Examination of Witnesses (Questions 973-979)
ED BALLS,
MR CLIVE
MAXWELL AND
MS SUE
CATCHPOLE
22 MAY 2006
Q973 Chairman: Mr Balls, welcome to the
Committee in your new post as Minister. Congratulations. Can you
introduce your team?
Ed Balls: It is a great honour
to appear before the Treasury Committee for my first appearance
before a select committee as a Minister. Can I introduce on my
right Clive Maxwell, who is a director of the Treasury for financial
services, and Sue Catchpole, who is the head of the payments and
inclusion team. Together Clive and Sue have been masterminding
the Treasury's input into the financial inclusion strategy over
the last months and probably for longer than that.
Q974 Chairman: How does your role
fit alongside that of the new Minister for Social Exclusion?
Ed Balls: I am the Treasury Minister
with responsibility for financial inclusion issues and also, more
broadly, for financial services in the City, which cover the broader
issues for financial capability. I think the Treasury has the
lead in Whitehall on financial inclusion and therefore it is my
responsibility to make sure that the government is effectively
working together with the FSA and the wider community to implement
the strategy which was set out in this Treasury document in 2004
called Promoting Financial Inclusion, which has been built
upon in pre-budget report statements and the work of the task
force since that date.
Q975 Chairman: Has your department
had communication regarding what is your fit, what is the fit
of the Minister for Social Exclusion and where the overlap is?
Ed Balls: As of today, I have
been preparing over the last period to appear before this Committee
and it has been extremely useful for me both to prepare for the
Committee but also to have the opportunity to read the transcripts
of all the evidence you have heard in recent months in order to
get up to speed with all the issues. I have not as of yet had
a conversation with Cabinet Officers Ministers. The lead across
government for financial inclusion matters is with the Treasury
but obviously we work closely with colleagues from the DWP and
the DTI and also on social exclusion issues. It was the PAT 14
report which set the agenda early on in the life of the government
which was at that time produced by the social exclusion unit which
was then under the Cabinet Office. The social exclusion unit has
now returned to the Cabinet Office with new ministers but I obviously
will be having conversations with those ministers in due course.
As of yet I have not.
Q976 Ms Keeble: I wanted to ask about
some of the targets in the financial inclusion task force. Presumably
it reports to you, does it?
Ed Balls: It is a task force of
the government but in the first instance it reports to me.
Q977 Ms Keeble: One of the goals
was to halve the number of people who are not banked and to make
significant progress within two years. What has the progress been
like?
Ed Balls: I saw the evidence that
you took from Brian Pomeroy. I met him this morning to discuss
these issues. He said that as they had reported to the Committee
and to the government there had been significant progress. As
he explained, it is obviously difficult because of the particular
data issues to give you a precise answer on exactly how much progress
we have made. The original commitment to reduce by half the number
of people without a bank account was based upon one survey, the
Family Resource Survey, and we cannot in a comparable way measure
progress against that initial target until we get numbers from
the 2005/6 survey which will not be published until the spring.
I asked for more detailed information. Are there ways in which
we can track progress even though the data are not directly comparable?
We can do that in two ways. One, there are ONS surveys which we
can use to track progress. To give the Committee the latest figures
from the ONS, in May 2005 there were 2.54 million adults living
in benefit units with no accounts of any kind. That number had
fallen to 1.89 million in December 2005. Adults in benefit units
with no current account had fallen from 3.54 million in May 2005
to 3.15 million in December 2005. Those numbers are not directly
comparable because the ONS is using benefit units and the family
resources survey is looking at households. What they do tell you
is that over those seven or eight months there has been a significant
fall in the number of unbanked individuals so I think that gives
us some confidence that we are making significant progress.
The Committee suspended from 6.14pm to 6.26pm
for a division in the House
Q978 Ms Keeble: How do you make sure
that the methods you put in place or the policies that are put
in place reach the financially excluded and also that you know
who the financially excluded are and have a profile of them: old,
young, black, white, single, childless or whatever?
Ed Balls: This is one of the issues
which the task force has as part of the remit of its work. Whether
it is mapping particular policies such as access to bank accounts,
access to ATMs or more generally trying to get behind the headline
statistics I gave you here and analyse the detail, that is one
of the things the task force will advise us on. We will from the
Family Resources Survey in January of next year have a very detailed
breakdown of the way in which trends have moved, not just the
overall number but the details in terms of ethnic group, race,
geographical location. Hopefully we will have a lot more detail.
Q979 Ms Keeble: Do you not think
we should have had that earlier than this, because we are quite
a long way down the track now of trying to tackle the financially
excluded?
Ed Balls: In the document, as
I understand it from a couple of years ago, there is quite a lot
of detail. We know quite a lot about who the financially excluded
are in terms of where they live, the regions of the country, their
income levels, chances of owning a home and having a job. The
financial inclusion task force gave you a briefing after their
appearance last week which broke down the unbanked by different
types of housing tenure which gave some interesting statistics
for the Committee so we are trying our best to understand more
about these things.
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