The Debt Respite Scheme (or Breathing Space Initiative) is active from May 4th, 2021. Its aim is to help those with problem debt find long term solutions to their financial issues by providing a period of legal protection from their creditors, alongside support in the form of debt advice.
Standard breathing space provides legal protection from action by creditors for up to 60 days and is available to anyone who has problem debt.
Mental health breathing space provides legal protection to those in mental health crisis for the duration of their treatment plus 30 days.
Qualifying debts under the legislation include rent arrears.
Once a creditor organisation has received notification of a breathing space it must take action immediately, including refraining from contacting the debtor to request repayment of the debt in most instances and halting enforcement action to recover the debt by themselves or an appointed agent.
Over the past year, many of our clients in social housing have already made changes to their arrears recovery processes, in response to the challenges their residents have faced during the pandemic. This capability to adapt processes and systems for such circumstances means our clients are well placed to review their processes further and make changes to assist in their organisation’s support of this new initiative.
MRI Software are happy to provide additional support and guidance to clients seeking to identify and implement measures to assist their organisation with its response to the Breathing Space initiative. You can arrange to contact our consultancy teams via your usual MRI account manager.
Find out more about the Breathing Space initiative