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The human face of Australia's $1 trillion debt -

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SABRA LANE, PRESENTER: Australians love credit so much, its contribution to the national debt stands at an astronomical $33 billion - so many zeros, it's hard to comprehend.

But the figures become real when you look at the lives of people being crushed by the weight of their debt.

Tonight, one couple has spoken to 7.30 about their desperation and how the trap they fell into so easily.

Adam Harvey reports.

ADAM HARVEY, REPORTER: For Tim Walk and Suz Connors, a letterbox full of junk mail is a relief.

Tim's a former fly-in, fly-out mine worker who was made redundant 10 months ago.

His work stopped, but his debts live on. There's $230,000 on the family home and $19,000 on a credit card.

TIM WALK: We'd built up the bill living off the card, being unemployed the six months that we were still up there. There were discussions of other contracts to go to. So, it was a case of we took a gamble that we'd move to another job shortly and then we'd pay the card off. Unfortunately, the other job didn't pan out and we have the bill.

ADAM HARVEY: In March, this came in the post.

TIM WALK: Quite a shock to open that up and read through it and then get to the bit where it says, "If you don't pay this, we'll take your house." I was shocked. Very, very upset. Didn't know what to do initially. And then I spoke with the people from Legal Aid, who assured me that that wasn't to be the case, that there were checks and balances that had to be in place first, and talking with them, they'd talk with the Ombudsman and start a negotiation process so that we could then arrange to pay off the debt and still keep the house.

ADAM HARVEY: Australia has the world's highest rate of household debt compared to GDP, thanks to our willingness to take on mortgages, personal loans and credit cards.

KATHERINE TEMPLE, CONSUMER ACTION LAW CENTRE: We can all fall into financial hardship very easily. It could be the death of a loved one, illness, relationship breakdown, losing our job. It can happen to any one of us.

ADAM HARVEY: A Senate committee is examining the ease with which we can get into big debt and the high interest rates charged when we're there. It's investigating the huge margin on credit card interest rates, where money's sourced at three per cent interest and is then lent out to the owners of some cards at rates approaching 19 per cent.

SAM DASTYARI, ALP SENATOR: All these products that are out there that are your eight, nine per cent cards and that, aren't the ones necessarily people are taking or being offered. They're being pushed towards these high interest rate cards.

KATHERINE TEMPLE: There is a very high level of cross-subsidisation here and it's generally the poorest that are paying for the benefits that the transactors, which are the people that pay off their card every month and reap all the benefits from all these rewards, it is the poorest in our community that are paying for that.

ADAM HARVEY: Australians owe $32 billion on their credit cards at an average of over $4,000 each. For many, it's an overwhelming problem.

Help is available for people willing to reach out.

KATHERINE TEMPLE: We get at least 15 calls a day from people drowning in credit card debt. The stress, the anxiety, the impact on their family and friends - it's a really serious problem.

TIM WALK: I was very depressed. I was quite worried. We had a very emotional house. Children were upset, crying. We didn't know where to turn. I was feeling quite bold that I'd get another job shortly or that one of the contracts that we were promised would come through. Nothing eventuated, and as time went on, depression started to increase.

SUZ CONNORS: He tries to hide it a lot, you know. He's trying to be the best dad that he is, you know, because his girls absolutely adore him.

TIM WALK: It was quite stressful. It certainly upset the family. To get a threat to take the house, it certainly wasn't very pleasant for the children. They were quite upset. And it was - yeah.

ADAM HARVEY: How did they find out that you'd got this letter?

TIM WALK: We sat down. We communicate quite openly as a family. We keep no secrets. We tell each other what's going on in our lives. Very open with the hardship we're going through. Obviously, children aren't stupid. They see that they're not getting to play the sports they used to play. Brought tears to a few eyes when the kids put the hand in the pocket and pulled out the pocket money and said, "Well, we can have this for food if you want it."

ADAM HARVEY: It's heartbreaking.

TIM WALK: They're good kids, very good kids.

ADAM HARVEY: So girls, whose idea was it to lend your parents your pocket money?

GIRL: Mine.

ADAM HARVEY: Was it a loan or a gift?

GIRL: A gift because, well, if they need it, they can have it.

GIRL II: They gave it to us anyway.

ADAM HARVEY: What do you girls know about how tough things are at the moment?

GIRL: Um, not really much.

GIRL III: Not much.

ADAM HARVEY: Do you know that money's tight?

GIRL: Mm-hm.

ADAM HARVEY: Has it made much of a difference to your life?

GIRL: No, not really. As long as we've got our family, that's really what matters.

ADAM HARVEY: Tim Walk says the most important thing he's done is to reach out to Legal Aid, to Centrelink and even to local charities.

TIM WALK: The local Indigenous charities were only too happy to say, "Hello, come aboard. We'll look after ya."
They gave us a small food parcel and some vouchers to get food and our Christmas was spent with a 44-gallon drum out the back with a fire in it and a bucket full of potatoes and peas and sat around a camp fire and it was like the good, old days. Kids loved it.

ADAM HARVEY: His goal is to get out of debt, and to do that, he needs to find a job.

And every day you're coming in and you're finding rejections?

TIM WALK: Every day. Here's one from today.

ADAM HARVEY: You just thought you'd keep working for your working life?

TIM WALK: Sure. Absolutely.

ADAM HARVEY: No reason to think that it would ever become difficult for you?

TIM WALK: Not at all, no.

ADAM HARVEY: That debt would become a problem for you?

TIM WALK: No. I tend to be a bit of a workaholic. I like work, I like mixing with people. I'm a people person. And sooner or later, one of these'll pay off. Sooner or later, I'll get the job.

SABRA LANE: Adam Harvey reporting.