Oral Answers to Questions

Debate between Damian Hinds and Penny Mordaunt

Thursday 12th November 2020 Commons Chamber

[Damian Hinds]

Will my right hon. Friend join me in commending the strong local agency working and local resilience forums, such as our own in Hampshire? Will the Government commit to working with local areas to really understand the pressures that, sadly, will persist even after this time? I am thinking in particular of areas such as children’s services.

[Penny Mordaunt]

I am very pleased to join my right hon. Friend in sending thanks to Hampshire LRF and all the LRFs around the country, which are doing an incredible job in such difficult circumstances. We very much understand that they are in the frontline of this fight, and communications with them and with local authorities are vital. That is why we put in liaison officers at the early stage of the crisis. We know and understand very well the additional pressures that they are under, particularly, as he says, with regard to children’s services, and children going into care or being in care for prolonged periods because of pressures on the family courts.

Fly-Grazing of Horses

Debate between Damian Hinds and Penny Mordaunt

Tuesday 26th November 2013 Westminster Hall

[Damian Hinds]

I do not know the specifics of that case, so I cannot comment on how quickly things were or were not done. On fly-grazing, I do know that the RSPCA and other charities are heavily overburdened and struggle to cope with their case load, which may be part of the issue.

[Penny Mordaunt (Portsmouth North) (Con)]

I thank my hon. Friend for securing the debate, not least because I hope it will raise public awareness. The public are really appalled at some of the welfare abuses that have taken place, but the strong message to them today is that they can be part of the solution by reporting cases. Quite often, welfare situations are exacerbated because of the time it takes for someone to identify where horses are and to report them. I congratulate my hon. Friend on securing the debate, and I hope it will help get that message out.

[Damian Hinds]

I am grateful to my hon. Friend. She is right that such incidents must be reported and that the public play an important part in that. It is frustrating if offences are reported and there either is not the capacity to deal with them or proceedings are started but end up in a shocking circular process.

High Cost Credit Bill

Debate between Damian Hinds and Penny Mordaunt

Friday 12th July 2013 Commons Chamber

[Damian Hinds]

My hon. Friend raises an important and telling point. It is, as he says, a problem affecting students, but I am afraid that it exists for many older folks as well. It highlights the fact that a cash number might be a more appropriate headline figure on which to explain the costs.

My second rule is that if the market is providing something that people want and it seems to fulfil a need, it cannot be got rid of unless something better is provided. Credit is a fact of modern life. During the year, people have ups and downs in their expenditures patterns—around Christmas, birthdays and back to school, as well as when unexpected things happen such as a car or a relationship breaking down. Credit is one of the means that everybody uses—or almost everybody, whatever their income level—to help smooth out those ups and downs. It can be entirely rational—the point raised by my hon. Friend the Member for Shipley (Philip Davies)—even to take out a payday loan at a 2,000% APR if in so doing someone avoids unauthorised overdraft charges by the bank, which might cost even more. When the market provides something that has a use, it will not be got rid of until something better is provided.

My third point is that although, as I said, the market will provide and supply will follow demand, it is also true that demand will follow supply—on that at least, Galbraith was right. Payday lending in the UK in recent years has not grown because it has suddenly become more difficult to get from one pay day to the next. People have always struggled to get from one to the next and to pay unauthorised overdraft charges to tide them over for a short period. The difference is the availability of payday lending—partly, Members may note, displaced from the United States, from where a number of operators have come as the regulatory environment in the US has become more difficult. That suggests that there is some efficacy in regulatory restrictions.

All of that tells us that individual simple and grand solutions will probably not create the whole answer. We need an integrated approach, and, as the hon. Member for North Durham (Mr Jones) mentioned, we need financial education. That is one of three parts that have to constitute an integrated approach. The others are sensible regulation and disclosure and ensuring that there are alternatives to high-cost credit and to operators that we would rather people did not have to use.

