Transact members again vote rate ceilings as a priority for action

Transact members have again registered their support for interest rate ceilings to be introduced into the U.K as a matter of urgency. Over 40% of all members voting in the last survey put interest rate ceilings in their top three priorities. Only securing a universal right to basic banking (57%), expanding credit unions (52%), and a national roll-out of money guidance (45%) scored higher.

Transact has 1500 members, of which 265 completed the survey. This indicates that we have the support of at least 108 consumer agencies in the UK for our campaign on rate caps.

Global Coalition for Responsible Credit calls on G20 leaders to create a financial system ‘worth saving’

Debt on our Doorstep, with support in the UK from the trade unions UNITE and PCS, the New Economics Foundation, Church Action on Poverty, the National Housing Federation, and former Cabinet Minister and Chair of the Labour Party Ian McCartney M.P, and with the support of a Global Coalition for Responsible Credit comprising the European Coalition for Responsible Credit, the U.S National Community Reinvestment Coalition, and partners in twenty other countries, today issued a call for the forthcoming meeting of the G20 to commit itself to the creation of a financial system that is worth saving by:

Agreeing to place financial services providers under a ‘duty to exercise responsibility in financial services’. Financial services providers need to be required to sign up to clear principles of responsibility and to have transparent mechanisms in place to ensure that these principles guide their behaviour in practice. Remuneration policies need to be reassessed in the light of this ambition. The responsibility should include a requirement for financial services providers to properly consider the needs of all households, including those on low incomes, when designing financial products

Ensuring taxpayer investment in the banking system is turned into real help for people in financial difficulties, by agreeing actions to force lenders to offer to reschedule the liabilities of households in debt over the long term at affordable rates

Committing to take further action to stop home repossessions and ensure lenders offer affordable mortgages to people in negative equity and/or mortgage arrears, and to work to stabilise housing costs in the longer term by increasing the supply of affordable housing.

Chair of Debt on our Doorstep, Damon Gibbons, commented:

“Financial services providers have engaged in irresponsible and usurious lending, causing households to become increasingly vulnerable to economic shocks and saddling them with unsustainable levels of debt. We call on the G20 to signal a decisive break with the short termism, greed, and irresponsibility that have caused the current crisis and to take action to ensure that taxpayer investment in the banking system is now used to create a system that benefits people.”

Supporting the work of the Global Coalition, Andy Case, a National Secretary for Unite, the UK’s largest trade union with 2 million members, including 178,000 working in the Finance Sector, said:

“The current situation provides an opportunity to re-build a financial system that supports a long-term outlook and is consistent with democratic aims, financial stability and social justice."

Protecting low income borrowers in the credit crisis

Debt on our Doorstep and Ian McCartney M.P have now finalised their report on measures that government can be taking to protect low income borrowers in the credit crisis. The full report is available from the link below.

The report has now been submitted to the Department of Business, Enterprise and Regulatory Reform and the Treasury and we are hopeful of a meeting in the near future.

In the meantime, the proposal to cap prices in non-competitive areas of the credit market is gaining further support with Transact members voting this as one of their top three priorities for action in a survey at the end of 2008. Following the Transact Annual conference London in November, we understand that there will be a number of regional debates organised on this issue in Spring 2009.

Protecting low income borrowers in the credit crisis

Ian McCartney M.P to work with Dood on Rate Cap proposal

Ian McCartney M.P today announced his intention to work with Debt on our Doorstep in order to develop a proposal to introduce a system of interest rate caps, which he will submit to the Chancellor, Alistair Darling, and Business Secretary, Peter Mandelson at the end of the week.

The announcement came during a live interview on the BBC's Politics Show, North West, in which Damon Gibbons, Chair of Debt on our Doorstep also took part.

