Citizens Advice responds to a new scheme to help people in debt

Today the government has announced a new ‘breathing space’ scheme which will protect people in debt for 60 days from interest, fees, charges and enforcement, as well as providing statutory protections from creditors for people who have plans to repay their debts.

Last year, Citizens Advice helped more than 330,000 people with over 910,000 debt issues. We also assisted 580,000 people with over 1,375,000 problems with their benefits.

But the charity is concerned thousands of people with debts and deductions under Universal Credit will miss out on support through this scheme initially.

Figures published by the Department of Work and Pensions show:

  • 57% of people who claim Universal Credit experience deductions

  • 60% of people who make a new UC claim take on an Advanced Payment - this is the most common cause of deductions from UC

  • 570,000 of the 2 million people claiming UC are repaying Tax Credit overpayments

  • £1 in every £10 awarded in Universal Credit is deducted to repay debts and costs.

Gillian Guy, Chief Executive of Citizens Advice, said:

“After years of calling for more support for people in debt, we’re pleased to see the government take action to protect people from action by creditors.

“This new scheme will help people struggling with debt keep a roof over their heads and food on the table while they pay back what they owe. This will also offer crucial respite from aggressive bailiffs.

“However the scheme won’t cover everyone straight away. We’re concerned thousands of people with debts and deductions under Universal Credit are going to miss out on this support initially.

“With more people likely to seek debt advice as a result of this scheme, the government also needs to ensure specialist debt advice services are adequately funded.”

Notes to editors

  1. Citizens Advice includes the national charity; the network of independent local Citizens Advice charities across England and Wales; the Citizens Advice consumer service; and the Witness Service.

  2. Citizens Advice is the statutory consumer advocate for energy and post. We provide supplier performance information to consumers and policy analysis to decision makers.

  3. The Citizens Advice Witness Service provides free, independent support for prosecution and defence witnesses in every criminal court in England and Wales.

  4. Citizens Advice offers Pension Wise services at 500 locations in England and Wales.

  5. Citizens Advice’s services are free, independent, confidential and impartial, and available to all regardless of race, gender, disability, sexual orientation, religion, age or nationality.

  6. To get advice online or find your local Citizens Advice, visit citizensadvice.org.uk

  7. For consumer advice, call the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 to talk in Welsh.

  8. We helped 2.6 million people face to face, by phone, email and webchat in 2017-18. For service statistics see our monthly publication Advice trends.

  9. Citizens Advice staff are supported by over 23,000 trained volunteers, working at over 2,500 locations in England and Wales.