Toward the end of last year, a trade unionist told me that a growing number of their members were increasingly reliant on credit card borrowing. At the time, the financial press was pointing to “increasing consumer confidence” and hopefulness about the “reopening of the economy.” But given what I had heard, I was skeptical that increasing confidence in the economy could be the cause of this extra lending.

Analysis of household surveys conducted by Debt Justice late last year confirmed that behind the boosterish headlines, things were getting worse for millions of UK households. An extra 1.3 million were pushed heavily into debt in 2021, even before Universal Credit was cut by £20, the Omicron wave, and the surge in the cost of living.

With inflation currently running at least three times the rate of benefits and double that of wages, borrowing is largely driven by need. Polling and analysis from the debt advice charity Stepchange confirmed that people are getting into debt to pay bills and make it through to payday, with households in the United Kingdom having taken out an estimated £13 billion of borrowing just to survive.