Debt - Are Village Charitable Trusts effective?
The most common problem encountered by the Citizens Advice Bureaux in south and east Cambridgeshire, is debt. Ely, Soham and Littleport take on over 100 cases each year, with the average debt at around £11,000. The Cambridge, Addenbrooke's and Sawston bureaux have some 420 files open at any one time. Here the average debt tops £11,600. Can charitable trusts help when local debt runs into millions of pounds? With typical credit card charges of around 20%, it would require close on £200 a month to service the average debt in the locality Even if this was forthcoming it would simply delay the inevitable by a month!
When your local bureau addresses the financial problems of a financially distressed client, it begins by confirming the sums involved with the creditors, then splitting non-priority from priority debts, to try to avoid the client becoming, at worst, homeless. Next comes a check on the client's situation, debt problems are invariably linked to relationship breakdowns, ill health, redundancy or such disasters.
The bureau will then check the client's entitlement to any state benefits, scrutinise each debt, check insurance policies and credit agreements. It is common knowledge that many of us aren't aware of all our benefit entitlements and tax credits, but few can experience the relief of a client who has spent sleepless nights following redundancy, to be told by his CAB adviser that his mortgage or loan are in fact covered by an insurance policy in these circumstances!
Next the bureau helps the client approach creditors with a financial plan that will satisfy them, yet be within the client's budget, and which will eventually remove the burden of debt. Invariably this brings relief and indeed rejuvenation to those who have been in a financial quagmire on finding order is restored, and protection is provided from loan sharks.
The Citizens Advice Bureau offers this service to anyone who walks through its doors. It could also, with the client's permission, approach a local charitable trust, presenting the trustees with a comprehensive appraisal of the client's situation and to allow them to decide on whether or what financial support from the trust would be beneficial. Should trustees wish to adopt this approach, they should contact the money departments at either Ely CAB, 70 Market Street, Ely, CB7 4LS or Cambridge CAB, 72-74 Newmarket Road, Cambridge CB5 8DZ, giving details of the trust and its rules.
The majority of Citizens Advice Bureaux workers volunteer their services, and funding comes from 3 local authorities, the Legal Services Commission, Addenbrooke's Hospital and individual donations. Trustees may sometimes consider it appropriate to make a donations towards CABx upkeep, though this is entirely discretionary.