Credit, Collections & Insolvency News
The new Government’s Bills and priorities have been announced as part of the King’s Speech. The speech announced new legislation to improve rights for people renting privately, alongside commitments to improving living standards, job security and wages across the UK.
Commenting on the speech Richard Lane, Chief Client Officer at StepChange, said “It’s encouraging to see the Renters’ Rights Bill introduced in today’s King’s Speech and that improving protections for private renters will be a priority for the new Government. With the ONS confirming today that private rental prices continue to rise at levels well above inflation, it’s vital that this issue is swiftly addressed. We hope that this Bill will account for renters experiencing financial hardship – especially with so many renters on low incomes now living in the private rented sector (PRS). People renting privately make up the majority of people seeking help with debt from StepChange.
“We also welcome a commitment to improving living standards and employment rights, ensuring that work pays and provides security. It’s positive to see a pledge to deliver a genuine living wage that will account for the cost of living. Our research shows one in ten UK adults – 2.8m people – in full time employment are in problem debt, which is half the total number of those in problem debt overall (5.6m).
“Supporting households struggling to cover basics, like their energy bills, must be a priority for this Government. People need a fair chance to build financial resilience following the last few years, and we must avoid further hardship for those on the lowest incomes who are finding themselves in debt after covering essential costs.”
Lowell’s UK CEO John Pears said “At Lowell, we see the firsthand impact of problem debt in the UK, and we make it our mission to know and understand how we can help. At a time of heightened financial vulnerability, where credit use is rising and savings have depleted for lower incomes, we need to call on the government to make sure that policy and legislation protect those vulnerable people and create a fairer system with common standards for debt collection in the UK.“
“It is disappointing to see that that a bill surrounding debt collection reform is not included in today’s speech, however, the Renters’ Rights Bill should provide more stability for the high number of financially vulnerable people living in rented accommodation, as highlighted by our FVI report. However, at Lowell after seeing the first-hand effects of the problem, we will continue to lobby for the government to implement further support around debt collection practices for the financially vulnerable across the UK.
“We need to align to a common standard across the UK, private or public sector, not a patchwork of standards for different departments. Considering that the largest cause of debt referrals is local authority debt, which is double that of credit cards, that forms the first of our three asks of the Labour government – we ask for the local authorities to all be signatories of the UK Government’s Debt Fairness Charter to ensure higher standards across the board. We also ask the government to step up and ensure that all bailiff firms are subject to independent regulation and that the government reforms the Consumer Credit Act (CCA) to make it easily understandable to customers.
“The reform would support those customers immensely, by dismantling the barriers that stop customers from engaging with their debt problem. We need to remove the stigma of debt and the fear of debt companies so that we can help customers earlier before they fall into the long-term debt trap.
“If Lowell, a commercial business, tightly and appropriately regulated by the FCA and focused on good customer outcomes, can ensure high standards, then there’s no excuse for public sector bodies not to meet those standards. We can change the system and be better we can have a fairer system and a fairer society.”
David Postings, Chief Executive of UK Finance said “We welcome the focus in the King’s Speech on economic stability and growth, something the financial services sector will play a key role in delivering.The transition to a low-carbon economy and the work of the National Wealth Fund is a major growth opportunity. Mobilising investment through the financial services industry will be critical to its success. Reform of the planning system is also key to delivering growth and ensuring more people can get the homes they need.
“In an increasingly digital economy we welcome the focus in the Digital Information and Smart Data Bill on digital ID. It is vital that people in the UK have a secure way to prove who they are and access services.The Bank Resolution Bill flows from work undertaken to review the special resolution regime. It is right for the authorities to have more tools at their disposal, but we would expect the Bank Insolvency Procedure to remain the default option.
“We look forward to working with the government and parliament on the development of the detailed proposals across its legislative programme. Any new measures introduced should not seek to increase costs for businesses or the overall regulatory burden, which would ultimately hold back economic growth.”
Joanna Elson CBE, Chief Executive of Independent Age said “We are very pleased to see that rental reforms look set to be a priority for this parliament. Measures announced today for people renting in England, including an end to ‘No Fault’ evictions, a ban on the discrimination against people in receipt of financial entitlements and an increase in the quality of private rented homes are urgent, and we look forward to this being progressed at speed.
“Today’s King’s Speech has outlined the UK Government’s focus on national renewal and it’s important that this renewal helps the two million older people currently living in financial hardship. We are pleased to see the UK Government commit to improving private pensions for future older people, including better access to small pension pots, but we also need action for the one in five single older people currently relying on the State Pension and financial entitlements alone. Right now, we need to see increased uptake of income related support for those living on a low income in later life. Currently Pension Credit isn’t received by around a third of older people who should be receiving it. In the longer term the UK Government should lead a cross-party review to establish what level of income is needed to avoid financial hardship in later life and ensure everyone is able to reach it. We are also calling on the UK Government to establish consistent national social tariffs to make sure that essentials like energy and water are affordable for everyone.
“We look forward to working with new and returning MPs across the Westminster parliament to make sure that poverty in later life becomes a thing of the past.”