Invited by the University of Birmingham Conservatives, controversial backbench MP Jacob Rees-Mogg visited campus on Friday 9th March, speaking about his views on free speech, housing, mental health, Russia and tuition fees to a packed lecture theatre of around 300 students.Written by Erin Santillo & John Wimperis on 16th March 2018
Rise In Students Borrowing To Cover Living Costs
Increasing numbers of young people are borrowing in order to afford basic living costs
Financial Conduct Authority Chief Executive Andrew Bailey said to the BBC: ‘there is a pronounced build-up of indebtedness amongst the younger age group’. Bailey emphasized that the increase in debt should not be attributed to reckless borrowing, rather: ‘this is directed at essential living costs. It is not credit in the classic sense, it is about the affordability of basic living in many cases’.
According to the Insolvency Service, the number of 18 to 34 year olds in the UK becoming insolvent rose 31.3% between 2015 and 2016. In addition, a report published in August 2016 by Money Advice Trust found that 37% of 18 to 24 year olds owed an average of £2,989 in debt from a credit card, an overdraft, or another form of borrowing. The debt accounted for in this report excluded student loans and mortgages.
Issues of increasing debt in the UK are being examined by the government. Last month Shadow Chancellor of the Exchequer John McDonnell announced that Labour would cap credit card interest charges with the aim of making sure that borrowers pay back no more than twice the amount borrowed. The FCA estimated that such a policy would force lenders to write off up to £1.3 billion per year.
Chancellor of the Exchequer Philip Hammond under pressure to deliver a budget next month that brings the Conservatives back from the brink with young voters, is reported to be looking into the idea of cutting National Insurance contributions for young people.
With the younger generation having to deal with rising debt, it is the case that many are not seeking advice. The report from Money Advice Trust revealed that just 21% of young people seek advice on debt matters online. 63% of young people however, do seek advice from their parents. Despite proposals from Labour to address debt issues by tackling lenders, and proposals from Conservatives to put more money in the pocket of young people, neither of the proposals address issues with many young people not seeking expertise in having to deal with debts.
Article by Michael Francis