The full show can be viewed from the following link, with the coverage from the North West starting 33 minutes in.

http://www.bbc.co.uk/iplayer/episode/b00fvxd1/The_Politics_Show_30_11_2008/

Transcript of speech to Transact Conference

A copy of the speech given by Damon Gibbons, Chair of Debt on our Doorstep, to Transact's National Conference on 21st November concerning the problem of credit dependency and the need for interest rate caps in the UK is now available from the following link

http://www.debt-on-our-doorstep.com/files/Speech%20to%20Transact%20Conference%20Gibbons%2021st%20November

Jim Devine M.P puts down Bill to limit interest rates

Jim Devine M.P (Labour, Livingstone) has put down a ten minute rule bill to limit interest rates on consumer credit contracts. The Bill is also supported by other Labour backbenchers including Jon Cruddas. First reading was on 12th November and details can be found here

http://services.parliament.uk/bills/2007-08/interestratesmaximumlimit.html

We urge Debt on our Doorstep supporters to write to M.P's asking them to support Jim's bill.

Damon Gibbons, Chair, Debt on our Doorstep will also be speaking at Transact's National Conference on 21st November to debate the issue of interest rate limits. This follows a survey of Transact members last year in which rate caps came top of their list of measures that should be implemented in order to make a difference to people on low incomes.

Finally, GMTV begins two days of publicity tomorrow to highlight the costs of predatory lending by door to door (home credit) and payday lenders.

Banking on Change - Can we build a sane future?

The action of governments and central banks across Europe and in the U.S to save the financial system from complete collapse is without a doubt one of the most significant economic and political events since the second world war. But it would be foolish to think that this crisis is anywhere near over. In fact, we may simply be entering a third phase in which we witness the impacts start to spill over into the real economy - resulting in more lost homes and rising unemployment.

The primary reason for continuing alarm? The causes of the credit crisis have not been addressed. We perhaps need to remind ourselves that neither the mass movement of bank deposits or the loss of liquidity in the banking system was the initial cause. Both of these were second order problems. They only arose because of falling values in the U.S - and by extension uncertainty in other national - housing markets. This 'trigger' remains in place, creating a prisoner's dilemma for banks.

Simply put the prisoner's dilemma is this - with so many people now in need of remortgaging at cheaper rates in the U.S, which one of the banks will be the first to take the risk on by offering them loans? The answer, clearly is none will do so for fear of attracting the most risky customers - after all just as the market knows that those banks accepting loans from government are in the worst problems, the banks know that those customers most desperate to reschedule home loans are likely to have the most problem repaying. This 'adverse selection' in credit markets was recognised long ago.

Two immediate actions need to be taken to resolve this. Firstly, households in the most difficulties need helping and fast. Secondly, central banks have to break the prisoner's dilemma by placing 'strings' on their assistance.

How can households be helped? - Debt on our Doorstep calls on government to consider introducing a 'housing interest credit' for low income families, which provides interest relief at source on mortgages and is paid on a sliding scale according to income. That will provide instant assistance to households struggling with increased fuel prices, and rising inflation but will ensure that it reaches mortgage repayments and reduces the risk of arrears. The Obama campaign has something similar in its economic proposals in the U.S at the moment.

Government should also legislate to amend S.36 of the Administration of Justice Act 1970 and S.8 of the Administration of Justice Act 1970 - the legislation which currently provides court's with powers to help borrowers facing repossession proceedings. The current law does not allow judges to reschedule mortgage agreements to ensure that people can retain their homes. They should be provided with the discretion to do so. Again, these measures are being supported by Democrats and community groups in the U.S.

But fundamentally the prisoner's dilemma in banking needs to be broken. To do this, banks must be forced to put out greater amounts of capital on loan to support mortgage and consumer credit restructuring for households over the next five years. Long term loans need to be made available to the banking industry from central banks to support this but banks must pass on this funding at fixed rates and terms established by the central banks to consumers. In effect the central bank will be setting the terms on which loans are to be provided to consumers, with banks simply acting as the intermediaries. Such is the lack of trust which can be afforded to Britain's banks.

Over time, such a direct mechanism can be relaxed provided the regulatory framework under which credit is provided in future is revamped and ensures that incentives are in place for responsible lending to take place and long term, ethical, relationships between consumers and lenders fostered.

