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Many years ago, when discussing this issue, I suggested that it was the job of the government, through local authorities, to address this issue. I suggested an emergency loan should be available to anyone, with a simple application process and a cap on the total possible facility, with loans only being provided for essential spending. But vitally, I suggested low-interest charges should be offered because repayment should be via the benefits or PAYE system, with simple adjustments being made to allow for that (and I do not think that beyond the boundaries of the design of either system).

Nothing like that has ever happened, of course.

I got nuttin

A Budgeting Loan

You only have to pay back the amount you borrow, and repayments are taken automatically from your benefits.

8 thoughts on “Oh, right”

  1. “with a simple application process … with loans only being provided for essential spending”

    A nonsense of course, since cash is fungible (as we saw with MPs’ expenses, you just claim for whatever you’re spending already that qualifies, then it’s extra cash to blue on whatever).

    But even without that, having to prove what you’re spending the money on does not make for a “simple process”.

    However, great to discover another area in which Murphy makes pompous pronouncements to show his ignorance.

  2. Normal people, when they face an unexpected crisis, turn to friends or family for a temporary bail out.
    F&F know the borrower and therefore are in a better position to assess credit risk than any bank or welfare department. Some borrowers may not be trustworthy but then the loan is implicitly a gift, if it gets made.
    Interest is irrelevant to this arrangement.

    I suspect that Murphy has run out of friends he can tap for a “loan”.

  3. Martin Near The M25

    “essential spending” = train sets and home brewing kits (if, say, you’re not allowed in pubs).

  4. Spud invents yet another preexisting thing. No doubt when challenged, he will claim his idea is really different

  5. Diogenes said:
    “Spud invents yet another preexisting thing. No doubt when challenged, he will claim his idea is really different”

    Or that he thought of it even earlier.

  6. In NZ this is how people really poor people get into serious debt.

    No-one else will lend them money. The risk is too high for commercial lenders, and their friends are equally skint.

    So they get an “emergency” loan from the state. Then another before the first is repaid, because they aren’t very good with money. And so it goes, until they owe tens of thousands, with no income and no means of repayment.

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