Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Rising debt amongst the poor compounds social deprivation

Rising debt levels amongst the poor compound social deprivation

It is not surprising that the suburbs identified by the recent New Zealand Deprivation index as being most social deprived are also the areas frequently targeted by mobile lending trucks and payday and doorstep lenders.

Referring to New Zealand’s latest index of socioeconomic deprivation by the Department of Public Health, University of Otago, Wellington, the Education and Development Manager at Westforce Credit Union, Tu Nuualiitia, said today that assertions by researchers that the geography of poverty within New Zealand will take generations to change, is optimistic at best because the problem is compounded by debt.

“People are digging themselves deeper into debt everyday and reversing that trend must be a priority before anything else can happen.

“Loan sharks make holes in people’s lives that are almost impossible to escape. The index researchers used different variables for calculating the deprivation index, like income, employment, owned home, living space and transport, but improvements in any of these areas would be undermined by rising debt.

“It’s not how much money you earn, it's how much money you manage to keep – which is not very much when their payday loan is charging more than 800 per cent in interest,” he said.

Mr Nuualiitia said loan sharks are active in many of the poorer Maori and Pacific areas identified by the index because they know that socially deprived people are vulnerable, and their use of aggressive marketing practices repeatedly undermines any assistance initiatives.

Credit Union Westforce is active in many of the areas identified by the index as being amongst the most socially deprived in New Zealand, including Mangere, Onehunga, Papakura and Avondale, and recently launched interest free payday loans to try and counter loan shark activities.

“We have an opportunity right now to make a massive contribution to reducing social deprivation and poverty in many areas with the Government’s revision of the Credit Contracts and Consumer Finance Act 2003, but its slipping through our fingers.

“Unlike similar legislation in Australia, the United States and the United Kingdom, the New Zealand legislation does not cap interest rates that loan sharks can charge.

“While the legislation puts onus on lenders to disclose details of interest and fees, the most vulnerable communities are struggling with low levels of literacy and financial literacy, never mind the skills required to make sense of loan shark contracts

“When your back is to the wall, as it is for many of these people, you will take help from any quarter to relieve the pain, only for it to come back ten times worse when the interest rates and penalties start mounting up.”

ends

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Gordon Campbell: On What John Key Should Be Asking Joe Biden

No doubt, US Vice-President Joe Biden will be updating Prime Minister John Key on the chances of a TPP vote taking place in the ‘ lame duck’ session of Congress that’s held between the November’s election and the inauguration of a new President in January. More>>

ALSO:

Make NZ Make Again: Greens Will Establish A Minister For Manufacturing

The Green Party announced today that it will establish a Minister for Manufacturing in Cabinet, to better represent the interests of manufacturers and ensure they thrive. The Minister will be inside Cabinet and have responsibility for the long-term interests of the manufacturing sector. More>>

ALSO:

Cannabis Party: Treasury Figures On Cost Of Criminalisation

Figures released by Treasury prove the economic viability of The Cannabis Party's policy, while destroying the credibility of police claims about cannabis harms. More>>

ALSO:

Green Party: Investigation Into Mental Health Facilities Shows Disarray

The Health Minister must urgently launch an inquiry into mental health services, after serious issues with the standard of care at mental health and disability facilities around the country were revealed today, the Green Party said. More>>

ALSO:

Apparently He Means 'Years 0-8': Seymour Announces 4th Partnership Schools Application Round

“The continuing growth of this policy reflects the achievement of the eight existing Partnership Schools, and the strong levels of interest educators and community leaders are showing in the Partnership Schools model and what it offers students and their families,” Mr Seymour says. More>>

ALSO:

Trust Directors: Urban Māori Win Case Against Te Ohu Kai Moana

The National Urban Māori Authority (NUMA) and Te Waipareira Trust have succeeded in their claim over a $20 million trust set up for the benefit of urban Māori, meaning all directors of the trust must represent Māori who are not affiliated with an iwi. More>>

New Model: Carbon Tax Could Lower Emissions And Boost Economy

A carbon tax targeting emissions-intensive industries, along with a revamped Emissions Trading Scheme (ETS), could boost economic growth, with the extra tax generated used to cut GST from 15 percent to 12.5 percent. More>>

ALSO:

Budget Docs Release: ACC Sought $158mn In Budget 2016, Got $26.4mn

The Accident Compensation Commission requested an extra $158 million in funding for 2016/17 from the government ahead of Budget 2016, but Treasury instead recommended an interim payment of just $26.4 million be funded to tackle demographic changes, papers published by the government show. More>>

ALSO:

Submissions Sought: Māori Party Joins Opposition Housing Inquiry

People who are homeless, those who were once homeless, those working with the homeless and concerned New Zealanders are being asked to share their experiences and solutions to this growing issue with the Cross-Party Homelessness Inquiry. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news