To be fair to the Government, there is quite a strong story to tell on each of those points about action that has been taken and is being taken. Financial education is going to be in the national curriculum, and there will be a strengthening of mathematics in schools. On sensible regulation and disclosure, we have the new regime with the Financial Conduct Authority, which has the potential to be tougher and more effective than regimes hitherto. Even at the end of the old regime, we are now seeing a sharper and tougher approach from the Office of Fair Trading.

Finally, on alternatives, I am proud of the Government’s support for the credit union sector. We could say the same of the previous Government’s support, although this Government have gone further and are seeking to help the credit unions—those in Great Britain, I should say for the benefit of the hon. Member for Foyle (Mark Durkan)—be self-sustaining and a healthy sector, just as credit unions in Northern Ireland are, and at economic scale. There is also possibly more that could be done in exhorting the mainstream banks to live up to what they might do to ensure further financial inclusion and affordable credit.

Are the Government doing enough? I think it remains to be seen. To some extent they may be, and the new FCA regime could produce quite a dramatic change over time, with credit unions becoming bigger, offering an improved product range and so on. That will really make a difference, and with the lifting of the cap from 2% to 3% per calendar month, we will start to get into a zone in which short-term loans can take on parts of the payday lending market.

Big issues remain, however, and the hon. Member for Sheffield Central mentioned some of them. At the top of the list, of course, is the massive and visible growth in payday lending. One thing that has really made a difference to the public policy debate is that now that high-cost credit is on the side of buses a lot more people are paying attention to it than when it was only on daytime telly or on the back of tabloid newspapers. There are also issues to do with credit brokers and the Amigo model, which is a new model of credit whereby people get their mates to underwrite their loan, and then it turns out, lo and behold, to the surprise of that mate, that he or she gets stiffed for having to pay the loan later. We must also consider the behaviour of certain debt management companies, marketing practices and so on.

Through it all, we should not forget old-school credit. I have mentioned all the flashy new things that are clearly visible on the radar of public policy makers and commentators, but home credit is an enormous sector that is largely invisible to most of us, because most of the time it is a door-to-door activity on streets and estates, using an agency network and without advertising. The leading operator of home credit claims to have one in 20 UK households as regular weekly customers. It is an enormous business.

I turn to specific aspects of the Bill. I will comment on them in the sequence of the customer journey, starting with advertising. This is tricky for me to say, as I believe in free markets—I am a Conservative MP and was a marketer before I came to the House—but at some point we have to face up to the fact that not only sharp practice, such as dodgy or unrealistic advertising, but the volume of advertising in the credit market makes a difference. The sheer ubiquity of messages about the ease of access to credit and the problems it will solve has an impact.

I am not about to advocate some sort of volume restriction on advertising, but we must have that point in the back of our mind. I understand that the Government have commissioned some research on the effect of payday loan advertising on consumers, and that we will hear back on it in the autumn, to which I look forward. Without trying to restrict the total number of ads for credit, I think there are some things that everybody can agree are blatantly bad and should be stopped. One example, to which I think the hon. Gentleman alluded, was the £1,000 night out text that First Payday Loans sent to people. It purported to be from a friend and said, “I’m still out on the town and I just got £850 or £1,000, and you can too.” That is clearly bad practice in advertising.

I saw an advert on Sky News the other day for an instalment loan, not a payday loan. It said, “Quote this voucher code for 20% off”, and then in small letters on the screen, it said “20% off your first repayment.” There are 12 repayments, with 20% off the first one, so it is hardly a bargain. We need better enforcement on advertising, and the new regime can bring that.

More generally, as the OFT has said, there is too much emphasis on the speed and ease of getting credit. The terms of competition are, “We will do it faster than the other lot.” It is about fewer checks, less waiting time and so on.

[Penny Mordaunt]

Does the hon. Gentleman agree that for an enormous number of people who are going for such loans, it is extremely attractive not to have any face-to-face time? Often, they are intimidated by having conversations with a bank manager and so forth, and some of them are deeply embarrassed about the situation in which they find themselves. Being able to go online and spend 15 minutes getting a loan without any advice or any real time to think about it is an extremely attractive option.