That regulatory framework now needs to be constructed with the active participation of consumer agencies and representatives in partnership with banks and government. Our conference, which will take place on 13th and 14th November in London provides a seminal opportunity to begin those discussions. Further details can be found at

http://www.cesi.org.uk/events/current_events/responsible_credit_conference.htm

Please note that we have also secured up to 50 half price places for not for profit agencies to attend these discussions.

BBC One reports on the growing payday loans scandal

BBC's 'the One show' yesterday highlighted the growing problem of payday lending in the UK. You can watch the clip from the link below

http://www.bbc.co.uk/blogs/theoneshow/consumer/2008/09/26/payday-loans-never-a-borrower.html#comments

Channel 4 Exposes Lies of Payday Lenders

Channel 4 News has exposed the irresponsible lending of payday lenders, which offer high interest loans without checking whether or not borrowers can afford to repay and without bothering to check basic details such as earnings, before offering to extend loans for up to 6 months.

Commenting on the footage, Damon Gibbons, Chair of Debt on our Doorstep said:

"Channel 4 must be congratulated on bringing the reality of payday lending to light. Lenders are constantly telling us that they are responsible and comply with guidance from the OFT and their trade associations. This report reveals that this is simply not true. We hope that the Office of Fair Trading will look carefully at the footage and consider what restrictions now need to be placed on payday lender's consumer credit licenses."

The coverage is available from the link below starting 5 mins and 40 seconds into the clip entitled Payday Loans (broadcast on Tuesday 9th September)

http://link.brightcove.com/services/player/bcpid1529573111

Stop the Payday Loans Scandal - MP's to lodge concerns

David Drew, M.P, will tomorrow lay down an Early Day Motion supporting Debt on our Doorstep's call for an investigation into the Payday lending industry in the U.K. The move follows the excellent response from supporters to our own petition on the Number 10 website, which obtained 460 signatures in just over two weeks.

Obtaining the support of MP's is now a vital part of this campaign, and we ask that all supporters write to their own M.P requesting that they put their name to the motion. We will provide a standard means of doing this from this website in the next few days.

In the meantime, a briefing on the Payday lending industry has been prepared, as below.

Payday Lending in the UK: Background Note


1.1 Pay day loans are provided to people in employment, with bank accounts, and operate by the lender accepting a post dated cheque (usually of £100) from the customer which is dated to the forthcoming pay day. A cash advance is then made of between £71 and £85, depending on the lender’s terms (see table below for details of lenders in this market). The difference between the amount of the advance and the £100 is the fee charged by the lender. Multiple cheques are accepted at the same time, with lenders offering up to a £750 - £800 to new customers. So, for example, a new customer would provide 8 cheques to the lender, each of £100, and receive a cash advance of £640 (the difference of £160 being the fees charged that will be collected by the lender on the customer’s pay day). APR’s on the agreements are typically in the region of 1200%, although one lender states that they can rise as high as 9899% .

1.2 Customers are given the option to ‘roll over’ the cheques if they cannot afford to have them cashed against their accounts when the pay day comes around. To do this, the customer must pay another set of fees direct to the lender at the same rates as the initial agreement. So, in our example, the £800 liability could be deferred for another month by the customer paying a further £160 in fees. Rolling over loans is particularly problematic as no amount is being paid off the original liability. For example, after just 5 months of paying £160 per month in fees (total of £800), the original liability of £800 would still be outstanding in full.

1.3 The table on the following page details the main brands and companies involved in the provision of Payday loans in the U.K, and the main terms and conditions of their loans.

1.4 Some, but not all, lenders restrict the amount of times that loans can be rolled over in this way, and have policies in place that require at least some payment off the capital amount to be made once a loan has been rolled over more than two or three times. However, there are no details given as to the amount of payment that is required to be made towards the capital in order for further rolling over to take place, so debts can still be rolled over many times prior to being cleared.

