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Banking and Bankruptcy

Volume 531: debated on Thursday 11 August 2011

The Petition of Elspeth Rushbrook,

Declares that the petitioner believes that the current rules regarding banking and bankruptcy need urgently revising; that since the downturn, there is very strong negative public feeling towards financial institutions; that there is much anger at the bonuses and that public money has bailed out highly paid bankers of a crisis which we are suffering and paying for in many senses, while banks create debts for private customers as well as the country as a whole.

Further declares that banks extract huge fees from thousands of personal customers for going only a little over a limit, and these fees have no cap; fees of up to £100 per month are taken automatically and there are cases where these have made those in hardship have four figure fees while investigations go on; that this can lead to loss of banking facilities and demands for further money from banks; that the High Court test case was a very drawn out way of looking at this issue, which is clearly deeply unbalanced; that the High Court decision was entirely in the bank’s favour, and the furore around the unsuccessful case shows how strong popular feeling is about this matter; that banks make over £1 billion each year through these fees, on top of their other profits.

Further declares that bankruptcy laws have been tightened without public consultation or even widespread knowledge; most websites on debt do not mention changes to bankruptcy laws, including the Government’s; in this time, debt has become very common; that debt is seen as bad but it is often the only way to improve circumstances, such as setting up business or paying for an education; that debt is also a result of materialism and consumerist society; that Government cuts, especially to legal aid and for medical treatment, make this worse.

Further declares that the petitioner believes that bankruptcy laws have been put in place by those who are well off; that the previous £50 free spending money a month was tight—but the current £10 for three years shows no understanding of modern life or poverty; that £10 per family member shows no understanding of single people and expects the burden and shame of bankruptcy to be spread across a whole household; and that for a person already under pressure, to not have any kind of relief asks for other problems, such as depression, as £10 a month means a single coffee a week, is not enough to buy a meal out, to allow you to leave your home town, to rent a DVD each week, for a television licence; that bankrupts may have to sell anything of value; that the law does not understand how things like DVD players, music and especially instruments, or computer games are vital; that whatever our financial circumstances, we all need a richer life, and after and during all the indignity and stress of debt, having pleasures and passions taken away is wrong and unfair; that being without a bank account is very hard in today’s society—it is necessary to have one in order to receive benefits; that anything extra the insolvent earns during those three years goes to the creditor, meaning that doing better financially gives bankrupts no relief and no benefit; that insolvents are even asked to pay to become insolvent, and are publically shamed by having their bankruptcy published.

Further declares that the petitioner believes that our whole ethos is built up on a contractual debt, blame and punishment that enters into every part of our existence; banks and law unfairly control much of our society; the recurrence of recessions and other problems suggest that our current systems are not the way, and invite us to urgently look again—not try to continue much as before.

Further declares that the petitioner believes that one should not have to pay to declare oneself bankrupt; that bankruptcy should last and have effect for only one year; that there should be no public publication and shaming; that the allowable personal budget should return to £50 per month, and to rise appropriately with inflation; that bankruptcy should not affect members of a household or family, only the persons directly filing for it; that creditors should not be able to take extra moneys earned in this time; that there should be a system in place to allow bank accounts for bankrupts without further fees; that there should be no ban on public offices or other roles; that personal bankruptcy should not stop a self-employed business and vice versa; that this is the livelihood and will mean no money for the person filing as bankrupt; that creditors should not be able to force borrowers into bankruptcy, particularly when the creditors have created the debt, such as with banking fees or aggressive lending.

Further declares that the petitioner believes that student loans of all kinds should be covered by bankruptcy; that the 2004 ban should be repealed as should the March 2011 legislation.

Further declares that the petitioner believes that having to attend a court hearing in respect of bankruptcy should be stopped—this is extra stress and cost (to attend) and quite often humiliation.

Further declares that the petitioner believes that information from debt advice centres should also be looked at, as many of these encourage insolvency as an easy way of freedom, and do not present the facts properly.

Further declares that the petitioner believes that the law should protect genuine people from large preying creditors without encouraging non-payment from reckless borrowers.

Further declares that bailiffs should be stopped immediately; that it is unsupportable to be harassed in your home for goods not related to the creditor’s claims.

Further declares that banking fees should be abolished immediately; that such fees are not necessary, as they are only partly as a deterrent; that if one goes over one’s account’s limit, the account should simply not allow further withdrawals until further funds are put in; that banks should be banned immediately from following up fees with demands to further repay overdrafts; that where in the past, unreasonable fees have been charged and or hardship has been caused, these fees should be returned to customers.

Further declares that the blame, debt and contract system of our society needs to be revisited and debate begun and implemented about a fairer way forward.

The petitioner therefore requests that the House of Commons urges the Government to urgently review these rules and the ethos behind them.

And the Petitioner remains, etc.