Debt Breathing Space Campaign

Update: The Government is committed to introducing 'breathing space' that would give heavily indebted consumers a period of respite from enforcement action and further interest and charges, for a period of up to six weeks. Ministers ran a call for evidence to gain as much insight as possible from lenders, the debt advice sector and other stakeholders about how best to design a breathing space scheme. This consultation closed on 16th January 2018, and officials are now working on the development of the policy.
A number of steps have also been taken to reform consumer credit, including taking action on high-cost short-term credit, and a comprehensive Financial Conduct Authority study into the credit card market.  
It is important to improve the help and advice available to those who may face debt problems. In 2016-17 the Money Advice Service put £45 million towards debt advice in the UK, which funded over 380,000 appointments.


The Families with Children and Young People in Debt (Respite) Bill, introduced by Kelly Tolhurst MP, would place a duty on lenders to provide financial respite for families with children and young people in debt.
I am pleased that the Government is already committed to exploring whether some form of 'breathing space' would be a useful and viable addition to the range of debt solutions. HM Treasury and the Insolvency Service have been asked to explore and identify possible options and have begun work on a review.
Further to this, action has been taken to reduce levels of personal debt. Household debt as a proportion of income has fallen to 142 per cent in 2016, down from a peak of 160 per cent in 2008. 
The Government's plan for a higher wage, lower welfare society makes it easier for families and working people to save, and includes the new National Living Wage which will mean a pay boost for 1.7 million workers this year.