Research suggests more families covering bills (From The Northern Echo)

Research suggests more families covering bills

1:08pm Saturday 11th February 2012 in News

THE proportion of families managing to cover their bills and debts in the North-East and Yorkshire has improved slightly this year, research suggests.

Easing inflation may have triggered the small recovery in household finances, the Legal and General Money Mood Survey said.

Households were typically £96 short a month - rising to £261 in London but dropping to £161 in Yorkshire and the Humber and £25 in the North-East.

But they were managing to save £93 monthly on average - rising to £177 in the East Midlands and falling to around £54 in the North-East and £34 in Yorkshire and the Humber.

Across Britain, one in 10 households said they were ''struggling'' and failing to cover their living costs, during the survey carried out last month, a slight drop from 11 per cent when a similar study was carried out last September.

Just over half (51 per cent) of households said they were ''surviving'' by covering their budgets and debts with nothing left to spare, up from 44 per cent in September.

But the proportion of families who said their finances were ''stable'', with some cash left over, dropped to 39 per cent, from 45 per cent last autumn, as more people moved into the ''surviving'' category.

Mark Gregory, Legal and General executive director, said: ''Perhaps the combined effect of lower inflation and costs of utilities and food starting to fall is producing some green shoots of recovery in household finances.''

Families have faced high living costs and soaring fuel bills, and analysts believe worsening employment conditions will add to the pressure on household budgets, despite signs of inflation beginning to ease.

Analysts have highlighted a general trend towards consumers trying to pay down their debts and a lack of appetite to take out more credit.

A recent PricewaterhouseCoopers (PwC) report found that UK families were typically £7,900 in debt from personal loans, overdrafts and credit cards, despite three years of paying them down. The report said UK households remain ''among the most indebted in the world''.

The Council of Mortgage Lenders has forecast that home repossessions will rise to 45,000 this year amid the weak economic backdrop, despite lenders offering some of their cheapest ever deals.

The study of 1,000 British adults found strong regional variations in how households were coping.

The number of homes struggling to meet bills rose in January in the Midlands, Scotland, the South East and the South West, which the study suggested reflected the impact of job losses.

The number of struggling homes dropped in the North-East, North West, Yorkshire and the Humber, East Anglia, London and Wales.

Here is how much households are typically left short by each month, followed by how much they save each month, the estimated number of households ''struggling'' to make ends meet and the change in January 2012 compared with September 2011: * North-East, £25, £45, 64,000, down by 104,000.

* North West, £83, £54, 161,000, down by 92,000.

* Yorkshire and the Humber, £161, £34, 198,000, down by 18,000.

* East Midlands, £92, £177, 96,000, up by 16,000.

* West Midlands, £174, £47, 270,000, up by 90,000.

* East Anglia, £25, £137, 60,000, down by 140,000.

* London, £261, £159, 189,000, down by 81,000.

* South East, £63, £117, 290,000, up by 87,000.

* South West, £97, £149, 119,000, up by 51,000.

* Wales, £46, £48, 40,000, down by 70,000.

* Scotland, £36, £86, 238,000, up by 17,000.