Welfare Reform Bill
12:00 pm
Kitty Ussher: Thank you for the useful history lesson about the origins of the people’s bank idea, which I shall mull over.
In a sense, we are simply taking a primary power, and all this will be discussed and consulted upon later, but the general view is not to have a different system by virtue of it operating through a different body, so the “rules,” if you want to call them that, or the conditions would be the same. In a sense, there is discretion at the moment in that an adviser decides whether the current criteria for granting a budgeting or a crisis loan are met. We may want to change the criteria across the board.
We do not need primary legislation to do this but, for example, we are being slightly too subjective by spending a lot of time questioning people about precisely how their cooker has broken down and why. Perhaps it is all right to accept that for people who are not well off, just as for middle-class people, there are spikes in expenditure. While it is always better to save in advance, sometimes you have to borrow and smooth the payments over time. It is irrelevant to that whether the reformed fund is administered by an external provider in some parts of the country or, theoretically, across the whole country, although we are nowhere near that. The advantage of taking the power to work with an external provider is that they may be quite good at another thing that we want to do, which is offering better financial advice so that people do not have to borrow in the first place. As you say, encouraging indebtedness is not a good thing in itself, but sometimes people need to borrow.