Item 4 on the agenda this afternoon is the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020 and I call on the Deputy Minister and Chief Whip to move the motion. Jane Hutt.

Motion NDM7451 Rebecca Evans

To propose that the Senedd, in accordance with Standing Order 27.5:

1. Approves that the draft The Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020 is made in accordance with the draft laid in the Table Office on 13 October 2020.

Motion moved.

Thank you, Dirprwy Lywydd, and thank you for the opportunity to open the debate seeking Members' approval of the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020. These regulations, commonly referred to as 'breathing space', fall outside of the Senedd's legislative competence. However, without the approval of the Senedd, the protections offered through breathing space will not be accessible to people in Wales. We know that life events like unemployment, illness and relationship breakdown are the key triggers for debt problems, and the circumstances we're facing with COVID-19 are increasing debt in households across Wales. When people fall into debt, the consequences can be severe.

But, thankfully, people can recover from debt. What they need is the time to seek professional advice and to understand their options without creditors threatening enforcement action or increasing their debt by adding on interest charges and other fees. This is what breathing space offers. For a 60-day period, people struggling with debt will get legal protection from creditors increasing their debt and from taking enforcement action, giving them the time to get the advice they need to start to bring their debts under control.

The link between poor mental health and debt is well evidenced. Half of all adults in problem debt also have a mental health problem, and I'm pleased people receiving mental health crisis treatment have an easier pathway to the protections offered by breathing space. Their protections will also last for longer than the standard 60 days, allowing people to complete their treatment, and then have the time to get advice and the help to make informed decisions on managing their debt.

Breathing space is the first part of the debt respite scheme. The statutory debt repayment plan is the second part and is expected to be introduced to 2022. As with breathing space, officials will work with policy makers to ensure the statutory debt repayment plan aligns with the needs of the people of Wales and the regulations will be brought before the Senedd for our approval. Diolch.

I call on Carwyn Jones to speak on behalf of the Legislation, Justice and Constitution Committee. Carwyn Jones.

Thank you, Dirprwy Lywydd. The Legislation, Justice and Constitution Committee considered these regulations on 2 November, and our report is available as part of the agenda. We have noted that these regulations are made by the Treasury under Part 1 of the Financial Guidance and Claims Act 2018, to which the Senedd gave its legislative consent on 13 February 2018. During that Plenary debate, the Minister for Housing and Regeneration at the time said this of any future debt respite scheme:

'This is still some way off, but we will continue to work closely with the UK Government and the SFGB, when it's established, in addition to advice providers and other stakeholders to influence the development of any scheme and determine whether it meets the requirements of Wales.'

Given this statement, we asked the Welsh Government to set out how the debt respite scheme has been developed to meet the requirements of Wales and to confirm whether it's content that these regulations do not generally come into force until 4 May next year. In its response, the Welsh Government advised us that officials had been working closely with the Treasury on the policy for the debt respite scheme since 2018. In addition, we were told that Welsh Government lawyers assessed the draft regulations for the scheme, following which the UK Government made amendments to the draft regulations to ensure they aligned with Welsh legislation.

With regard to the commencement date of the regulations, the Welsh Government's response indicates that the development of the debt respite scheme was delayed on two occasions, a fact that it has found disappointing. However, the Welsh Government considers that there remains a lot of challenging work, and while it would welcome the implementation of the scheme taking place before May of next year, it considers that it is more important that a scheme is implemented with all protections in place. As such, the Welsh Government has accepted an implementation date of 4 May 2021.

As a committee, we are aware that the Welsh Government has laid a legislative consent memorandum before the Senedd in addition to the UK Financial Services Bill. I draw this to Members' attention this afternoon because that LCM indicates that the regulations being considered today are the first part of the debt respite scheme. The second part, the statutory debt repayment plan, is the subject of the UK Financial Services Bill. Our committee will consider the LCM for this Bill in the coming weeks, and no doubt the Senedd will be asked to consider a consent motion in the near future. Thank you, Dirprwy Lywydd.

Thank you. I call on the Deputy Minister and Chief Whip to reply to the debate.

Thank you very much, Deputy Presiding Officer. As Carwyn Jones has said, I think the responses to the Legislation, Justice and Constitution Committee have demonstrated that this is the appropriate time to proceed. If introduced in Wales in May 2021, breathing space will help those people who have been suffering from debt, the households whose financial burden is considerable, particularly with COVID-19 putting household finances under enormous strain. We have to move forward in terms of ensuring that breathing space will help these people to deal with their debt, perhaps at a time when, as I said, help has never been so needed. So I hope Members will join me in giving their approval to the breathing space regulations.

Thank you. The proposal is to agree the motion. Does any Member object? I see no objections. Therefore, in accordance with Standing Order 12.36, the motion is agreed.

Motion agreed in accordance with Standing Order 12.36.

We will now take a break before we go into Stage 3, and we will ring the bell when we are ready to resume proceedings.

Plenary was suspended at 15:52.

The Senedd reconvened at 16:06, with the Llywydd in the Chair.