AM in Credit Union call as Llaneli residents hit hard by welfare changes

Local Assembly Member, Keith Davies has spoken up on behalf of Llanelli residents facing an uncertain financial future to the introduction of direct payments by an ‘out-of-touch’ UK Government.

Speaking in the recent debate on Direct Payments of Housing Costs to Tenants in Wales (on Tuesday 8th October), Keith Davies highlighted estimates by the Payments Council that that 2.7 million welfare claimants will struggle to manage their finances once changes are fully implemented. The AM for Llanelli also used the debate to call for wider promotion of Credit Unions to support those facing financial difficulty highlighting the cost benefit of providing financial advice and support so that ‘people do not fall between the cracks’.

Speaking in the Chamber, Keith Davies said:

“While our Welsh Labour Government has pressed to exempt tenants in Wales, Westminster is pressing ahead, regardless, despite views based on our own research and on specialist third sector organisations, such as Shelter, Community Housing Cymru and Citizens Advice.”

“For those of my constituents in Llanelli who will be affected, the sad reality is that the impacts do not end with rent arrears. In the Station Road area of Llanelli, rent arrears are exactly the concern that my constituents have raised with me. Tenants will now be paid a lump sum in arrears and are worried about that, and landlords are concerned that rent will no longer be paid directly to them. Surely, as called for by Shelter, Citizens Advice and the Money Advice Trust, tenants should be given a choice on direct payments.

“I held an advice event in the past in the St Elli centre, where organisations such as Citizens Advice, the SAVEeasy Credit Union and the Money Advice Service were present to speak to people and to offer advice and support. Due to the continued need for support and advice, where funding for such services has been cut by the coalition in Westminster, I intend to hold similar events for those who need it again this year.

“I met recently with the Wales Co-operative Centre, which operates a credit union rent account, available to all credit union members. They are designed to help with budgeting and, specifically, paying rent. Rent money, in full or in part, is set aside, so that it is not used for other expenses. Its focus is housing benefit, but it is paid into a credit union account and the money is then transferred into a nominated landlord account. However, is this, by any means, a fix-all solution? In fact, it relies on awareness and membership of a credit union. If you are not aware of that, you cannot be involved in it.”

“The former Minister for Communities and Tackling Poverty rightly said that cuts and welfare reforms create a perfect storm. He said that, given the scale of Welsh budget cuts, we will not be able to fund all services, but we are determined that people do not fall between the cracks. Following the commissioning of an advice services review, £1.8 million was allocated to the advice sector to adapt to increased demand and funding cuts. The advice services review identifies that every pound spent on advice creates a saving of £2.43 for housing advice, and a saving of £2.98 for debt and money advice. I would be interested in how the Minister is ensuring that all Welsh Government schemes and actions are specifically tailored to meet needs as they arise from these changes.”