In a recent news story published to the Government website it was announced that a new breathing space period will freeze interest, fees and enforcement for people in problem debt, with further protections for those in mental health crisis treatment.
Millions of people will be helped by the Government to get their finances under control.
‘Breathing Space’ For Those In Debt
There will be a 60-day breathing space period during which any enforcement action from creditors will be stopped and interest will be frozen. Those affected will also receive professional advice on how to manage their debt and find a long-term solution.
The same protection will be offered to anyone receiving mental health crisis treatment.
700,000 People To Receive Help
The impact assessment for breathing space forecasts that it will help over 700,000 people across the UK get professional help in its first year, increasing up to 1.2 million a year by the tenth year of operation.
Of this, 25,000 to 50,000 people in mental health crisis treatment are expected to benefit from breathing space every year.
Money Trust Advice Comment
Joanna Elson, chief executive of the Money Advice Trust, said: “Breathing Space will provide a powerful new incentive for people in problem debt to seek the free advice they need, and give them the time and protections necessary to get back on the road to financial health.
“We are particularly pleased that debts to local authorities and other government creditors will be included. Breathing Space will make a real difference to people in problem debt – and we look forward to playing our part in making this scheme a success.”
Mental Health And Debt
Phil Andrew, CEO of StepChange Debt Charity, said: “We know that debt is bad for your mental health, with all the additional stress and anxiety that it can create. Around two in five people who turn to us have an additional vulnerability on top of their debt – and for half of them, that vulnerability is a mental health problem.
“However, the good news is that after debt advice, many people report improvements in their wellbeing such as being able to sleep better at night or cope better with day-to-day life.
“Breathing space will deliver much needed additional help in two important and connected ways. It will encourage more people to seek advice, and when they do, there will be better protections in place to stop further harm and help recovery.”