Government White paper...
29th July 2003

Ceilings research delayed.. national money advice service considered

New Consumer Credit Minister, Gerry Sutcliffe, last week announced plans to publish a White paper on Consumer Credit reform in the Autumn, and highlighted in the media that this would include a statement on tackling high interest lenders. The DTI press release is available here. Of note is the statement that the White paper will detail how the licensing system will be used to address problems, and the proposal to create a national co-ordinated money advice service.

However, the Government's research into the effectiveness of interest rate ceilings in other countries has been delayed, and this is not now expected to be completed until February 2004. We are therefore facing the prospect of a White paper without much needed information on the potential use of interest rate ceilings.

The call for a national money advice service is welcome, although there will be a need for Government to ensure that proposals meet the need of borrowers on the lowest incomes. This should include joining up money advice services with credit union development on the ground.