Pay Day Loans – Credit where credit’s due

Sometimes in politics, you have to say “Credit where credit’s due”. And today on payday loans, that’s certainly the case.

Plenty of people deserve credit for bringing the blight of legal loansharking to the attention of the Westminster Village (the rest of the country knew about it a while ago). Those who have campaigned up and down the country against the pernicious influence of high-cost credit in their communities, the credit unions who have offered a far better alternative (often assisted by trade unionists) and – of course – campaigning MPs like Stella Creasy, who has become synonymous with the issue of tackling high cost credit for years now.

She’s an example of what a backbench (now front bench) MP can achieve if they pick an important issue and stick to it dilligently. And she deserves the credit that is coming her way today – even (begrudgingly) from George Osborne.

But the list of people who deserve credit today doesn’t include the Tories, despite their MPs endlessly parroting CCHQ lines on Twitter today about how they’re acting to help “hardworking people”. If they really cared about the impact of high street rip off merchants they wouldn’t have waited years to act. And if they really cared about the way in which desperate people are driven to terrifying levels of debt by wealthy bankers they wouldn’t have repeatedly voted against capping the cost of credit in the Commons. This isn’t a case of “when the facts change I change my mind” – the facts have been abundantly clear for some time now.

And as George Eaton noted this morning, Osborne has gone from lambasting Miliband as a “Marxist” to echoing him, saying this morning that government must:

“create the rules of the market”

If you had told me five years ago that a Labour leader would speak so clearly about restricting capitalism for the benefit of the common good I’d have laughed. Loudly and sadly. And now we have a Tory Chancellor – the axe man himself – talking about the market as something which must be controlled and restrained. Just weeks ago Ed Miliband said we were living in a Wonga Economy –
now George Osborne seems to agree.

We’re deep down in the rabbit hole now –
and we’re still far from finding how deep it goes.

But – before I’m accused of getting overexcited – I know that the devil of the government’s promises will be in the detail. We still don’t know at what level the “cap” on credit will be set. If it’s 4000%APR then today’s announcement is meaningless. If it’s 200% it’s meaningless. And with the Tories being rather close to certain usury pushers, it’s hard to see why they would possibly push for a suitably low cap.

But at least now the playing field on which we’re playing is a fair deal for those who borrow, now just those who lend. And we might see a race to help those at the bottom, rather than a race to the bottom.

Because the rules of the game are changing – and today we have Stella Creasy and Ed Miliband, and tens of thousands of others to thank for that.