Newcastle North MP and Shadow Treasury Minister Catherine McKinnell joined the leader of the Labour Party today (17 October) on a visit to the office of a credit union in Peckham, London.

During the visit, Catherine heard firsthand the suffering caused by payday lenders and Ed Miliband set out action that a future Labour Government would take to tackle this issue.

Ed Miliband announced that, the next Labour Government will double the public funds made available to low cost alternatives to payday lenders such as credit unions, by introducing a levy on the profits of payday lenders.

This comes on top of plans to cap the cost of credit and give local authorities new powers to limit the spread of payday lending shops in town centres.

Following the visit Catherine stated:

“I am really pleased with today’s announcements outlining further action that a Labour Government would take to tackle the cost of living crisis.

“Families across our region are really struggling at the moment due to stagnant or falling incomes, rising prices, and ever increasing energy bills. This has led to a dramatic increase in the numbers turning to payday lenders as their incomes simply cannot stretch between paydays.

“It is appalling that, due to the cost of living crisis, 5 million families are thought to be planning to borrow money from payday lenders in the next six months and more than a third of those already doing so are turning to them simply to pay for household bills such as gas and electricity.

“Labour is offering a real alternative to the Government’s inaction on this issue by bringing forward proposals to freeze energy bills, reintroduce the 10p tax rate, tackle exploitative zero hours contracts and curb the explosion of payday lenders by capping the cost of credit and supporting credit unions.”