Asked by: Laura Smith (Labour - Crewe and Nantwich)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what assessment he has made of the effect of rising household debt on levels of child poverty.
Answered by Elizabeth Truss
The proportion of people in absolute poverty is at record lows. Since 2010 there are 600,000 fewer people, with 200,000 fewer children, in absolute poverty. Work is the most effective way out of poverty and unemployment has not been lower since 1975. We are helping people retain more of what they earn by raising the personal allowance, successive increases mean that a basic rate tax payer will be £1,075 better off in 2018-19 than in 2010-11, and to help with the cost of living we are also freezing tax on fuel and alcohol. To support working parents we are introducing Tax Free Childcare, providing support of up to £2000 per year for each child, and are doubling free childcare available for 3 and 4 year olds to 30 hours a week, saving in total around £5,000 a year per child. We are also banning letting agent fees and have published a draft bill to require Ofgem to implement a cap on standard variable and default energy tariffs. However, there is more to do and the government is committed to delivering a country that works for everyone. Last April, the government published its “Improving Lives: Helping Workless Families” strategy. This focused on measures that tackle the root causes of poverty, including specifically problem debt.
Asked by: Laura Smith (Labour - Crewe and Nantwich)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what steps he has taken to increase the ability of regulators and consumer enforcement bodies to order fines against companies that have been found to have broken consumer law and to deliver redress.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The Financial Conduct Authority (FCA) has been given a wide range of enforcement powers to protect consumers and to take action against firms and individuals that breach the FCA’s rules – including rules on consumer protection - through the Financial Services and Markets Act (2000), as amended by the Financial Services Act (2012),
Such action includes issuing fines against firms and individuals. In the calendar year 2017, the FCA issued fines totalling £229,515,303.
The Financial Ombudsman Service (FOS) was set up by the Government to resolve individual complaints between financial services firms and their customers. If the FOS decide that a consumer has been treated unfairly, it has legal powers to force the firm to pay redress to the consumer.
Asked by: Laura Smith (Labour - Crewe and Nantwich)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, whether he plans to reduce the cap on the cost of credit offered by payday lenders.
Answered by Steve Barclay - Secretary of State for Environment, Food and Rural Affairs
The Government placed a duty on the Financial Conduct Authority (FCA) to cap the cost of payday loans. As a result, this is a matter for the FCA, who are operationally independent from Government. The question has been passed on to the FCA. The FCA will reply directly to the honourable member by letter. A copy of the letter will be placed in the Library of the House.
Asked by: Laura Smith (Labour - Crewe and Nantwich)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, whether the Government's planned Breathing Space scheme will include a full 12-month freeze on interest, charges and debt collection activity.
Answered by Steve Barclay - Secretary of State for Environment, Food and Rural Affairs
The Government committed in its manifesto to establish a breathing space for heavily indebted consumers which would freeze interest, charges and further enforcement action for up to six weeks.
The Government is committed to taking the proposals forward as per its manifesto commitment, and is actively consulting on the policy design with stakeholders.
Asked by: Laura Smith (Labour - Crewe and Nantwich)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what steps he has taken to make consumer markets operate more fairly to reduce the costs of essential household items.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
Competitive markets are the best way of delivering value and choice for consumers. Autumn Budget 2017 announced more resources for the Competition and Markets Authority to enable them to take more cases against companies who are not competing fairly. The government is also taking specific action to ensure that financial services markets work for consumers. For example, to improve access to affordable sources of credit, the government is increasing the number of potential members that a credit union serving a local area can have from 2 to 3 million.
The forthcoming Consumer Green Paper will set out the government’s broader approach to ensuring that markets are working well for consumers and businesses.
Where it can, the government is also taking direct action to help families with the cost of essential items. For example, the government has extended the fuel duty freeze for the eighth year. This freeze has saved the average car driver £850 over the last eight years compared to what they would have been paying under the pre-2010 escalator plans.
Asked by: Laura Smith (Labour - Crewe and Nantwich)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, whether he plans to implement a duty on regulators to identify vulnerable customers within the finance industry.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The government believes that the Financial Conduct Authority’s (FCA) existing objectives to protect consumers and to promote effective competition are sufficient to safeguard the interests of vulnerable consumers. The government therefore sees no need to legislate to impose an additional duty on the FCA.
In November 2017, the FCA published their Future Approach to Consumers Paper. One of the core ideas within this Paper is “Regulating for Vulnerable Consumers”. The FCA expects firms to pay attention to possible indicators of vulnerability and have policies in place to deal with consumers where those indicators suggests they may be at greater risk of harm.
Asked by: Laura Smith (Labour - Crewe and Nantwich)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what assessment he has made of the level of incidences of collusion in the insurance industry between providers of home and contents insurance.
Answered by Steve Barclay - Secretary of State for Environment, Food and Rural Affairs
The government is committed to ensuring that the home insurance industry operates on a fair and competitive basis. The government works closely with the Financial Conduct Authority (FCA) and the Competition and Markets Authority (CMA). Both CMA and FCA have significant powers to deal with anti-competitive behavior. The government is confident that both regulators are effective in their assessment of the practices of the providers of home and contents insurance.