6-11-03

Barrett calls for debate on looming debt crisis

John Barrett, Scottish Liberal Democrat MP for Edinburgh West, today called for an urgent parliamentary debate to discuss the looming debt crisis facing the UK.

Figures from the Office of National Statistics this week showed that personal debt has risen by 50% since 1997, over twice the increase of incomes.  The statistics also show that unsecured personal debt now stands at an average of over £5,000 per person. 

The massive increase in the burden of debt is widely seen as one of the reasons behind today's interest rate increase by the Bank of England.

Speaking during Business Questions in the House of Commons, John Barrett said it was time MPs were given an opportunity to debate the looming debt crisis.  He has also signed a parliamentary motion, which calls for new health warnings on all material, which advertises credit, to warn people against borrowing more than can be afforded.

In a statement, John Barrett said:

"Consumer debt in the UK is now spiralling out of control and shows no sign of abating.  Figures from the CBI just this week showed that consumer spending is now increasing at its fastest rate for 18 months.  The increase in interest rates shows that the UK's impending debt crisis is worrying the Bank of England too.

"People who do borrow money must be better informed of the problems of getting into too much debt.  All too often, warnings about debt re-payments are given in tiny print at the bottom of a form or rattled off at great speed towards the end of an advert.  Proper credit health warnings on all material, which advertises credit products, would help raise awareness of the problem with debt and discourage people from borrowing more than can be afforded."

ENDS