Turning the Tide - Citizens Advice Campaign on Living Standards

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03 July 2026

Today, Citizens Advice launched a national campaign to focus the government's attention on the continuing cost-of-living crisis faced by low and middle income households. Below is a summary of the blog that launched that campaign.

"The cost of living crisis is no longer a one-off event. It’s a monthly reality for millions. We need to turn the tide on energy, housing and debt, before it’s too late.

Crisis has become the new normal. Millions of households face a relentless financial squeeze that feels like it never stops. At Citizens Advice, our advisers do all they can to help people find a way forward. But prices keep rising faster than incomes, pushing household debt levels ever higher.

Half the people who come to us for help with debts don’t have enough coming in each month to cover their essentials. That’s even after a debt adviser has helped them cut back as much as they can and maximise their income. We call this a ‘negative budget’. We estimate that across England and Wales there were 4 million people in negative budget households last year, including almost 900,000 children.

These problems have deep roots. For key essentials like rent and energy, government policy has failed to protect households from spiralling costs that are out of their control. Meanwhile, years of low wages and inadequacies in the benefits system have squeezed incomes. Debt has filled the gap, but is now becoming a growing weight that threatens to pull households deeper into the red.

These are the challenges — energy, rent, and debt — that any government serious about tackling the cost of living must address.

Energy

The last few years have shown just how quickly global events can drive up our energy prices. Following the surge in energy prices in 2022, millions were pushed into hardship just trying to keep the lights on, and their homes warm. Although average bills have dropped back from their peak, they are still far higher than they were 5 years ago. But incomes and bill support mechanisms have not kept up. Households are left with mounting energy debts, forced to choose between heating and eating. Energy debt is now the leading debt issue we help people with, and average energy debt levels per person are up over 50% in the last three years.

Given ongoing global upheaval, providing more targeted support to protect against further energy bill shocks is key to preventing households being tipped into crisis every winter.

Rent

Housing is the biggest cost most of us face. For renters in particular, costs have been spiralling. Housing support has been frozen for more than 2 years, and is still based on rent levels from September 2023. Average rents have grown nearly 17% since then. For more than half of private renters on Universal Credit (UC) who receive this support, the amount they receive fails to cover their rent. In some parts of the country, as many as 3 quarters of these households have a shortfall between their support and actual rents.

Soaring rents, inadequate housing support, and a lack of social housing are pushing renters deeper into the red. Private renters we help with debt issues who are on UC are, on average, £75 in the red every month. Of those who came to us with issues related to inadequate housing support this year, we’ve referred 1-in-4 to food banks or other charitable support. Our broken housing system is the heart of the problem. As a first step, support must be tied to the actual costs of renting. But making rents more affordable must also be part of the solution.

Debt

Even if energy and rent costs come down, for many households that won’t be enough. Debt is at record levels for the people we help. This year, the average total debt per person is nearly £10,000 for the first time. More than 40% of this is linked to essential bills like energy. Rent arrears are also one of the fastest growing areas of debt. For people in a negative budget, average debts are even higher and have been rising faster. Without help to climb out of debt, those households won’t fully benefit from action to tackle energy or housing costs.

A problem this deep needs bold solutions. This is urgent. The threat of costs rising even further looms large over people whose finances are already in the red. But no government action has grasped this reality yet. Turning living standards around must be the number one priority for the UK government, whoever leads it. It will take tough decisions, but progress can be made during this Parliament with a relentless focus on tackling the biggest drains on people’s budgets — energy, rent and debt".

For the full version of this blog, sumarised here with kind permission of the author Emer Sheehy, please click on the following link - https://wearecitizensadvice.org.uk/its-time-to-turn-the-tide-8a6c1ac2a82f

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