Nick Smith MP

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Nick Smith MP has called for the Financial Conducts Authority to deliver for families in Blaenau Gwent and stop extortionate interest fees on household goods.

The Blaenau Gwent MP believes companies like Bright House charge unfair interest rates for goods such as fridges and freezers under the guise of small weekly payments.

For example, a babies cot in the Ebbw Vale store that costs £283 will end up costing £780 over three years thanks to sky-high interest.

Mr Smith used Prime Ministers Questions in December to call for the Government to cap interest rates this sector charges and also pressed the FCA to take action.

Now the Government have written to Mr Smith saying they will be working to ensure the FCA will have all the tools needed to take action where necessary.

With the FCA report into the sector due to be finalised in the coming months, Mr Smith wants the sector to face the same interest rate caps as the payday loan sector.

In the eighteen months since that cap was introduced, the Citizens’ Advice Bureau have reported a 50% drop in payday loan problems.

“Paying £780 for a £283 babies’ cot is just not on and people struggling to get by need to be protected”, he said.

“I campaigned for ethical credit options such as credit unions when payday loan companies like Wonga were lending Blaenau Gwent £1m a year.

“But these companies have been a long standing problem. People who are just about managing feel they have no choice to pay through the nose in the long term for the essential goods they need right here, right now.

“I’ll continue to press the Financial Conducts Authority to consider the same interest rate caps that have worked so well on the worst excesses of payday loans.”

Unfair interest rates punishing families struggling to get by

Nick Smith MP has called for the Financial Conducts Authority to deliver for families in Blaenau Gwent and stop extortionate interest fees on household goods.

end-child-poverty.pngNick Smith MP has backed a campaign to meet the challenge of child poverty head on as new data revealed it affects nearly a third of children in Blaenau Gwent.

New figures from the End Child Poverty Coalition have revealed 4,662 children in the borough are in child poverty – 32%.

It prompted the Blaenau Gwent MP to back Dan Jarvis’s Child Poverty Bill, which would require the government to set a child poverty target and a strategy for meeting it.

In 2015, the Tories scrapped children poverty targets, brought in by the last Labour government, meaning they have no legal duty to tackle the number of children in poverty.

Mr Smith said: “No child in Britain should have to grow up in poverty. For those children who do, poverty represents a real barrier to them reaching their potential. 

 “They are more likely to fall behind in school, less likely to secure a job, and more likely to suffer from illness.

 “We need to give every child the opportunity of the best start in life.

 “Through establishing a target to reduce child poverty, we are making a clear statement that can drive change across government”

The debate on this bill is now scheduled to resume on February 24 after Tory speakers attempted to talk it out on its original date.

A bill on parking charges - that had been supported by the Government - took three and a half hours to debate and meant the Child Poverty Bill ran out of time.

Mr Smith said: “It’s clear from the Government’s position on this in the past and their concerted effort to ruin this bill that it is an issue they are afraid to debate.

“They know the uncomfortable truth about child poverty, which is why they scrapped the figure altogether and swept it under the carpet.

“It’s up to Labour MPs to remind this Government that while they continue to stick their fingers in their ears, 3.9m children live in poverty.

“It is a national disgrace”.

To sign the petition calling on the Tories to set a target to reduce it now, visit www.nochildpoverty.org.uk

Backing the campaign against child poverty

Nick Smith MP has backed a campaign to meet the challenge of child poverty head on as new data revealed it affects nearly a third of children in Blaenau Gwent....

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Nick Smith MP has called on the Prime Minister to protect vulnerable families who rely on hire purchases to furnish their homes.

This year Citizens’ Advice Bureau in Blaenau Gwent has seen a 59% increase in cases where people are struggling to keep up with payments, with companies such as BrightHouse charging sky-high interest rates.

Mr Smith, who had previously campaigned for controls on payday loan companies, used his opportunity at Prime Ministers’ Questions to ask for a cap on interest rates for hire purchases.

A cap, which is currently being considered by the Financial Conduct Authority as part of their review into the industry, has seen a massive turnaround in payday loan problems.

Although the problem is still on the rise in Blaenau Gwent, where Mr Smith discovered Wonga had loaned more than £1m to customers in one year, nationally the figures have halved since the cap’s introduction.

Speaking after the PMQ session, Mr Smith said people’s need for basic household necessities were being exploited.

“It’s not about the family who overspends at Christmas or lives beyond their means. It’s living week-to-week and needing a fridge or cooker to feed your loved ones”, he said.

“The payments are low but the interest is staggering. People end up paying two or three times as much for the same items and far from helping those in poverty, it helps to keep them in it.

“I’m glad to see more credit checks in the industry and as with payday loans, the need for credit is an important one.

“But more needs to be done to protect people who have no other choice. We’ve seen the success of the interest rates cap with payday loans and the Government and FCA need to seriously consider this option.”

In response, Prime Minister Theresa May acknowledged the problem of high-cost credit and said she would look at the issue further.

CAB in Blaenau Gwent reported 43 cases involving hire purchase problems in the first half of 2016/17, up from 27 in the same time period in 2015/16.

Up to 400,000 people use rent-to-own firms to buy household appliances, paying back high rates of interest.

For example, a Hotpoint Fridge-freezer normally costing £472 would cost £1,170 on a three year repayment plan from BrightHouse.

Sky-high rates punishing “just about managing” families need to be capped

  Nick Smith MP has called on the Prime Minister to protect vulnerable families who rely on hire purchases to furnish their homes. This year Citizens’ Advice Bureau in Blaenau...


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