Financial recovery from Covid-19

A quarter of people in the UK will have to survive another year of hardship before their finances recover from the coronavirus pandemic, according to new Turn2us findings.

People who have lost income and incurred debts since March 2020 will need an average of 17 months to get their finances back to pre-pandemic levels.

Turn2us says that the time needed for people to recover is clear evidence that the government should not pull away support schemes too quickly and now has a clear moral obligation to make permanent the £20 uplift to Universal Credit.

People have seen their finances affected in a variety of ways, including one in five (19%) are now struggling to pay bills, one in six (17%) are struggling to afford food and one in seven (15%) are struggling to afford their rent or mortgage payments.

Profound effect on mental wellbeing

The severity and depth of these financial worries have had a clear and profound effect on the nation’s mental wellbeing. 62% of us state that our mental health has been affected at least a little bit and a third of us (33%) say it has had significant consequences.

The ways in which people’s mental health has been affected as a result of the pandemic is extensive:

• 28% of people have had anxiety
• 24% of people have lost sleep
• 19% of people have had depression
• 13% of people have avoided looking at bills
• 11% of people have argued with loved ones
• 9% of people have been drinking more.

As always, those of us who face steeper social barriers are affected more severely; including women, parents and younger people.

Thomas Lawson, Turn2us Chief Executive

Thomas Lawson, chief executive at Turn2us, said: “We have been inundated with demand for support over the last twelve months, giving millions of pounds in grants, and we see no sign of this slowing down any time soon.

“It will take us significant time to recover from the debt, loss of income and damage to mental health that so many of us have experienced in this pandemic, which is why it is so important that the Government makes permanent the £20 uplift to Universal Credit and extends it to legacy benefits."

Helen Undy, Money and Mental Health Policy Institute Chief Executive

Helen Undy, Chief Executive of the Money and Mental Health Policy Institute said: “Mental health problems and debt can be a marriage made in hell, and these issues have become even more acute in the current crisis, with millions more people affected. It’s vital that the government strengthens the safety net for people — by making the Universal Credit uplift permanent and extending it to other benefits, and by ensuring everyone can access adequate sick pay.”