Financial Mentoring Report Demands Immediate Action On New Zealand’s Spiralling Debts – Greens

The Green Party commit to regulating debt collection and banning attachment orders against beneficiaries, following FinCap’s finding that their clients’ debt has surged to almost a billion dollars.

“Families are increasingly under pressure from the rising cost of living and the growing burden of difficult debt. Poorly regulated debt collectors are deepening the crisis for too many families,” says Green Party Social Development spokesperson Ricardo Menéndez March.

“An attachment order mandates the Ministry of Social Development to deduct up to 40% of a person’s benefit, paying it directly to a creditor to settle a debt.”

“During a time where people are struggling, this is directly taking away people’s ability to afford the essentials. It prioritises these predatory companies over people who are struggling to stay afloat.”

FinCap’s report found that 86% of their financial mentors have seen debt collectors demanding for repayments that would prevent people from affording essentials.

“Nobody should have to choose between feeding their family or paying the power bill because they’re being chased for a spiralling debt that they can’t afford to pay.”

“The financial mentoring sector has been crying out for action on this for years, but no government has been willing to address problematic debt collection practices and to support the financial mentoring sector.”

“The Green Party will introduce a licensing regime for debt collectors and banning attachment orders against beneficiaries and we call on the Government to implement all of the recommendations in FinCap’s latest report,” says Menéndez March.

Notes:

Attachment orders allow private debt collectors to force beneficiaries to pay up to 40% of their benefit directly to debt collectors, enforced by the Ministry of Social Development.