ANGUS MACDONALD WELCOMES PLEDGE TO CAP PAYDAY LOANS IN AN INDEPENDENT SCOTLAND
Sunday, 04 August 2013 21:36
UK GOVERNMENT REBUFFS SCOTTISH GOVERNMENT PLEAS FOR ACTION NOW
Falkirk East’s MSP Angus MacDonald has welcomed an announcement from First Minister Alex Salmond that payday lenders would be subject to tougher regulation in an independent Scotland.
Mr Salmond proposed that short-term interest be capped - as they are in many countries in Europe, Japan, Canada and some US states. He also proposed regulation of advertising and restrictions placed on the ‘rolling over’ of loans, which sees those unable to pay off the initial debt saddled with a bigger loan that is more difficult to clear.
The pledge comes after it was revealed that the Westminster Government rebuffed pleas from Scottish Ministers to introduce a cap on interest rates, as part of a toughening of the regulations surrounding the industry.
Commenting, SNP MSP Angus MacDonald said:
“I have been shocked by the number of enquiries I have received from constituents caught up in the payday loan racket. Unfortunately the Westminster Government has rebuffed pleas from Scottish Ministers to introduce a cap on interest rates, as part of a toughening of the regulations surrounding the industry however it is clear we must do all that we can as quickly as possible to deal with these vultures who tend to prey on people on low incomes or who are in financial difficulties.
“That’s why these are welcome proposals to curb the exorbitant interest rates charged by some payday lenders.
“It is hugely disappointing that the Westminster Government – who currently have powers over financial regulation and payday loans – is refusing to take any action in this area. If it can be done elsewhere, there is no reason why it cannot be done here.
“The Scottish Government is also doing all it can to mitigate the effects of Westminster austerity - through policies such as the Social Wage which sees Council Tax remaining frozen, free prescriptions maintained, concessionary bus travel supported and a Living Wage of £7.45 for workers covered by Scottish Government pay policy. The £33m Scottish Welfare Fund has also been established for families facing hardship as a result of welfare cuts.
“Today’s pledge from the First Minister shows that the SNP is committed to taking action in other areas in which we currently don’t have the powers to act.
“Next year, we face a choice of two futures. With a Yes vote, we can stop the scandal of 50,000 children in Scotland being pushed into poverty by 2020 and gain the powers to build a more fairer society. The only certainty of a No vote is more of the same austerity and hardship pushed onto us by Westminster.”