Why we need a cap on credit card costs
The End the Debt Trap campaign published a report on regulating the credit card market with a launch event in Parliament on 9 July. We are part of a coalition of organisations campaigning to cap the costs of all consumer credit so no one would have to pay back more in fees and interest than they originally borrowed. A cap was put in place for payday loans in 2015, and we demand it should be extended to all types of loans.
It was a moving event, with East Londoners we work with telling of their personal experiences with debt problems. A cross-party group of MPs – Labour’s Yvonne Fovargue, Conservatives’ Sir David Amess and Liberal Democrats’ Sir Vince Cable – pledged to ask the Parliament and the Financial Conduct Authority to cap credit card costs.
Open letter on FCA lack of action on predatory lending
Research for Action also joined 27 other campaign organisations, charities and think tanks in an open letter calling John Glen, the economic secretary to the Treasury, to investigate the Financial Conduct Authority’s lack of action on the growing personal debt crisis. Nearly three million households spend more than a quarter of their income on debt repayments, and nearly half of them have incomes less than £15,000 a year.
Open letter: When the UN calls out poverty in the UK, the government must listen
At the end of June Special Rapporteur Philip Alston, who visited the UK last year, presented to the UN his report on poverty in the UK. We submitted evidence to his inquiry and spoke at a hearing in Newham during his visit. Alston has strongly condemned the UK government for its responsibility for rising inequality, receiving in exchange attacks from politicians rather than commitments to address the issue. We were among 50 signatories to an open letter to the government, demanding they engage with international human rights bodies and listen to the people affected by austerity policies.
Not all of you may be aware that Research for Action is a worker co-operative… and we are proud to be one! It means we are collectively owned by our members and we run our organisation democratically.
From late June to early July the Co-op Fortnight, organised by Co-operatives UK, brought together co-ops from around the country to spread the word about co-ops. Media coverage reached over 35 million people and the #Co-opFortnight hashtag alone had a reach of millions. We participated online but also in person, with Vica attending the London co-ops connection meet-up.
Council pensions in trouble following investment fund collapse
Trouble at Woodford Investments has again revealed problems with local authority investments. When Kent County Council tried to withdraw £263m from its council staff pensions pot, the fund manager at Woodford froze the funds instead. Understandably, this has concerned workers not only in Kent council but others that have investments with Woodford. It also raises questions about private funds gambling with public sector money and the lack of oversight. The company that was supposed to oversee Woodford’s investment portfolios is Link, which two years ago acquired Capita, a familiar name from outsourcing and advise that have previously troubled councils.
Joel is quoted in the Guardian article, and also FT has covered the story in depth.
LOBO loans, LIBOR and financial regulation
Joel was the keynote speaker at Henley Business School’s (University of Reading) residential course for MSc students in Financial Regulation. He gave a lecture on LOBO loans and received a lot of interest from the audience.
In further engagement with the financial regulators, Vica attended the launch of Oonagh McDonald’s book “Holding Bankers to Account”. The author is a former MP, a former Shadow Treasury Secretary, a former non-executive director of the SIB, the FCA and the Investors Compensation Scheme. The purpose of the book is to provide a clear and documented account of the manipulation of LIBOR and similar benchmarks, focusing on the responsibilities of the banks and the failings of their control systems. We welcome a more systemic analysis of LIBOR rigging that does not only focus on the role of the individual traders. However, we would also like to see a more critical stance on the role of the regulators.