YVONNE FOVARGUE - Those in serious financial need require urgent help

But it should not forget the thousands of people in serious personal debt and who now find their situation getting worse and worse.

Regular readers of this column will know that I have long promoted the idea of ‘Breathing Space’.

This is where those in serious debt are freed from having to make repayments on any borrowing, say on a credit card or store card, while they get their finances in order. During this time, lenders are not allowed to impose any additional interest or charges, or to take legal action against the borrower to recover the debt.

Last year, the Government finally agreed to introduce a breathing space scheme into law, but unfortunately this is not due to happen until 2021.

Given the current crisis and its likely effects on people’s incomes, I have therefore called on ministers to bring forward their plans and to introduce breathing space as soon as possible.

I fully appreciate that this will require certain regulations to be passed and systems to be established and that this may take some time, so in the meantime I have also joined the call for lenders to implement the scheme voluntarily and without compulsion.

If businesses are prepared to take this enlightened approach in the current crisis it could have a really profound effect on the wellbeing of struggling families.

There are also other things the Government could do to prevent people from getting into debt in the first place and to help shore up household finances.

Ministers have already made some moves. Home-owners, for example, have been given payment holidays, including buy-to-let landlords, and this now needs to feed through to those affected by the crisis as a guaranteed payment break for those who are renting.

We also need to see changes made to Universal Credit, particularly in light of increased demand.

Unprecedented numbers of people have already lost their jobs, and this has already led to more than one million people applying for the benefit in the last two weeks.

This has of course put much extra strain on the Department of Work and Pensions, and this has to be recognised, but it is crucial that the system provides speedy and generous help to those who need it.

This means getting rid of the five-week wait for the first Universal Credit payment and which places many claimants in a desperate situation.

The wait, which applies even though a claim has been processed and agreed, has long been a bone of contention to me and should be scrapped immediately.

The same applies to those advance loans which can be made under Universal Credit rules, and which also push claimants into further debt.

In the present circumstances, these loans should be made into non-repayable grants so that claimants get the cash-flow they need and are better able to cope in their changed circumstances.

The Government’s package of support on Coronavirus for businesses and household finances is clearly very much about stopping things from getting worse and managing a time of crisis.

This is right and proper and to be welcomed, but there are clear gaps.

More needs to be done to help those who have lost their jobs or who are struggling with an income shock and who need to claim benefits.

And more needs to be done to help those already in debt and who face a worsening situation.

The more we can help struggling people now the easier it will be to get back to normal life when the crisis is over.