1.5 Lenders frequently advertise the fact that no credit checks are required and that money is available quickly. No assessment appears to be made of a customer’s ability to repay. Application forms do not generally ask for any details concerning expenditure or outstanding debts of borrowers. It is likely therefore that these loans would fall foul of any reasonable definition of ‘irresponsible lending’ – a term included in the Consumer Credit Act 2006 that the OFT must consider when licensing credit providers from 6th April 2008.

1.6 There is an absence of published information concerning the size of payday lending operations in the U.K. However, the expansion of Moneyshop stores over the past 12 months, the entry into the UK of QuickQuid in the third quarter of 2007, U.S takeover of Month End Money and the significant increase in internet sites and financial brokers offering payday loans over the past 12 months indicates that the sector is growing rapidly.

1.7 Dollar Financial, owners of the Moneyshop brand, report that their U.K. business realized growth of 71.7% in 2007 and that U.K. loan originations increased by 55.3% or $34.5 million in that year. They have 221 company operated stores in the UK, and a further 193 operated under franchise, which is approximately 25% of all payday lending outlets in the UK . 2007 third quarter accounts indicate that approximately £16 million is put out on loan each month in the UK. We estimate that a customer base of approximately 150,000 - 200,000 people would include what be required to sustain this. Assuming that the outlets of competitor lenders have similar reach, then this would suggest a market of approximately 600,000 - 800,000 people although recent developments including the increased availability of payday loans on the internet may mean that this is a conservative figure.

1.8 The advertising of payday loans on many websites is often deliberately vague and fails to provide essential information, such as the APRs, and the impacts of rolling over loans on these. In some case advertising may breach the relevant regulations. For example, the website for Quicksilver payday loans, a brand of MEM Consumer Finance Ltd., contains the following statement:

“Payday loan companies are required to calculate the APR% for their customers even though the measure is inappropriate for 30 day (i.e. very short term) cash advances. We’ll calculate it when you go through the application process…”

MEM Consumer Finance Limited also launched a TV advert in December 2007, which is running throughout 2008, under the brand name Payday Now!. This fails to mention the APR of loans at all.


Main Payday Lenders in the UK - Terms and Company Information

The Moneyshop £9.99 on first cheque of £100 only – APR of 260.2%. Usual rates, and anything other than the first cheque, are charged at £14.99 and advances made of £85.01, which would bring APR’s up to approx 1,000% Owned by Dollar Financial, US company expanding in the U.K. Has over 250 stores in the UK now and in the quarter to 31st December 2007 recorded lending growth of 55.3%. The company lends approximately £2.5 million per month

Month End Money,also trading as Payday Now!, PayDay UK, Payday Store, Quicksilver Payday Loans £25 per £100 borrowed. Will lend up to £750 to new customers. APR – 1355%. The Quicksilver website states that full roll overs allowed for two months, then some element of capital repayment required in addition to the roll over fee (amount of capital to be repaid not specified). Owned by MEM Consumer Finance Limited which was acquired by US company CompuCredit in 2007 - unfortunately Compucredit’s accounts do not break down by country, so it is not possible to determine the size of the UK operation. The company has launched a TV ad in December 2007 which is running throughout 2008

Payday Express, Wageadvance.co.uk, Paydaysolutions.org.uk. £20 on each £100 borrowed. APR 1286.1% (based on 31 day month). Will lend up to £800 to new customers. Money available over the internet and paid into bank accounts within 2 days or same day (for which an additional £15 fee is charged) After 3 loans, customers can apply for an increase in the limit. Owned by Express Finance (Bromley) Ltd – Turnover of roughly £1 million per annum. Family owned firm.

Albemarle & Bond. Payday loans available up to £600. No information on website concerning charges – available from within their pawnbroking stores. A national pawn broking company with 75 outlets that has expanded into pay day lending. Company income from payday lending has increased from £0.05 million in 1996 to over £3.6 million in 2006.

