New scheme launches to help people in debt
4th May 2021
The Government launched a new programme, designed to help people struggling with financial difficulties.
People under the scheme, dubbed ‘breathing space', will have legal protection from creditors for 60 days, with most interest and penalty charges frozen and enforcement action halted.
The 700,000 participants across England and Wales positioned to benefit will also be entitled to professional advice during this time to design a debt recovery plan.
Protections will also be available for individuals in mental health crisis treatment for the duration of their crisis treatment plus 30 days, given the link between debt problems and mental health issues.
The scheme comes days after a slew of attacks from business leaders and campaigners on the Government for the three million people who have fallen through the cracks of COVID-19 financial assistance, 19 of whom have taken their own lives.
Martin Lewis, founder of MoneySavingExpert.com and the Money and Mental Health Policy Institute described the scheme as:
"A win-win-win; for individuals who get their finances back on track, creditors who'll recoup more cash in the long run, and the economy as there will be less financial catastrophe".
The breathing space scheme can be accessed through a professional debt advisor.
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