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Did you know that we have an amazing group of over 30,000 people who give to CAP every single month? We call them Life Changers because without their generosity we wouldn't see our clients go debt-free and their lives restored.

What's it like to be a Life Changer, I hear you ask? Look no further. We spoke to Hannah Kunar to find out why and how she has chosen to support CAP.

Hi Hannah! Tell us a bit about yourself.

I'm married with two kids, work from home as a Freelance Graphic Designer and I love chocolate and a cup of Yorkshire Tea.

How did you hear about CAP?

I first heard about CAP when my brother-in-law started working for them. He gave me John Kirkby's book, Nevertheless, and I honestly couldn't put it down! I was captivated by his journey that led him to start Christians Against Poverty to help others out of debt.

How long have you been a Life Changer?

I've supported CAP now for over 8 years.

Why did you choose to support CAP?

A few years ago, I had the incredible privilege to work for CAP as a Graphic Designer in their creative media department. During my time at head office, I was given the amazing opportunity to go on a client visit. It opened my eyes to see the devastating effect debt has on a person, and in some cases, their families. To see how CAP's front-line operated was nothing but pure compassion, genuine love and professionalism. I was never the same after that. Over my four years at CAP, I heard countless stories week after week of people whose lives had been forever changed, not just through becoming debt free but also in finding Jesus.. how amazing is that?!

What has your experience of being a Life Changer been like?

I love receiving anything from CAP! I always feel thanked and appreciated for what I give on a monthly basis and the best part is knowing that it's making a real difference through reading stories of lives that have been changed, which is my favourite part of all! It's great to be updated on how many people have become debt free each month and to know where the money goes is really helpful seeing how CAP operates. I also need to say how much I love the design and content of all CAP's communication. It's always so friendly, informative and approachable. Keep up the great work!

Like the sound of helping see lives transformed and getting to hear the difference your support is making in people's lives? Why not join our 30,000 other regular givers by becoming a Life Changer today?

Become a Life Changer

Council Tax: we’ve got to pay it, but what happens when we can’t afford to? 

Introduced in England, Wales and Scotland in 1993, Council Tax pays for a lot of things, from education and social work to infrastructure, street lighting and even taking our rubbish away. We pay for these services to keep our local communities running, but it doesn’t come cheap. The average band D Council Tax bill in England in 2018/19 cost £1,671 per year.

Paying Council Tax can be a particularly heavy burden for those who are struggling financially.  At Christians Against Poverty (CAP), we saw that Council Tax was the most common priority debt amongst clients in 2019, with almost half (46%) of those coming to us for help having arrears. Priority debts are those that carry the most serious consequences when not paid; for example, your mortgage or rent. 

What about COVID-19?

Amidst the coronavirus (COVID-19) pandemic, Council Tax still needs to be paid, but many households are living on reduced incomes. The Government tried to pre-empt the risk of arrears by providing councils with a £500 million hardship fund to reduce the bills of those households in receipt of Council Tax support. A good step, but is it enough? Many of the households facing income shocks wouldn’t have been existing benefits claimants and so they would not have been receiving Council Tax support. In these instances, these households wouldn’t be eligible for help from the hardship fund. 

Citizens Advice estimates that two million people have already fallen behind with their Council Tax bill as a result of COVID19. The Local Government Association has also reported that £506 million in Council Tax has gone uncollected in the past three months as people struggle to pay bills during the coronavirus crisis. With the economic landscape growing ever bleaker, and with a fixed end-date for the coronavirus ‘emergency period’ of 23 August in relation to taking control of goods, more needs to be done to protect those who cannot afford to pay.  

The problem

This is not a new problem. CAP and others in the debt advice sector have long been raising concerns over how councils collect unpaid Council Tax. CAP clients report that debts owed to government authorities, such as Council Tax, make them feel more powerless than others. It might surprise you to know that banks and mortgage lenders have a better track record when it comes to supporting people in financial difficulty than Council Tax collections. 

As it stands, not paying Council Tax can have some serious consequences. In England in 2020, if you don’t pay your Council Tax you can end up in prison! Thankfully, the number of people convicted is actually low, but many in arrears get letters threatening imprisonment, unsurprisingly creating high levels of anxiety and fear amongst those who can’t make ends meet.

