Lib-Dems warn on rising level of chronic personal debt

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Indy Politics

People in the UK are sinking chronically into debt and finding it harder to pay off credit card bills and meet mortgage payments, according to a study to be released this week.

A Liberal Democrat report shows that 40 per cent of people fail to pay off their credit card debts each month and are clocking up even higher interest rates with spiralling balances.

The cost of mortgages means that almost a third of people are without insurance to protect them if they become unemployed or are injured.

The spiralling level of debt is set to be highlighted this week as Gordon Brown launches his mini- Budget in which green taxes to tackle climate change and encourage people to stop driving gas guzzling cars are expected to be announced.

Vince Cable, Liberal Democrat Treasury spokesman, said: "There is a real complacency about the extent to which millions of people are getting out of their depth with mortgages and unsecured borrowing."