Many people struggling with debt find the new mandatory telephone gateway “too complex” to use and are failing to access the help they need, according to Islington Law Centre debt specialist Julie Gray.
Consequently, Law Centre staff are having to step in to help, even though public funding is no longer available. The consequences for those who slip through the net will be “devastating”, she says.
Legal aid was removed from debt in April 2013, by the Legal Aid, Sentencing and Punishment of Offenders Act 2012. Instead, clients requiring legal help with debt, special educational needs or discrimination matters are directed to a telephone gateway. Exceptions can be made where the client is in detention or in a secure hospital, is under 18, or has previously been assessed by the gateway in the last 12 months as needing face-to-face advice and is seeking further help on a linked problem,
However, Gray says many people find the gateway service hard to use: “These clients are already in debt, have no credit on their phone and do not know how to access the telephone advice. Once they are referred to the gateway, clients cannot cope with the various requests. They come back to the Law Centre asking us to make the phone calls and scan the necessary documents to the gateway team just to be able to get past the first hurdle. Having deadlines to meet is often too overwhelming for clients.”
“In effect the Law Centre is having to subsidise these activities just so that clients do not lose out on defending possession actions, and retain their homes. Some clients have disabilities and just cannot cope with the gateway, for some face to face advice is the only way to get help.”
Gray predicts the situation will get worse “within the next three to six months” as contingency funding for debt problems given to some law centres begins to run out.
The problem has also been compounded by the fact other areas of law have been taken out of scope of legal aid, such as welfare benefits.
Gray says: “With so many of our clients having been made redundant or forced to take a reduction in hours, certain relief they could have accessed has been made difficult to access. More people are having to apply for bankruptcy and Debt Relief orders. These clients not only need advice on how to apply but also need our assistance [in doing so]. The bankruptcy form has 31 pages and the Debt Relief order has to be done through an intermediary so clients cannot apply directly for this relief through the insolvency service. Clearly a lot of factors were not considered when these areas were taken out. Some clients just require our help in dealing with creditors to ask for time to repay the debts.”
“We will not be able to reach some clients before they take drastic actions and some will be left extremely isolated and marginalised,” Gray continues. “Some will be left at the mercy of the loan sharks as help and assistance is no longer available. Some will suffer financial abuse because there is no longer somewhere to turn to for free legal advice. With the cuts to welfare benefits and financial sanctions being applied the impact will be devastating.”
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