Normally if you miss a Council Tax installment and fail to make it up, you immediately become liable to pay the year’s remaining balance in one go (liability order). Research from the Money Advice Trust (MAT) showed that in 2018/19, over half (54%) of all cases sent to enforcement agents were for Council Tax arrears. For those unable to pay in full, the next step taken by most councils is to obtain a liability order through the Magistrates Court. 

Most councils also want you to pay all the Council Tax the year it’s owed, making it almost impossible to spread the repayment out for longer. This is because Local Authorities are ranked on a league table based on the percentage of payments they collect, which means they have an incentive to collect payments within the same year they were due. CAP is working to influence change in both these areas. 

What needs to change?

Simon Clarke, Minister of State (Housing, Communities and Local Government) stated, ‘The Government expects authorities to be sympathetic to those in genuine hardship and proportionate in their use of any enforcement action’. This is exactly what we want, but sadly it is not the current experience. 

At the moment, apart from a temporary hold on collections and the new hardship fund, nothing has really changed. If you fall behind and don’t engage, you may still be visited by enforcement agents, and you may still be threatened with imprisonment (in England), causing many sleepless nights. The number of people with Council Tax arrears is increasing, yet there is no new collections structure. 

We are not sitting still. CAP is joining forces with the other major debt advice agencies to call on the Government to make changes. We want to see change in how arrears have to be paid, with more flexibility and forbearance. We also want to see councils do more to help people through the introduction of a pre-action protocol. This would require councils to take additional steps before seeking a liability order, going to court or sending out enforcement agents, such as setting up an affordable repayment plan. In Scotland, CAP is joining with Money Advice Scotland and StepChange to write a letter to the Scottish Government 

Before enforcement action restarts, we will be living in the calm before the storm. We will continue to stand up for CAP clients and influence change and will keep this blog updated on our progress. If you are interested in reading more, in 2018 CAP released a briefing paper about clients’ experience of debt collection by central and local government, called Powerless people, which you can read here.

Yesterday CAP took part in a debate all about poverty, justice and mental health. 

The debate was hosted by Patrick Regan, founder of Kintsugi Hope, a charity striving to make a difference to people's mental wellbeing. Paula Stringer, our CEO, was one of the panelists. 

In this extremely difficult time, widespread issues like poverty and mental ill-health have been exacerbated. Panelists at the debate spoke about the growing levels of anxiety and depression due to the pandemic, as well as those now struggling to get by on low incomes, who may continue to struggle for some time. Action needs to be taken from the Government, society as a whole and individually. We can all play a part to speak out against injustice.  

What we know

In our experience, debt and mental health are often found hand-in-hand. Mental ill-health can make managing finances harder, and worrying about money can make someone’s mental health worse. Often you don’t just treat one, but both. To make things harder, the stigma associated with debt and mental health problems can prevent people from seeking help or speaking up about it with friends or family. 

CAP has found that two in five (40%) clients struggle with a mental health issue and three in five (61%) say that debt caused their mental health to deteriorate. We also know that people with a long-term mental health problem are more than twice as likely to live in poverty than those without. Debt can make you feel trapped, with no way out, sadly 34% of CAP clients have considered or attempted suicide in their desperation.

Debt, mental ill-health and COVID-19: a perfect storm?

The world we now live in is unrecognisable to that of just a few months ago. Despite sharing the experience of COVID-19 worldwide, we are all faced with individual uncertainties around our finances, social lives and futures. For many, COVID-19 has created a perfect storm of personal and financial crisis. We are seeing heightened levels of anxiety and depression across the nation and one in five households are now struggling to pay their bills.

The lockdown has also had an adverse effect on those who were already struggling with mental health problems by exacerbating preexisting conditions, as seen in the client story below. Existing support to help people struggling with mental ill-health has been stopped due to social distancing measures and so some are receiving support via phone calls. However, others cannot afford phone credit or broadband, leaving them instantly cut off from friends and family, unable to contact anyone to ask for help.

CAP client Sarah said, ‘My mental health has really been affected by this. I’m really finding it hard not seeing my children. 

I think it’s bad that the mental health team hasn't called. I haven't had check-up calls. If we were seeing people weekly, which I was, surely we should be getting a phone call? It’s not just me, it’s a lot of people.’

