EDMONTON MP Kate Osamor has backed calls for a scheme to help protect thousands of families being ravaged by debt.
The Labour MP is supporting a new scheme called ’Breathing Spaces’ that would offer people seeking debt advice, a 12-month legal protection from mounting interest, charges and enforcement action.
Ms Osamor said debt often strikes during sudden changes in circumstances such as job loss or ill health, adding that aggressive action from creditors and pressure to repay at an unaffordable rate can lead families to cut back on everyday essentials such as food or to take out other, expensive loans.
The ‘Breathing Space’ scheme is supported by The Children’s Society and StepChange Debt Charity.
It builds on protections offered under the Debt Arrangement Scheme in Scotland, which has made sure that families sticking to an affordable repayment plan agreed with their creditors are not harried or hassled for the duration of that plan.
Kate Osamor said: “Families in problem debt need time and space to get back on their feet.
“By providing a period free from additional interest, charges and enforcement action, a new Breathing Space scheme would help families recover their financial situation and put in place a plan to affordably repay their debts.
“In Edmonton alone, there are an estimated 4300 children living in families who have fallen into problem debt. Analysis from The Children’s Society shows that children in low-income families with multiple debts are more likely to suffer from mental health problems than equivalent families with fewer debts.
“It can’t be right that children’s mental health and happiness is suffering as a result of creditors unfairly escalating people’s debt problems.”