Clause 19 - Unfair relationships between
Consumer Credit Bill
3:45 pm
Mr Laurence Robertson (Shadow Minister, Economic Affairs; Tewkesbury, Conservative)
I think, not for the first time, that the hon. Gentleman makes a very good point. My amendment No. 25 deals with credit reference agencies and although my intention was slightly different, it may just cover his point. It is probably largely up to the industry, but if companies were not so able to rip some people off as they are, they might not be so quick to lend money without taking into account people's circumstances. There is probably a logical thread in that.
If we apply to borrow money for a house, our income is checked. If we try to top that up more than our income allows, we will not be lent the money. That is because it is not as easy for those companies to rip others off to compensate for bad loans that they may have made. In the credit card and in the loan shark industry—if I may put it so crudely—that is not the case. It is a bit like third-world debt. Some organisations have lent money at extortionate rates of interest to compensate for the possibility that country B may not repay them. We have a similar situation, and I am not sure how effectively the Government can deal with it. They can act by reducing the burden of the test from extortion to unfairness. I welcome that, but let us clarify the matter so that we can squeeze out those who simply lend money to anyone.
I do not know how on earth that poor gentleman got 22 credit cards. I do not think that many of us would be able to do that, but it is obvious that some people can. I hope that I have made the case for defining the word ''unfairness''. I accept that my amendment is not perfectly worded and that parts of it are better than others; but it is a genuine attempt to help the Government with the Bill rather than to get in the way.