The proposed new Repayment Plans would allow for a certified debt advisor to develop a repayment plan that would provide reassurances that debts would be paid, in return for legal protections for the debtor. In our response to the consultation, we urged the UK Government to consider three main points.
Limit the circumstances where housing debt is covered by SDRPs
Under current proposals, rent debts are considered 'discretionary' due to the risks associated with delaying rent payments, such as the landlord not renewing a tenancy agreement. When deciding if rent arrears should be included within the SDRP, we recommend that they should only be included as a last resort, as a landlord could fall into mortgage arrears and be unable to take possession proceedings in respect of arrears included in a plan.
Mediation between all parties should be made mandatory
The development of SDRP should be made in conversation with the tenant, agent, landlord and debt advisor. This would ensure the frequency and amount of payment is in the best interests of all parties involved.
Ensure risks of exploitation are minimised
We urge that tenants with a history of rent arrears should be ineligible for the plan. Additionally, we urge that all mandatory grounds for repossession under Section 8 should be included as mandatory revocations of the protections provided by the SDRPs. This would reduce instances where landlords face prolonged debt plans with no way of evicting tenants, even if they break their tenancy agreements.
During these difficult times, it is essential that we find ways to support tenants who temporarily cannot afford to pay off debts including rent, while ensuring the solutions cannot be abused by those who have no intention of paying. When tenants, landlords and agents communicate effectively to resolve issues, we can prevent unnecessary evictions.
The UK Government needs to consider the risks associated with delaying housing debt payments, as this could impact the private rented sector and prevent people on plans to rent property.
