Clause 8 - OFT to prepare information sheets on arrears and default
Consumer Credit Bill
9:55 am
Gerry Sutcliffe (Parliamentary Under-Secretary (Employment Relations and Consumer Affairs), Department of Trade and Industry; Bradford South, Labour)
Again, I am pleased about the spirit in which the hon. Gentleman raised those issues, because they are important. It is important that consumers know exactly what their rights are. Consumers should be informed about the consequences of missing payments and that redress needs to happen immediately. That is a message that we cannot communicate enough.
Consumers should receive relevant information about how to manage debt issues at the most appropriate time—when they first fall into arrears or when they are in default. The best way to get the information to them is through the lenders. The most effective time is when a problem first develops, not later. The information sheets are designed to assist consumers who have difficulties paying their loans. The OFT will have to consult interested parties—the industry and the stakeholders who have been identified in consultation on the Bill—and publish the notices, to ensure that the information is both relevant and helpful. The Government want to help consumers with debt problems. Informed consumers can make better choices. Giving them relevant and helpful information at an early stage will help them to prevent bigger problems from developing.
What kind of information will the sheets contain? Consumers should receive relevant information about how to manage debt issues at the most appropriate time. The information sheets will contain information about the possible consequences of not making payments, including the potential for court action by a creditor.