Christians Against Poverty’s (CAP) latest briefing paper, ‘Deficit budgets: The cost to stay alive’ explores the severe consequences of deficit budgets in households across the UK and pushes for urgent systemic change.
A deficit budget happens when a household’s income (whether from wages or benefits) isn’t enough to cover essential living costs, such as rent, utility bills, food and clothing. Almost half (47%) of those who seek help from CAP have a deficit budget, and would need, on average, an additional £273 per month in income to make their budget balance.
Key findings:
- 22% of UK adults report living on a deficit budget, unable to cover essential bills and costs with their income.
- 47% of CAP’s clients have a deficit budget, requiring £273 more per month on average to make their budget balance.
- Personal impact: Deficit budgets significantly affect mental and physical wellbeing, contributing to severe stress and worsening existing health conditions.
- Societal inequality: The rise in deficit budgets is deepening social inequality, disproportionately affecting those on low incomes.
- Coping mechanisms: In order to simply survive, many are forced to skip meals, limit gas and electricity use, and rely on informal borrowing or selling possessions.
- Policy recommendations: The report recommends urgent systemic changes, including a Minimum Income Standard, better social security, and protections relating to housing and energy costs.