Miliband calls for councils to be given powers to tackle payday loan shops

Councils should gain planning powers to stop the spread of payday loan shops, Labour leader Ed Miliband has said.

Launching his party’s campaign for the 2 May local elections, he said high streets were “the heart of our local communities, but today our high streets are changing – and often not for the better”.

Payday lending facilities were used by people with an urgent need for cash but “often they just engulf people in debts that they cannot pay, with interest rates of over 1,000 per cent,” he said.

Under current planning rules, if a bank closed a payday loan firm could open up in the same premises under the same use class without needing any further permission, even if several similar shops were already established nearby, Mr Miliband said.

He called for “new powers so that local people can have a say about which type of shops they want to see and which they don’t”.

The coalition had abandoned its earlier enthusiasm for localism and was now “caving in” to powerful interests, the Labour leader said.

May’s elections are for all county councils in England and handful of other authorities.