Agenda item

This Council expresses deep concern about both the proliferation of high cost, short-term lenders on our high streets and the increasing number of people becoming trapped in a cycle of long-term debt due to extortionate interest rates charged by these companies.

Members reiterate their commitment to work to tackle this problem in Leeds and welcome the recent move to block access to the websites of payday and high interest lenders via the Council network.

However, with an estimated 1 million families a month taking out payday loans, including many families in Leeds, Council instructs the Chief Executive to write to the Minister for Employment Relations and Consumer Affairs to lobby Government to:

• Look again at introducing a cap on interest rates charged by high cost, short-term lenders.

• Introduce restrictions around the practice of ‘rolling over’ loans given the OFT’s recent findings regarding the proportion of revenue generated through charges associated with this practice.

• Re-designate such lenders within the Town and Country Planning Act so as to require planning permission to be granted before certain establishments can be converted into pay day or high interest loan shops.

Council further requests that Leeds City Council officers produce a report for consideration by the Executive Board which explores the possibility of working with city partners to restrict the advertising of high interest or payday lenders in public spaces – for example, on billboards and in bus stops.

This Council commits to extending its current activity in order to increase awareness of the potential impact of borrowing through high cost lenders. Council also reiterates its commitment to work with partner organisations to increase the accessibility and visibility of alternative mainstream financial institutions such as the Credit Union.

K WAKEFIELD

It was moved by Councillor Wakefield, seconded by Councillor J Procter that this Council expresses deep concern about both the proliferation of high cost, short-term lenders on our high streets and the increasing number of people becoming trapped in a cycle of long-term debt due to extortionate interest rates charged by these companies.

Members reiterate their commitment to work to tackle this problem in Leeds and welcome the recent move to block access to the websites of payday and high interest lenders via the Council network.

However, with an estimated 1 million families a month taking out payday loans, including many families in Leeds, Council instructs the Chief Executive to write to the Minister for Employment Relations and Consumer Affairs to lobby Government to:

• Look again at introducing a cap on interest rates charged by high cost, short-term lenders.

• Introduce restrictions around the practice of ‘rolling over’ loans given the OFT’s recent findings regarding the proportion of revenue generated through charges associated with this practice.

• Re-designate such lenders within the Town and Country Planning Act so as to require planning permission to be granted before certain establishments can be converted into pay day or high interest loan shops.

Council further requests that Leeds City Council officers produce a report for consideration by the Executive Board which explores the possibility of working with city partners to restrict the advertising of high interest or payday lenders in public spaces – for example, on billboards and in bus stops.

This Council commits to extending its current activity in order to increase awareness of the potential impact of borrowing through high cost lenders. Council also reiterates its commitment to work with partner organisations to increase the accessibility and visibility of alternative mainstream financial institutions such as the Credit Union.

An amendment was moved by Councillor Golton, seconded by Councillor Downes,

To add at the end of the motion (after Credit Union) the words :-

“and Community Development Finance Institutions”

The amendment was carried and, upon being put to the vote as the substantive motion, it was

RESOLVED -

That this Council expresses deep concern about both the proliferation of high cost, short-term lenders on our high streets and the increasing number of people becoming trapped in a cycle of long-term debt due to extortionate interest rates charged by these companies.

Members reiterate their commitment to work to tackle this problem in Leeds and welcome the recent move to block access to the websites of payday and high interest lenders via the Council network.

However, with an estimated 1 million families a month taking out payday loans, including many families in Leeds, Council instructs the Chief Executive to write to the Minister for Employment Relations and Consumer Affairs to lobby Government to:

• Look again at introducing a cap on interest rates charged by high cost, short-term lenders.

• Introduce restrictions around the practice of ‘rolling over’ loans given the OFT’s recent findings regarding the proportion of revenue generated through charges associated with this practice.

• Re-designate such lenders within the Town and Country Planning Act so as to require planning permission to be granted before certain establishments can be converted into pay day or high interest loan shops.

Council further requests that Leeds City Council officers produce a report for consideration by the Executive Board which explores the possibility of working with city partners to restrict the advertising of high interest or payday lenders in public spaces – for example, on billboards and in bus stops.

This Council commits to extending its current activity in order to increase awareness of the potential impact of borrowing through high cost lenders. Council also reiterates its commitment to work with partner organisations to increase the accessibility and visibility of alternative mainstream financial institutions such as the Credit Union and Community Development Finance Institutions.