Financial experts delivered a fresh warning yesterday that Britain faces a huge household debt crisis - as heartless bosses' leader John Cridland defended the country's low-pay economy.

Resolution Foundation researchers warned that even if interest rates - currently at a record low 0.5 per cent - stay low and pay rises equally across all income groups over a million people face "debt peril."

That's the point at which more than half a person's wages go merely on servicing payments to bank loans and credit cards.

And the figure rose to two million when higher interest rates and uneven pay rises were taken into account.

The foundation warned that people on rock-bottom pay, which the GMB union revealed yesterday has fallen by 13.8 per cent on average since banks sparked the 2008 economic crisis, would be hit the hardest.

"Even if we take a somewhat rosy view of how the economy will develop over the next few years the number of households severely exposed to debt looks as though it will double," senior economist Matthew Whittaker warned.

But in his new year's message CBI boss Mr Cridland warned politicians off any attempt to rein in workplace "flexibility" - business-speak for freedom to exploit employees.

The anti-union business lobbyist branded any attempt to roll back businesses' growing use of zero-hours contracts as "inappropriate regulation" that he claimed would increase unemployment.

Around a million workers tied to such deals are expected to work without guaranteed pay, hours or employment rights.

The government has responded to public concern at the scale of exploitation with a pledge to investigate the issue.