Global Coalition for Responsible Credit says it wants financial system ‘worth saving’

By agency reporter
April 2, 2009

Church anti-poverty campaigners say they hope that the G20 meeting today in London will commit itself to the creation of a 'financial system that is 'worth saving'.

The call comes from Church Action on Poverty (CAP) which is a member of the Debt On Our Doorstep campaign and is echoed in the UK by a wide coalition of trade unions including UNITE and PCS, as well asthe New Economics Foundation, the National Housing Federation, and former Cabinet Minister and Chair of the Labour Party Ian McCartney MP.

It is also being backed internationally by the Global Coalition for Responsible Credit comprising the European Coalition for Responsible Credit, the US National Community Reinvestment Coalition and partners in 20 other countries.

CAP is urging the G20 to agree to place financial services providers under a ‘duty to exercise responsibility in financial services’. Campaigners say financial services providers should to be required to sign up to clear principles of responsibility and to have transparent mechanisms in place to ensure that these principles guide their behaviour in practice. Remuneration policies need to be reassessed in the light of this ambition. The responsibility should include a requirement for financial services providers to consider carefully the needs of all households, including those on low incomes, when designing financial products.

They also urge that taxpayer investment in the banking system be turned into 'real help' for people in financial difficulties, by agreeing actions to force lenders to offer to reschedule the liabilities of indebted households over the long term at affordable rates.

It is hoped that a commitment with be forthcoming to take further action to stop home repossessions, ensure lenders offer affordable mortgages to people in negative equity and/or mortgage arrears and to work to stabilise housing costs in the longer term by increasing the supply of affordable housing.

Damon Gibbons, Chair of Debt on our Doorstep, commented: “Financial services providers have engaged in irresponsible and usurious lending, causing households to become increasingly vulnerable to economic shocks and saddling them with unsustainable levels of debt. We call on the G20 to signal a decisive break with the short termism, greed, and irresponsibility that have caused the current crisis and to take action to ensure that taxpayer investment in the banking system is now used to create a system that benefits people.”

Supporting the work of the Global Coalition, Andy Case, a National Secretary for Unite, the UK’s second largest trade union with 2 million members, including 178,000 working in the finance sector, said: “The current situation provides an opportunity to re-build a financial system that supports a long-term outlook and is consistent with democratic aims, financial stability and social justice."

Although the views expressed in this article do not necessarily represent the views of Ekklesia, the article may reflect Ekklesia's values. If you use Ekklesia's news briefings please consider making a donation to sponsor Ekklesia's work here.