Chequebook Loans. £20 on each £100 borrowed – APR 1286%. Company based in Luton, offering payday loans over the internet. Private limited company. Exempted from last accounts requirements on basis of small size. Next accounts due in April 2008.

Payday Advance UK. £29 on each £100 borrowed – no APR figure given on the website. Limits of up to £1000 for new customers. Company registered in Malta. Member of Consumer Credit Association UK.

QuickQuid. £25 - £50 charge on each £100 lent. (APR generally 1,576.5%) Website also states that typical rates range from 1351.7% to 9889.3% A subsidiary of CashNetUSA and Cash America Intl.. Only operates on the internet for UK customers – a service started in the third quarter of 2007. No figures yet available concerning take-up. Next financials released on 24th April 2008

Today's Times: Debt charities cast a wary eye on waters as loan sharks circle

Christine Seib , The Times 25th March 2008

Doorstep lenders and loan sharks are moving into the space left by Britain's high street banks, whose tightening credit terms are leaving millions of people without access to mainstream finance.

Debt campaigners have seen hordes of clients forced to borrow at extortionate interest rates because they have had their credit cards cut off or have been refused loans as the country's biggest banks react to the global liquidity crisis.

Banks have scrapped 125 per cent mortgages, increased the minimum deposit needed for first-time mortgages and reduced credit card limits as the banks' own borrowing costs rocketed in response to a worldwide collapse in interbank lending.

Last month Egg, the online lender, cancelled the credit cards of more than 160,000 customers. Many lenders, including Nationwide, Britain's biggest building society, are charging higher rates for borrowers who do not have a 25 per cent deposit.


At the same time, Provident Financial, the country's most prominent doorstep lender, has predicted a booming 2008. The lender said this month that the number of people who fell into the “non-standard” category of borrowers had grown to about ten million.

The Financial Services Authority estimates that up to seven million people had difficulty gaining mainstream credit, and Citizens Advice reported last week that mortgage arrears problems had shot up by 35 per cent in the first two months of 2008, compared with the same period last year. Citizens Advice bureaux said that they had dealt with 215,000 new debt problems in January and February.

Doorstep lending, which usually involves small loans on interest rates of 100 per cent or more, with payments collected each week by a local agent, is legitimate, but debt charities fear that unauthorised lenders are also capitalising on the increased number of people who have found their usual lines of credit diminished or cut off.

Faisel Rahman, managing director of Fair Finance, a non-profit sub-prime lender based in East London, said: “It's a race. We can forge a new way of lending but we can assume that our competition will also move in.”

Neil Cooper, of Debt on our Doorstep, which campaigns to end high charges for sub-prime lending, said: “I'm sure unauthorised lenders will see an opportunity there, but the biggest risk is the sub-prime lenders who already have their infrastructure set up. People will be forced to go to them for very expensive loans because they can't get credit elsewhere.”

Keith Tondeur, president of Credit Action, a charity that offers budgeting education, said that many of the people who were turning to sub-prime lenders had previously been good customers of the high street banks. “People who've been able to borrow at will are now unable to do so,” he said. “This comes at the same time as rising food and fuel prices and declining asset values — it's not a pretty picture.

“There's a great core of people who've been borrowing happily for 20 years and all of a sudden that's no longer available to them.”

Case study

Luis García, 38, who asked The Times not to use his real name for fear of reprisals, repaid more than £15,000 over five years after borrowing £3,000 from a loan shark in Britain.

Unable to get a standard bank loan, the Colombian borrowed the cash in 1999 to set up a new life in the UK, but, with repayments of £450 a month, was unable to pay off the principal.

“I was paying 15 per cent on my loan, but if I couldn't pay the full £450 and gave him only £300 one month, the other £150 went on to my loan and I paid 15 per cent on that as well.”

When his lender, also from Colombia, threatened the life of Mr García's family in his home country unless he kept up the huge repayments, Mr García turned to Fair Finance.

He said that he cried with joy when the non-profit sub-prime lender offered him sufficient credit to pay off the loan shark.

Stop the Payday Lending Scandal - Sign our Petition

Payday lending is growing exponentially in the UK.

