Salvation Army calls for change in debt support on Isle of Man

Salvation Army calls for significant change in debt support ahead of general election

The Salvation Army is calling on all candidates standing in the upcoming House of Keys general election for an overhaul to the current approach to personal debt for residents of the Isle of Man.  

With current practices outdated and falling behind the reality of modern debt, The Salvation Army is appealing for significant change including accessible options for individuals with unmanageable debt and ensuring there is a clear distinction between inability and refusal to pay.  

This comes after the church and charity’s Debt Advice Service, which supports some of the most vulnerable members of the community, saw its active case load exceed over £2M of debt at the start of the year* with more people continuing to be pushed into financial stress just trying to live day to day. 

Debbie White, area debt advice co-ordinator for The Salvation Army on the Island said: “The Salvation Army has always tirelessly fought to improve the lives of the most vulnerable and has had a presence in left behind communities for a long time. We continue to work with people experiencing homelessness, addiction, exploitation and debt and feel we have a responsibility to ensure that, ahead of a general election, candidates make the most marginalised people a priority, ensuring positive and meaningful change. 

“Through our debt advice service, we know that finance is one of the biggest factors that impact people’s lives and debt can be a cause or consequence of poor mental health. We also know that there is currently no modern, accessible framework to resolve unmanageable personal debt and this must now change.”

The Salvation Army’s calls for an urgent change in policy comes ahead of the House of Keys general election, which is due to take place on Thursday, September 24, and at a time when candidates are actively campaigning within their constituency and hearing about key issues that local communities are facing. 

The Salvation Army is calling for…

• Phase three of the Isle of Man Government’s insolvency reforms to be progressed as a priority. The Government has already recognised the need for personal insolvency reform, but progress has stalled and there is currently no clear timetable for introducing these reforms. This leaves people with unmanageable debts and no formal options to resolve them.
• Replace outdated debt laws with a modern legal framework that gives people with unmanageable debts appropriate options to resolve them.
• A review of enforcement approaches - ensuring a clear distinction between inability and refusal to pay as there is currently no distinction between the two.

Josh Adcock, policy analyst for The Salvation Army said: "The decisions governments make, or choose not to make, have real consequences for people facing hardship. Evidence from our Debt Advice Service shows that when essential costs exceed income, no amount of budgeting can bridge the gap. Without the right solutions, people can become trapped in debt and pushed into destitution. Personal insolvency laws should give people a fair way to resolve unmanageable debt, rebuild their lives and regain dignity, choice and agency, while giving creditors a clear legal framework. On the Isle of Man, reform is urgently needed because rising debt and outdated laws are leaving people with too few routes out."

The Salvation Army’s debt advice service, which takes place at its church and community centre on Isle of Man business park, Ballacottier Crescent, is regulated by the Financial Conduct Authority and aims to reshape people’s financial future. The service has been providing vital support to the Island community for more than five years and has three regulated debt advisors available offering support.

Since its launch in September 2020, people have been supported with money management, have attended budgeting courses and outstanding and historical debts have been consolidated into easy to manage repayments. Recently, the service has seen debt deepen owing to the high cost-of-living and more complex and longer-term cases being received.  

Debbie continued: “The Island’s legislative framework for personal debt is rooted in historic provisions and does not reflect modern understanding of financial difficulty. At the moment people aren’t able to access bankruptcy, and this means that people are trapped in the cycle of debt. Quite simply, the existing approaches are not adequate enough. Although we welcome the Government’s continued work on insolvency reform the current approach risks delaying change for individuals and in the lead up to the General Election, and with the power for change in the candidates’ hands, we are calling for a more modern system to be put in place.

The Salvation Army is only one of two avenues for debt support on the Island with the church and charity regularly championing to abolish the stigma around debt. The Office of Fair Trading also offers assistance. 

Debbie added: “Through our service we see individuals and families trapped in long-term financial hardship, with serious consequences for mental health, employment, and wider public services. Our team works holistically with clients, in a safe space, helping individuals to discover the root cause of financial issues, which may not be immediately apparent, and we look forward to welcoming more people that need support.”

The debt advice service is available to everyone within the community, offering one-to-one support with debt advisors working alongside clients to look at what they owe and make a realistic plan for repaying debts. The service can also contact creditors on a person’s behalf and explore and negotiate available options such as repayment holidays.

For anyone seeking debt advice or anyone worried about bills that are in arrears or struggling to meet regular monthly payments, The Salvation Army can be contacted on (01624) 675702 or via email at iomdas@salvationarmy.org.uk