Financial Inclusion

Oral Answers to Questions — Treasury – in the House of Commons at 10:30 am on 5 June 2008.

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Photo of Mark Todd Mark Todd Labour, South Derbyshire 10:30, 5 June 2008

What recent discussions he has had with ministerial colleagues on promoting financial inclusion.

Photo of Kitty Ussher Kitty Ussher Economic Secretary, HM Treasury

The Government are committed to ensuring that everyone has access to financial services to meet their needs. In 2007, I chaired a ministerial working group on financial inclusion, with colleagues from across the Government. That group developed a three-year action plan, which was published in December 2007.

Photo of Mark Todd Mark Todd Labour, South Derbyshire

I thank my hon. Friend for that reply. Does she agree that information and education are the crucial features in giving people better access to financial products and that that should be delivered at the youngest possible age? Some of the programmes that I see in schools that are designed to teach young people about financial products are, frankly, rather poor and not fit for purpose. Is there some sense perhaps in looking harder at whether the available materials are pedagogically suitable?

Photo of Kitty Ussher Kitty Ussher Economic Secretary, HM Treasury

I agree with my hon. Friend, which is why from September this year financial capability will be included in the personal, social and health education curriculum at key stages 3 and 4. My right hon. Friend the Secretary of State for Children, Schools and Families has announced £11.5 million precisely to provide educational support on financial capability in schools. I hope that we will shortly be in a position to announce who will provide that information.

Photo of Anne McIntosh Anne McIntosh Shadow Minister (Environment, Food and Rural Affairs)

The category that is most excluded is, of course, women, who tend not to present themselves for advice on taking up a financial package. What measures are the Government taking to include women more in those financial packages, and how does the Minister respond to newspaper reports today that women will be particularly affected by the removal of the 10p income tax band?

Photo of Kitty Ussher Kitty Ussher Economic Secretary, HM Treasury

Our policies are designed for all people, male and female, but an important strand of the financial inclusion action plan published at the end of last year is making sure that we use all the public sector agencies to reach the people who most need support and information. That is why every single person who visits a hospital to have a child will shortly be given the new parents' guide to money through the midwife service. I have seen that scheme in action in my constituency, and I can heartily recommend it.

Photo of Kerry McCarthy Kerry McCarthy PPS (Rt Hon Douglas Alexander, Secretary of State), Department for International Development

I know that the Minister is a great supporter of the role of credit unions in tackling financial exclusion, and I thank her for agreeing to speak at the inaugural meeting of the all-party group on credit unions at the end of the month. Does she agree that a fundamental review of credit union legislation is long overdue, if credit unions are to play the role that is needed within communities to tackle financial exclusion?

Photo of Kitty Ussher Kitty Ussher Economic Secretary, HM Treasury

I agree wholeheartedly with my hon. Friend, which is why we conducted a review of the environment in which credit unions and co-operatives operate. The results of the consultation were considered and published at the end of last year, on, I think, 31 December. We are working extremely hard to make sure that credit unions can play their full part in addressing the problems of some of the poorest people in our society by providing them with affordable credit and other forms of financial support. I hope to be in a position to announce more details shortly.

Photo of Adrian Bailey Adrian Bailey PPS (Rt Hon Bob Ainsworth, Minister of State), Ministry of Defence

I am sure that the Minister agrees that educating children about financial management from the earliest age is essential if we are to combat long-term financial exclusion. Will she undertake to look at AweSum Challenge, a programme recently devised and launched in West Bromwich by West Bromwich Building Society with the support of the Secretary of State for Children, Families and Schools, to consider its potential for combating financial exclusion?

Photo of Kitty Ussher Kitty Ussher Economic Secretary, HM Treasury

I would be delighted to look at that programme in my hon. Friend's constituency, and I commend him on his work on the issue. I believe that we can do far more through the education system, and through the various grass-roots organisations in some of our poorer communities, to drive up levels of financial capability. My hon. Friend will know that we commissioned Otto Thoresen to do some work on the subject and to provide a service that works for the whole population. The results of his work are currently being taken forward by the Financial Services Authority.