• household debt

    Household debt is an important issue that I know impacts people in our area and across the UK. Indeed, the Money Advice Service has estimated that 8.3 million adults in the UK are living with problem debt.

    As you know, the Financial Conduct Authority (FCA) took over responsibility for regulating consumer credit in 2014 and announced its intention to crack down on high-interest lending in May 2018. As part of this review, the FCA looked at the rent-to-own (RTO) sector and found examples of people paying more than £1,500 for household essentials, like a cooker, that could have been bought on the high street for less than £300. Following a consultation, the FCA has recently confirmed that it will introduce a price cap on RTO products.

    I know that the introduction of this cap will be welcomed by many vulnerable customers who rely on the RTO sector. I am pleased that the FCA will require firms to benchmark product base prices against retail prices, as this will allow us to check that the rules are working as intended.

    However, I believe that we need to solve the underlying problems in our unsecure economy. I am concerned that austerity has forced people to use high-cost credit just to get by, and to survive with no savings to fall back on.

    Too many families are having to rely on borrowing just to get to the end of the month and are facing huge costs from our high-street banks. I believe that the low paid debt trap is a national scandal that must end, which is why the Opposition has pledged to place a cap on credit card interest and cap the total amount that can be paid in overdraft fees. Alongside this, I believe we should also introduce a £10 per hour real living wage, stop the rollout of Universal Credit and ban zero-hour contracts.