Thursday, 15 March 2007

Ed Balls Announces Extension of Financial Inclusion Fund

Ed Balls, the Economic Secretary to the Treasury, yesterday announced that the Financial Inclusion Fund would be extended to 2011 to provide for "financial inclusion activity at the current level of intensity". Following 2011, he expects to see financial inclusion activities mainstreamed into core departmental activities. The Financial Inclusion Fund will continue to be monitored by the Financial Inclusion Taskforce until 2011.

Speaking at a Resolution Foundation event called to discuss the Treasury's proposal for the creation of a generic financial advice service, Balls stressed that there was a continued commitment to financial inclusion across Government and following the Comprehensive Spending Review, a new cross-Government Ministerial working group on Financial Inclusion would be established to develop a detailed financial inclusion action plan for implementation.

Responding to the announcement Damon Gibbons, Chair of Debt on our Doorstep, commented:

"The commitment to create a national financial inclusion action plan is to be welcomed. However, much more effort needs to be made to obtain financial services industry contributions to support an expansion of money advice and affordable credit provision. Continuing the Financial Inclusion Fund at its current level - although better than nothing - is inadequate to bring about the level of change required."

Debt on our Doorstep has called on DTI Minister Ian McCartney to consider a levy on the Door to Door lending industry of £100 million - the amount of excess profits that they will make between now and the implementation of the Competition Commission's recommendations - to boost credit union and third sector lending to the poorest at affordable rates.

"At a stroke that would quadruple the Government's contribution to the growth of affordable credit through the Financial Inclusion Fund", said Mr Gibbons.

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