I very much support Lords amendment 1 on the duty of care. As the Minister will recall, we have raised this during the previous stages of the Bill, in Committee and on the Floor of the House. We think that a financial services duty of care has never been more needed than it is just now, given the difficulties that people have had in the past year with the impact of coronavirus and long covid. The Minister’s proposals are really for consultation, to kick the can down the road until August 2022, giving
our constituents quite some time before they can get the duty of care that I think we would all agree they deserve.
In particular, the amendment would help those suffering not just from the effects of covid but from cancer, which is why it is supported by Macmillan Cancer Support. Four out of five people with cancer are affected financially, being on average £570 a month worse off as a result of their diagnosis. Without support to manage this financial impact, money worries can spiral out of control. Macmillan estimates that more than a third of people with cancer, 39%, are severely financially impacted by their diagnosis and of those almost one in three had to take a loan or go into credit card debt. Macmillan’s clear ambition is that every person affected by cancer can rely on their financial services provider to give the support they need to cope with the financial impact of a diagnosis.
At the moment, there is a clear gap in the service. Only 11% of people tell their bank about a diagnosis. Why is that? Is it because they do not think that they will get a fair hearing? Is it because they do not want to admit something like that to their bank because they fear some sort of negative consequence? That tells me that the rules as they stand are not working. It is a patchwork. Someone might have the good luck to have a financial services provider who is understanding, but that is not good guidance and it does not help everybody.
People support there being a duty of care. Research by the Financial Services Consumer Panel found that 92% of consumers, 99% of sole traders and 97% of small and micro businesses believe it is important that there is a duty of care in financial services. Health issues could have an impact on them, because they would affect their business and its viability going forward. The duty of care is also supported by Age UK, the Alzheimer’s Society, Fair by Design, the Money and Pensions Service, StepChange Debt Charity, Surviving Economic Abuse and The Money Charity. They believe in it because a duty of care can lead to the necessary change in culture and practice. Customers should be easily able to access forbearance from their provider, including flexibility on mortgage payments and interest freezes on credit cards or loans, without it damaging their credit files. If we put that in place, it would prevent long-term harm and financial exclusion.
There should be a clearer path to compensation when things go wrong because a provider has failed in its duty of care. That leads to a standard that people can expect and we can hold to account people who do not meet that standard. It would make a real difference were the Government to take this on, and it is hugely disappointing that they do not wish to do so today. I suppose there is still hope that the Government could change their mind right now and do this, but kicking the can around until 2022, when perhaps something will happen, does not help people here and now. I urge the Government to consider that and see whether there is any way they can bring it forward more quickly. Lots of the evidence on this issue already exists so we do not need to go into further consultation to prove the evidence that is clearly there.
In other areas the evidence is slightly more contentious and disputed, such as Lords amendment 8 on mortgage prisoners. The number of people affected seems to be part of the contention. The Minister said that he follows the facts and the evidence, but in reality he is disregarding
some of the facts and evidence that do not suit his position. As the right hon. Member for Wolverhampton South East (Mr McFadden) said, the evidence is disputed. Although there may be up to 250,000 people stuck on that standard variable rate, many of them have also paid considerably over the odds in their mortgage payments.
There is also a degree of geographical impact. As a result of the location of Northern Rock, 14% of those affected are in the north-east, 16% in the north-west, 12% in Yorkshire and Humberside, and 11% in Scotland. That bears consideration, because this issue has a disproportionate impact on a large and significant group of people and their families, particularly in the context of covid and the challenges that many will be facing, which have deepened this year. It is incumbent on the Government to bring forward some kind of solution.
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People are undoubtedly being let down again by the Government and by the Minister. We need solutions, and it is deeply frustrating that the Minister is leaving people trapped with no solution. It is a bit hollow for him to talk about practical options and solutions, but not to say when such solutions will be brought forward. Unless he is prepared to do so—perhaps in the Financial Services Bill; the best minds in the Treasury could have been put to this—the situation does not give people an awful lot of hope. The Minister talks against the notion of false hope, but he is leaving many with no hope at all that there will be a solution and that people will get change. I pay tribute to the all-party group on mortgage prisoners, the hon. Member for Thirsk and Malton (Kevin Hollinrake), and all those who have worked hard with this group of people. They deserve a solution from the Government to this long-running issue, and they deserve it now.
The SNP was glad to see the move to extend cashback, particularly because the wider issue of access to cash is missing from the Bill, despite its being a perfectly good place to include it. The move might to some degree help to keep money in local communities. Many communities do not have facilities for business banking at all, and that is part of the wider picture and problem. What conversations has the Minister had with business representatives about the practicalities of this measure? Will it mean that small businesses will have to hold more cash in order to provide cashback as a service? What are the costs and implications of that? It would be useful to have a wee bit more practical information.
I pay tribute to the hon. Member for Walthamstow (Stella Creasy) who was brilliant on “buy now, pay later” in Committee. The timing of the Woolard review was not helpful for bringing things forward in the Bill, but I am glad action is now being proposed. I hope it will happen swiftly, as there has been a massive proliferation of “buy now, pay later” companies. Now when people click on any website to buy something, that is what pops up. The Government have a job on their hands to try to regulate that and ensure that our constituents are kept safe. As I said in Committee, this seems to have a disproportionate impact on young women who are buying things on those websites, and I ask the Government to do a lot more analysis into who this issue affects, and how best to introduce legislation that will protect everybody.
I welcome any movement to improve the regulations on climate change. With COP26 hopefully happening this year in my constituency, I am keen for the Government to take a leading role and do more to ensure that financial institutions take their responsibilities to tackle climate change seriously. A lot more could be done on that, and everybody needs to take responsibility and play their part if we are to tackle climate change and make meaningful progress.
Finally, it would be nice if Opposition amendments were taken on board more often, or indeed at all, by this Government. There is so much that could be done in areas reserved to this Parliament, where the Scottish Parliament would also like to act but cannot do so. I hope very much that some day soon Scotland will not have to wait for a UK Treasury Minister to act, and that we will be able to do so ourselves, with the proper powers of an independent nation to protect our own people and to build a fairer, more inclusive, more prosperous nation.