U.S lenders, such as Dollar financial, have exported their business to the UK (trading here as 'Moneyshop') and now have over 200 stores in the UK. Pay day loans carry APR's of up to 1,000% and are regularly rolled over ensuring that households in financial problems are trapped into a cycle of credit dependency. Although the US pay day lending industry is subject to interest rate restrictions in their own country (including a 36% APR cap on pay day loans made to US military personnel), no such restriction on interest rates is in place in the UK.

Debt on our Doorstep have now launched a petition on the Number 10 Website calling on the Prime Minister to ensure an investigation is conducted into the UK pay day lending industry. Debt on our Doorstep is also calling on the Prime Minister to reconsider its previous decision not to introduce interest rate ceilings in the U.K.

You can sign the petition here http://petitions.pm.gov.uk/Payday-lending/

The petition closes on 27th March 2008.. Please e-mail your friends and ask them to sign up.

Dood Workshop on Responsible Lending Proposals

Damon Gibbons, Chair of Debt on our Doorstep, will be leading a workshop at the forthcoming Debt conference hosted by Kirkby Unemployed Centre, Merseyside on 28th February.

The workshop will focus on Dood's Responsible Credit 'proposals for action' which were launched in late 2007, and Gibbons will provide an update on Debt on our Doorstep and the European Coalition for Responsible Credit's perspectives for the current credit crisis.

Further details concerning the conference are available from Helen Jones at KUC, helen.jones@kuc.org.uk

Dood Calls on MEP's to protect UK consumers

No Downgrading of Consumer Protection in the EU – Consumer and Social Organisations protest the Latest Move of the Parliament on the Consumer Credit Directive

The European Coalition for Responsible Credit (ECRC) and Debt on our Doorstep (DooD) today issued calls for MEP’s to stand up for UK consumers and to resist the latest proposals to water down protections contained in the EU Consumer Credit Directive.

The move comes in response to a new draft of the Directive being introduced into the European Parliament by the Rapporteur, Mr. Kurt Lechner of the Internal Market and Consumer Affairs Committee.

Commenting on the new proposal Professor Udo Refiner, Chair of the ECRC said:

“Consumer organisations from fifteen European states have been shocked in recent days to find that a significant weakening of consumer rights is being suggested in the European Parliament. There has been no consultation with national parliaments or with consumer representatives, on this new draft of the Directive, which appears to have been drafted with the assistance of the credit industry.”

Damon Gibbons, Chair of Dood called on UK MEP’s to take action in the Parliament to protect UK consumers.

“We are calling for MEP’s to intervene and reject the new draft. There has been no debate in the UK on these issues, yet consumers here stand to lose valuable protections. This all comes at a time when there is an obvious need for greater responsibility in lending. The last thing we need from Europe is a green light for lenders to con UK borrowers.”

Full text of the media release and details of the proposed amendments can be downloaded here

Responsible Lending: Proposals for Action

Debt Campaigners Declare October 23rd ‘Responsible Lending Day’ and call on Government to raise its game to tackle UK Debt Crisis.

Debt on our Doorstep, the campaign for fair and responsible financial services, has declared October 23rd to be the UK’s ‘Responsible Lending Day’ and called on Government to raise its game to tackle irresponsible lending and Britain’s growing debt problem.

The day will see the Westminster launch of Debt on our Doorstep’s 17 page report into debt in the UK which sets out proposals for action in 8 areas including calls for:

Banks to disclose how they serve low income communities and meet the need for affordable credit

Regulation of the credit card industry to be tightened to ensure they take proper account of a borrower’s ability to repay and for a ban on unsolicited increases in credit limits and credit card cheques

Longer term funding for projects to tackle illegal money lending and for the introduction of a criminal offence of usury.

