We’re celebrating at CAP today because after many years of campaigning alongside friends at other debt agencies, the Government has announced people in debt will be granted a grace period called ‘breathing space’.
It means that from 2021, when a debt adviser notifies creditors on behalf of a person in debt, the creditors must stop chasing for money for 60 days to give time for a debt solution to be agreed. No extra fees, interest or enforcement action can be applied in this time period.
We’re particularly pleased that central and local government debts like council tax and benefit overpayments will be included, something CAP specifically campaigned for.
Also, if someone is in mental health crisis, they can have extended 'breathing space' on the advice of their mental health professional to give them time for some recovery before taking steps to tackle their finances. This is something MoneySavingExpert.com founder Martin Lewis has been pushing through the Money and Mental Health Policy Institute.
'This is great progress and is to be warmly welcomed. Now we’re really interested to know about the practical detail,' said CAP’s Director of External Affairs Dawn Stobart.
'Our experience shows that the most vulnerable clients will take time to find the courage to seek debt help, and it could be more than 60 days before they do so. If that happens, can another 60 days be triggered?
The extension for people with poor mental health is wonderful but it’s only for those receiving treatment through the NHS. The thing is, we know about three quarters of those we’re helping are suffering with their mental health with many not receiving treatment. What extra help is available for them?
So, while we are delighted to see this day, we are also full of questions and concern that the most in need don’t fall between the cracks. We look forward to meeting with all those concerned to dig into the detail so it works for everyone.'