Latest Public Sector News

12.09.18

Councils urged to provide place-based credit building and salary-linked loans

A new report has urged local authorities and all other public-sector employers to offers their employees salary-linked loans and saving systems to boost financial literacy and end “punitive” borrowing costs.

The think tank, ResPublica, also argues that this could boost the credit ratings of those in the most disadvantaged communities, as poor credit ratings are disproportionately more common in more deprived areas.

The report, ‘Credit Emancipation: How salary-linked lending can help turn around disadvantaged places,’ received praise from Guy Opperman MP, minister for pensions and financial inclusion.

He said: “We have already brought forward a range of proposals, from auto-enrolment to the Single Financial Guidance Body. But ResPublica’s report unveils an exciting and interesting new set of ideas to lessen debt and the cost of debt.”

According to the report, improving the aggregate credit score of a local authority, from the bottom 10% to the middle of the credit score distribution, would improve median weekly earnings by £36, increase employment by three percentage points and increase home ownership by 6% points.

Opperman added: “ResPublica’s argument for salary-linked lending to become the norm across both the public and private sector is an important contribution to the debt reduction debate and one that I will be discussing with ministerial colleagues.

“I will be interested to see if the public sector – whether locally or nationally – can play its part in exploring, and piloting, the possible benefits and practicalities of developing a system of salary-linked lending for the UK’s civil servants.”

Phillip Blond, director of ResPublica, said that given the government wage restraints on the public sector, “finding other ways to support hard pressed workers is common sense.”

He added: “Across government, some 5.5 million people are employed, many of whom are on low incomes. Offering all of these people access to affordable credit will improve workforce retention and productivity. It will also help to put another nail in the coffin of predatory companies.”

Top image: georgeclerk

 

Enjoying PSE? Subscribe here to receive our weekly news updates or click here to receive a copy of the magazine!

Comments

There are no comments. Why not be the first?

Add your comment

 

public sector executive tv

more videos >

last word

Prevention: Investing for the future

Prevention: Investing for the future

Rob Whiteman, CEO at the Chartered Institute of Public Finance (CIPFA), discusses the benefits of long-term preventative investment. Rising demand, reducing resource – this has been the r more > more last word articles >

public sector focus

View all News

comment

Peter Kyle MP: It’s time to say thank you this Public Service Day

21/06/2019Peter Kyle MP: It’s time to say thank you this Public Service Day

Taking time to say thank you is one of the hidden pillars of a society. Bei... more >
How community-led initiatives can help save the housing shortage

19/06/2019How community-led initiatives can help save the housing shortage

Tom Chance, director at the National Community Land Trust Network, argues t... more >

interviews

Artificial intelligence: the devil is in the data

17/12/2018Artificial intelligence: the devil is in the data

It’s no secret that the public sector and its service providers need ... more >

the raven's daily blog

NSPCC: Working together to improve the support available for children who have been sexually abused

08/10/2019NSPCC: Working together to improve the support available for children who have been sexually abused

Hayley Clark, the acting head of development and impact at the NSPCC, talks about the significant gap in support services for children who have been sexually abused and the Ho... more >
read more blog posts from 'the raven' >

editor's comment

25/10/2017Take a moment to celebrate

Devolution, restructuring and widespread service reform: from a journalist’s perspective, it’s never been a more exciting time to report on the public sector. That’s why I could not be more thrilled to be taking over the reins at PSE at this key juncture. There could not be a feature that more perfectly encapsulates this feeling of imminent change than the article James Palmer, mayor of Cambridgeshire and Peterborough, has penned for us on p28. In it, he highlights... read more >