Almost two fifths (37%) of new StepChange Scotland clients responsible for paying council tax bills were in arrears between July and September, up from 31% in the previous quarter, according to quarterly data released by the debt charity.
StepChange Scotland also reported an uptick in new clients with rent arrears, rising to a quarter (25%) in Q3 of 2023, up from 21% in Q2.
While the summer months led to a slight reduction in the proportion of clients with energy arrears, the cost of living remained the biggest driver of debt for new clients, with 25% citing this at the time of advice, up from 21% in the same period in 2022.
Meanwhile the figures showed a jump in the proportion of StepChange Scotland clients in receipt of Universal Credit, rising by seven percentage points year-on-year to almost two in five in Q3 of 2023 (38%).
StepChange Scotland raised concerns around the proportion of its clients that hold council tax arrears, as well as what it referred to as the excessive action often taken by local authorities to collect these debts.
Richard Lane, director of external affairs at StepChange Debt Charity Scotland, said: “It’s a worry to see the proportion of clients in arrears with essential bills in Scotland creep up, especially as the weather turns and energy bills begin to put a greater burden on people’s budgets again.
“While energy bills have dropped from the record highs we saw last year, less government support and a build up of arrears across other household bills will make this winter just as challenging for households.”
He added: “When it comes to council tax, falling behind on payments can spiral into significant amounts of debt quite rapidly, with some local authorities quick to resort to enforcement action, such as the use of sheriff officers, to collect arrears.
“For someone struggling to make ends meet, paying back arrears whilst covering daily essentials can be near impossible, leaving them trapped in mounting debt.
“We would urge local authorities to take a more supportive approach toward council tax collection, taking into account financially vulnerable groups to prevent further financial harm as the cost of living crisis rages on.”
