Call for debt 'breathing space' for people in mental health crisis

By agency reporter
February 22, 2018

After analysing national data, the Money and Mental Health Policy Institute estimates that 23,000 people in England were struggling in problem debt last year whilst in hospital for their mental health.

This group are likely to be receiving calls and emails from banks, credit card companies, local authorities and other creditors whilst in acute distress, potentially feeling suicidal. Thousands more were in a similar position whilst receiving mental health crisis support in the community.

Under current government proposals out for consultation, people in problem debt would be given a 'breathing space', a fixed period without fees, charges, interest or collections activity if they seek debt advice. This is intended to allow time to get on top of debts before they spiral out of control, but would not support the tens of thousands of people in mental health crisis who are too unwell to either manage their finances alone, or to seek debt advice.

A broad coalition of organisations, including Mind, Rethink Mental Illness, StepChange and Carers UK, led by the Money and Mental Health Policy Institute, are calling for the government to extend ‘breathing space’ to people in mental health crisis. Without this, Money and Mental Health’s research has found that tens of thousands people are trapped in a spiral of escalating debts and worsening mental health. The charity found instances of people who had:

  • Received a court summons for debts whilst they were in hospital as a result of their mental health, finding letters on their doorstep when they were discharged
  • Missed payments for bills whilst in hospital and unable to access their account, which then led to escalating fees and charges
  • Attempted suicide after receiving contact from bailiffs about escalating debts whilst receiving emergency mental health support.

The extension of the Breathing Space scheme would apply to anyone accessing psychiatric inpatient care, or the care of a Crisis Resolution Team.

Martin Lewis, Founder and Chair of the Money and Mental Health Policy Institute said, “It’s time to stop people in mental health crisis being hassled over debt, which risks making recovery harder, and means they’ll be even less likely to repay creditors in future.

“I long campaigned for breathing space for those in crisis debt – but for those having a short period of acute mental illness; suffering panic attacks, unable to open post, call the bank, or even think coherently – going to a debt counsellor in order to call a halt to things is just impossible.

“Extending the breathing space scheme so that it gives people recovery space could genuinely save lives, allowing people to focus on getting better rather than cowering at the worry of bailiffs at the door.  And with the tragically common marriage of mental illness and debt, the simplest way to do it is assume all in serious mental health crisis are likely to be struggling with their cash.

“I do hope the government will see the sense in this and act quickly to help.”

A quarter of people with mental health problems are also in problem debt. ‘Recovery Space’, a new report published by the Money and Mental Health Policy Institute, is the first in-depth study of the financial experiences of people in mental health crisis and their carers.

* Read the full report Recovery space: Minimising financial harm caused by mental health crisis here

* Money and Mental Health Policy Institute


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