A trillion and a half is such a big a number that most people probably wouldn't even try getting their heads around it.
But that is the total level of personal debt owed by the 50 million or so British adults. Per head of population, it qualifies us for the dubious honour of the most indebted nation on earth. Most think it's a mess, two decades at least in the gestation that we haven't even come close to tackling yet. But who is meant to be clearing up this mess? Step forward Lord Stevenson of Balmacara, the new chairman of the country's biggest debt charity, the Consumer Credit Counselling Service (CCCS).
A quick glance at Lord Stevenson's CV meets the old Denis Healey test that all public figures should have a "hinterland". The 64-year-old Oxford-educated life peer was director of the British Film Institute in the 1990s, followed by nine years at the progressive think tank the Smith Institute. He is governor of his local school as well as Chiltern Way, a Buckinghamshire federation of secondary schools for boys with special educational needs. And from 2008 he was an adviser to the former prime minister, Gordon Brown.
In his new role at the CCCS, the lord certainly has his work cut out. "From the moment I walked into our call centre I could sense a real buzz of advisers helping people make big changes with their lives. On one call, I listened to someone with £46,000 of debt spread across 12 different lenders," he says. "Such multiple debt problems create real crisis points; the lenders don't know about each other and go shouting for their debt. People need someone to draw all these creditors together and act as a free, impartial intermediary with the creditors and that's our role."
And it's busy work: the CCCS gets a staggering 416,000 cries for help with debts each year. "Think of us like a GP service. You come to us with your debt problem and then we recommend a course of action to the creditors, whom we have dealt with for many years, like a hospital referral. It tends to be the case that you get better treatment if you have someone working on your behalf than if you take a case-by-case approach to the lenders."
Meanwhile, the fee-charging debt management industry is being radically overhauled by the Office of Fair Trading. "The OFT is doing a terrific job with its guidelines (issued last Tuesday) to these firms and for getting rid of some firms which were acting to the detriment of consumers."
But with interest rate rises likely later this year, if not next, the CCCS could be getting a lot busier and Lord Stevenson's prognosis is not a happy one. "I am relatively gloomy for the prospects two years down the line. This recession is proving a real grind and it's too early to say if we have entered a Japanese style 'lost decade'. There are real pinch points when rates rise. The first is families with small children, and then there are parts of the north that are struggling."
As for Ed Miliband's "squeezed middle", this is a reality. "Our research shows a lot of people coming to us who are in their late forties or fifties who would normally be in a decent position as they're homeowners. But for any number of reasons – ill health, relationship breakdown, job loss – this is the group struggling with debt often for the first time."
One area of increasing concern to the CCCS is the number of enquiries relating to energy prices, what with the announcement that Scottish Power was to raise its gas prices by a shocking 18 per cent. "You ain't seen anything yet in terms of gas and electricity rises. It's yet another pressure we are seeing reflected through our debt calls. The role it plays in debt is only going to increase." The other hot debt topic is student debt and Lord Stevenson feels that we haven't yet thought through the implications of loading such huge debts on to the shoulders of the young.
But all is not doom and gloom; there are signs that after the credit splurge of the past decade or so, Britons are taking a more sensible approach. "The average debt of a CCCS client was £28,000 a couple of years ago. Now it's £21,000, which shows that slowly but surely people are paying down what they owe. People do learn lessons. If you get into difficulty, you're not going to go out the instant you're free and pile the credit back on. Credit is actually a good thing. It allows us to live our lives to the full." However, credit at rates in the hundreds or even thousands of per cent is not such a good thing. "Government has to decide whether or not there should be a cap on interest rates, while also ensuring that the more unsavoury elements such as the illegal money lenders are put out of business. As for the payday loan firms (some of which charge over 4,000 per cent APR) there are better ways of financing yourself than them."
But what about that £1.5trn pile of debt? As a former Brown adviser, does Lord Stevenson feel that New Labour got it badly wrong? "No one saw this thing coming. It's all very good to be wise after the event. Firstly the seeds of the credit boom were sown long before the Brown or Blair premierships and this is not a British problem. This is something that happened worldwide." Whoever is to blame, the likes of the CCCS and Lord Stevenson are now left picking up the pieces.
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