I would encourage all who is concerned about their fellow human beings to watch this Youtube and lets have a proper debate on how to influence policies at the top:
Hey folks a serious question to all of you how many people will be celebrating Christmas, New Years and singing the following song Jingle Bells and White Christmas this year when the coalition only Christmas presents to all us is cuts, cuts in local government services, all Government Departments, price increase from the big energy companies and pay day loans running all the way to the banks rubbing their hands quoting that people must have muggings written on their foreheads, long queues outside foodbanks and mobile companies chasing you up to pay unpaid bills as Christmas and New years is just around the corner.
Yet Stella Creasy is the Shadow Minister (Business, Innovation and Skills) has been active in campaigning for increased regulation of payday loans companies. In an article in The Guardian, she stated that six companies controlled lending to 90% of the seven million Britons who lacked a bank account or credit card. She claimed that the average cost of credit to these customers at 272% APR has led to cross-party support for a cap as in the rest of Europe and there has been a fourfold increase in payday loans since the start of the recession. In a debate in Parliament she noted the lack of competition in the market and asked for Government support to cap loans which exploited the poor, and in some cases reached 4000%. APR.
In 2012, a Wonga employee used company equipment to make offensive personal attacks on Creasy. Wonga made an “immediate and unreserved apology” after the attacks, and Creasy also requested that the firm promote a constituency event to help struggling families. According to the Guardian, a Wonga computer was used to edit the company entry using several accounts. Like many of we continue to ask the coalition do they see Stella Creasy as a threat to them as she has been very consistent in raising the issue of pay day loans which must having them on the run in Parliament.
George Osborne executed a hasty politically driven U-turn, surprising even coalition Liberal Democrat ministers, when he ended years of resistance and announced a legal cap on the overall cost of payday loans.
In a sign of the speed of the Treasury about-face and the secrecy surrounding the chancellor’s move, papers distributed on Friday for Monday’s inter-departmental ministerial meeting on consumer credit contained no reference to the policy shift.
Labour claimed the move showed the success of its cost of living agenda and revealed the Tories’ strategic confusion and weakness, including in Osborne’s own attitude to the role of the state in regulating markets.
Osborne may feel he has shot one of Labour’s foxes and done something to dispel the impression that the Conservatives do not represent the low-paid.
He presented the move as “a logical next step” to regulate a market left unregulated by the previous Labour government, adding that evidence in Australia showed caps on the overall cost of loans could be effective.
The chancellor said that there would be controls on charges, including arrangement and penalty fees, as well as on interest rates. “It will not just be an interest rate cap. You’ve got to cap the overall cost of credit.”
He said the move would “make sure that hardworking people get a fair deal from the financial system, whether it’s the banks or the payday lenders or the internet lenders”.
A possible catalyst for Osborne’s move was a renewed push from backbench Lib Dems to impose a cap using an amendment to the banking bill in the Lords this week. Earlier this month the Treasury had been given full ministerial responsibility for consumer credit, taking responsibility from the business department.
In another sign of the haste of the decision, the Treasury has yet to set out its alternative amendment.
Osborne said he would be imposing a legal duty on the Financial Conduct Authority to impose an overall cap on the cost of credit. The FCA already had the power to impose a cap, but now it would be forced to do so. The chancellor said it would be for the FCA to decide the specifics of how the cap would work.
Osborne made his decision even though the Competition Commission had just started an inquiry into the industry.
A Lib Dem source said: “The Lib Dems have been pushing for tougher action on payday lenders for well over a year – at every step of the way this has been met with strong resistance from Conservatives in the Treasury. It seems the Tories read the runes on this one and realised that increasingly the evidence and political tide were against them. Their change of heart is very welcome but none of this positive action would have happened without the Lib Dems in government.”
The Lib Dem backbencher Lord Starkey held discussions about his alternative amendment last week with the Lib Dem consumer affairs minister Jo Swinson and Treasury chief secretary Danny Alexander. Starkey was calling for a maximum cap on the size of a loan of £300and admitted that he was astonished by Osborne’s decision.
Australia has an interest rate limit of 4% per month, after a maximum up-front fee of 20%. However, even in Australia, borrowers can still face charges, and penalties for late payment are allowed to be as much as twice the loan amount.
The chancellor praised the shadow consumer affairs minister Stella Creasy for her campaign.
Creasy, the Labour MP for Walthamstow, who has campaigned against the payday lending industry’s practices, criticised the government for sending “confusing” signals to the regulator, and said the coalition was “playing catch-up” with Labour, who have said they would bring in a cap if they were handed power in 2015.
In an interview on Radio 4’s Today Programme, Creasy said that introducing a duty to cap at this stage would “leave in tatters the consultation announced a few weeks ago where ministers specifically ruled out the move to introduce a cap”.
Creasy said the regulator had told her it was not using its existing powers to cap interest rates in the sector because there was insufficient political will for it to do so.
Whilst it is alleged that three in four people on low wages in 2002 failed to escape from Britain’s “low pay trap” over the next 10 years, according to a report published today. Coupled by according to Resolution Foundation think-tank, 1.3 million (27 per cent) of the 4.7 million workers on low pay in 2002 remained in the bottom bracket for the next 10 years.
