Well done on the Government finally doing something to cap loan sharks.
In the future of course.
Not now.
So let’s rephrase that, well done the Government doing ‘something’ at ‘some undefined point’ in the future about capping dirty filthy scum loan sharks.
Like all things this Government does, it’s too little too late.
So while they’re patting themselves on the back over promising to do something about loan sharks in 2020, how about the other evil scum bag when it comes to plunging beneficiaries into debt – the Government itself?
Reports obtained through the Official Information Act revealed that as of March 2018, half a million people are in debt with the Ministry of Social Development, with the total debt being $1.5 billion. Most of the debt comes from overpayments and recoverable advances for basic necessities such as clothing, furniture and petrol. Weekly repayments are set by MSD, with some low-income people expected to pay up to $80 a week which comes out of their benefit.
Add to that the sexist and cruel billions in penalties for child support, the vicious student loan repayment system that keeps students from returning home and which has more tax chasers than the rich white collar criminals get and the legal aid farce which forces poor people to plead guilt rather than take out debt to get legal representation.
How dare this government clap itself on the back over predatory lenders when the Government is the worst predatory lender of all!
It’s just another feel good promise that hasn’t even been implemented while the Government continues to act just as cruelly as the behaviour they are legislating against.
Ii’t time Government forced the Global corporates stepped up and finally paid their share of taxes since they have been rorting our system.
Especially since 2008 when the wheel wheeling John Key Government opened up our public owned assets to the ‘fire sale’ to let them buy our assets we had paid for for generations and never ever got anything back them for robbing our assets.
The poor and elderly, need a break here now at least in fairness as they were some of those who paid for the assets sold off to the greedy global corporations!!!!!
When I was on the DPB benefit and I needed a washing machine or fridge we were given what was called an advance payment and we paid it back @ 5$ a week or more if we could afford it.
I found this to be good policy. But under the national government the debt racked up is 1.6 billion something like this amount. How did it get so big ?How much of this is from rent to stay in those ugly short term motels and why is the national government saying they will consider erasing the debt when it happened mostly under their watch as they treated beneficiaries and the poor like shit instead of genuinely helping them.
So you found it a ‘good policy’ to pay back out of your ordinary benefit (meant to cover food, accommodation, power, water), which will have been kept low since ‘Ruthanasia’ ruled in this country, at $5 a week?
They forced you to cut back on food and so, to do that, that is the truth, and that is NOT good policy, for sure, it is unfair, it is creating hardship and enforces a hopeless situation of poverty for a person.
A better approach for those with children would be to advance the money as an interest free loan repayable on employment/re-marriage/etc.
People are still signing up to what will still be 100% interest loans because no one in their right mind wants to try and deal with winz any more than they have to.
Capping debt recovery to 100 percent per annum (incl. fees) may seem like an improvement to some of us, but to be damned blunt and honest, this is not the improvement needed, it falls far short of putting into force controls for credit companies and what we consider as being loan sharks.
100 percent maximum interest and fees per year is still double the amount of what a person received in credit, be it a loan or something similar, and it is still extortionist a practice and exorbitant for an amount, for this to be allowed.
It should be something more like 50 percent maximum, or I would prefer 30 percent per annum, not 100 percent. The banks do usually charge no more than about 25 to thirty percent maximum for higher risk loans and credit, that should be a guideline for such a law change.
And regarding WINZ, they do what the government has instructed them to do, they are merely cold hearted, at times less so, executers of government policy, the law and orders.
What is needed is a change in law, so that ‘special needs grants’, such as for necessary home appliances (fridges, washers), for urgent needs (having something repaired), for even dental treatment, are no longer recoverable. So far, for many years that is, most special needs grants are expected to be paid back. But the benefit people get is already so meagre, it is tightly set, so to cover only basic needs for food, perhaps cheap clothing, electricity, water and possibly some basic transport costs (I would actually challenge this even being covered on present rates).
Hence when getting a special needs grant, that must be paid back, WINZ do basically force beneficiaries to cut down on other essentials, to pay back the advance or ‘loan’ given by WINZ, as there will for most be NO other way to do so. But perhaps the idea is, that benefits should only be very ‘temporary’, so people are expected to move off them and get back to work, in order to be able to pay back such debt.
What about long term sick and disabled persons though? They cannot work, so they should for a start not have to pay back advances. This government has now the chance to address these injustices, and increase benefits (base or main rates) by at least 20 percent, and/or to stop the policy and practice to force beneficiaries to pay back advances that only working persons not being on benefits could be able to pay back, at some time.
Let us watch this space, but going by their record, if any one minister moves too fast, he or she may upset the MSM, and then the PM, and be disciplined or even be out of a job.
Hence they call in further advisory groups to buy time, to mellow the public and to delay decisions, that may not even address any of the serious issues and injustices we have, many created by nine long years of a nasty Nat led government, that only really looked after its better off clientele, to exploit the rest as desperate servants in precarious employment, or on poverty creating benefits.
If it felt more motivated, the government could have chosen to put a chunk of its current $5.5 billion surplus into Kiwibank, to enable the bank to offer the kind of micro-loans (in the $500-2500) range that comprise the bulk of loan shark lending. All very well for PM Jacinda Ardern to talk about wanting to eliminate child poverty – but her government isn’t doing much to confront the predators feeding upon the incomes of the families in question. When the accidents of fate strike those with little or no income stored away in reserve, the government needs to be on hand to help. Yet before and after the GFC, the regulatory emphasis has been much further up the socio-economic ladder.
This was from a news article posted in error.
It’s no more than 200% of the loan in repayments, the loan plus no more than 100% in costs – interest, and all fees and charges. This is to ensure that unsecured loans are still available to the working poor but they will not be financially ruined repaying them.
The alternative is to provide the seed capital for non profit lending to low income earners.
As for Work and Income changes
1a sole parents and the unemployed with children should not repay the grant till they go off the benefit
1b those who made repetitive claims, above the norm, should go onto a spending card
2. those on permanent benefit (invalids) support should get the needs based grants without need to repay them.
3. those going onto a benefit while with children should get a loan to help them adjust to their lower income status (to refinance – pay off credit debt and hire purchase).
NZ debt clock climbing.
https://www.youtube.com/watch?v=reVrRfAo_Z8
Everyone get ready!
The move is welcome, though why it starts in 2020 rather than 2019 is beyond me.
The 100% total repayment idea is sound. Loan finance will continue but hardship derived from it will end.
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