Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether he has made an assessment of the potential merits of introducing a Jubilee Fund to provide grants to pay off and cancel unavoidable debt accrued by the poorest households during the covid-19 lockdown period.

The Government has put in place an unprecedented package of support to help people during the COVID-19 pandemic, protecting livelihoods with the Self-Employment Income Support Scheme, the Coronavirus Job Retention Scheme, and temporary welfare measures.

The Government has also worked with mortgage lenders, credit providers and the Financial Conduct Authority to help people manage their finances with payment holidays, and has taken unprecedented action to support renters, ensuring that no-one has been forced from their home during lockdown.

However, the Government recognises that the full impact of COVID19 on people’s personal finances is still unfolding and that some are struggling at this challenging time. To help people in problem debt get their finances back on track, the Government has agreed to maintain record levels of debt advice funding for the Money and Pension Service in 2021-22, bringing the budget for free debt advice in England to £94.6 million. This is more than a 70% increase since 2019-20 and reflects the Government’s commitment to ensure that appropriate support is available for people in problem debt; enabling an additional 1 million people in England to get free-to-client debt advice.

In addition to this, the Breathing Space scheme has now been launched in England and Wales. The scheme will offer people in problem debt a pause of up to 60 days on most enforcement action, interest, fees and charges, and will encourage them to seek professional debt advice.

The Government regularly engages with a wide range of stakeholders to assess the merits of new policy proposals and ideas. A key consideration for the Government is that it is keen to ensure it is fair to people who pay their bills on time, whilst taking a supportive but proportionate approach to those who are not able to. The Government believes that a Jubilee fund to provide grants to write-off debts accrued as a result of COVID-19 would not be a proportionate solution that delivers this fairness.