Families need more debt help and less pressure from bailiffs – new report says
The Government must take urgent action to help hard-pressed households deal with debt, MPs have warned.
A report from the Commons Treasury Select Committee also calls on ministers to act now to tackle a looming crisis caused by 12million people not saving enough into pensions.
It comes after figures from the Money Charity revealed Britain’s personal debt mountain – which includes mortgages – hit £1.58trillion in May – up from £1.54trillion a year ago.
The average amount of debt per adult is now £30,670, or around 113.8% of average earnings. That’s £900 more per person than this time last year.
Today’s Treasury Committee report says too many families have too much debt and don’t have any rainy-day funds.
Pay off your debts
It recommends the Financial Conduct Authority brings in regulations to limit the cost of credit, including overdraft fees.
It also raised big concerns about the heavy-handed way local and central government debt collections, such as council tax arrears, are handled.
Other recommendations include bringing the self-employed into pension auto-enrolment and abolishing the Lifetime ISA because it’s too complicated and has been slammed by industry experts.
Nicky Morgan, who chairs the Treasury Committee, said: "Many households are facing challenges that are putting pressure on the health and sustainability of their finances."
Citizens Advice said it had seen a more than 25% rise in bailiff problems since 2014. Chief executive Gillian Guy said: “The Government must now show it’s taking the issue seriously.”
Tom McPhail, of investment firm Hargreaves Lansdown, said: “The Committee deserves great credit for pinning the government down on its responsibility for long-term household savings, investments and financial resilience.”
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