As we approach Rishi Sunak’s spring statement on Wednesday, Britain is facing a dramatic cost-of-living crisis. Even as a debt charity used to helping those who are unable to make ends meet, we’re finding the situation daunting. Our advisers have been taking an increasing number of calls from people who fear they won’t be able to keep up with their debt repayments, and this is expected to get worse: one in five people are predicted to fall into problem debt this year. We’re also expecting an influx of demand for debt advice from those who have been tipped over the edge financially by the rising cost of living. The consequences of failing to direct more support at the least well-off households would be dire. We already know that 11 million households are facing £25bn of Covid-related debt. Four million people are using credit to pay for essentials because they simply can’t make ends meet otherwise. For these households, rises in energy bills and the increasing cost of essentials are not things that make the difference between being able to afford luxuries or not; they’re the things that genuinely make the difference between heating and eating. Among our clients, energy bills were a source of very real worry even before this crisis – one in 10 UK adults were already behind on electricity and gas bills. One in three bill payers seeking help from StepChange have fallen into arrears on electricity and gas, up from one in seven before the pandemic. A recurring theme for people in problem debt is the impact on mental health. One of our clients, who lost his job in the pandemic and subsequently experienced financial and mental health problems, recently explained that the consequence of his energy bill increasing by £800 a year and the price of his regular food bill going up means he can no longer afford to visit his elderly, vulnerable mother regularly, with further consequences for his own anxiety. Behind every case of debt is a very human story. Currently, around one in three of our new clients already has what we call a “negative budget” – that is, not enough income to meet priority bills such as rent or mortgage, council tax, energy bills and essentials. Frighteningly, our modelling suggests this may be the scenario that could face nearly half of the people who turn to us for help, if there is no further intervention. In England and Wales, the government introduced a statutory “breathing space” scheme for debt nearly a year ago (following an existing statutory moratorium scheme already operational in Scotland). This can give eligible people 60 days of protection from creditors while they take advice and put a plan in place to deal with their debt. While this doesn’t help people with the fundamental problem of a lack of money, it does prompt people to get help. Goodness knows, plenty more people are going to need that in the months ahead. Unless the chancellor finds a way to mitigate the alarming prospect of rising numbers of people with negative household budgets, personal debt management will inevitably become more difficult over the coming months. Increased costs to health and public services go with that. A government that deserves credit for having done much to try to improve the public policy approach to how personal debt is managed surely cannot settle for being satisfied with this prospect. As Martin Lewis of MoneySavingExpert commented this weekend, those of us who help people manage their finances are reaching the limits of our arsenal – we need the chancellor to recognise the plight of the most financially vulnerable and offer them support. Phil Andrew is the CEO of StepChange Debt Charity Guardian Newsroom: The cost of living crisis Join Hugh Muir, Richard Partington and Anneliese Dodds MP for a livestreamed event on the cost of living crisis on Thursday, 14 April 2022, at 8pm BST | 9pm CEST | 12pm PDT | 3pm EDT. Book tickets here