Unemployment figures highlight protection need

A quarter of people contacting CCCS for help in 2010 were in financial difficulty due to unemployment and almost 11% were claiming Jobseekers Allowance (JSA).

On average, CCCS clients claiming JSA owe £15,816 in unsecured debt, close to double the national average.

The charity says that the shock to family finances caused by unemployment can force thousands of people into unmanageable debt just to keep afloat. Last year, unemployed clients had a shortfall of £2,436 in the money needed to cover the costs of day-to-day living.

Delroy Corinaldi, CCCS external affairs director, said: "With almost 2.5 million people currently unemployed, many will have no alternative but to take on debts in an effort to maintain a basic standard of living.

"Anyone who has lost their job and is worried about making ends meet should seek help as soon as possible before being tipped into the black hole of debt which can be a real struggle to get out of."

Commenting on the unemployment figures released yesterday by the Office for National Statistics (ONS), John Pollock, group board director for Legal & General's risk business, said: “The planned changes in state benefits means that those unfortunate enough to be made redundant will not find it easy to replace their loss of income with unemployment benefits. More people are likely to struggle to meet their household bills and make their monthly mortgage payments, potentially putting their home and family at jeopardy of repossession.

“Recent statistics from The British Population Survey on Unemployment published in January showed that 35% of jobseekers had a family and that nearly 50% either had a mortgage or were in private rented accommodation.

“Our own recent research has shown that only 2% of those surveyed had considered taking out insurance since the financial crisis hit, to provide cover if they were made redundant. 73% believe that the Government should provide financial help for those that are unemployed but not really understanding the actual benefits this would mean.”