Big Issue founder John Bird has launched his own bill in the House of Lords aimed at helping millions of renters get fair access to credit.
Lord Bird – now a crossbench peer – introduced his own private member’s bill on Wednesday on creditworthiness, a bill designed to create a level playing field when it comes to the availability and affordability of credit.
At the moment the rental payments of the UK’s 11 million renters aren’t recorded or recognised in the same way mortgage payments are. It means some of the country’s least well-off pay the most to borrow, including repayment contracts for white goods, utilities and mobile phones.
We’re trying to help reliable rent-payers get the same advantages as reliable mortgage payers
“If you are a rent payer, even if you pay your rent on time for many years, it won’t necessarily get the credit file that you would if you were paying a mortgage,” Lord Bird explained.
“So we’re trying to help reliable rent-payers get the same advantages as reliable mortgage payers.”
“Generation rent has been hit hard and they deserve fair access to credit,” he added. “We want to empower more people to get on in life.”
This comes after a petition was launched earlier this year demanding that “paying rent on time to be recognized as evidence that mortgage re-payments can be met”, which received more than 147,000 signatures – well over the 100,000 threshold requiring parliament to consider the topic for a debate.
— John Bird (@johnbirdswords) June 28, 2017
Lord Bird’s bill will oblige credit service providers to take rental payment data and council tax payment data into account.
Big Issue Invest – the social investment arm of The Big Issue Group – has already tested this approach in the social housing sector to tackle financial inclusion.
If we can help more people get better credit files and scores, we can help more people move further away from poverty
The Rental Exchange scheme, a partnership with Experian, has shown that 80% of tenants see their credit score rise once included in the initiative.
Lord Bird believes transforming the way credit assessment is done can help tackle and prevent poverty.
“If we can help more people get better credit files and scores, we can help more people move further away from poverty,” he said.
Rather than continuing to struggle to put sticking plasters over the country’s growing social problems, The Big Issue has championed stronger government intervention to prevent poverty from occurring.
— John Bird (@johnbirdswords) June 29, 2017
During the general election campaign, we called on readers to join our #ActivistArmy and hold the country’s political candidates to account on poverty prevention.