Wales Co-operative Centre

Canolfan Cydweithredol Cymru

Posts Tagged ‘finance

Shocking poverty figures provoke call for more digital inclusion support

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Nearly a quarter of a million people in Wales want a job but do not have one.  More than 8,000 households were homeless in 2013 and 79,000 people needed food aid.  One in three children lives in a low income family. This is the stark backdrop to the Bevan Foundation’s new report “Rethinking Poverty – Implications for Action”, which is of great interest to us at the Wales Co-operative Centre and the work that we do that supports the wider poverty agenda.

The report argues that digital and financial skills are essential to help people out of poverty, or at least mitigate its impact.  About digital inclusion, the report says:

“Digital skills are an important adjunct to literacy and numeracy, as more and more services are either available only online, or offer time and/or cash savings if accessed online. The shift towards online benefit claims is a particularly strong driver of change. People without access to the internet and without the skills to use it are disadvantaged. There is a marked income-effect in digital exclusion – in 2013, only 1 in 10 (9%) of those in managerial and professional occupations did not use the internet compared to more than three in ten (31%) of those who had semi-routine and routine occupations.

“It is very welcome that digital skills have a relatively high profile in the 2013 Tackling Poverty Action Plan.  The plan includes the Digital Inclusion delivery plan’s targets, the targets for which have mostly been met.  The commitment to digital skills and inclusion should continue, with challenging targets for people in low income groups, with programmes of sufficient scale and impact to achieve them.”

The Money Made Clear Wales website is a great example of where people can get financial advice online

The Money Made Clear Wales website is a great example of where people can get financial advice online

The achievement of the targets in the Digital Inclusion delivery plan was due to the Welsh Government’s Communities 2.0 programme, which is led by the Wales Co-operative Centre.  How is this going to work then when Communities 2.0 comes to an end in March next year?  Well, we need everyone in Wales working to tackle poverty to take digital inclusion seriously.  Our experience is that the current practice is too patchy.  And to get this consistency we need a strong, lean leading digital inclusion project  to help all front line services deliver effective digital skills support.

The Bevan Foundation report is blunt about the nature of the challenge.  For the last eight years, there has been no improvement at all in the number of Welsh people living in poverty.  And that number is set to rise.  Yes, we need an informed debate.  But we also need action.

Dave Brown is the Director of Strategic Development & Performance at the Wales Co-operative Centre

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Financial education…..it’s complicated, but not impossible

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Martin Lewis says ‘The modern UK has a nasty debt habit’ and he is right. I don’t say this from a judgmental perspective (and I am sure he doesn’t either). But, if you take a step back and look objectively at how we manage our personal money lives I don’t think many people would disagree.

The alarming rise of pay day lenders, their use, and attempts to curb their use, is only one symptom of the problem. So is legislation and regulation the answer? Should financial literacy be a compulsory part of the curriculum and local authorities have a duty to promote financial inclusion?

As anyone that reads my blogs regularly might predict, my answer to that is …it’s complicated.

Research from a plethora of sources, including the Money Advice Service, shows that young people learn about money primarily from their parents. The financial environment that they, as families, live in is demanding and complicated. Input at school would help, but these messages need to be echoed at home. This means that some parents need to learn to manage their money better, first.

Then there is the matter of financial services. It’s all very well to tell people to be ‘prudent’. Life’s ups and downs are often partnered with money ups and downs. If someone needs to borrow a small amount and the bank won’t lend it to them, where do they go? Sadly more and more people are turning to pay day lenders instead of responsible lenders like credit unions.

Interestingly, for some, the introduction of much more stringent ‘money behaviour’ checks for mortgage applications may be surprisingly effective at changing attitudes to money. No longer will the use of pay day loans (whether paid off, or not) be acceptable – and I am not surprised. It may only be a matter of time before other kinds of lending follow suit. Indeed many credit unions already have these conversations with borrowers.

The National Assembly for Wales is currently considering a proposal for a Financial Education and Inclusion Bill. Take a look at our response to the consultation related to this Bill. It’s complicated, but not impossible.

Written by Katija Dew

April 29, 2014 at 4:20 pm

Could co-operatives play a bigger part in Welsh economy?

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Yesterday, at the beginning of the United Nations’ International Year of Co-operatives, the Wales Co-operative Centre published a report that brings together the latest research about co-operatives in Wales. This marks the first time we have examined the current impact of co-operatives in the Welsh economy and the role they could be playing.

Co-operatives in the Welsh economy’, written by the Bevan Foundation, reveals that co-operatives are a dynamic, thriving sector of the Welsh economy, generating £1 billion in income and employing around 7,000 people in a wide range of sectors.

Co-operatives in Wales generated a total pre-tax profit of £19 million in 2010, with three generating profits in excess of £1 million and a further four generating profits of between £250,000 and £1million.

