Local MP hits out at axing of Financial Inclusion Fund

Catherine McKinnell, Labour MP for Newcastle North, has hit out at the Coalition’s axing of the Financial Inclusion Fund (FIF), which supports crucial face-to-face debt advice services in Newcastle via the city’s Citizens Advice Bureau.

The Treasury’s decision to end the fund in March 20011 comes as figures published by the Association of Business Recovery Professionals reveal that Catherine’s constituency of Newcastle North had the highest level of personal insolvencies in England and Wales in 2009 (with Newcastle Central ranked third and Newcastle East ranked fourth).

Catherine said:

“The Financial Inclusion Fund has supported vital debt advice services for people across our city. Established five years ago by the previous Labour Government, the £25m a year national fund was deliberately targeted at supporting advice centres in areas that suffered from deprivation and with communities that had difficulties in accessing debt advice.

“Getting into debt can expose vulnerable people to the threat of homelessness, bailiffs seizing their possessions, loss of essential services – or even a loss of liberty. Having access to free, confidential debt advice is therefore absolutely crucial.

“These are very difficult economic times for many people across Tyneside and the North East, and it simply beggars belief that the Tory-led Government has taken the decision in the current climate to axe this much-needed fund. Once again, it would appear that the North East is bearing the brunt of the Coalition’s cuts.

“I have written to the Chancellor, demanding that he thinks again on this appalling decision as a matter of urgency. However, on the Government’s current form, I have little hope that he will change his mind.”

Notes:

1. There are currently 8 full and part-time debt advice workers at Newcastle CAB supported by the Financial Inclusion Fund (FIF). During the last financial year, the value of priority debts that Newcastle CAB’s FIF staff advised on in Newcastle increased by 55%, and the average value of the debts increased to £14,450.

2. A ‘Personal Insolvency Map by Parliamentary Constituency’, published by the Association of Business Recovery Professionals shows that, for the total number of new personal insolvency cases by constituency in 2009, the top 11 constituencies in England and Wales were as follows:

1. Newcastle upon Tyne North
2. North Tyneside
3. Newcastle upon Tyne Central
4. Newcastle upon Tyne East
5. Gateshead
6. Sunderland Central
7. Washington and Sunderland West
8. Houghton and Sunderland South
9. Darlington
10. Middlesbrough
11. Middlesbrough South and East Cleveland