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Kinnock attacks loan charge idea Kinnock attacks loan charge idea
(about 2 hours later)
Former Labour leader Lord Kinnock said that a proposed imposition of interest charges on social fund loans would prove unacceptable to the party. Lord Kinnock said that any interest charges on social fund loans would prove unacceptable to the party.
He predicted it would be dropped before ever reaching parliament. The former Labour leader predicted it would be dropped before ever reaching parliament.
Lord Kinnock told BBC1's Andrew Marr Show: "I don't know where the idea of imposing any form of interest on repayment of social fund loans comes from. The pensions minister Kitty Ussher later said: "We are not proposing to charge interest on the government loans."
Lord Kinnock told BBC1's Andrew Marr Show there was "no point" and "no justice" in such an idea.
"I don't know where the idea of imposing any form of interest on repayment of social fund loans comes from.
"But I know where it is going to, and that is absolutely nowhere.""But I know where it is going to, and that is absolutely nowhere."
The government said the loans, run by credit unions, would be "affordable".The government said the loans, run by credit unions, would be "affordable".
The social fund currently extends £500m a year in interest-free loans to some 1.2m benefit claimants, many of them elderly or disabled.The social fund currently extends £500m a year in interest-free loans to some 1.2m benefit claimants, many of them elderly or disabled.
The BBC's political correspondent Jo Coburn said the reforms were meant to ensure that interest-free loans were not offered to people who did not really need them.The BBC's political correspondent Jo Coburn said the reforms were meant to ensure that interest-free loans were not offered to people who did not really need them.
'Period of difficulty''Period of difficulty'
A Department for Work and Pensions consultation document suggests offering contracts to credit unions to provide "affordable loans", as well as other services such as savings accounts and financial advice.A Department for Work and Pensions consultation document suggests offering contracts to credit unions to provide "affordable loans", as well as other services such as savings accounts and financial advice.
But Lord Kinnock added: "There is no point in doing it, let alone no justice in doing it."But Lord Kinnock added: "There is no point in doing it, let alone no justice in doing it."
Asked if he thought it could get through the Commons, he replied: "It won't even get that far."Asked if he thought it could get through the Commons, he replied: "It won't even get that far."
There has been cross-party criticism.There has been cross-party criticism.
Conservative shadow cabinet member William Hague accused the UK government of behaving like loan sharks and pledged a Tory administration would not implement such a policy.Conservative shadow cabinet member William Hague accused the UK government of behaving like loan sharks and pledged a Tory administration would not implement such a policy.
A DWP spokesman said the intention was to consult over widening access to credit unions to people on benefits and those in work to provide advice on debt.
Work and Pensions Minister Kitty Ussher said: "We are not proposing to charge interest on the government loans."
Meanwhile, on the economy, Lord Kinnock said people had the "common sense" to know the bigger and the earlier the commitment to combating the recession was, the more likely it was to succeed.Meanwhile, on the economy, Lord Kinnock said people had the "common sense" to know the bigger and the earlier the commitment to combating the recession was, the more likely it was to succeed.
"Looking at the situation of our economy and the global economy, people understand Gordon Brown and his government are best equipped to lead us out of this particular period of difficulty, afflicting everybody but felt in every household and business in Britain.""Looking at the situation of our economy and the global economy, people understand Gordon Brown and his government are best equipped to lead us out of this particular period of difficulty, afflicting everybody but felt in every household and business in Britain."
He also said he believed an early election was "a long way down" Mr Brown's list of priorities, believing he had an "utter preoccupation is serving the country by building recovery from recession."He also said he believed an early election was "a long way down" Mr Brown's list of priorities, believing he had an "utter preoccupation is serving the country by building recovery from recession."