Our research found that social enterprises employ more people relative to turnover than mainstream small businesses and worker co-operatives have lower-than-average levels of staff turnover and absenteeism. This can be explained in part by their democratic structures, which mean workers have more opportunities to take active roles in decision making. Co-operatives are also more likely to involve women and minority ethnic groups than private businesses.

You can download Co-operatives in the Welsh Economy from the Wales Co-operative website and also find out more about the International Year of Co-operatives 2012.

Excerpt taken from the blog post ‘The Italian Way‘ by Wales Co-operative Centre Chief Executive Derek Walker.

Wales Co-operative Centre is holding several events through 2012 to celebrate International Year of Co-operatives, including the publication of three further documents.


Written by C Kenzie

January 11, 2012 at 10:38 am

Credit union reforms mean expansion and competing with banks

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New powers for credit unions in England, Scotland and Wales will, from today, enable them to significantly expand the services they offer, and to compete directly with high street banks and other savings providers.

The changes, under a Legislative Reform Order (LRO), mean the financial co-operatives can now pay interest on savings for the first time and expand beyond their traditional customer base.

Credit unions are not-for-profit organisations owned by their members.

The reforms will allow them to provide services to community groups, businesses and social enterprises.

Robert Kelly, general manager of the NHS Credit Union for Scotland and the North of England, said: “The LRO is going to give us the opportunity to get closer to offering full services that are equitable and can compete with mainstream financial institutions like banks and building societies.

“It also gives us more potential for partnerships with a wide range of other organisations.”

The Association of British Credit Unions (Abcul) expects membership to increase as a result of the changes, which the UK government introduced as part of a commitment to promote mutuals.

There are currently about 420 credit unions across England, Scotland and Wales, with close to one million members.

The changes are designed to help individuals, businesses and other organisations access fair and affordable financial services in their communities. They will allow credit unions to provide a more effective alternative to high street banks on the one hand and high cost lenders and loan sharks on the other.

Common link restriction lifted 

Until now, credit unions have been hampered by restrictions which meant all of their members had to have something in common – such as living in the same geographical area or working for the same employer.

Credit unions no longer need to prove that all the eligible members have something in common, which will mean that credit union services can be extended to new groups much more easily. For instance, a credit union providing services to anyone living or working in Pontefract will now be able to serve all the employees of a company too, even if they do not live or work in Pontefract.

Interest on savings, not dividends

Previously, credit unions could not pay interest on savings, only a retrospective dividend. Credit unions will now be able to begin to pay interest on savings, which will mean that people will be able to more easily compare the rates of return with other savings providers and it will help credit unions attract more savers.

Organisations can join a credit union

Under the old rules, only individuals were able to become members of credit unions. The new rules mean that organisations themselves can join a credit union (up to a maximum of 10% of the members) and use the financial services it provides. A community group, housing association or local employer, for example, may now be able to use a credit union to manage its money, with the added advantage that the money is kept in the community.

Credit unions can now compete with banks

Mark Lyonette, chief executive of the Association of British Credit Unions (Abcul), said: “These changes are a major breakthrough in the delivery of credit union services to communities around Britain. The new rules mean credit unions can now compete more effectively with banks and other lenders to provide fair and affordable financial services. Credit unions will be able to reach many more people, helping them to develop a savings habit, which can only be good for communities.”

More information

Source: Which?, BBC News

Find out more about credit unions in Wales.


Written by C Kenzie

January 9, 2012 at 10:54 am

Credit unions can help increase diversity in financial services

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The Government has an aim to increasing diversity in financial services, and Mark Lyonette, Chief Executive of the Association of British Credit Unions (ABCUL), thinks they are in an ideal position to help.

Speaking at a fringe event at the Conservative Party Conference, Mark Lyonette explained how credit unions now serve nearly a million people in England, Scotland and Wales and sought reassurance from Financial Services Secretary Mark Hoban that the Coalition Government would support the sector to expand and serve more people.

“Once new legislation is in place – and we sincerely hope that any further delays can be avoided – many more individuals, as well as local community groups and businesses,  will be able to access credit union services.

“We are confident that everyone in Britain will soon be able to join a credit union and have the option of a mutual and local home for their money.

“I look forward to seeing how the Government’s aims of fostering diversity and promoting mutuals will translate into action to support the growth of the credit union sector.”

Financial Secretary to the Treasury Mark Hoban MP, who also spoke at the fringe meeting, said: “The Government supports credit unions as part of its policy commitment to foster diversity in financial services, promote mutuals and create a more competitive banking industry.

“I believe that strong credit unions, as part of a diverse financial services sector, will greatly enrich British society. It is in our interest, therefore, that the credit union movement should prosper and we are determined to help credit unions grow and expand into the future.”

Source: ABCUL

Wales Co-operative Centre offers advice and support to credit unions in Wales.

Written by C Kenzie

October 15, 2010 at 8:13 am

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