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calendar11 July 2017

Author: Kiri Saunders

‘Breathing space’ to tackle problem debt

‘Breathing space’ to tackle problem debt

The stress of being in debt, combined with the threat of enforcement action and the spiralling of interest and charges often leads to ill health, relationship problems and even thoughts of suicide.

‘Breathing space’ is an initiative to give those in financial crisis time and space to begin to work towards a debt solution, without their situation worsening. This is done by providing guaranteed protection from collections and enforcement activity, as well as stopping all interest and charges.

Here at CAP we always work with creditors to try getting interest and charges stopped and we contact enforcement agents to prevent collections activity. Unfortunately, not every company responds positively but a formal ‘breathing space’ would guarantee protection to all those in financial crisis.


‘Breathing space’ builds on the idea in the Financial Conduct Authority (FCA) guidelines stating that as soon as someone seeks debt advice, creditors should provide a 60-day hold period on collections activity.

The idea of an extended ‘breathing space’ was first mentioned by our friends at debt charity StepChange two years ago, inspired by a scheme in Scotland that gives legal protections to those repaying debts.

In 2016 ‘breathing space’ started to build momentum and The Children’s Society, StepChange and Kelly Tolhurst MP brought it to be discussed in Parliament via a Private Member’s Bill. ‘Breathing space’ gained much political support and Parliament discussed the idea twice, but the election in June put a halt to progress. That being said, we were all encouraged when both Labour and Conservative manifestos included a commitment to implement ‘breathing space’.

The new Conservative government hasn’t yet formally put ‘breathing space’ plans into motion, but we understand that this is still something they are looking to do.

CAP supports the principle of ‘breathing space’, but we still need to work out the technical details to make sure it is flexible for those in the most vulnerable situations. In June it was promising to hear Stephen Barclay, Economic Secretary to the Treasury, say:

‘The Government fully supports the principles of better debt management and lower levels of problem debt. The Conservative manifesto committed to introduce ‘breathing space’ and we will outline further information on how this policy could be implemented in due course.’

Email your MP

With the formation of the new government, this is a key time to ask your MP to keep it on the agenda. Why not write to them and explain what is important to you, asking that they keep supporting ‘breathing space’ in this new parliament?

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