‘I wonder if it’s worth getting up’: life in Corby, the debt capital of Britain | Money

Corby in Northamptonshire has taken on a few notable titles over the years. It has been dubbed “Little Scotland” to reflect the Scottish workers who flooded in during the last century for jobs in its now defunct steelworks. More recently, Corby emerged as the fastest-growing borough outside London, its population now swelled by EU migrants and young workers commuting to London.

Last week, the East Midlands town had the dubious honour of topping a new list. Amid the latest warnings around Britons’ growing reliance on borrowing, Corby was named the personal loans capital of Britain.

Borrowers there had made more inquiries about personal loans than in any other place in the UK, according to an analysis by MoneySuperMarket. There were 75.5 inquiries per 1,000 residents in Corby – 47% higher than the UK average, according to a trawl through 3 million such inquiries made via the price comparison site since 2015. More generally, the UK-wide figures showed that the country’s appetite for borrowing had grown over the last two years.

A mere decade on from the financial crash, signs that households are building up debts are worrying the Bank of England. Some of the rise is down to low borrowing costs and the easy availability of credit to pay for anything from cars and weddings to everyday living costs.

However, borrowing is rising faster than incomes and the Bank’s director for financial stability, Alex Brazier, warned last week that lenders who are offering cheap deals were taking the risk of sparking a fresh financial crisis. They could be contributing to a “spiral of complacency”, he said.

Debt charities warn that unsecured borrowing – which does not include mortgages – will continue to rise as people grapple with rising living costs, precarious employment and welfare cuts.

In Corby’s main shopping area, few of the people approached by the Observer seem surprised that their town has been crowned Britain’s personal loans capital. Their stories encapsulate the shift seen around the country to more insecure work and less reliable incomes.



Twins Callum, left, and Ryan Noble help each other find agency work in warehouses. Photograph: Andrew Fox for the Observer

Since Corby’s main steel plant closed in 1980, new jobs have been created to fill the gap. But many of them are low-paying, low-skilled roles.

Much of the work available is via employment agencies that offer contracts with very few, or no, guaranteed hours per week, says Ryan Noble, 24. “People are taking out loans to cover the cost of living,” he says.

Ryan and his twin Callum help each other find warehouse work via agencies, but the hours fluctuate. At Christmas, Ryan took out a £150 loan to stay afloat. “I would do it again. If I got work for three days out of five, I would probably take a £150 loan for that month to cover the loss of the two days.”

Ryan earns £250 after tax in a typical week for picking and packing in a supermarket warehouse. But sometimes even his scheduled shifts get cancelled or cut short. “Today I was scheduled to work 6am to 2pm. I was sent home at 10am,” he says.

Mother-of-three Marie Bradley points to rising food prices over the last year and says pay is not keeping pace. “Wages are so low in Corby. A lot of jobs are agency based,” adds the 45-year-old.

Her concerns about low pay are backed up by research into living standards from the Institute for Fiscal Studies thinktank and anti-poverty campaigners the Joseph Rowntree Foundation.

Their regional analysis of trends over 40 years shows the Midlands has fared worst in terms of income growth. Average incomes in the east and west Midlands are now 6% and 9% below the national average, respectively.

Corby Borough Council leader Tom Beattie testifies to that gap. “The level of wages in Corby – compared to the rest of the county, not just the rest of the country – is lower here than elsewhere and I think that’s a reflection of the sorts of jobs we have, at the lower end of the skills scale,” says the Labour councillor.

The town has put money into regeneration and its fast-growing population is testament to the effort to recover from post-industrial decline. But Beattie is conscious that some people are struggling. The council recently employed financial inclusion officers to help benefit claimants cope with living costs and changes to their income as welfare reforms are rolled out. The council would like to do more but its grants from central government have been cut by about 50% since 2010, he adds.

Corby must also tackle the root causes for households’ financial strains, says Beattie. “We can’t just be a low-skills, low-wage based economy. We need to work on that skills base.”

Charities see a close link between rising debts and the proliferation of low-paid, insecure work. The debt advice charity StepChange estimates that 8.8 million people are using credit to pay for essentials, and of those, 1.1 million are using high-cost loans.

Marie Bradley with her daughter Leanne.



Marie Bradley, right, with her daughter Leanne: ‘Wages are so low.’ Photograph: Andrew Fox for the Observer

“There are people where, even after we give them budget counselling, they don’t have the money to get by,” says Peter Tutton, the head of policy at StepChange. “There is a big pool of people on the edge, hanging on by their fingernails.”

One type of debt on watchdogs’ radars is credit cards. Earlier this year, the Financial Conduct Authority (FCA) unveiled proposals to help millions of people with long-term credit card debt. It said 3.3 million people had fallen into a persistent debt spiral, where all their money went on interest and the total debt was never lowered.

It is a situation one Corby resident visiting a weekly food bank knows all too well. The woman, who asked not to be named, says she and her partner have £12,000 of credit card debt. They have come to an agreement with the card issuers to pay back a bare minimum of £26 a month. The mother of two says things got tighter when her disability benefits were cut earlier this year.

“I don’t sleep. I go to bed at night wondering is it worth getting up the next day because it will just be the same when it’s no money and no one understands,” she says.

One of the food bank volunteers, John Hunter, is handing out parcels. He has seen a rise in people getting into financial difficulty because of benefit changes and because they get sanctioned – having their benefits paused – for not applying for enough jobs. “We do find it hard sometimes to keep up with demand,” says Hunter.

One food bank user, Gerry, is in arrears on his council tax and rent after changes to his benefits. Gerry worked for most of his life as an engineer at food factories but lost his job nine months ago.

His jobseeker’s allowance is being switched over to universal credit, with a six-week gap between the two, the 63-year-old says as he sorts through his food parcel.

“When I was at the job centre, I said ‘What am I going to live on?’ They gave me a voucher to come here,” he says.

Citizens Advice has highlighted a connection between borrowing and the rollout of universal credit, which involves wrapping six existing benefits into a single monthly payment. The charity surveyed 800 people who sought help with universal credit in pilot areas, finding 39% were waiting more than six weeks to receive their first payment and more than half (57%) were having to borrow money to get by during that time.

The government says it has put extra help in place, such as advances, for people who need it under universal credit and that its research shows the majority of claimants were comfortably managing their money. “Work is the best way to raise living standards, and record numbers of people are now in employment,” said a government spokeswoman.

“We’ve introduced universal credit, the national living wage and increased the tax-free personal allowance to make sure it always pays to have a job, and we’ve committed £45m to providing free debt advice for anyone with money concerns.”

Credit market experts are also keen to stress that the rise in borrowing is not simply a feature of financial strain. The availability of credit is also up. Using credit cards, or borrowing to buy cars, has become more commonplace.

One woman, walking down Corby’s main shopping area with her family, sums up changing attitudes. “I have had a couple of loans myself.” says the woman, who asked not to named. “It’s not so much a taboo any more. It’s on the TV all the time, this loan and that loan being advertised.”

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