[Damian Hinds]

My hon. Friend is entirely correct. It is not necessarily even about face-to-face time; even not having to provide a physical signature makes a difference. We cannot logically explain why that is so—it just is. Each hurdle makes people reflect further on what they are doing, and as things become quicker online, that creates an added danger.

Some of the advertising and marketing styles of payday loan companies in particular, such as using cutesy cartoon characters, are to my mind not really appropriate to people possibly getting themselves into financial trouble.

Portsmouth-London Railway Line

Debate between Damian Hinds and Penny Mordaunt

Wednesday 9th March 2011 Commons Chamber

[Penny Mordaunt (Portsmouth North) (Con)]

I wonder, Mr Speaker, whether on your outreach trips up and down the country you travel by rail. If you do, I wonder whether you like to look at your speech en route and to travel with your elbows. These are pertinent questions should you intend to come to Portsmouth to give us the benefit of your wisdom, for it seems that South West Trains expects its passengers not only not to work while travelling in standard class but not to have elbows either. A report commissioned by South West Trains on the ergonomics of its class 450 carriages, which are now on half the Portsmouth-London line, found that 59% of people, when their elbows are taken into account, will not fit into the seats. My admittedly anecdotal evidence shows that most people prefer to travel with their elbows most of the time. The only sense that one can make of that bald admission by South West Trains is that it explains why there are no arm rests on those services.

Allow me to describe the conditions in the class 450 Desiro carriage. The seats are arranged in a two-plus-three formation, so there are five seats across the width of the train. Each seat is 43 cm wide, but, crucially, there is no space between them. They are hard, they have no arm rests and the seat closest to the window is compromised by the heating channel encroaching into the foot space. Earlier today, I took the liberty of measuring out, on this very Bench, 129 cm from the Gangway and invited three hon. Friends to attempt to squeeze themselves into the space they would have for a 90-minute journey on the London-Portsmouth line. I am sorry to say that if my hon. Friends had been in a class 450 carriage, my hon. Friend the Member for Gosport (Caroline Dinenage) would have been 90% in the aisle. I hardly need to remind the House that this is the usual seat of my hon. Friend the Member for Louth and Horncastle (Sir Peter Tapsell), who, as we all know, is not a man to be crowded. We are accustomed to regular games of sardines as we squeeze ourselves into a Chamber with too few seats; if we cannot do it, what hope do others have? Crucially, we are content with this arrangement; we approved of the decisions of our predecessors to create a Chamber deliberately short of seats, but Portsmouth commuters are not content to play sardines every day.

[Damian Hinds (East Hampshire) (Con)]

I congratulate my hon. Friend on securing this important debate. Is she aware that this issue affects not only Portsmouth commuters but many of my constituents in Liss, Liphook and Petersfield, and that the same trains are used on the Alton line? Sometimes it is an issue not just of comfort but of health and safety—people with back trouble and so on.

[Penny Mordaunt]

My hon. Friend is absolutely right. I know that he has done a tremendous amount of work liaising with his constituents, especially those who commute to London, on this issue. He might also be aware that in 2005, when the 550 operated from Waterloo to Basingstoke and Alton, the Rail Passengers Council—the forerunner of Passenger Focus—said that the 450’s seating arrangements were

“only reasonable for the route on which they were run”—

that is, not suitable for a mainline service. Why, then, were those unsuitable carriages introduced to the Portsmouth-London line on 65% of the services in October 2006, before being scaled back again to 49% late in 2007? South West Trains claims that it met an urgent need to address overcrowding on the route, based on the 2005-06 passenger figures—a full 12-carriage rake of 450s having 140 more seats than the 10-carriage 444 rakes. Those passengers-in-excess-of-capacity figures for peak times showed that of the 23 services operated with the 444 carriages, only five showed standing figures of almost 100 or more, the worst being 272.