By Graeme Strachan

A LEADING poverty worker in Dundee yesterday said there has been a year-on-year increase in debt levels in Dundee and many borrowers expect to be deeper in debt in 12 months’ time.

Jim Milne, project leader at Dundee Anti-Poverty Forum, said he was “not surprised” that most people in Scotland expect to be gripped in the same amount of debt next year as they are now.

A survey carried out by the Prudential showed 90% of Scots expect to borrow the same amount or more during the coming 12 months.

This compared with an average of 75% across the UK who think they will remain in the same predicament.

Only 12% of people said they had cut their debt levels in the past year.

“It’s not surprising,” said Mr Milne. “There is so much credit on offer that people sometimes don’t realise the full extent of the repayment schedule they’re asked to commit themselves to, which is a problem and that’s unhelpful.

“I think there is a responsibility on the credit companies not to offer credit to people who it’s obvious will struggle to meet the repayment schedule.

“They must allow for a repayment schedule that is realistic. There was a report out earlier this year focused on Dundee indicating that Dundee had one of the highest levels of debt per adult population in Scotland.

“I think also people’s circumstances are changing, particularly those who are on low income, where they’re in marginal employment and could be short-term, part-time or low-paid.

“These are people who have taken on debt with the expectation that they’ve got more of a career in front of them and it tends not to work like that at times.”

Mr Milne said the debt advice services within the local authority and in the voluntary sector are doing an “excellent job” in dealing with people’s problems.

“They are showing year-on- year an increase in debt levels in Dundee and an increase in their workloads,” he said.

“So it’s obvious that over a period of time, debt is a problem that has not been on the decline.

“I think there needs to be more teeth to the financial services agency, more control over credit companies and more flexibility to accessing benefits.”

He said a year-on-year rise in minimum wage levels to combat inflation would also benefit the poorest.

However, Mr Milne said many young people fail to see debt as a “major issue”.

“Particularly younger people nowadays, they don’t see a major issue with having debt and it’s probably a change in culture from older people,” he said.

“It would be fair to say that elderly people had a different view regarding debt as being something that people tried to avoid, today younger people are brought up with credit being offered to them on a daily basis and its seen as a way of life.

“This is not particularly helpful. Younger people tend to accept that debt is not a problem for them, especially those who are going into home ownership, then they’ve taken on debt at a very young age. If that can be sustained then fine, as long as you can meet the repayments.

“Financial inclusion is something that the Scottish Executive is trying to drive forward in Dundee. The Discovery Credit Union is doing a good job in trying to ensure that people have access to financial services where in the past sometimes the banks wouldn’t be prepared to entertain people on low incomes or people on benefits.

“That’s a positive development in the city.”

Mr Milne advised anyone with difficulties to contact the Discovery Credit Union in the Central Library.