Oral question asked in the House of Commons, by Nicholas Winterton (Conservative). It was answered on Thursday, 13 July 2006 on behalf of the Treasury.

Financial Capability

Question: Does the Minister accept that too many financial institutions—such as banks, building societies and credit card companies—encourage people of all ages to borrow beyond their ability to repay? Is that responsible? Should not something be done about it? The citizens advice bureau in my area wrote to me recently about growing debt among the elderly, because they are encouraged to borrow. What can the Government do about it?

Answer: I understand the hon. Gentleman’s concerns, and join him in praising the work of citizens advice bureaux. I met them a week or so ago, and they are in the process of hiring 350 personal finance advisers, precisely to give that kind of advice. It is often the case, however, that people fall into debt because they suddenly and unexpectedly face unemployment, family break-up or ill health. In those circumstances, going into debt would be the wrong thing, and we need to give people proper advice and support. In general, I do not think it right to say that banks should discourage people from taking out loans or credit cards, which in fact play an important part in our economy. The fact that so many more people in our society have mortgages and are home owners is a good thing, but we need to make sure that people have proper advice and support, especially at times of crisis, and I commend the CAB for all its work.

Secondary information

Type: Oral question
Reference: 448 c1469
Session: 2005-06
Oral question type: Supplementary
Chamber / Committee: House of Commons chamber
Subjects: Debts Education Financial services Finance Financial Services Authority
Link: View this Oral question on www.publications.parliament.uk