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calendar30 October 2018

Author: Marianne Clough

Room to breathe in a debt crisis

Room to breathe in a debt crisis

The Chancellor might not have mentioned it in his speech, but the Budget small print had debt charities nearly panting with excitement at the mention of ‘Breathing Space’.

This long-running campaign, mentioned in both Labour and Conservative manifestos at the last election, has been something the debt advice sector has been calling for and working towards for years.

The idea is to provide space for people so that while they seek debt advice from a charity like CAP or others, creditors legally can’t chase them for money.

Breathing Space was to be six weeks (or 42 days) and has been extended, thanks to the Chancellor, to 60 days.

CAP warmly welcomes this positive step forward as long as this includes public sector debt – and that doesn’t appear to be specifically spelled out, as yet.

A whopping 68% of CAP clients are in arrears with a household bill when they call us for help (43% Council Tax). We know from our own research that this kind of debt can be the most frightening to deal with.

What sort of breathing space would it be if some of the creditors went quiet while the others were still coming to the door and calling several times a day?

So, when all types of debt, both priority and non-priority, are explicitly included with Breathing Space, you could say we really will sigh with relief!

Our clients often have complex lives with multiple difficulties – and it’s good to remember what life can look like for them.

For instance, Mark, who was full of anxiety. All interest in life had gone. He was living in a dirty studio flat with broken furniture and a faulty boiler. He slept on the floor feeling increasingly isolated and, while debts stacked up, he worried he’d be evicted. The times he’d asked for help, he’d felt rejection as he didn’t fit the criteria, and he started to think he’d have to commit a crime so he could go to jail.

Turning things around for Mark was never going to be a quick fix (although, thankfully with the help of some wonderful referrers, caring church volunteers, co-operative creditors and CAP head office determination, that did happen).

So, when we answer the Government’s latest consultation on Breathing Space, we will be reminding them that simply advertising a service for our client demographic won’t be enough.

Most people in debt have a series of emotional barriers which prevent them asking for help. Often they don’t believe it exists or feel they don’t deserve it. No wonder so many take years to call us.

Also, will 60 days be enough space to make the moves that would help someone like Mark? What flexibility will be built in for those complex cases where people, bruised and battered by their situation, just aren’t responding as we’d like, or thinking rationally?

We are really delighted to see in the Budget that people receiving NHS help for a mental health crisis will now no longer have to endure creditor activity while they are unwell.

The Money and Mental Health Policy Institute, from Martin Lewis, has been campaigning hard for this and we’re delighted to see such progress. When compassion and understanding land up in the Budget, it really is genuine cause for celebration.

So, what about those who are suffering anxiety and depression, and are on tablets from their GP? They might not be a mental health patient, but will they get the respite? We’ll be looking closely at the practical detail, as you’d expect.

We're determined that Breathing Space will revolutionise the experience of some of the poorest and most struggling debt ridden UK households, if done right. We’re grateful to be in the conversation with Government decision-makers so that we can continue to reflect clients’ experiences and help this happen.

Keep up to date with our work on policy and government here.

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