Financial Secretary talks about debt

Mark Hoban MP, Financial Secretary to the Treasury, recently gave a speech at the Consumer Financial Education Body (CFEB) Conference, in which he stressed the need for a responsible approach to debt and other aspects of personal finance.

Taking action on personal finance was, he said, one of the Government`s priorities, and one that featured strongly in the Emergency Budget and the Coalition Programme for Government.

Everything in those two documents, he continued, is based on freedom, fairness and responsibility - the three `core values`.

"Each of these values is fundamental to our approach to consumer finance, but today I would like to emphasise one aspect in particular, that of promoting responsibility in personal finance."

Mr Hoban`s speech dealt with the subject of debt, pointing out that in 2008, household debt in the UK was 99.9% of GDP (Gross Domestic Product - a measure of the country`s productivity). In Germany and France, the figures were just 61% and 50% respectively.

And many of the Britons in debt were in arrears, to the tune of £1,100 on average.

On top of high levels of debt, there were low levels of saving - 2008 was the first year since 1950 that household saving had actually been negative. Almost 50% of households had under £1,500 in savings before the crisis occurred, while over 25% of households had no savings at all.

"Over the summer," Mr Hoban said, "we will be taking a good look across Government at the support we currently provide for debt advice as a part of the Spending Review. We will be working with CFEB to make sure that the work of the National Financial Advice Service is joined up with the work of debt advice services in the most effective possible way."