Savings (Government Contributions) Bill

Debate between Seema Malhotra and Gareth Thomas

3rd reading: House of Commons & Report stage: House of Commons
Monday 12th December 2016 Commons Chamber

[Mr Thomas]

My hon. Friend makes an important point. We need much more ambition for credit unions and for financial mutuals and co-operatives more generally. I am thankful for his intervention.

Ministers claimed in Committee that a multiple provider model for Help to Save would not offer value for money, yet as far as I can see they have produced no costings to justify that claim. It is not as if Ministers are dealing in the case of NS&I with a private company demanding an exclusive arrangement as it feels threatened by the competition that credit unions can offer. NS&I is a state-owned bank, effectively, and is responsible to the Treasury. Indeed, I understand that the Minister responsible is the Economic Secretary to the Treasury, who is also responsible for policy on credit unions. NS&I has some 25 million customers and £135 billion in assets. By comparison, credit unions across the UK have £1.37 billion in assets, less than 1% of the value of NS&I’s investments. In short, credit unions are no threat to NS&I.

NS&I is under the control of the Treasury, as I have said, and it is in Ministers’ hands, or it was until the start of the House’s proceedings on this issue. The House now has the opportunity to decide whether credit unions should be allowed to offer the Help to Save scheme.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

I thank my hon. Friend for giving way, and I am delighted to serve as a Labour and Co-operative MP alongside him. Does he agree that allowing such diversity is important in helping to change behaviour? Many of the issues with savings are about cultural attitudes, and having ways to reach out to communities that might not have engaged in such behaviour is an important part of changing the savings culture in this country.

[Mr Thomas]

My hon. Friend makes a good point, and I hope to deal with it a little more in due course. She is right that credit unions have scope to reach out to more of the 3.5 million people Ministers want to assist through the Help to Save scheme, whom NS&I might not be best placed to help.

Credit unions are not-for-profit financial co-operatives, owned and controlled by their members. They are, I would argue, more uniquely exposed to low and middle- income financial services markets and are used to offering financial services to those who are often excluded from other better known sources of finance. They provide safe savings and affordable loans, with some credit unions offering other products, such as current accounts, individual savings accounts and mortgages.

Nepal Earthquake: First Anniversary

Debate between Seema Malhotra and Gareth Thomas

Monday 25th April 2016 Commons Chamber

[Mr Thomas]

I join the hon. Gentleman in paying tribute to the many charities, small and large, that have assisted. I want to draw particular attention to the contribution that many from Britain made to the search and rescue effort once reports of the earthquake had become clear, and to pay tribute to the work of NGOs such as the excellent Oxfam, Save the Children, VSO and Christian Aid, which have responded. CAFOD is another strong example of an international NGO operating in Nepal.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

This is indeed a very important day to remember what happened last year. A few weeks ago, I visited Nepal with my constituent Bishnu Gurung, who raised a significant amount of funds in Hounslow, along with fellow Councillor Hanif Khan, to support the work of Humanity First. Does my hon. Friend agree that, as well as looking at the reconstruction, it is absolutely vital to rebuild the economy of Nepal—its GDP growth dropped to about 1.5% rather than the forecast 4%—and we need to do much more to open up trade relations and to build Britain-Nepal trade opportunities?

[Mr Thomas]

My hon. Friend makes a good point about trade links. Encouraging economic growth within Nepal was important before the earthquake, given the fragility of life for many Nepalese people, but it is particularly urgent now in the wake of the earthquake. World Bank and Government of Nepal analysts estimate that the total cost of the damage from the earthquake is roughly $7 billion, or 706 billion Nepalese rupees.

With the exception of the Kathmandu valley, the central and western regions that have been affected by the earthquake are essentially rural and heavily dependent on agriculture. The quake destroyed the stockpile of stored grains and killed almost 60,000 farm animals. These districts have tended to see larger numbers of households reliant on livestock as their main, or one of their main, sources of income. The widespread loss of that livestock has caused a severe income shock in the short term for many already very poor families. Sadly, inevitably for vulnerable families with fewer assets, limited access to economic resources and a lack of alternative livelihoods, there is a heightened risk of sexual and gender-based violence, human trafficking, child marriage, and child labour. Indeed, I have had representations from Nepalese constituents of mine worried about an increase in the trafficking of young earthquake victims.

If a major earthquake was not tough enough on its own for a country to negotiate, there has been a major cross-party effort to agree a new federal constitution for Nepal. That was finally agreed in January, but it led to a 135-day unofficial blockade of food and fuel across the India-Nepal border, which has made the reconstruction effort even more difficult. It would be helpful to hear the Minister’s assessment of the level of political stability in Nepal and the strength, or otherwise, of its relationships with its two big neighbours. The tensions have, I understand, eased recently. Crucially, the Nepal Reconstruction Authority has been established, which began its work on 16 January.