I’m Gareth McNab and I’m Director of External Affairs at Christians Against Poverty, and this is a short video just to explain a little bit about the changes to Debt Relief Orders in England and Wales announced in the Budget, and just what that means to us at CAP and what that means for us as a campaigning community that wants to push for change in our nations.
The changes announced: the fee for Debt Relief Orders, a form of insolvency to help people get debt free, who have relatively small amounts of debt, certainly very low levels of income and very, very low levels of assets.
You used to have a fee of £90 before you could access that debt solution in England and Wales. That fee is being removed from the beginning of April, taking away an unnecessary barrier to people finding freedom.
From the end of June, some of the limits on a Debt Relief Order are changing too, to be able to bring more people into scope of this very important debt solution in England and Wales.
There are similar debt solutions in Northern Ireland and Scotland, covered by different laws and jurisdictions. The change that was announced is specifically for England and Wales.
We’re over the moon. When we’ve done the work, this will mean that more people can get debt free more quickly, through our vital services in partnership with the UK Church.
But we as campaigners, as people agitating for change, we’re also over the moon too, ‘cause we have an idea of how we got here. While it was a bit of a surprise to be announced right at the beginning of the Budget in the Chancellor’s fourth or fifth sentence – I went on to have a very busy day! – the change has been long in the making.
Back in February 2021, we released a report called Simplify the Solution, which was specifically about these issues. Why a Debt Relief Order isn’t quite enough to help people get free from debt.
The report came from numbers of our colleague Debt Advisors and people in our frontline services saying to us, ‘Oh, this client just has £1,000 too much debt, just has a little bit more disposable income than the rules say.’
And so we looked at those edge cases, the people for whom a Debt Relief Order was nearly right but was just a little bit out.
So the paper itself, the report came from insight gathered from our front line services, both the head office in Bradford and frontline churches around England and Wales in particular. So we gathered that together into a report. We published it. We invited campaigners to write to their MP to ask them to pressure the Insolvency Service (the government body responsible for these debt solutions) to pressure the Insolvency Service to pay attention to these issues.
There was a consultation that they launched, that we enabled lots and lots of people to respond to. The pressure on MPs, to pressure the Insolvency Service, led to top level engagement between our Chief Executive Officer at the time, Paula Stringer, and the Chief Executive Officer of the Insolvency Service – the first time we’ve been able to connect at quite that level.
We were able to follow up with officials from our policy and public affairs section over some months. And then, in summer, 2021 we started to see some cracks in the wall emerge that the barrier was weakening. We saw some changes to some of the limits in who could have a Debt Relief Order.
But the fee remained – there was still a barrier, an unnecessary one that doesn’t cost a lot of money to take away. And so we continued to engage with the Insolvency Service, through formal channels like through my teams, through informal networking around the debt advice sector ‚ore broadly, and then in the Budget, the Chancellor stood up and, after a couple of introductory remarks, mentioned that this was one of the key changes that they were bringing in, just from this April.
I’m delighted. I think you can tell. All of us coming together, our expertise in our debt service, our passion and compassion in our frontline. You, as supporters and campaigners, who want to work together, want to add your voice to ours, to the voices of those people are trapped by the weight of poverty and problem debt, to call for better, to call for change, to call for routes out of the debt and poverty that many of us are trapped by.
Friends, brothers, sisters – it works. When we connect in this kind of way, change can happen and we know change must happen. We need it.
14.5 million people in poverty in the UK today is not something that any of us can stand for. So we go again. Let’s keep going. Let’s join our voices together and call for the better society, the more just and compassionate society that we know everyone in the UK deserves.