Lenders to also advertise APRs of agreements with payment protection insurance included so that borrowers can see the true cost involved

Calling on Government to draw up a properly resourced national strategy for debt advice provision

Launching the report, Damon Gibbons, Chair of Debt on our Doorstep, commented:

“The Government has so far underplayed the role of irresponsible lending in causing debt, and continues to allow the industry to target high cost credit at people on low incomes as a means of increasing profit.

We are now seeking some fundamental changes to the UK’s credit society – asking banks and mainstream lenders to prove that they are engaging with low income communities and can offer them the products they need. If the Government is willing to pump money into the financial services sector to offset the impact of the ‘credit crunch’ then it must start to seek better services for people in return.”

The launch takes place at 5pm in Committee Room 5 of the main building of the Houses of Parliament with the following speakers:

Prof Iain Ramsay, University of Kent Law School (Chair)
Damon Gibbons, Debt on our Doorstep
Mark Lazarowicz MP (Lab) & Chair, All Party Parliamentary Group on Debt
Ed Vaizey MP (Conservative)
Adam Price MP (Plaid Cymru)
Danny Alexander MP (Lib Dem)
Anne Pettifor, Advocacy International and author of 'The Coming First World Debt Crisis'

The first Responsible Lending Day also features a British Bankers Association conference in London on these issues, but which is taking place at a cost of £400 per head and has minimal involvement from consumer groups.

A full copy of the proposals for action are available from: http://www.debt-on-our-doorstep.com/files/responsible%20credit%20proposals%20for%20action.pdf

Westminster Launch of Responsible Credit Proposals

Invitation to the Westminster Launch of Our 'Responsible Lending' Proposals & AGM, Tuesday 23 October, London

Irresponsible lending in the US sub-prime mortgage market has now fed through into a 'credit crunch' for UK banks, causing upward pressure on mortgage and lending rates for all consumers. With increasing evidence of irresponsible lending practices in the UK, there has never been a better time to lobby for improved regulation of the financial services industry.

Following the success of our own responsible credit conference in Edinburgh in May, we will be launching a new set of proposals for action to MP's to address irresponsible lending practices at the Houses of Parliament on Tuesday 23 October (time tbc). A number of MP's from across the political spectrum, as well as agencies involved in our campaign will be speaking at the event.

The launch will be immediately preceded by a Campaign Forum and Annual General Meeting, 3 - 4:30pm at the Abbey Centre (behind Westminster Abbey at 34 Great Smith Street, London SW1P 3BU )

Please let us know if you are able to participate by emailing, faxing or posting back the form below.


[ ] I plan to attend the Campaign Forum and AGM on 23 October. Please send me a map and agenda.
[ ] I want to attend the "Responsible Lending" Parliamentary launch. Please send me more details.
[ ] I am unable to attend. Please note my apologies.

Name .........................
Organisation .........................
Email .........................
Address .........................
......................... Postcode ......
Please return to: Debt on our Doorstep, c/o CAP, Central Buildings, Oldham Street, Manchester M1 1JT, OR fax 0161 2375359 OR e-mail to info@debt-on-our-doorstep.com
________________________________________

UK Credit Options Conference Success

The UK credit options conference organised by Debt on our Doorstep and Citizens Advice Scotland earlier this week was a huge success with over 100 delegates on each of the two days debating the need for further work to ensure access to responsible financial services.

The conference, which featured the first public engagement of the new Scottish Executive's Minister for Communities and Sport, Stewart Maxwell, and which brought together local authorities, debt advice agenices, citizens advice bureaux, academics, banks, lenders, and politicians and policy-makers attracted considerable media attention. A full report of the conference, including a media report will now be pulled together in advance of the European Coalition for Responsible Credit conference in Brussels in September (see www.responsible-credit.net for further details).

Discussions at the conference for further action included the development of a sustainable Debt on our Doorstep network in Scotland, of which we hope to bring you more details in the next few weeks, and also preliminary but exciting talks to hold similar events in Belfast and Cardiff.

In the meantime, below is a list of media that featured the conference, demonstrating the impact of events like this not only on taking forwards the debate amongst practitioners, the industry, and policy-makers, but also how they help to raise public awareness of the problems facing UK consumers.

