Nearly a quarter of people could not find £200 in an emergency, report suggests

The report confirms the old adage that 'the rich get richer as the poor get poorer'

Nearly a quarter of people would be unable to find £200 in an emergency. One in six said they would have to borrow the cash, with a further 8 per cent saying they simply could not pay, according to the latest Financial Inclusion report from the University of Birmingham.

Meanwhile most people have continued to cut back on their spending, despite recent signs of recovery for the economy.

The report confirms the old adage that “the rich get richer as the poor get poorer” as it finds that while those at the top of the pile are seeing marked improvements in their financial situations, things are getting worse for people at the bottom.

Karen Rowlingson, professor of social policy at the University of Birmingham, said: “We are experiencing a three-speed recovery.

“A lucky minority at the top are steaming ahead, benefiting from the current low interest rates and the return to growth to increase their savings, while those in the middle are standing still, finding things difficult but adapting to more austere times.

“Those at the bottom are going into reverse, really struggling and getting further into debt.” Almost two-thirds of households have unsecured credit, with a quarter of the population owing more than they have in savings. Nearly one in five people with debt say it’s a “heavy burden”.

Underlining that view is the dramatic increase in the use of food banks in the last few years, from 61,000 people in 2010-11 to just under one million in 2013-14.

And there are further woes ahead, warned the report’s co-author Stephen McKay, professor of social research at the University of Lincoln. “Increases in interest rates are likely and this will hurt those owing money, while changes to welfare benefits will only start to show up in the data in the coming months.”

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Research Associate / Asset Management Research Analyst

£40 - 45k (DOE) + Benefits: Guru Careers: A Research Associate / Research Anal...

The Green Recruitment Company: Graduate Energy Analyst

£20000 Per Annum: The Green Recruitment Company: Summary: The Green Recruitm...

Ashdown Group: Finance Accountant - Financial Services - Central London

£30000 - £35000 per annum + benefits : Ashdown Group: Finance Accountant - Fin...

Ashdown Group: Chief Technology Officer (CTO) - Glasgow

£90000 - £98000 per annum + benefits : Ashdown Group: A truly exciting opportu...

Day In a Page

Solved after 200 years: the mysterious deaths of 3,000 soldiers from Napoleon's army

Solved after 200 years

The mysterious deaths of 3,000 soldiers from Napoleon's army
Every regional power has betrayed the Kurds so Turkish bombing is no surprise

Robert Fisk on the Turkey conflict

Every regional power has betrayed the Kurds so Turkish bombing is no surprise
Investigation into wreck of unidentified submarine found off the coast of Sweden

Sunken sub

Investigation underway into wreck of an unidentified submarine found off the coast of Sweden
Instagram and Facebook have 'totally changed' the way people buy clothes

Age of the selfie

Instagram and Facebook have 'totally changed' the way people buy clothes
Not so square: How BBC's Bloomsbury saga is sexing up the period drama

Not so square

How Virginia Woolf saga is sexing up the BBC period drama
Rio Olympics 2016: The seven teenagers still carrying a torch for our Games hopes

Still carrying the torch

The seven teenagers given our Olympic hopes
The West likes to think that 'civilisation' will defeat Isis, but history suggests otherwise

The West likes to think that 'civilisation' will defeat Isis...

...but history suggests otherwise
The bald truth: How one author's thinning hair made him a Wayne Rooney sympathiser

The bald truth

How thinning hair made me a Wayne Rooney sympathiser
Froome wins second Tour de France after triumphant ride into Paris with Team Sky

Tour de France 2015

Froome rides into Paris to win historic second Tour
Fifteen years ago, Concorde crashed, and a dream died. Today, the desire to travel faster than the speed of sound is growing once again

A new beginning for supersonic flight?

Concorde's successors are in the works 15 years on from the Paris crash
I would never quit Labour, says Liz Kendall

I would never quit party, says Liz Kendall

Latest on the Labour leadership contest
Froome seals second Tour de France victory

Never mind Pinot, it’s bubbly for Froome

Second Tour de France victory all but sealed
Oh really? How the 'lowest form of wit' makes people brighter and more creative

The uses of sarcasm

'Lowest form of wit' actually makes people brighter and more creative
A magazine editor with no vanity, and lots of flair

No vanity, but lots of flair

A tribute to the magazine editor Ingrid Sischy
Foraging: How the British rediscovered their taste for chasing after wild food

In praise of foraging

How the British rediscovered their taste for wild food