Finance (No. 3) Bill

Nicholas Dakin Excerpts

Monday 4th July 2011 Commons Chamber

[Stella Creasy]

I am happy to share the figures with the hon. Gentleman, although I am afraid to say that his interpretation is incorrect. One of the things that I have done—perhaps I am getting a reputation for it in the House—is my homework on this market, and I have sought as much accurate information as possible. That was why I made the freedom of information request, and I would be happy to share the data with him. One of the challenges is that the Government have information about how quickly this market is growing, but they are timid about confirming it.

[Nic Dakin (Scunthorpe) (Lab)]

My hon. Friend is setting out carefully and deliberately the challenges that people face. Does she agree that the exponential growth in this high-cost credit lending is the very reason the Government need to act to address this issue sooner rather than later, in line with the consensus across the House?

[Stella Creasy]

I absolutely agree. I am quoting research by the consultancy practice, R3. It is conducting surveys because it is worried about the mix and range of credit that people are taking out and the high-cost credit itself, which is causing people to get into debt. That is why I am passionate about tackling the problem sooner rather than later. Contrary perhaps to some of the briefings that hon. Members might have had from the payday industry, the majority of people borrowing from these companies are on comparatively low incomes. In particular, one in 10 UK payday customers has an income of less then £11,000, and 46% have incomes of less than £15,000 a year. It is evident how quickly high repayment charges eat into an already meagre wage.

--- Later in debate ---

[Mr Gauke]

As I said, where this is within our control, public sector workers earning less than £21,000 are getting the £250. Where it is not within our control, we have funded local authorities; they are funded to make this payment, but it is ultimately for them to decide.

[Nic Dakin]

As a former council leader, it occurs to me that Governments were for ever putting conditions on how money for local government should be spent, so surely that could be the case in this respect as well?

[Mr Gauke]

This Government believe in localism. I do not know whether the hon. Gentleman wants to return to the days when local authorities were highly prescribed as to how they could spend money and everything was ring-fenced, but that is not how we want to operate.