Credit Cards: Cost Regulation

Tulip Siddiq Excerpts

Wednesday 7th February 2018 Westminster Hall

[Stella Creasy]

The hon. Gentleman prefigures much of what I will say about who I believe are the new Wongas in our society.

It is not possible to make the argument that the millions of people on zero-hours contracts and in temporary work can manage their repayments and can be confident about the amount of money coming into their households. With millions of people now self-employed, and more people in England likely to be employed in the gig economy than working for the NHS in a few short years, it is clear that insecure, precarious work and precarious finances are the new norm for millions of people in our country.

[Tulip Siddiq (Hampstead and Kilburn) (Lab)]

I thank my hon. Friend for securing this important debate. Many of my constituents rely on organisations such as Citizens Advice to support them when they are in dire credit card debt. At the West Hampstead Women’s Centre in my constituency, bespoke Citizens Advice surgeries often lead to referrals to specialist services, such as the face-to-face disability and debt service. However, since 2010, Citizens Advice has seen its funding slashed from £178 million a year to £99 million a year. Does my hon. Friend agree that, in addition to taking on credit card companies, we need to ensure that debt management services are protected as well?

[Stella Creasy]

I completely agree with my hon. Friend. The idea is that this is just a problem for a few hundred thousand people, but debt, worrying about debt and the causes of debt are mainstream concerns in this country. Debt management, debt advice and the work of Citizens Advice is very important, but I also believe that, when we see these problems growing again, there is a role for us to step in before they get any worse. I made a call to action several years ago about payday lenders. We did not listen then until it was too late. I hope the Government will listen now.

We know that not everybody is struggling, and that Britain is a nation of contrasts, where some people have seen their wealth balloon because of property and pension rights. However, we also know that there are too many for whom debt is just everyday life. It is debt on basic payments—on food, rent and travelling to work costs. We know that 25% of the UK population now struggles with debt. Not everybody is in trouble, but enough are, and the reason is the nature of the products they use to deal with their debt, particularly credit cards.

I hope the Minister will understand why we need to act, because credit cards are the acceptable face of modern debt for people. All of us have one; I am sure if Members were to open up their wallets and purses, they would have, if not one, then maybe two or three with them. There are 30 million cardholders in the United Kingdom. Indeed, the Financial Conduct Authority has been investigating the credit card market.