My Lords, I thank the Minister for her remarks, which were broadly in support of the approach I was taking. I understand her difficulty in accepting the amendment, although I am sad that she will not be able to do so. I also thank my noble friend Lady Drake for her very interesting and wide-ranging comments. I thought she was right to pick up on the possibility of more work being done at the point of transaction in relation to personal debt. The idea of conditionality is a good one and perhaps we should think again. She was right to warn us that things are going to get much worse, particularly in relation to those at the low-pay end of the labour market because of the interaction between welfare and tax and the need for some sort of savings vehicle to help with the problems we encounter there. The truth is that we are going to have problems with problem debt for a long time. I think that she, like me, is arguing that we need to think very hard not so much about having a financial capacity strategy, which is very often prayed in aid at this time on these issues, but actually focusing a bit more on debt.
Debt is a necessary component of growth in the economy and yet it is the one we understand least about and about which we have very little statutory or other measures in place. Most of it is done by the charitable sector and the Government’s arrangements are being reviewed by the Farnish review—which I mentioned, although unfortunately a coughing fit may have covered my best lines. I wonder if I might just sharpen them up at the end so noble Lords can get a sense of them. Perhaps the noble Baroness might write to me about some of them. It is really important that the Farnish review, if it is coming out by the end of the year, focuses on what the structural changes have been in this area because they are not helping at present. It is really important to find a role for the Money Advice Service. It needs to be a facilitator, not a service deliverer. When it tries to do service delivery it just bumps into the existing structures and is not working.
We need—as I think I managed to get out before I was caught by my coughing fit—a statutory backing for personal debt. The arrangements in Scotland work; they are very effective and we should learn from them. We need to tie any new statutory interventions here into a thoroughgoing review of the Insolvency Service which offers too many not very well organised and not cognate solutions. For instance, if you do the decent thing by your debts and go and see a free advice service and talk about what you can do to get your debts paid off, you come off worse in terms of what your credit rating will be at the end of that process than if you had gone bankrupt. In other words, if you try hard, save money every month, repay all your debts and after six years emerge cleansed of those debts, you cannot get credit for six years. If you go bankrupt, you immediately lose your debts—and you certainly lose your credit rating—but you are back in business in three years. If you do a debt relief order, it is four years. What logic is there behind that? I would have said all that earlier. I could not say it. I say it now and I would like a response to it. I beg leave to withdraw the amendment.