Citizens Advice estimated in August 2020 that six million UK adults had fallen behind on at least one bill during the pandemic, with one in five of those falling behind unable to afford essentials.
The COVID-19 pandemic has placed unprecedented demands on household finances. Studies show one in four private renters have seen their earnings fall since the start of the pandemic and half a million private tenants are in rent arrears and at risk of eviction.
To safeguard people from financial hardship, Ministers should drop their proposals to cut UC, end the five-week wait for housing benefit, and suspend the benefit cap. Local Housing Allowance (LHA) should also be increased to cover average rents throughout the pandemic.
The immediate priority is to make sure that people get the support they need to prevent them losing their homes during this public health emergency. However, longer term reform is necessary. Beyond the pandemic, I support calls for UC to be replaced with a new social security system that provides a proper safety net and has dignity and respect at its heart. We also need stronger regulation in the private rented sector as well as more affordable and social housing.
Also, the Government must set out a clear timetable for introducing its Statutory Debt Repayment Scheme to help those who have fallen into problem debt. Addressing the stigma of problem debt also requires further work.
Thank you once again for contacting me. The Financial Services Bill is currently in the House of Lords and I can assure you I will look closely at any amendments related to the debt respite scheme that it makes.
In the meantime, the Government should make good on its promise that nobody will lose their home as a result of COVID-19 and strengthen support for renters.