Demand for debt advice 'overwhelming'

A debt advice service offered by the government is being forced to turn people away due to overwhelming demand, the National Audit Office as warned.

An investigation into the service run by the Department for Business, Innovation and Skills (BIS) found that the system was "unnecessarily complex".

As a result, it was unable to cope with a 28 per cent spike in demand in the space of one year.

The report also found that consumers had a shocking £1.46 trillion debt at the end of 2009 – with personal borrowing amounting to 160 per cent of British household's annual pre tax income.

Unsurprisingly, this had caused the demand for debt advice to soar, with one in ten struggling to keep control of their borrowings.

Kevin Still, director of Atlantic said that "this is the tip of the iceberg", as the debt advice referred to is for the people struggling with debt to then manage the problem themselves.

The government cash distribution has been focused on initial face-to-face meetings, the most expensive type of debt advice, which costs an average of £265 per person.

Atlantic's approach is based on confidential face-to-face meeting, usually in your home at a time to suit you, and then - if applicable - a fully managed Debt Management Plan (DMP) with a Personal Case Manager.

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