Economic Secretary welcomes contribution to debate on savings and debt

Economic Secretary to the Treasury Kitty Ussher MP today welcomed the publication of The Fawcett Society’s report on women’s financial assets and debt, saying it provided a useful insight into the differences between men and women’s consumption of financial services and added to the ongoing debate on saving and debt.

The Fawcett Society’s report investigated whether there is a savings and debt gap between men and women in addition to the well-documented income gap, and to understand the factors that drive this gap.

Kitty Ussher said:

“The Government is committed to rooting out unfairness across society and we have been actively engaged with the Fawcett Society throughout the project. We are already making progress but there is further to go. Recent policies such as pensions reforms, the Child Trust Fund and the Saving Gateway pilots have had a positive impact on gender outcomes, while important steps forward are being made with the financial inclusion and financial capability agendas.”

Government policies that will help to address gender inequalities include:

The Pensions Act 2007

The Act will allow women to receive higher state pension entitlements with almost half a million extra women over State Pension Age entitled to a full basic State Pension in 2025. Further changes to private pensions will mean genuine equality of opportunity in access to workplace pension provision. An estimated three and a half million women could be auto-enrolled into a pension, many gaining access for the first time.

Financial Capability

The Government’s aspirations for financial capability include considering a range of programmes, particularly aimed at the most vulnerable. The needs of women are considered in delivering these programmes for example, by looking at financial education and information in Children’s Centres, which are visited primarily by women.

Financial Inclusion

The Government is committed to tackling financial exclusion. Building on the Financial Inclusion Fund of £120 million for the period 2005-08, the 2007 Comprehensive Spending Review committed £130 million to the Financial Inclusion Fund over the next spending period.

Current financial inclusion initiatives are tackling gender imbalances in access to financial services. For example, the Department for Work and Pensions’ Growth Fund aims to make affordable credit through credit unions and Community Development Finance Institutions more widely available. Of the 41,000 loans made so far, 72 per cent have been to women, and 46 per cent to lone parents. And the Department for Business, Enterprise and Regulatory Reform is administering £47.5 million to recruit and train over 500 new money advisers in areas of high financial exclusion and have already provided assistance to over 66,000 clients struggling with debt. Recent analysis shows that women made up 56% of those helped by these new advisers.

Financial Capability

The Government’s aspirations for financial capability include a range of programmes particularly aimed at the most vulnerable. The needs of women are considered in delivering these programmes for example, by offering financial education and advice in Children’s Centres, which are attended primarily by women.

Kitty Ussher said:

“This work recognises the important role policies such as these have to play. But The Fawcett Society’s research shows that the root cause of gender imbalances in levels of debt, savings and assets comes from inequality in the workplace, both in terms of promotion and of pay. We have made great strides, but must continue to focus efforts if we are to have a society that is genuinely fair.”

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