Campaigners and faith groups have given a warm welcome to a vote by MPs to restrict 'vulture funds' – companies that buy up poor country debts cheaply, and then sue for massive profits.
The measure is at the centre of the Debt Relief (Developing Countries) Bill, proposed as a private member’s bill by the Labour MP Andrew Gwynne. It passed its second reading in the House of Commons yesterday (26 February).
All parties supported the Bill, but the Conservative Party refused to allow the Bill to by-pass its Committee Stage, which would have speeded its progress.
The Bill seeks to ensure that creditors cannot pursue payment beyond the level assessed as sustainable by the International Monetary Fund and World Bank. It also provides an incentive for debtor countries to co-operate in settling these debts on terms consistent with the initiative.
“It is great to see, in a week where politics has focused on personalities, that MPs are uniting to ensure developing countries are not forced to choose debt-repayments over development,” said Richard Vautrey, Vice-President of the Methodist Church.
Nick Dearden, Director of the Jubilee Debt Campaign (JDC), said “We are delighted that the vultures bill attracted cross-party support, and we understand the desire of MPs to scrutinise the bill to make sure it is as effective as possible”.
However, the JDC criticised the Tories for insisting the Bill goes through Committee Stage. They fear that it will not become law before the general election, expected in May.
During the debate, the Conservative Treasury spokesperson, David Gauke, declined to guarantee that a Tory government would support the measure.
Dearden added, “We call on all political parties to ensure that this bill progresses as fast as possible through Parliament, and that all parties commit to introducing legislation if they form a government in a few months time.”
The Bill’s co-sponsor, Sally Keeble MP, said that the Bill would “help protect funds destined to provide services for some of the poorest people in the world. It will also protect the interests of British taxpayers who provide money for debt relief, only to find that some gets creamed off into these secretive funds.”
Richard Vautrey added that, “We all need to play our part to ensure our courts are not used to allow unchecked greed to flourish in a world where over a billion people are malnourished”.