Why can't we work together to stop people losing their homes?

Published on Monday 17 November 2008 21:24

CATHY JAMIESON, MSP Shadow cabinet secretary for health and wellbeing

SCOTLAND is in the eye of an economic storm. Mervyn King, the governor of the Bank of England, says that the UK banking system has come closer to collapse than at any point since the beginning of the First World War.

What this means is that businesses are finding it much more difficult to get credit, unemployment is rising and the number of home repossessions has doubled.

Statistics from the Scottish Courts Service show that there were more than 1,000 actions for home repossession in September.

Every one of these cases is a personal tragedy for the family involved.

The Scottish Government's announcement of support for a national debt helpline is a welcome step, but ministers could do much more to prevent home owners from being thrown on to the street.

Gordon Brown, the Prime Minister, has acted decisively by imposing a new duty on lenders and the courts in England and Wales to seek alternatives to repossession. The new English pre-action protocol has been described as "ground-breaking" by the housing charity Shelter.

I simply do not understand the SNP's failure to follow this lead and ensure that repossession is also a last resort in Scotland.

Homeowners here deserve at least the same protection as those in the rest of the United Kingdom. Scottish ministers must show much more urgency.

I believe that the threat of recession raises important questions for the major high street banks as well as for the government.

It is morally offensive that many of the men responsible for bringing Scottish banks to the brink of collapse are walking away as multimillionaires.

I would like to see those senior managers who remain donating their bonuses this year to a special fund to help struggling families who are in danger of repossession.

Financial institutions that have received billions of pounds from the taxpayer should change their attitude to customers who have trouble making their own payments.

In difficult economic circumstances, I want to see every possible alternative explored before families are taken to court, including part-ownership.

This week, the Scottish Liberal Democrats and the Green Party gave their support to our proposals for a shared-equity scheme as an alternative to repossession.

Our proposal is that banks should take a stake in the property to cover arrears when customers get into trouble.

This would mean that a vulnerable family could reduce their mortgage payments by up to 50 per cent and keep their home, while the bank's financial interest is protected.

Govan Law Centre's Mike Dailly has advised us that scheme would require legislation in the Scottish Parliament to create a fast-track conveyancing system.

He added that, "it is clear that we are in uncharted territory and we need some fresh thinking to deal with the tough times ahead".

I met with Nicola Sturgeon, the health secretary, last week and urged her to speak with the banks to promote shared equity as an alternative to repossession.

To be blunt, her response was disappointing.

The Scottish Government is sitting on its hands and doing nothing while people are losing their homes.

Scottish Labour has shown we can build a progressive consensus at Holyrood behind our proposals. We also want to work with the SNP and the Tories.

In this spirit, I believe there is a case for a special cross-party investigation to see what more can be done.

We need to understand the mistakes that were made by Edinburgh's financiers and find practical and imaginative solutions to see us through hard times.