The damage of financial abuse can continue long after a relationship is over. Photo: Flickr
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Government and banks must tackle the overlooked financial element of domestic abuse

Time for government, banks and creditors to break the silence.

Financial abuse is little recognised. But it’s serious. Many people are unaware that controlling someone’s money or limiting their economic freedom is in fact a form of domestic abuse.

It may not be as visible as physical violence, but exerting financial control can trap victims in abusive relationships by isolating them from friends and family, or cutting them off from the money they need to leave.

And the damage of financial abuse can continue long after the relationship is over. Victims can be left in dire financial straits, liable for debts they never agreed to, and at the mercy of the perpetrator who can still control and access their money.

The Home Secretary’s recent announcement that the government will seek to make "coercive control" illegal, marks a shift towards national recognition that domestic abuse is not just physical. It’s time that psychological, emotional and financial abuse was put on the same legal footing as physical abuse.

A new Citizens Advice report shines the spotlight on the hidden prevalence of financial abuse: nine in ten advisers contributing to our research have helped people with such cases in the last year.

One of the most common forms is where individuals have been forced by their partner to take out loans on their behalf: almost three-quarters of the advisers who responded to our survey have helped a client who has taken out credit and gone into debt as a result of pressure from their partner. Yet too often, high street banks and other lenders fail to acknowledge that their customer may be subjected to this type of control.

Earlier this year, a young woman came to Citizens Advice seeking help with almost £10,000 of debt. She had left her home and marriage because of the abuse she suffered from her husband. Following physical abuse and threats in the relationship, she had been forced by her partner to take out a number of debts in her own name, passing the money onto him. These included bank loans and credit cards, as well as acting as a guarantor for his loans.

Banks and other lenders have a big role to play in tackling this problem. While there is some good practice, the majority of banks and creditors fail to recognise the needs of those customers who fall victim to this type of abuse.

Of course it is a difficult area. It is not easy for a company to investigate behind the privacy of closed doors. Nor is it straightforward for victims to approach companies to try to untangle themselves from these sorts of financial ties.

Up until this point, statutory and self-regulators in the financial services industry have done little to ensure banks, lenders and other financial institution have a set of guidelines to help. This needs to change if victims of the kind of coercive control highlighted by Theresa May and our report are to be supported.

It is time financial abuse is addressed. The political will to do so is there: all three of the biggest political parties have pledged admirable commitment to eliminating abuse. It is time action is taken to prevent it and to help support victims to get back on their feet and on with their lives.

Government and financial professionals must work together to develop the framework so urgently needed to protect individuals at their most vulnerable.

Imogen Parker is Senior Policy Researcher at Citizens Advice and is leading the charity’s research into domestic abuse. She tweets @ImogenParker

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There's nothing Luddite about banning zero-hours contracts

The TUC general secretary responds to the Taylor Review. 

Unions have been criticised over the past week for our lukewarm response to the Taylor Review. According to the report’s author we were wrong to expect “quick fixes”, when “gradual change” is the order of the day. “Why aren’t you celebrating the new ‘flexibility’ the gig economy has unleashed?” others have complained.

Our response to these arguments is clear. Unions are not Luddites, and we recognise that the world of work is changing. But to understand these changes, we need to recognise that we’ve seen shifts in the balance of power in the workplace that go well beyond the replacement of a paper schedule with an app.

Years of attacks on trade unions have reduced workers’ bargaining power. This is key to understanding today’s world of work. Economic theory says that the near full employment rates should enable workers to ask for higher pay – but we’re still in the middle of the longest pay squeeze for 150 years.

And while fears of mass unemployment didn’t materialise after the economic crisis, we saw working people increasingly forced to accept jobs with less security, be it zero-hours contracts, agency work, or low-paid self-employment.

The key test for us is not whether new laws respond to new technology. It’s whether they harness it to make the world of work better, and give working people the confidence they need to negotiate better rights.

Don’t get me wrong. Matthew Taylor’s review is not without merit. We support his call for the abolishment of the Swedish Derogation – a loophole that has allowed employers to get away with paying agency workers less, even when they are doing the same job as their permanent colleagues.

Guaranteeing all workers the right to sick pay would make a real difference, as would asking employers to pay a higher rate for non-contracted hours. Payment for when shifts are cancelled at the last minute, as is now increasingly the case in the United States, was a key ask in our submission to the review.

But where the report falls short is not taking power seriously. 

The proposed new "dependent contractor status" carries real risks of downgrading people’s ability to receive a fair day’s pay for a fair day’s work. Here new technology isn’t creating new risks – it’s exacerbating old ones that we have fought to eradicate.

It’s no surprise that we are nervous about the return of "piece rates" or payment for tasks completed, rather than hours worked. Our experience of these has been in sectors like contract cleaning and hotels, where they’re used to set unreasonable targets, and drive down pay. Forgive us for being sceptical about Uber’s record of following the letter of the law.

Taylor’s proposals on zero-hours contracts also miss the point. Those on zero hours contracts – working in low paid sectors like hospitality, caring, and retail - are dependent on their boss for the hours they need to pay their bills. A "right to request" guaranteed hours from an exploitative boss is no right at all for many workers. Those in insecure jobs are in constant fear of having their hours cut if they speak up at work. Will the "right to request" really change this?

Tilting the balance of power back towards workers is what the trade union movement exists for. But it’s also vital to delivering the better productivity and growth Britain so sorely needs.

There is plenty of evidence from across the UK and the wider world that workplaces with good terms and conditions, pay and worker voice are more productive. That’s why the OECD (hardly a left-wing mouth piece) has called for a new debate about how collective bargaining can deliver more equality, more inclusion and better jobs all round.

We know as a union movement that we have to up our game. And part of that thinking must include how trade unions can take advantage of new technologies to organise workers.

We are ready for this challenge. Our role isn’t to stop changes in technology. It’s to make sure technology is used to make working people’s lives better, and to make sure any gains are fairly shared.

Frances O'Grady is the General Secretary of the TUC.