A further 2.2 million (46 per cent) moved in and out of low wages but failed to break free of them for good by the end of the decade.
The findings will fuel the growing concern about the lack of social mobility in the UK and the heated political debate about the “cost of living crisis”.
In a Commons debate today, Labour will highlight figures showing that average earnings have fallen in real terms in every part of the UK since 2010.
Labour will claim that the Coalition has failed to meet the goals it set itself on living standards, economic growth and the deficit.
Only 800,000 (18 per cent) moved up the earnings ladder for a sustained period without slipping back into low pay. A further 400,000 (9 per cent) retired or left the labour market. Low pay was defined as two-thirds of median hourly earnings – £7.32 and £10.98 respectively at today’s prices.
Alex Hurrell, senior analyst at the foundation and author of the report, said: “For many people, low pay is not a first rung on the ladder – it’s a long-term or even permanent reality. Identifying those who are least likely to escape low pay is the first step in targeting policies to help them get on.”
Researchers found women were much more likely to be stuck on low pay than men.
Some 900,000 women (33 per cent) on low wages in 2012 had been there for the previous 10 years, compared to 400,000 men (21 per cent).
The North-east was the region where workers were most likely to be trapped on low earnings. One in three (34 per cent) in this category in 2012 had been there for a decade.
The East Midlands, Yorkshire and Humberside and Wales (31 per cent) were the next worst affected. London and the South-east were the least affected, although 23 per cent of the low paid in 2012 had been stuck for 10 years.
Half of all the workers trapped for the decade were aged between 41 and 60, which means they spent up to 10 of their “peak earning years” on low pay. Some may remain stuck for their entire careers, the foundation said.
Public-sector workers were more likely to escape low pay than those in the private sector. Women, manual workers, administrators and staff of firms with fewer than 10 staff were least likely to escape.
The sectors where people were most likely to be stuck included retail, hospitality, sales, customer services, manufacturing and care. The foundation said more must be done to help workers progress.
Only one in six women (15 per cent) working in the retail sector in 2002 escaped low pay during the decade.
Gavin Kelly, the think-tank’s chief executive, said: “Living on low pay in 2013 is tough, but being stuck on it for years on end is harder still.
“This report shines a light on the persistent nature of low pay for millions of workers and shows that women, those in regions such as the North-east, the East Midlands and Wales, and people working in sectors like administration are far likelier to be stuck in low pay than others.
“It also highlights the large numbers who cycle in and out of low pay over time.
“Limited earnings mobility is a long-running problem in our economy which spans a number of decades and has occurred under governments of different complexions.”
Chris Leslie, the shadow Chief Treasury Secretary, said: “On every economic test David Cameron and George Osborne set themselves three years ago they have failed.
“Far from delivering rising living standards, working people are now over £1,600 a year worse off under this Government.”
In the debate today, ministers will point out that the problems of low pay pre-date the Coalition coming to power in 2010 and will accuse the previous Labour government of failing to tackle it.
While in the House of Lords the government has been defeated in the House of Lords over its plans for reforming the banking system.
A Labour amendment to the Financial Services Bill, which would introduce a licensing system for senior bankers, was passed by five votes.
Earlier, ministers agreed to set up a panel of experts to review the effectiveness of regulatory changes.
This will examine whether plans to ring-fence bank retail operations from riskier investment arms are working.
The bill is designed to make a repeat of the 2008 financial crisis less likely by introducing tough internal safeguards to ensure losses in one part of a bank do not spread and threaten its collapse.
Critics say this so-called ring-fencing does not go far enough and want the regulators to have a reserve power to step in to force banks to separate their investment and retail operations.
“We don’t know whether this (ring-fencing) will work,” former Chancellor Lord Lawson said during Tuesday’s debate at report stage in the Lords.
“We don’t know whether there will be cultural contamination across the ring fence because that would be a very serious matter.”
Attempts to get the reserve power introduced into the bill were defeated by nine votes although ministers agreed to set up a body to determine whether the proposed arrangements were working.
But ministers were defeated over calls for a licensing regime specifying “minimum thresholds of competence” for senior bankers and adherence to a recognised code of conduct.
The measure, passed by 222 votes to 217, may be overturned by MPs when the bill returns to the Commons.
The Archbishop of Canterbury, who supported the proposal, said it was right that professional standards in banking were on a par with those for the law and medicine.
The Most Rev Justin Welby, a member of the Parliamentary Commission on Banking Standards, told peers it was not always the most senior staff who could inflict the most serious damage.
“The expectations on senior managers must be high,” he said.
“However, it is also right that those who are not part of the senior management of the bank also have high standards.”
He told peers it was not always the most senior staff who could inflict the most serious damage.
“They could be a junior dealer, new in the business, who ignoring his internal limits deals in a way that does great damage both to customers and his employer.”
Government minister Lord Newby said the proposal would add to regulatory burden on banks “without introducing any real improvements in standards in the industry”.
He added: “There will be a regime of regulatory standards for employees encapsulated in enforceable banking standard rules.
“Firms will inevitably have a role in ensuring their staff comply with those standards and taking action if they do not, whilst the regulator will be able to take action if needed.