London: faiths call for curbs on exorbitant lending

The Mayor of London, Boris Johnson

The Mayor of London, Boris Johnson

Two thousand people from more than 150 civil-society organisations - mostly churches, mosques, temples and synagogues - will gather at the Barbican Centre in the City of London on 25 November to call for a cap on interest rates and the extension of the living wage. Concerned at the impact of the financial crisis on ordinary people, the capital's largest civic alliance is calling for the measures in order to soften the impact of the crunch on ordinary people.

Among those responding to the five-point call by London Citizens will be politicians from the main parties (Stephen Timms, Greg Hands, Vince Cable), representatives of leading financiers (the British Bankers' Association, the Corporation of London, Barclays, KPMG) and bodies such as Fair Finance and

"Despite historically low interest rates and a massive taxpayer bailout of the banks, ordinary people across London have been forced into the hands of legal loan sharks in order to gain access to credit," said Paul Regan, Methodist minister and London Citizens trustee. "It's time to restore responsibility, not least because of the effect on the mental health of the poor, who are weighed down by usurious debts."

The London Citizens Autumn Assembly will also see the launch of a new economics foundation (nef) report, Doorstep Robbery - Why the UK needs a fair lending law, which argues for a cap on the cost of credit as well as new rules which would oblige banks to make more loans available to the less well-off.

The study by Veronika Thiel reveals that 3m UK households pay hundreds of thousands to "legal loan sharks" because of lack of access to credit from banks. London Citizens and nef argue that the UK should follow the example of major European countries and introduce a 20% cap on the cost of lending by financial institutions, thus making borrowing at interest rates of 50 or 500% illegal.

Doorstep Robbery shows that in Germany and France poor people have greater access to mainstream credit than in the UK - disproving the Government's stated objection that such curbs reduce the flow of credit.

At a previous assembly attended by the mayoral candidates in April 2008 pledged to back the London Living Wage and a pathway to citizenship for undocumented migrants.  The Mayor of London, Boris Johnson will be attending. The London Living Wage, currently £7.60, was introduced by the former mayor, Ken Livingstone, in 2004 following a London Citizens campaign for a basic wage that reflects the higher costs of living in the capital. Boris Johnson has been a strong advocate of the LLW, arguing that no one in London should be paid less.

The evening will include powerful testimonies from ordinary people whose lives have been destroyed by high-interest debts, and readings by faith leaders which recall the prohibitions on exorbitant lending in Judaism, Christianity and Islam. Among those attending will be Dr Mohammed Bari, secretary-general of the Muslim Council of Britain; Jonathan Wittenberg, Senior Rabbi, New North London synagogue; Rev Ermal Kirby, lead chair of London Methodist District; Col. Mike Parker, head of London division Salvation Army; Mgr John Armitage, vicar-general of Brentwood Diocese; and a number of senior Catholics and Anglicans.

London Citizens is calling for an extension of the living wage, a 20% cap on interest rates, a statutory lending code, a financial literacy project in schools and an expansion of mutual lending such as credit unions. The agenda has been drawn up through six months of listening campaigns, surveys, and democratic assemblies, attended by leaders from London Citizens members in south, east and west London. Members are mostly churches, mosques, synagogues, charities, trade union branches and ethnic associations.

Tessa Jowell, Olympics minister, and Andrew Altman, chief executive of the Olympic Park Legacy Company, will be asked  on the night to include a Community Land Trust for affordable housing on the Olympics site.

There will be dance groups, beat poets and singers in the foyer, as well as acrobatic street dancers and a specially commissioned London Citizens choir. Schools and young people will be involved in the presentations and acts.

London Citizens assemblies include moments of political drama. 25 November will be no exception.

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