Debt-ridden Britons could benefit from new legislation which would allow them to take a repayment "holiday" following life changes which prevent them meeting their obligations.

If the proposed enforcement restriction order became law, debtors would have the opportunity to suspend repayments without suffering from charges, although interest would continue to be charged.

Civil justice minister Bridget Prentice commented that the government is keen for everyone to be able to repay what they owe.

"Debt’s a problem that can affect anyone at any time – unexpected costs can hit even the most diligent and careful person," she warned.

Other government legislation designed to protect debtors from the full effects of bankruptcy includes the individual voluntary arrangement (IVA).

They were created to provide an alternative to bankruptcy and allow people to retain important possessions such as their home.

IVAs allow Britons to become debt-free within a set period of time, with any remaining money being written off after that time.