Financial Inclusion

Lord Tunnicliffe Excerpts

Monday 11th July 2022 Lords Chamber

[Baroness Penn (Con)]

I agree with my noble friend’s sentiments. As he pointed out, a cut to the taper rate of universal credit is essentially a tax cut for those on the lowest wages, and it makes sure that the incentives are aligned for them to take on more work and bring home more money. So I totally agree with him, but I cannot speculate on any future policies in that direction.

[Lord Tunnicliffe (Lab)]

My Lords, I congratulate the noble Lord, Lord Holmes of Richmond, on his tenacity on this subject, which has made this fact stand out to me: 22% of adults have less than £100 in savings. They are not just unlucky; they are victims of the policies of firms, ranging from car parks to banks, to reduce costs and hence make more profit. We need a comprehensive and holistic approach, and the Government are going some way down that road, but the Financial Inclusion Commission wrote to Mr John Glen, setting out a comprehensive way forward, including the concept of a “have regard” duty on the FCA. Is that letter being responded to, and how does it fit in with the Government’s general approach?

[Baroness Penn (Con)]

My Lords, I am sure that that letter will be responded to, although I take this opportunity to pay tribute to the work of my honourable friend John Glen, to whom the letter was addressed, as Economic Secretary to the Treasury. He has done a huge amount in post to promote financial inclusion, and I reassure noble Lords that that work will continue. For example, the FCA has consulted on its new consumer duty. The noble Lord referenced those who do not have access to savings. Of course, the Government have the Help to Save programme to ensure that those who are on lower incomes get more support to save so that they have a financial buffer for when times are tough.