06 March 2024 , 15:17
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New measures will be introduced to support those struggling with debt, Chancellor Jeremy Hunt announced today in his Budget.
Delivering his spring Budget 2024, the Chancellor alluded to the cost-of-living crisis and stressed a cut in National Insurance will help struggling families retain more money they earn. The 57-year-old politician also said he would increase repayment programmes for those taking advanced loans from 12 months to 24 months.
And Mr Hunt, who became Chancellor in October 2022, insisted around 40,000 families will also benefit from his decision to abolish the £90 debt relief charge. Mr Hunt made the pledge to scrap this as he listed several amendments to our spending.
The politician said: "For some people, the best way to resolve debts is through a debt relief order. But getting one costs £90 which can deter the very people who need them the most."
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British Gas debt collectors break into vulnerable people’s homes to fit meters
Some 40,000 will benefit from the change around debt, it's understood (file image) (Getty Images)A debt relief order is one way for people to deal with debts. You can make an application if: you owe £30,000 or less, do not own your own home, do not have other assets or things of value, and do not have much spare income.
Mr Hunt's move to abolish the relief charge has been welcomed in the industry. Money Wellness, one of only two debt relief hubs in the UK, said the call will benefit the most financially vulnerable households in the country.
Sebrina McCullough, Director of External Relations at Money Wellness, said: "We’ve campaigned to eradicate the £90 administration fee for debt relief orders (DROs) for the past 12 months, as it was preventing some of the most vulnerable in the UK getting the debt help they so desperately need. Removing it will help around 40,000 financially vulnerable households.
"DROs are aimed at those who owe less than £30,000, don’t own their home, have few assets and little or no spare income, so finding the upfront £90 administration fee was a big ask. We warmly welcome today’s change.
"And the extension of the Household Support Fund is much needed too. It plugs a gap for those struggling with living costs and makes sure millions aren't forced to go without food and energy.
"We’re helping around 1,000 people a day – demand is unprecedented and is growing month on month. Energy debt and priority arrears are at an all-time high, and bills are still increasing. There’s no respite for households from cost-of-living pressures and the Household Support Fund provides a vital safety net for millions."
Mr Hunt also announced reforms to Child Benefit, a new vaping charge, and abolished the non-dom tax status in a major U-turn today. Yet, ignoring warnings from the International Monetary Fund (IMF) against tax cuts, Mr Hunt put the National Insurance cut at the centrepiece of the Budget - and even suggested another reduction may come.