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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. 

Lone parents face the biggest financial shock waves due to coronavirus. In April alone, an additional 216,000 single parent families were found to be living on extremely low incomes, with less than £500 to see them through the month, according to Turn2us. 

In a just and compassionate society, our social security system should anchor people when the financial impacts of coronavirus crash down upon them. Unfortunately for many, the help on offer falls short. 

The benefit cap is a limit on the total amount of benefit you can get each year. It currently affects 79,000 families, and is set to impact many of the 1.8 million new Universal Credit claimants too. This means they will not receive extra money from the Government’s cash injections to Universal Credit that are intended to help people in poverty stay afloat during the outbreak. 

The benefit cap

The benefit cap is set at £20,000 for families (with children) living outside of London and £23,000 a year for those in London. 

The families most likely to be affected by the cap live in high-rent areas and typically have two or more children. On average, they lose out on between £48 and £53 a week because of the cap - money they cannot afford to lose. Of those that replied to CAP’s recent Facebook poll, more than half (55%) of people affected by the benefit cap said it meant that their family always went without.* 

Lone parents going under

Following a relationship breakdown, Megan**, contacted CAP for help with debt. Now a lone parent to her three children, aged 7, 9 and 17, she relies on Universal Credit to support her family. She is entitled to £1,893 a month, but her payments are reduced by £604 because of the benefit cap and Local Housing Allowance limits.

In April, when the Government increased Universal Credit and Local Housing Allowance limits, it promised an extra £203 a month for the family. Yet the cap means that they see none of this, leaving the family of four (after paying their rent) just £358 a month to live on.

Seven in ten households affected by the benefit cap are headed by lone parents like Megan. 

Last month, one such parent told the cross-party group of MPs who scrutinise the work of the Department of Work and Pensions that the benefit cap meant she struggled to pay basic bills. She said “My children are my priority. If that means I don't eat, I won't.”

Breakdown of social security 

Economists refer to social security benefits as ‘automatic stabilisers’ - payments that kick in to steady households and the economy when storms hit. The reality is that the benefit cap stops lone parent families receiving all the vital support they need. 

The cap was brought in to incentivise people to find paid work or move to cheaper housing, yet in a recent blog, the Institute for Fiscal Studies highlighted that there is little evidence that the policy is successful in economically stable times. At a time like we are currently facing, finding work or moving home is even more difficult. 

CAP is calling on the Government to suspend the benefits cap during the outbreak, in order to help households who are already pushed to the brink. We joined with Shelter and other anti-poverty charities to send this message to the Chancellor. The government needs to know that people across the UK want to see more support for families living in poverty during coronavirus.  

Your voice can make a difference, email your MP here.

 

*There were 40 respondents to the poll which ran on CAP’s Facebook page 10 May 2020.
**Name has been changed.

Our latest research shows the shocking revelation that one in ten of our clients has no bed or mattress to sleep on. If this is the picture of problem debt now, what does a post pandemic UK look like?

This is the question we must ask following on from the Client report we’ve just published exploring the latest debt trends, as well as the difference CAP’s services made in 2019. The report is a cornerstone piece of research that our External Affairs team use to show industry and government the picture of poverty in the UK.

It’s a harsh reminder of the level of debt and poverty many of our clients are facing every day. The average income for new client households in 2019, after housing costs, was £12,579, meaning that  81% of CAP clients have an income lower than the national average, and almost half (48%) are living below the poverty line. 

This level of low income meant that two thirds of  CAP clients borrowed money in order to pay another bill or debt, and six in ten borrowed money in order to pay for food, clothes or other essentials.  Living in debt also impacts health. Three in four of the people we help said debt negatively affected their health, with many seeking help from a GP for a debt related illness. 

In light of the pandemic

Covid-19 (coronavirus) is being felt by everyone but the poorest are least able to weather the storm As the global economy is set to suffer for years to come,household debts will continue to grow and we’re expecting to get even busier. 

The hard-hitting picture painted by this  report - which uses 2019 data - makes us very concerned for the future.

The good news

But let’s talk about some good news in all of this. In 2019, CAP helped 22,778 people to change their story. We celebrated with more than 2,000 households who became debt free, and walked many more along the road to a more hopeful and positive future.

We are so thankful to all of you who donated to our crisis appeal. Your donations mean that we can continue to run our emergency support line, which is providing hundreds of households with  vital emergency food shops, fuel vouchers and phone top-ups. 

Sarah Elson, who works in CAP’s Network Management team, is coordinating our response.

 Sarah Elson 

‘CAP has always operated an emergency aid fund for debt clients who are in desperate need of support with food and energy top-ups. However, now due to the coronavirus pandemic we are seeing clients being pushed harder than ever into difficult circumstances. This includes things like changes to employment, reduced working hours, people waiting for benefits or an increase in mental health difficulties.

When lockdown began, CAP decided to offer support to a wider range of people and develop what it was supporting people with. The emergency aid line now helps by providing food shops, fuel vouchers and phone top-ups. By having three different options for aid, we've been able to address material needs for food and power, as well as allowing people to stay connected to family and vital support services.