The stigma attached

Both debt and mental ill-health have stigmas attached, which means that people can feel ashamed of their situation or face discrimination from others. It can also mean that people don’t seek the help they need when they need it. Events like The Big Debate help in raising awareness and breaking down stigmas associated with these important topics. 

The good news is that the local Church and CAP are well placed to reach out and support people struggling with their mental health. Even during lockdown, CAP Debt Coaches have been supporting clients through encouraging messages and phone calls and referring clients to CAP’s emergency support line.

‘My CAP Debt Coach messaged me yesterday. I’m not always good at getting back to people but she has messaged throughout.’ - Sarah, CAP Debt Help client

Kintsugi Hope’s mission is to create a world where mental and emotional health is understood and accepted, with safe and supportive communities for everyone to grow and flourish. We can all play our part to check our own attitudes, speak-up about these issues and look out for others who may need support. 

To find out more about Kintsugi Hope, and their church Wellbeing Groups visit their website. 

Just as the Chancellor stood in the House of Commons and announced that the UK had ‘turned the page on austerity’ the world was hit with a pandemic. It wasn’t the news anyone was hoping for, especially people already struggling to make ends meet. Our Client report and energy report, A dark place, based on data from 2019, showed that many people helped by CAP had been sacrificing meals (48%), disconnecting themselves from their energy supply (52%) and sleeping without a bed or mattress (11%). 

Already under immense pressure from all angles, can you imagine what a nationwide lockdown, a surge in unemployment, or a sudden increase in household costs would do? 

It might just break the camel’s back. 

Suffering in silence
One in three (30%) people who seek CAP’s Debt Help waited for three years before making a call. This is often due to fear, shame or thinking they’d be able to sort the problem out themselves. On this basis, CAP isn’t expecting to see the true impact of COVID-19 for many months. 

Right now, households will be facing tough choices: trying to live off 80% of their wage, claiming Universal Credit for the first time, or reducing their hours to accommodate childcare. Households will be trying to weather the storm, taking advantage of payment holidays, reducing payments for credit card bills, or using savings. But none of us know how long this situation could go on for. 

The impact of coronavirus
We have been closely monitoring the impact of COVID-19 on CAP clients and you can read the full briefing paper, Life in lockdown, produced by our External Affairs team here. 

We’ve found that life in lockdown is disproportionately harder for those living in poverty. For anyone struggling on the brink, even a slight reduction of income is felt. Faced with the constant pressure of rising household costs, prospects of unemployment or juggling health and caring responsibilities. Those classed as being in ‘in-work poverty’ often work in customer-facing roles, such as shop workers, delivery drivers or cleaners, which increases their risk of exposure to others. On top of this, poor health is more prevalent amongst people on low incomes, and therefore the risk of serious illness is higher for those who do catch Covid-19.

Speaking to CAP clients and former CAP clients, has enabled us to engage with people's first-hand experiences. Our clients are experts by experience and can speak into the financial implications of coronavirus, as described below. From our research, we have found that CAP clients are experiencing more income shocks compared to the same period last year. A growing number of clients are unable to progress their CAP Plan because of coronavirus and households are struggling with increased costs.  

Homeschooling 
‘I had to buy a printer and paper, which all adds up. That was for my son with his school work. Because I’m working on my laptop for work, I can’t use that for him. I have to print all the work off.’ - Paula, expert by experience.

Increased household costs
‘The electric is horrendous – because you’ve got to do homework online and because they’re on the xbox or gadgets because they're bored – that’s extra money on the electric. For the three kids, I get free school meal vouchers of £180 every two weeks. I can’t divide the voucher – I have to spend it in one place. Morrisons is cheaper, but they don’t accept vouchers of more than £100, I couldn’t go there.’ - Georgia, expert by experience and CAP client

Isolated
‘I won’t be online in two days as my phone is Pay-As-You-Go and it is £15 every 30 days. That’s how I’m online. I don’t have a phone or internet in my house. I can’t afford the phone bill. I won’t be able to phone [my family] as I won’t have any credit. It’s been horrible these last few weeks.’ - Diane, former CAP client and expert by experience.

Priced out
‘Because I live on my own, a lot of people have set up deliveries – but the minimum order is £20 or more. There’s only me and otherwise I would have to throw fruit and veg away.’ - Tina, former CAP client and expert by experience.
 

