Economic slowdown hits poorest families

THE Archbishop of Canterbury has highlighted the fact that government targets on alleviating poverty,
particularly child poverty, risk not being met.

Dr Rowan Williams has warned that in a period of economic decline the poorest in society, who carry a higher proportion of personal debt, are most at risk. Speaking in the House of Lords in April, the Archbishop talked about the 'poverty trap' and the effect this has, particularly on children:

"Children in poverty are in fact caught in a particularly toxic version of the 'poverty trap': families with
children face heavier pressures in regard to basic expenditure, pressures that push their outgoings
beyond their weekly income levels.

And this is not to do with purchasing luxuries: it is a matter of school uniforms, adequate diet and heating in the home, access to routine leisure activities (How much does it cost to travel to the nearest swimming pool?) and so on - never mind the extra expectations around Christmas or birthdays . . . "

He called for greater financial education to help prepare young people understand the risks of borrowing and spoke of how credit unions provide a better, alternative source of credit for borrowers,
encouraging the government to do more to foster their growth. The Archbishop warned of the dangers of the doorstep lending in relation to excessive charges and rates ofinterest, and called for tighter regulation of the lending market.

Alison Davies, President of Essex Savers, a credit union supported by Chelmsford Diocese, has confirmed that with the credit crunch and increased daily living costs, more and more people on lower incomes are coming under pressure.

"They are coming to us for more help," she said. "With small loans from Essex Savers, they can start paying off the doorstep lenders and have somewhere to come for the unexpected. If we were unable to give them help, they would turn back to high interest lending. This would spiral them into greater debt. 

"Essex savers needs a higher level of support, funding and resources from the local authorities whose residents are using our services, to enable us to employ the staff needed to give advice. What we need to do is build membership, introduce simple local banking for each parish and make it accessible for everyone."

And John Spence, chair of the Chelmsford Diocesan Board of Finance, who is currently leading a fund-raising campaign for the Church Urban Fund, has spoken of his concern for the poorest communities, said: "I guess we are all feeling a bit worse off. Those with houses or investments see uncertain value, and we are all experiencing higher food
and fuel prices. How easy it might be to close our purses, or at least tighten our belts.

"Naturally, I would argue the opposite. Across the Diocese, we have made outstanding progress towards balanced budgets through Christian generosity. We can all experience the joy of giving, but surely that joy is greater than when we are merely making up for the shortfalls of the past. It would be a tragedy if we were now to retreat from the progress we have made.

"Secondly, and more important, I think about need. Whenever economic growth slips, the better off
will feel things a bit, but the greatest impact will be on the poorest communities.

"The trickle-down factor has to stop somewhere and it will be those without jobs or in precarious employment, those without assets and those least able to cope in good times who suffer most when the going is tougher. I have seen this at first hand in the communities served by the Church Urban Fund. If the giving involves a bit more pain, maybe it is just a bit more precious."

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