Newspapers
Herald / Society
Press & Journal (mentioned over 2 days)
Glasgow Evening Times
Sunday Mail

Sunday Mirror

Television
BBC Scotland
ITV / GMTV

Radio
BBC / Good Morning Scotland
Central FM
Forth FM
Clyde FM
Tay FM
Northsound
Moray Firth Radio
Talk 107

West Sound

Websites
Parliament Today
Third Force News (main magazine of Scottish voluntary sector)

Community Care Magazine

Dood Reveals 'Debt Tax' on Poorest Households

Debt on our Doorstep today released an analysis of household debt in the UK showing that one third of the U.K’s poorest households are paying over 11% of their annual incomes servicing unsecured credit debts.

The move comes prior to the start of the ‘UK Credit Options’ Conference, organised by Citizens Advice Scotland and Debt on our Doorstep for 28 /29th May 2007, which will bring together over 100 delegates per day to discuss the need for responsibility in lending.

Our analysis shows that whilst poorer households are less likely to get access credit (37%) than their richer counterparts (60%) – they take on a greater level of debt relative to their income. This translates into higher debt repayments as a % of their income for poorer households, making debt act as a form of taxtion on the poor.

Damon Gibbons, Chair of Debt on our Doorstep, commented:

“Repaying a growing debt burden reduces the disposable incomes of the poorest households more than it does those of their richer counterparts. For the poorest 20% of households with debts, the growth in debt repayments will completely offset any growth in their income as a result of tax and benefit changes that have been made in the past 6 years and pull households back under the Government’s poverty line.”

“Because debt is not spread evenly across households, it acts like a form of regressive taxation, magnifying existing inequalities in the income distribution. Further investigation by the Government is urgently required. To date, none of their official reports on indebtedness have looked at this issue”.

A full copy of the paper, which was presented to a conference on Responsible Credit at the University of Trento, Italy, earlier this week is available here.

Motion Laid in Scottish Parliament Welcoming Conference

Jackie Baillie, MSP, has put down a motion in the Scottish Parliament welcoming the Debt on our Doorstep/ Citizens Advice Scotland conference taking place in Edinburgh on 29th and 30th May.

The conference, which is now fully booked, will debate the critical issues of responsible credit and fair financial services at a crucial time with banks facing what amounts to a popular rebellion over default charges and increasing concern over extortionate lending and the lack of affordable financial services for low income communities. The motion (see below) goes onto underline the importance of cross part collaboration in Holyrood and Westminster to tackle these concerns.

Activity is also increasing on the European and Global stage, with the European Coalition for Responsible Credit gearing up for a conference in Brussels in September (see www.responsible-credit.net for details); and contacts made by the Global Fair Finance initiative in Japan, Mexico and South Africa.

The motion reads:

*S3M-30 Jackie Baillie: UK Credit Options Conference; ;That the Parliament recognises the crucial importance of fair and affordable credit for all in Scotland; welcomes delegates to the second UK credit options conference in Edinburgh on 29 and 30 May 2007, hosted by citizens advice Scotland and Debt on our Doorstep, and acknowledges the importance of the Cross-Parliamentary Cross-Party Group on Tackling Debt in contributing to full debate of the issues surrounding credit and debt.

Graham Norton Snubs Home Credit

Following Debt on our Doorstep's intervention, TV presenter Graham Norton has confirmed that he will refuse to make an award to home credit lenders at tomorrow's Credit Today Magazine Awards Ceremony, due to take place in London's Grosvenor Hotel.

Today Graham's agent, Dylan Hearn, said that having been made aware of the issues, Norton did not wish to be associated with such an award - although he will continue to host the overall event.

Damon Gibbons, Chair of Debt on our Doorstep said: "We're delighted that Graham has agreed to sit out that part of the ceremony, and send out such a message. These lenders crave recognition as part of the mainstream credit industry but they only further reduce the incomes of low income borrowers. They cannot be part of the solution to poverty in the U.K."