Thirty-Fifth Report - The pharmacy early payment and salary advance schemes in the NHS
Select Committee
Public Accounts Committee
HC 745
4 February 2022
Government response
Treasury minutes: Government response to the Committee of Public Accounts on the Thirty Fifth report from Session 2021-22 · published 28 Apr 2022
Recommendations & Conclusions
6 results
5
Recommendation
Rejected
The growth in salary advance schemes across the NHS raises questions about their status as...
Recommendation
The growth in salary advance schemes across the NHS raises questions about their status as unregulated consumer lending. In February 2021, the Financial Conduct Authority (FCA) published the Woolard Review which noted that the salary advance schemes market was predominantly …
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Government Response Summary
The government rejects the recommendation to urgently consider regulation for salary advance schemes, arguing they do not constitute credit and lack evidence of consumer detriment. It welcomes the industry's development of a code of practice and will engage with it.
HM Treasury
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20
Conclusion
Rejected
The failure of Greensill Capital resulted in some NHS trusts switching to a paid for...
Conclusion
The failure of Greensill Capital resulted in some NHS trusts switching to a paid for salary advance scheme. When Greensill Capital failed in March 2021, the Earnd UK business (formerly FreeUp Finance Limited) ceased to operate. Wagestream, an existing market …
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Government Response Summary
The government rejects regulating salary advance schemes, stating they generally fall outside credit regulation, show no substantive consumer detriment, and thus do not merit regulation. It welcomes an industry code of practice and will monitor for future consumer detriment.
HM Treasury
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29
Conclusion
Rejected
The National Audit Office reported that between 1.3% and 10% of staff at NHS trusts...
Conclusion
The National Audit Office reported that between 1.3% and 10% of staff at NHS trusts were looking at using these services, so, clearly, a substantial number of people. We asked NHS SBS what expectations it had of usage of payday …
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Government Response Summary
The government disagrees with the implied recommendation to regulate salary advance schemes, stating they do not typically involve credit, show no substantive evidence of consumer detriment, and regulation would impose unnecessary costs. It welcomes an industry-led code of practice and will engage with its development.
HM Treasury
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30
Recommendation
Rejected
The Woolard review noted that the salary advance schemes market was predominantly found in the...
Recommendation
The Woolard review noted that the salary advance schemes market was predominantly found in the hospitality, retail and healthcare markets and was still in a stage of relative infancy. It stated that salary advances could result in some users experiencing …
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Government Response Summary
The government rejects the recommendation to urgently consider regulation for salary advance schemes, stating that they generally fall outside credit regulation and there's no substantive evidence of consumer detriment to merit it. However, it welcomes and will engage with the development of an industry code of practice.
HM Treasury
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31
Conclusion
Rejected
Greensill Capital’s approach coincided with NHS trusts’ own research into salary advance scheme providers in...
Conclusion
Greensill Capital’s approach coincided with NHS trusts’ own research into salary advance scheme providers in the context of staff financial wellbeing and employee benefits. NHS trust working papers also showed that employers considered the service could provide additional benefits, including …
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Government Response Summary
The government disagrees with the need for regulation of salary advance schemes, stating it has not seen substantive evidence of consumer detriment and believes existing frameworks are sufficient. It welcomes the development of an industry code of practice and will engage with it.
HM Treasury
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32
Conclusion
Rejected
We asked if there were lessons particularly for the Department about promoting these products that...
Conclusion
We asked if there were lessons particularly for the Department about promoting these products that have no FCA imprint. An employee on a low salary might decide to take some early advance and it is not actually a regulated product …
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Government Response Summary
The government rejects regulating salary advance schemes, stating they generally fall outside credit regulation, show no substantive consumer detriment, and thus do not merit regulation. It welcomes an industry code of practice and will monitor for future consumer detriment.
HM Treasury
View Details