The Money Advice Trust has today welcomed a call by members of the House of Lords for a new government strategy on financial inclusion, and the designation of a lead Minister tasked with driving this agenda across government.
The charity, which runs the free National Debtline advice service, called the Financial Exclusion Committee’s final report an “important call-to-arms” that should galvanise government, regulators and industry to take strong action to improve financial inclusion and access to financial services.
The Financial Exclusion Committee, chaired by Baroness Tyler of Enfield, has spent nearly a year taking evidence on financial exclusion from charities, industry representatives and current and former Ministers.
The report recommends the appointment of a “clearly designated Minister for Financial Inclusion” and “a clear strategy for improving financial inclusion in the UK”. Other recommendations include expanding the remit of the Financial Conduct Authority (FCA) to promote financial inclusion as one of its key objectives, and introducing rules setting out a “reasonable duty of care for financial services providers to exercise towards their customers”.
Joanna Elson OBE, chief executive of the Money Advice Trust, the charity that runs National Debtline, said:
“This report is an important call-to-arms that should galvanise government, regulators and the financial services industry to do much more to tackle financial exclusion in the UK.
“A lead Minister for Financial Inclusion is an idea that has real merit – and we hope the government will consider this case carefully.
“Financial exclusion is driven by a range of factors – including fundamental issues around poverty, low financial capability, and products and services that do not always meet the needs of low-income consumers. We need a whole-society strategy, led by government, to tackle these complex challenges.
“This strategy must also recognise that problem debt is both a cause and a consequence of financial exclusion – and that reducing the former is essential in tackling the latter. Crucially, we need to ensure that many more people in financial difficulty receive the free advice they need to deal with their debts, and get back on the road to financial health.”
In a written submission to the Committee’s call for evidence in September 2016, the Money Advice Trust described financial exclusion as “a significant social problem, the scale of which necessitates a co-ordinated, whole-society strategy in response”, and called on the government to take on a “greater leadership role” in improving financial inclusion in the UK.
The Trust’s chief executive Joanna Elson OBE provided oral evidence to the Committee’s first session on Tuesday 5th July.
Read the final report of the House of Lords Financial Exclusion Committee.