Six-week breath­ing space from the bailiffs

Peo­ple in debt will be able to ap­ply for le­gal pro­tec­tion from in­ter­est charges and en­force­ment ac­tion

The Sunday Telegraph - - Politics - By Camilla Turner and Ed­ward Mal­nick

THERESA MAY is poised to in­tro­duce a six-week respite to pro­tect peo­ple sad­dled with debt from bailiffs and le­gal ac­tion, The Sun­day Tele­graph can dis­close.

The Prime Min­is­ter will hon­our a man­i­festo com­mit­ment to in­tro­duce the so-called “breath­ing space” scheme, as well as a statu­tory re­pay­ment plan for those in se­ri­ous debt.

Cam­paign­ing or­gan­i­sa­tions have wel­comed the move, say­ing that the at­ti­tude of “the harder you push the more money you get back” no longer holds.

Martin Lewis, founder of Money Sav­ing Ex­pert, said: “This is in­cred­i­bly wel­come. It is a win-win-win sce­nario. It is a win for the in­di­vid­ual, be­cause they will have six weeks in which the pres­sure is taken off and they are able to or­gan­ise their fi­nances and get in a bet­ter po­si­tion without ex­tra charges and in­ter­est and be­ing pestered.

“It is a win for the lenders be­cause the truth is when peo­ple are in cri­sis they can­not re­pay their debts. This will ac­tu­ally in­crease the like­li­hood of re­pay­ment.

“And it is a win for so­ci­ety be­cause debt is a huge cause of prob­lems, it has a huge im­pact on men­tal health.”

The “breath­ing space” scheme will only be for peo­ple who are us­ing ad­vice from reg­u­lated debt ad­vis­ers, the Govern­ment will say.

Dur­ing the six-week pe­riod, peo­ple will be able to ap­ply for le­gal pro­tec­tion from fur­ther in­ter­est charges and en­force­ment ac­tion. They will also be of­fered a statu­tory re­pay­ment plan.

The an­nounce­ment will be seen as an at­tempt by Mrs May to meet Jeremy Cor­byn head on and win over sup­port from work­ers.

It fol­lows her dec­la­ra­tion at the Con­ser­va­tive con­fer­ence in Birm­ing­ham that aus­ter­ity is over. Dur­ing her key­note ad­dress, she set out her vi­sion for post-Brexit Bri­tain and promised vot­ers that “bet­ter days” lie ahead.

“Af­ter a decade of aus­ter­ity, peo­ple need to know that their hard work has paid off,” she said ear­lier this month.

“Be­cause of that hard work, and the de­ci­sions taken by the Chan­cel­lor, our na­tional debt is start­ing to fall for the first time in a gen­er­a­tion.”

Mrs May told the con­fer­ence that her party had cleaned up the mess left by Labour in the wake of the fi­nan­cial crash and was now steer­ing the coun­try to a brighter fu­ture.

The “breath­ing space” scheme will also be seen as an at­tempt by Mrs May to come good on her prom­ise to help work­ing fam­i­lies who are “just man­ag­ing”.

Fol­low­ing the snap election of 2016, she said that for an “or­di­nary work­ing class fam­ily” life is “much harder than many peo­ple in West­min­ster re­alise”.

She pledged to “fight against the burn­ing in­jus­tices” of poverty, race, class and health and give peo­ple back “con­trol” of their lives.

The Trea­sury launched a con­sul­ta­tion on how the “breath­ing space” scheme should work a year ago, ask­ing how it should work, how long the pe­riod of grace should be and how prob­lem debt would be de­fined.

Mr Lewis added: “I have to be straight – those of us who cam­paigned said that six weeks isn’t long enough and 12 weeks is the con­sen­sus.”

An HM trea­sury spokesman said: “We are com­mit­ted to help­ing peo­ple over­whelmed by debt by giv­ing them the time they need to seek ad­vice and get their lives back on track.

“We will an­nounce more de­tails in due course.”

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