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Breathing Space scheme to launch in May 2021

The government has confirmed that the new statutory Breathing Space scheme is due to launch on May 4 2021.

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The news means that those in problem debt will be able to access 60 days of protection from interest, charges and creditor action, while being able to seek debt advice.


The scheme will cover a wide range of debts such as credit cards, loans, council tax, utility debts, and personal debts owed to HMRC and the Department for Work and Pensions. It will not, however, cover debts incurred from court fines, child maintenance payments, student loans and personal injury liabilities.


The government has previously forecasted that the breathing space initiative will help more than 700,000 people in the first year, increasing up to 1.2 million each year a decade after its introduction.


Joanna Elson OBE, chief executive of the Money Advice Trust, said: “Breathing space will provide the time and protections that people in financial difficult need to begin to deal with their debts, and gives us a powerful tool to incentivise people to seek free debt advice.”


“As households deal with the economic and financial impact of the Covid-19 crisis, the benefits that breathing space will bring cannot come soon enough.”


StepChange head of policy Peter Tutton said: “We look forward to working on the detail of implementation constructively with the government, to ensure that it fully meets the policy objectives of getting more people to the debt advice they need.”


Tutton added: “There is still more that the government can do to help support the increasingly enlightened approach to debt that the breathing space scheme augurs.”

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