StepChange responds to Spring Budget

^{6 March 2024}

StepChange Debt Charity has responded to measures announced by the Chancellor in today’s Spring Budget, welcoming changes to the repayment of Universal Credit budgeting advances, as well as the scrapping of the £90 application fee for Debt Relief Orders (DRO).

The charity is pleased to see the Household Support Fund extended, but says a short term extension risks further uncertainty for households.

Richard Lane, Chief Client Officer at StepChange Debt Charity, said:

“It’s encouraging to see a six-month extension to the Household Support Fund (HSF) announced today, but it’s questionable how much things will improve in that time, especially considering two in five people are currently struggling to keep up with household bills and credit commitments. Our advisors regularly speak to clients struggling to meet even the most basic needs, like getting a healthy meal and keeping the heating on. Local support funded by the Household Support Fund are a crucial lifeline for them. 

“Increasing repayment times from 12 months to 24 months for Universal Credit (UC) budgeting advances will improve affordability for those struggling to make ends meet. However, we know that millions of people receiving UC are still subject to unaffordable deductions from their benefits to repay other government debts and more will need to be done to end unaffordable UC deductions that can all too often cause real hardship.

“We are particularly pleased to see the announcement that the application fee for Debt Relief Orders (DRO) will be scrapped and this will remove a real barrier to those seeking support with problem debt. When already facing financial hardship, fees to access solutions can be prohibitive in getting back on track and rebuilding financial security.

“Today’s announcements are steps in the right direction, but further reforms are needed to reduce essential costs like council tax and energy. We have called on the Government to commit to introduce an effective council tax support scheme and develop a social tariff for energy as soon as possible.”