Creditworthiness Assessment Bill [HL]

Lord Davies of Oldham Excerpts

2nd reading (Hansard): House of Lords
Friday 24th November 2017 Lords Chamber

[Lord Davies of Oldham (Lab)]

My Lords, I too congratulate the noble Lord, Lord Bird, on his Bill and on his speech introducing it. Of course he has great experience of people who have difficulty coping with debt. We all know that an unacceptably large percentage of our population are daily facing challenges which can often be quite extreme. I suppose that the Government and the Prime Minister would say that they fall into the category a little below those who are referred to as “just about managing”. The worry is how large those two groups are. My belief is that they will come to haunt the Government as they seek to cope with the declining economy.

The problem has been identified clearly by the noble Lord, Lord Bird, and other speakers in the debate, who have reflected a strong consensus in favour of the Bill: society stacks the cards against poor people. An anxiety that we have expressed for many years now and which still leads to terrible deficiencies in our society is the absence of any real financial understanding of how household budgets should be handled. I know that attempts have been made in recent years to increase the provision of financial education, and under considerable pressure some progress has been made, but it is still easy to meet people who have no concept at all of some of the most basic aspects of household finance. That is why this problem is so acute. More than 1 million of our people do not have a bank account, which is indicative of the limitations they face.

Of course, as has been described on both sides of the House, the more limited your financial health, the more costly it becomes to tide over in difficult circumstances when debts are incurred. Credit companies inevitably favour safe investments and discount heavily against those with limited assets. We recognise this because it is an aspect of the market, and indeed we may hear a little more about the operation of the market before the debate concludes. However, there are very good reasons why those with limited resources should be anxious about market forces because they can be cruelly affected by how they work.

We know about those forces in relation to housing costs, and we know also that one of the fundamental problems in our society at present is the generational difference between those who were able to purchase their homes at prices within their means, given that their mortgages took up only a limited amount of their wages, and the situation today. Now, the decline in the economy and the extraordinary increase in house prices—attached to the wage freezes and impoverishment of our people—means that, for the generation coming on stream now, the issue has become a crisis.

The Government may be making some moves. In the Budget, we had indications that at least the housing crisis will be addressed, but we all know that the Budget projections on how the housing need will be met mean that it will be a decade or so before we start to see any real substantial matching of supply to demand. Housing costs, which after all relate to the question of having a roof over one’s head, will continue to burden so much of our population.

Last evening, when I was thinking about the Bill and about indicating my complete support for it, as well as that of my party both here and in the other place—my party has expressed strong commendation of the Bill—I thought I would be addressing a House with a substantial consensus of opinion. However, Governments are always good at busting consensus if it does not meet their particular rubric. As a result of communications received by the noble Lord, Lord Bird, only a day or so ago, I know that the Minister must indicate today that the Government do not think that the Bill is the appropriate solution to the problem. For the Government to change the terms of the debate 48 hours or so before we are due to debate the Bill is pretty poor conduct on their part. I excuse both noble Lords opposite—they have both been in the Commons and therefore seen, from time to time, exercises of which no one could approve. I have no doubt that neither of them was involved in this exercise, but I ask the Minister to pay due regard to what we on this side of the House regard as a somewhat unfair operation on a Private Member’s Bill at such a late stage.

I have no doubt that the Minister will say that is because the Government have a better idea and that the better idea is market orientated. Of course, in certain philosophies, of which the Conservative Party is the clearest exponent, just to use the word “market” means commendation immediately. I am not sure that the Government are bent upon improving the Bill, but they are bent upon trying to take credit for the enormously successful campaign of the noble Lord, Lord Bird, which, through the Big Issue and his experience he has operated over a considerable period of time. I think the Government are seeking to snatch a modicum of credit for the fact that they are responding to this development of public pressure. I have no doubt that they will get away with it; after all, they have a majority in the House of Commons, I am told, although it seems to have a certain process of erosion attached to it. Today, on the basis of a very limited mandate, the Government are setting out to indicate that they intend to stop this Bill in its tracks, because although the Minister will persist with his usual commitment and present the opportunity for future arguments, I have no doubt that the Government will be working toward their own agenda, which does not include the passage of this Bill.

I am sorry to have brought a slightly discordant note to proceedings, but it is on the basis of what I think is one of the latest incursions upon a Private Member’s Bill. Remember that we as parliamentarians value Private Members’ time and the ability to get Bills through. They should not be wrecked by the Government unless there is a very good cause. The cause in this case seems not to be an improved position over the Bill but the Government seeking to take credit when in fact credit is due to the noble Lord, Lord Bird, and all those people who have supported him throughout the whole of this campaign.