London, along with other capital cities like Singapore, Hong Kong, Kyoto are thought to be one of the most expensive cities to live in the world. So is London Mayor Sadiq Khan, going too far by suggesting that every young Londoner should be entitled to a bank account?
The simple logic should be: if you can’t afford to live and work in London, don’t move to London. But I suppose it is not as simple as that, and the good, great and the millennials have been lured to the Capital for studying, family or work reasons. This sort of simple logic might be a tad unreasonable.
In the first week of January, the London Assembly Economy Committee published a report titled ‘Short changed: the financial health of Londoners’, highlighting the fact that 44 per cent of the people in the UK who are in financial difficulty are between the ages of 18 and 34, and around a quarter (27 per cent) of 18 to 30-year olds in London say they are in debt all the time.
It is therefore not surprising the Mayor Khan wants to work with the financial services industry, schools and colleges to create a young person’s banking charter, with the aim of ensuring all 16-18- year olds have a bank account and hold a ‘Money Advice Week’ to promote affordable credit.
Caroline Russell AM, Chair of the Economy Committee, says:
‘The cost of living has increased in the capital and many Londoners are cut off from accessing affordable financial services, such as loans and credit cards. They have to turn to high-cost credit, like payday lenders to make ends meet.’
Russell adds: ‘It is absolutely crucial that young people are given the right support in terms of their finances, when they leave school. For many, it is the first time they will be responsible for their own money.’
But is this enough? Even though the latest UK inflation figures were sort of positive, slipping to 3%, its first fall in six months, the squeeze on British household budgets cannot be ignored due to weak wage growth, which stood at 2.3% in the three months to October, and could remain below the rate of inflation this year.
I think the premise of simply giving ‘a bank account to every young Londoner’ isn’t going far enough. There is also the impossible of task of trying to get on the property ladder for the first-time in London, the general cost of living and remaining employed under the shadow of Brexit.
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