Breathing Space Scheme: Consultation Response

Lord Bishop of Leeds Excerpts

Wednesday 19th June 2019 Lords Chamber

[The Lord Bishop of Leeds]

My Lords, I welcome this Statement, and thank the Minister for repeating it. I also want to note the work that the Church of England and the Children’s Society have done promoting these matters. I am particularly pleased that public and utilities debt is to be included in this, but—taking advice from Donald Tusk, who said “Don’t waste the extension”—can the Minister say who will ensure that plans are put in place for sustainable debt resolution? It was said that debtors will have to seek professional advice. How will that be ensured, so that we do not simply prolong the problem of debt where it will be exacerbated? Secondly—and I am sorry if I missed this in the Statement—when might we expect the new regulations to be published?

[Lord Young of Cookham]

On the latter point, the first regulations will be laid towards the end of this year. I will write to the right reverend Prelate about the timetable for the sustainable development plans. Can I pay tribute to the work that the Church has done in this area? There is the Just Finance Foundation, founded by the most reverend Primate the Archbishop of Canterbury, the Lifesavers financial education programme, very active in primary schools, and Christians Against Poverty, a registered debt advice agency. I pay tribute to the work that they do.

The idea is that those who enter into a breathing space will, after a dialogue with the debt advice agency, then have a sustainable debt plan which takes into account the resources that are available and arrives at something which enables them to meet their debts—but over a period ideally not more than seven years. It is designed to ensure that they have enough to meet their obligations, including their ongoing debts. There may be some cases where the income simply is not available to enter a sustainable debt plan, in which case they may be advised for bankruptcy or IVA. The idea is to give a breathing space of 60 days in which a person can come to terms with their financial circumstances and have professional advice about the best way through, enabling them to get their life back on an even keel.