Will my hon. Friend curb the activities of credit reference agencies that give out references on people's creditworthiness by reference not to the individual, but to the address at which the individual lives? Does my hon. Friend accept that that is a dangerous and misleading practice, and will he provide a means of redress for people whose reputations are harmed in that way?
My hon. Friend has touched on an undoubtedly difficult area. We believe that the laws and regulations in this area are generally adequate and have been so until now, but my hon. Friend is right to point out what can be a difficult area. I undertake to look at the matter again urgently and to see whether there are any methods that we could use to improve the position and to address the problems that my hon. Friend has identified.
When the Minister is looking at consumer credit legislation as it affects borrowers, will he arrange for more information to be given to people who borrow from banks so that they know, for example, that when they obtain money on an overdraft it is normally repayable on demand—most people do not know that—and that if they exceed the limit they could be charged a prodigious, unwarranted and disgraceful rate of interest of which they have had no advance notice?
The hon. and learned Gentleman will be pleased to know that new regulations on credit advertisement will come into effect next February. They will cover some of the points that he has raised, such as the use of more understandable English, and they will close certain loopholes. It is always difficult to legislate or to regulate this area in such a way as to take care of all developments. One often feels that almost as soon as one: has identified one difficulty, others arise. I assure the hon. and learned Gentleman that we are constantly vigilant in this area and that we shall look carefully at the point that he has raised.
Does my hon. Friend realise that constituents of mine with children and young people in their families are very worried by the fact that they are perpetually bombarded with invitations to borrow more and more money? My wife has a great sackful of these unsolicited appeals. What regulations does my hon. Friend propose to introduce to ensure that people fully understand what they are signing up for?
I know that that causes a lot of concern. Let me say immediately that section 50 of the Consumer Credit Act 1974 prohibits the sending to minors of circulars inviting them to borrow money or to apply for information about obtaining credit, so that aspect is already dealt with. Generally speaking, it is up to lenders to assess the way in which they offer credit, and they rarely offer it to minors, although that is something we shall have to watch. In general, existing legislation covers the point adequately.
What has the legislation done to protect and extend the rights of savers? A constituent of mine who has spent more than two years in an old people's home, during which time her deposit account at the bank remained untouched. Without her knowledge, the bank redesignated the account as dormant and reduced the rate of interest paid on it to I per cent. Are the banks acting within their legal powers in doing that and does the Minister think it right for banks to profiteer at the expense of old people in the despicable way that I have described?
It is quite right that the hon. Gentleman should raise an important constituency matter at Question Time, but I ask him to write to me with the details so that we can consider the case properly. I should not like to try to give an instant answer, but if he will write to me I will see what, if anything, can be done to help to remedy his constituent's grievance.