Our partner churches have stepped up to meet the needs of their communities in so many ways. In the last four weeks, CAP has been able to support them by providing aid for more than 150 CAP clients. This support helps frontline staff to build relationships with their clients and group services members, and provides a lifeline for many during an especially difficult and uncertain time.’ 
 

We cannot take our foot off the pedal right now.

The financial impacts of coronavirus are going to be long lasting and, for thousands, this pandemic will be the tipping point into financial crisis. We need to respond now to make sure CAP can be there for them when they call us.

Will you give today and bring hope to someone plunged into financial darkness by the coronavirus pandemic?

We’ve been blown away by the UK Church's incredible response to coronavirus (COVID-19). You are showing incredible generosity to the deprived, bringing hope to the desperate and serving the vulnerable with compassion. Many in need are struggling more than ever, but despite the challenges facing us all, the Church is as active and alive as ever.

CAP exists to equip and empower the Church to serve the poorest and most vulnerable in this nation. And at this time of desperate need, we want to share our knowledge and experience to help your church provide crucial support to your community.

CAP’s Church Resources

We’re excited to be launching our Church Resource page. A place where, over the coming days and weeks, we will be adding resources that draw on the experience of hundreds of our partner churches across this nation, as well as CAP's own knowledge and expertise.

It can feel daunting when faced with such a huge need. But we hope these free tools will equip you and your church to effectively serve with confidence and continue to offer the hope of Jesus in your communities during this crisis.

What resources can I expect?

We understand the pressures that church leaders are facing during this time as you seek to guide your congregation through unknown territory, and respond to the need in your local area. So we have gathered resources that we hope provide support to you, your church, and your community. Expect to find:

• Information on Government and industry support
• Signposting to organisations providing additional specialist support, for individuals and churches
• Practical advice on how to serve those in need in your community, starting with our new project: Pathways out of Poverty

We’re committed to supporting you throughout this crisis, and we’ll be working on further content over the next few months. So be sure to check in to the resource page regularly and keep an eye on our social media to be kept up to date with new resources as they’re available.

Thank you for the amazing work you’re doing amongst your congregation and wider community at the moment. God is continuing to use his Church in amazing ways during this time, and we can’t wait to hear of more lives impacted and transformed.

Mrs Arlene Foster MLA and Ms Michelle O’Neill MLA
First Ministers of Northern Ireland
Stormont Castle
Belfast
BT4 3TT

Dear First Ministers,
We are writing to you as leaders of Christian charities in Northern Ireland to offer our support to you
and the Executive at this time.
Our organisations and networks across Northern Ireland are used to stepping up and finding solutions,
creating community, and inspiring and resourcing people to act compassionately. Right now, in the most
difficult of times, we are doing what Jesus told us to do: to love our neighbour.
The Church has a body of highly motivated and experienced volunteers, on the ground in our cities,
towns and villages. Equipped by our charities they are:
● Helping communities manage their money and deal with personal debt
● Informing and supporting those needing government help
● Delivering food parcels to vulnerable people
● Ensuring children in poverty are prioritised
● Supporting young people in their wellbeing and mental health
● Supporting people in recovery from addictions
● Positively intervening in homelessness and rough sleeping
● Building communities and supporting families in a wide range of challenging situations
● Providing befriending and support to prison leavers
● Reaching those who are not online and ensure they are cared for
● Helping people stay healthy and positive, especially those with poor mental health
● Connecting those who want to give and volunteer with those in need
● Bringing hope and addressing loneliness at a very local level

We have been working locally in communities across the North and beyond and we stand ready to work
strategically in partnership with the Executive, local government and agencies at every level to ensure
the best possible response at this time. Please let us know how we can best work with the Government
to direct our specialist resources and volunteer networks to most effective use.
We also recognise that we will need to increasingly work together in the coming months as the country
begins to face the reality of a significant economic downturn, when charities and the Church will be
more needed than ever. We ourselves will not be immune to this downturn and anticipate reductions in
our own income, as across the whole charity sector.
We are committed for the long haul, but with this changing landscape we will also need the Executive to
stand with us – not for our own sake but for those we serve – to ensure this valuable work can meet the
growing need of the coming months and years. We are grateful for the steps the Executive has already
taken to support the sector and we look forward to positive engagement over the coming months as we
work together for the benefit of this place and all our people.
Thank you for your leadership and be assured of our prayers for you and the Executive at this time.
Yours sincerely,

David Smyth, Head of Evangelical Alliance Northern Ireland

Alison Flanagan, National Leader, Christians Against Poverty, Northern Ireland

The Reverend Brian Anderson, Mission Superintendent, East Belfast Mission

Mike Royal, Co-CEO, Cinnamon Network UK

Keeva Watson, Regional Development Manager Northern Ireland, Redeeming Our Communities

Diane Holt, Head of Thrive Ireland

Howard Davey, General Secretary, Belfast YMCA

Tony Silcock, CEO, Youth Iniitiatives

Ricky Wright, Chief Executive, Vineyard Compassion

Rev David Rock, The Big House Ireland