Prime Minister unveils real help for consumers
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Issued Date: 17 Mar 2009
The Prime Minister today announced a package of real help and
protection for consumers struggling to make ends meet because of the
Speaking to an audience of consumer groups and money advice
agencies, he announced action to prevent people getting trapped in a
cycle of debt, measures to ensure fair treatment by courts and
debt-enforcement agencies, and a crackdown on scams and get rich quick
He also set out his commitment to a stronger regulatory regime
for banks and announced a White Paper on modernised consumer rights law
to give people a fairer deal.
Prime Minister Gordon Brown said:
"The changes we're dealing with as a country right now are
enormous. But we are determined to do our bit - when we see
hard-working, hard-pressed people being buffeted about by a storm not
of their making, we will never pass by on the other side."
Chief Secretary to the Treasury Yvette Cooper said:
"It is vital that people who are facing money worries know
where to turn to for help. Today's announcement will boost the
substantial help and advice we are already providing, so people can get
help to cope with the downturn and to plan for the future."
Consumer Affairs Minister Gareth Thomas said:
"Many people are already struggling to stay on top of their
bills and pay their debts. We want anyone in difficulty to be able to
access the advice they need. We are taking action to ensure consumers
are treated fairly and to put them back in control of their finances."
The Government today set out a package of real help to benefit
consumers during the downturn:
* Fair rules for debt enforcement - new measures will be
introduced to provide clarity for debtors and certainty for creditors
in advance of full independent regulation of the bailiff industry.
Bailiffs' powers of entry and force will not be extended and reforms to
charging orders will not be introduced. There will be consultation
which will set out the new rules and the way forward.
* Credit cards - the Government will stop lenders from raising
credit card borrowing limits where customer have not requested the
increase, and it will end the practice of firms sending unsolicited
credit card cheques. The Government will legislate at the earliest
* National Fraud Strategy - later this week the Government
will set out the action it will take to tackle fraud which costs the UK
£14 billion a year, and protect consumers from mass marketed frauds
such as bogus lotteries, get rich quick schemes and investment scams.
* Debt Relief Orders - from April, people on low incomes with
limited debts who could not previously afford to go bankrupt will able
to write off their debts and start again after a period of 12 months.
This is not an easy option for people in debt - the insolvency will be
a matter of public record and creditors will be able to apply to have
the order revoked. But it will help those trapped in poverty.
* The Money Guidance pathfinder - impartial sales-free advice
on money issues will be available in the North West and North East of
England from next month. It will help people stay in control of their
finances, help them cope with income shocks and avoid the distress of
* Debt advice - the Government is currently reviewing the
provision of debt advice to tackle any gap between capacity and demand
and ensure we get the most out of the existing network of providers.
This work will conclude before the summer. The Government invested
£15.85 million in the debt advice sector at the last Pre-Budget Report
in addition to the £130 million invested since 2006.
* Mortgage advice - making £2.5m available for advice agencies
to support the delivery of the new Homeowners Mortgage Support scheme.
And to safeguard a fairer deal for consumers in the future,
the Government will:
* Lead the way internationally with reform and regulation of
the banking sector to clean it up and make it deliver for consumers.
The Turner Review will set out proposals for further strengthening the
FSA and protecting savers' deposits, the Treasury will publish a White
Paper on financial services regulatory reform around the time of the
Budget, while the forthcoming Walker Review will make recommendations
to improve corporate governance, with particular regard to risk
management and remuneration.
* In light of the Turner Review and the current OFT
consultation on strengthening consumer protection, we will review the
split of responsibilities between the FSA and the OFT for the
regulation of second-charge mortgages.
* Publish a White Paper on action to help consumers in the
summer - with proposals to simplify and modernise consumer rights.
Government action to boost advice and tackle indebtedness:
* The HMT-sponsored Face-to-Face Debt Advice Project has
provided a step change in the availability of advice provided free to
clients in England and Wales, with around 500 new debt advisers. The
funding has resulted in over 193,500 clients receiving free
face-to-face debt advice to the end of December 2008. The funding has
been targeted at helping the most highly financially excluded areas and
* In the 2008 Pre-Budget Report the Chancellor also announced
additional funding of £10m for Citizens Advice up to March 2010. This
funding has enabled around 250 Citizens Advice Bureaux to open
additional hours in February and March 2009, with over 70% of Bureaux
expected to benefit from this extra funding.
* BERR has contributed £1m per year since 2003-04 to the
National Debtline. In the 2008 Pre-Budget Report, the Chancellor
announced an additional £5.85m for National Debtline in the spending
period to March 2011.
* The Ministry of Justice runs debt advice outreach projects
and the Community Legal Advice phone line. During 2007-08, Community
Legal Advice's specialist advisors handled 21,939 debt advice matters.
The Legal Services Commission (LSC) continues to fund free face-to-face
debt advice for eligible clients. During 2007-08 the LSC funded 87,999
case starts in debt.
* The LSC also funds schemes offering those facing a housing
possession hearing in the County Court the opportunity to access
emergency advice and representation and are open to all regardless of
* The Government and FSA are implementing Helping you make the
most of your money: an action plan for financial capability including
the Money Guidance pathfinder and embedding financial education in
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Article Published/Sorted/Amended on Scopulus 2009-03-18 14:15:19 in Business Articles