SOARING living costs and hefty credit debts are causing many Brimbank and Melton residents to declare bankruptcy, according to local financial counsellors.
Good Shepherd Youth and Family Services counsellor Melissa McAllister said many people were struggling to keep up with loans and pay back credit cards because their working conditions had changed or they were battling rising living costs.
“Petrol prices have gone up as have utility bills for things like gas, electricity and water and this can put a lot of strain on households,” she said.
“The clients we see from the local area have usually lost work or had reduced hours and can’t
afford to pay back their debts. They are paying off one debt with another and it catches up and becomes too much.”
Ms McAllister believed more local small business owners were looking into bankruptcy because of the struggling retail sector.
Figures released by Insolvency and Trustee Services Australia last week revealed suburbs like Caroline Springs, Deer Park, Burnside, StAlbans, Kealba and Kings Park had a higher rate of bankruptcies than other postcodes in the west.
Ms McAllister said a rise in rental prices had also impacted on the level of bankruptcies.
Recent modelling commissioned by the Australians For Affordable Housing showed more than 40per cent of Brimbank renters were experiencing housing stress. When low-income households spent more than 30per cent of their income on housing costs, they were officially in housing stress.
AAH spokeswoman Sarah Toohey said areas like Brimbank, Melton and Maribyrnong were facing a housing crisis. “Urgent action is needed by state and federal governments, with a proper housing strategy that includes more than releasing land on the city fringe, ” Ms Toohey said.
She urged the federal government to commit to a $2.5billion a year fund from 2013-14 to provide 100,000 affordable houses over five years.
