Week after week in my advice surgeries I see the hardship and emotional suffering caused by poor financial decisions. In my work locally with our excellent Citizens’ Advice Bureau and in Parliament as I carry out my role as the Vice-Chairman of the All Parliamentary Group for Citizen’s Advice; I have seen overwhelming evidence for the urgent need to reform the regulation of consumer financial services and to massively improve the quality of financial education and free advice offered to people.
On Monday the Government presented the Financial Services Bill to Parliament which aims to learn from the mistakes of the last Government’s attempts to change how banks and financial services were regulated. Since modern banking was developed centuries ago there have been individual bank failures and mis-selling of financial products, but the system wide failure of our own and so many other western countries banking systems during the past few years represents something new; this is an issue that has to be tackled and now is the time to do so.
Other countries such as Canada have fared much better during the current recession as they regulated their financial services in a different way.
Consumer Focus, Age UK and the Citizen’s Advice Bureau have congratulated the government on the consultative approach to the proposed legislation saying it is a ‘once in a generation opportunity to create a regulatory framework that fosters a robust and vibrant financial services market providing a range of valuable goods and services for consumers.’
Continuing this consultative process will be essential as the legislation is scrutinized and debated in Parliament. I am particularly concerned that the legislation will ensure that information about the products we all depend upon such as current accounts, pensions, savings, insurance as well as loans and mortgages is presented in a clear and straight forward way. Too often charges are hidden or presented in a way many people don’t understand.
I have spoken in debates about the need for better education regarding personal finances and budgeting. Alarmingly, 6.8 million UK adults lack basic numeracy skills to manage their daily financial matters. More than 20% of adults, asked to choose between receiving £30 or 10% of £350, opt for the lower figure. One in five gave the wrong answer to a question in a recent FSA survey which asked: ‘if the inflation rate is 5% and the interest rate you get on your saving is 3%, will your savings be worth as much in a year’s time?
I welcome all comments from constituents on this bold and far reaching bill. Just call my office on 01872 274 760 for a copy of the Bill.
Finally, on Sunday, I had great pleasure in joining the first of what I believe will be many celebrations of the Queens’s Diamond Jubilee as I joined the Mayor of Falmouth in a parade through the town and a service at the Parish Church. It was an honour to read the words written especially for the occasion by two much loved members of the congregation, Mr and Mrs Foye.