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Saturday, December 3, 2016
Churches call for end to extortionate credit and usury
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¬†Debt and financial exclusion blights the lives of over six million people on low incomes in the UK - a new Church Action on Poverty (CAP) report reveals. Over the past 18 months, a series of CAP National Policy Forums have brought together people with first-hand experience of debt and financial exclusion, policy makers, politicians and civil servants to help find solutions. Their report: Forgive Us Our Debts, As We Forgive Those Who Debt Against Us, is being launched tomorrow - as part of a national day of action against poverty. The event will include personal stories of debt and financial exclusion, the launch of a New Economics Foundation report on 'predatory lending' and a response from Ruth Kelly, Financial Secretary to the Treasury. "I don't think anyone can understand properly just how it feels, to dread letters coming through the letter box. When they did come you'd feel so ill you'd put the letters behind the mantelpiece - never even open them sometimes." said one participant. "People get into debt over Christmas presents, clothes. Not cars and luxuries" - said another. The report is a testimony to the havoc which debt and poverty wreak on the finances of those living in poverty. Debt and poverty combine to form a cycle in which those on a low income swiftly descend into a long hard struggle with few opportunities to escape. The report calls on the Government to take immediate action to tackle the scandal of extortionate lending to low income households, frequently at rates of interest in excess of 160%apr - a practice which in previous times would have been condemned as usury. The report proposes six solutions that would hugely change the lives of the over six million people on low incomes in the UK by enabling them to rise out of the trap of debt and financial exclusion. The report points to the need for a cross-governmental approach to tackling debt as part of the Government's anti poverty strategy and makes six key policy recommendations: *A flexible benefits system which will enable people to shift easily from benefits to work without risk of going further into debt. *Better provision of financial advice, both to those experiencing debt problems and to those considering taking out a loan before accepting a loan contract. *A wider range of financial services to be tailored to the needs of people on low incomes. *Abolition of the use of domestic bailiffs as ineffective, inefficient and draconian. * The legal definition of extortionate credit needs to be redefined in order to provide effective protection against creditors who charge extortionate rates or operate oppressive practices or terms. *The Social Exclusion Unit needs to undertake a thorough cross-cutting review of Government anti-debt policy, and develop proposals for co-ordinating policy across government. Launching the report Niall Cooper, National Co-ordinator of Church Action on Poverty, said: "Christmas should bring joy and hope - but for millions on the breadline it brings huge stress and the start of many months in debt. Without a co-ordinated response to the problem of debt facing many people in poverty, the Government,s whole anti-poverty strategy will simply fail. We urge government to study the recommendations of our National Policy Forum and take immediate action. Forgive Us Our Debts, As We Forgive Those Who Debt Against Us, A Report of The National Policy Forum on Debt and Financial Exclusion published by Church Action on Poverty 3 December 2002 price £5.00 a summary of the report can be downloaded at: http://www.church-poverty.org.uk Church Action on Poverty is an ecumenical Christian charity, established in 1982, that works with church and community groups to make poverty a priority in the UK. CAP is one of the leading organisations in the UK dedicated to empowering people living in poverty to speak for themselves and contribute to national policy making.
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