Queen’s Speech a missed opportunity to deal with problem debt
4 June, 2014
Commenting on the Government’s legislative programme, Mike O’Connor, Chief Executive of StepChange Debt Charity said:
“It’s disappointing that today’s Queen’s Speech did not contain measures to tackle problem debt. Our recent report Life on the Edge showed that despite the economic recovery, millions of households are still stretched to their absolute financial limits. Low or no wage growth and rising household costs have left many unable to make ends meet, let alone put money aside for a “rainy” day.
“The impact of debt is never purely financial, it can have devastating consequences. Debt can lead to mental health problems, family and relationship breakdown and even job loss.
“This is why we need action from the Government now. We need a commitment to a national debt strategy, with a dedicated Government Minister tasked to work with all the sectors involved - public, private and voluntary. We believe the Government should start by ensuring that all creditors - including utility companies, landlords and local authorities – give customers in financial difficulties breathing space to get back on their feet. There is good practice among some financial lenders of forbearance and reduced payments. We need a wider breathing space scheme so that people in financial difficulty who are taking proper action to tackle their problems are given protection from further actions that may worsen their situation, e.g. measures such as a freeze on interest and charges.
“We would also like to see more done to help working households become more financially resilient to cope with the financial shocks we all face in life. People on lower incomes should not have to pay more for the essentials of life such as energy bills or for credit. We also need to do more to encourage people to save for a rainy day and their old age. Even with the best policies in place there will always be people suffering from problem debt and free debt advice should be is available to all those who need it. We all benefit from tackling problem debt.
“The cost of living is high on the agenda but problem debt is about the risks families are facing, and with an overhang of debt and no savings, millions of people lack the financial resilience to deal with the bumpy road to economic recovery."