which increasingly impoverished families put food on the table.
"It's like the 1980s all over again," says Eileen Halligan, chief executive of Central Liverpool Credit Union. Shrinking benefits and low pay give people little choice but to borrow: "People are either getting massively into debt, or they will get malnourished and [their homes] underheated."
St Andrew's Community Network runs a money management service in Clubmoor, the city's sixth most-deprived ward, which has traditionally helped clients with issues such as overspending on catalogue shopping. Now much of the charity's work is helping people manage payday loan debt incurred to pay for food or utility bills, rent or to fend off the bailiff.
Clients are not just those on benefits. Being in paid work is no longer a buttress against crisis, because so much of the work available locally is low paid or insecure, and wages fail to keep up with living costs. Even the most resilient of families now find themselves "in situations they never thought they'd be in", says St Andrew's manager, Julie-Anne Wanless.
Many of the households currently juggling bills and debts to get by hover desperately close to crisis. Even a relatively small change in income, such as the bedroom tax (which is taking £11 to £22 a week out of the income of families deemed to have too many rooms for their needs) or a delay in wages being paid can trigger meltdown because the margins of financial survival are so tight. Few have savings or assets to draw on when crisis hits, says Wanless.
Low-income families in Liverpool and the north of England are typically spending just £3.30 a person each day on food, according to research by Real Life Reform. Although this suggests there is little room to spend less on groceries, many told researchers they would have to do precisely this to cope with the impact of the bedroom tax and other welfare cuts. Others were planning to go without meals, or to try to secure referrals to a food bank.
More than a quarter of those households – all social housing tenants – interviewed for the research said they had just £10 a week to live on once bills had been paid; 37% said they had no spare cash at all. On average, these households spent £26 a week on energy bills (or at least 10% of income, which is – the definition of fuel poverty). The report noted that this was in the summer, months when the heating was off. Families typically spent £20 a week paying off debt.
Most of the families interviewed for the research were adamant that they would not fall into the trap of relying on expensive credit. Yet 63% acknowledged they were worried welfare cuts would result in them getting into more debt. Payday loans are often taken out amid feelings of panic and wild optimism, says Halligan: "The easy solution is 'give me [financial] help this month, and by some miracle I'll be on top of it next month'."
Getting on top of debt – or avoiding it in the first place – means often desperate measures, not least choosing whether to spend your last few pounds on food, or put it in the electricity meter. "If you don't have the money you sit in the dark or you don't cook," said a charity worker.
Wanless says the heat-or-eat dilemma even has an impact on the kinds of help they can offer. The charity runs a food bank and it has sometimes had to change the type of groceries it gives out when clients say they can't afford to switch on the cooker. "We adapt the food parcel to give them food that they won't have to cook."
Anfield resident Peter Browne, 42, an unemployed former chef, is wondering how he will get by when £11 of his £71-a-week jobseekers allowance is swallowed up this month by the bedroom tax. He wants to move to a one-bed flat but there are none available. Until there are "it pretty much means heating or eating."
Browne spends about £5 a week on gas now but he expects that to rise to £12 in the winter. He aims to restrict his food budget to £2 a week. Packets of noodles for 12p, and tins of spaghetti for 19p are on his shopping list. Time your visit right, he reckons, and you can get a nearly-out-of-date loaf of bread from Asda for 6p.
What about fruit and vegetables? He laughs: "Only if they are giving it away."
The sense of imminent crisis as more families are dragged down by debt and poverty is reflected in a ripening collective gloom, says Browne: "You can physically see the fear and the worry in people and you can sense it in the area. People used to have plans. Now we don't even know what we are going to do next week. It's like trapping an animal in a cage. There's nowhere to go, and that's that."
An alarming byproduct is the impact on people's health and wellbeing. Merseyside police have reported an increase in people talking about suicide, while Liverpool Housing Trust (LHT) is training staff to recognise mental illness among tenants. The bedroom tax in particular has triggered powerful feelings of insecurity, pessimism and powerlessness. One tenant told Real Life Reform researchers: "My neighbourhood is a tsunami of fear."
"We get people coming in saying 'I've never been in rent arrears in my life and now I'm struggling," says Allan Eveleigh, a neighbourhood team leader with LHT. "These are decent people, who are conscientious. People are resilient. But they are being pushed to breaking point."
Browne remains stubbornly optimistic, even after four years of fruitless job applications and myriad training schemes. Surprisingly, he supports welfare reform in principle: "I've no problem with it. I don't think it should be easy to be on benefits. But the way the government have gone about it is benefiting no one. It's not saving money; it's not helping people into work; it's not freeing up council properties. What exactly is the point of it?"
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