The only way they have staved off repossession is by cutting down on food and other essentials and running up debts that reached pounds 3,000 last year.
The couple and their three children, Leon, 16, Rebecca, 15, and Lesley, 12, cannot afford to pay for the funeral of Mr Smith's mother, who died this week.
Their three bedroom cottage near Corton, four miles outside Lowestoft, Suffolk, is heated in one room only by an open fire fuelled with wood collected by Mr Smith and the children from the nearby forest at weekends.
The family have one joint of meat a week and fill up on bread and home grown fruit and vegetables. All Ms Thompson could afford to buy the children for Christmas were stocking fillers. She is still paying off debts to catalogues for presents from three years ago.
Their formerly comfortable life in a cottage, worth about pounds 60,000, which was bought with a pounds 20,000 mortgage in 1984, ended two years later when the coachbuilding company that Mr Smith had worked for for 25 years closed.
He has had menial, low paid jobs ever since. As a father of three taking home pounds 130 a week from his job, and with Family Credit and child benefit, he would be pounds 40 a week better off unemployed. He would get about pounds 20 less in Income Support, child benefit and family premium, but the state would also pay his mortgage interest payment of pounds 60 a week. But 'he couldn't bear to be thought a parasite', Ms Thompson said.
If he was in rented accommodation he would also be better off because, even if he was working, he could claim Housing Benefit of almost pounds 57 a week.Reuse content