Hundreds of thousands of people struggling with money problems can make use of a new debt respite scheme.

The Treasury said the scheme, called Breathing Space, will give those facing financial difficulties space to receive debt advice or mental health crisis treatment without pressure from creditors or mounting debts.

People will be given legal protections from their creditors for 60 days, with most interest and penalty charges frozen, and enforcement action halted.

This scheme will give people a breathing space from charges, distressing letters and bailiff visits

They will also receive professional debt advice to design a plan which helps to get their finances back on track, the Treasury said.

People across England and Wales who are struggling to repay their debts could be eligible, and the Government expects 700,000 people to benefit in the first year of the scheme.

The Treasury said the standard Breathing Space can be accessed by contacting a professional debt adviser.

For those in mental health crisis treatment, an approved mental health professional can certify they are receiving treatment and then a debt advice provider can consider whether they are eligible for the scheme.

John Glen, Economic Secretary to the Treasury, said: “We’re determined to tackle problem debt, but it is incredibly hard to get your finances back on track when your debts are piling up and you’ve got creditors at the door.

“This scheme will give people a breathing space from charges, distressing letters and bailiff visits, so they can tackle their problem debt with support from a professional debt adviser.

“And to help people going through a mental health crisis, which is too often linked to financial problems, we’re bringing in stronger protections lasting beyond the end of their crisis treatment.”