Cap may drive thousands into hand of loan sharks

Local SNP MSP Angus MacDonald has warned that Tory Government cuts to the level and availability of Social Fund Crisis Loans could drive thousands of disabled, pensioner and loan parent households into the hands of loan sharks.

The UK Government plan to implement a cap of three Crisis Loan awards for general living expenses in a rolling twelve month period, however, a parliamentary question has revealed that, over the last year alone, more than 700,000 loans were approved for people who had already required four or more loans.

In addition to cutting the number of loans available, the UK Government have said that loans will no longer be available for items such as cookers and beds and the rate paid for living expenses will be cut from 75 per cent down to 60 per cent of benefit rate.

SNP MSP for Falkirk East, Councillor Angus MacDonald, slammed the move by the UK Government saying:

“Cutting support for people at a moment of crisis must be the Tories cruellest cut yet. It will impact on the most vulnerable households, and could drive thousands into the hands of loan sharks, making their financial difficulties even worse.

“It is clear from the UK government’s own figures that hundreds of thousands of people, who have been granted four or more loans in a twelve month period, would lose access to this lifeline support. These awards must be based on need not an arbitrary cap set by Ministers in Whitehall.

“By their nature crisis loans are a last resort, and the fact that so many people have had to take out these loans should underline the difficulties that households are facing. Instead of trying to help, the Tory Government are making things much more painful.

“These are loans that people pay back, so these cuts are not about saving money.

“With further powers over the economy and over the welfare system that supports our most vulnerable people we could put a stop to the Tories dismal decade of cuts, invest in growing our economy and support our most vulnerable properly so that together we can make Scotland better.”

Copyright © Angus MacDonald MSP 2017

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