Standing in the gap
In addition to our life-changing services for those battling poverty, CAP has the privilege of representing what life is like for such people in places where change can happen. Over the last two months we have identified areas where policies are impacting CAP clients and we are calling for change. COVID-19 will not stop us from standing in the gap for those whose voices are not being heard.

If you’re facing a hard time right now, please don’t be afraid to seek help. 

If you’re working in collections or financial services, don’t forget about those who are often overlooked. 

And if you’re a supporter, thank you. Your gifts and prayers mean our work continues to be possible.

What is an emergency?

The UK is facing an invisible threat. Coronavirus (COVID-19) became a Public Health Emergency of International Concern at the end of January this year and since then it’s been called a crisis by the media on an almost daily basis. 

But it’s not just a public health emergency. COVID-19 is having a devastating effect on many household finances. Income streams are drying up, bills are going unpaid and anxiety is rife. The Government and industry are working tirelessly to roll out support packages for households in need. Yet, many don’t know what help is available and others are struggling to access it. Customers across the board are being told they should, ‘Only call in an emergency.’ But what does that mean? Am I going through an emergency right now?

Increased household costs

The regulator for energy, Ofgem, says that since the lockdown began more than half of energy customers (56%) have reported using more energy than normal, a figure that rises to three-quarters (75%) for those with children. With the nation isolating at home and schools closed, families are having to spend more on energy than ever before. The problem is made worse for those families who were already facing debt and financial uncertainty, throwing them into further chaos; families like CAP client Sue’s.

‘(The cost of) food has increased. The heating did start to increase, but because of the beautiful weather it’s been off quite a lot. My electric is a Direct Debit each month but I’m expecting that to go up. Maybe double?  My son is on his laptop/Xbox all day. We’re on the tablets and the computer and the TV is going all day. There’s more washing. And my water bill will probably increase.’ - Sue, former CAP Debt Help client (Names have been changed)

What do the numbers say?

Before the pandemic, we conducted some research into our clients’ experiences of the energy sector, and this was published in our report, A dark place. We found that 87% of CAP clients do not feel confident asking their supplier for help. 

The statistics and responses from our clients show that even before lockdown they were already isolating themselves for very different reasons; shame, fear and guilt were the causes, rather than coronavirus. In fact, one in four (24%) CAP clients did not leave their house for a week or more. And this was before the phrases ‘lockdown’ and ‘social distancing’ were in our daily vocabulary.

Suddenly, a vast number of people are unable to work and are now facing financial uncertainty. But for those already struggling, how much has changed? Are the people who were previously cut off from society going to be lost in the enormous crowd of those isolating for new reasons? Those feelings of fear and shame created by debt will still be there. The way companies interact with their customers once the lockdown ends needs to be effective, or they risk pushing households into further isolation.

Ofgem recently published data looking at energy customers’ responses to the current situation. It showed that just 8% of those who had difficulty topping up their prepayment meter have contacted their supplier for help. In fact, more people (17%) were asking friends and family for help, rather than their energy provider. This number is particularly worrying when you realise it comes from a group of customers engaged enough to respond to an Ofgem survey.

Looking at these new figures with those from before the pandemic, it is distressing to think about how many more households will be struggling to afford energy, but are afraid to ask for help. Families will be sitting at home during this time, unable to afford food and heating, afraid to speak out due to fear and anxiety. Even through this current crisis, they are unable to make themselves heard.

Lost, but not forgotten

The good news is that help does exist. Suppliers are doing their best to provide help and assistance through emergency top-ups and significant lenience for their customers. However, far too many people lack confidence in both themselves and their supplier, meaning even in their darkest moments they don’t seek the help they need. We often refer to debt as a burden; one that weighs people down and buries them. With a virus-driven lockdown, we need to find ways to lift this burden from them, before they get lost in the crisis.

Like a virus, debt is often invisible. But people don’t need to suffer in isolation. We all need to make sure nobody is lost in the rush to deal with the crisis. At the beginning of the outbreak, many people reached out to their neighbours to offer a helping hand. Two months on, isolation, financial struggle and anxiety are still on the rise across the nation. If you know someone who is facing a tough situation, why not offer a helping hand again? You never know what could be going on behind closed doors.