asked the Minister for Industry and Commerce if his attention has been drawn to the shortcomings in the moneylending legislation identified in the recent report of the Combat Poverty Agency on moneylending, that (1) the definition of moneylending is unsatisfactory, (2) exorbitant rates of interest are not prohibited, (3) the penalties are insufficient and (4) the burden of proof in legal terms lies with the borrower; if it is intended to take any action to deal with these shortcomings; and if he will make a statement on the matter.
Ceisteanna-Questions. Oral Answers. - Moneylending Legislation.
26.
I have seen the report to which the Deputy refers.
In accordance with the commitment given in the Government announcement of 21 November, I am now, in conjunction with the Minister for Justice, carrying out a full review of the effectiveness of the present legislation on moneylending with a view to countering disreputable practices though improving the regulation and control of moneylending.
In addition, I plan to introduce legislation to give effect to the EC Directive of 22 December 1986 on consumer credit. This directive comprehends all forms of consumer credit including moneylending.
What work has the Minister done since 22 December 1986 in bringing the consumer directive to fruition? Is he aware that this would deal with all the defects in the Moneylenders Act if, and when, it is implemented?
It would deal with a lot of the defects. A considerable amount of work has been done on it. As the Deputy will be aware, it has to be introduced by January 1990 and will have to cover a wide range of matters, such as, the content of credit agreements, early discharge by the consumer of his obligations, repossession of goods sold on credit, the liabilities of the grantor of credit with regard to goods and supervision of grantors of credit. The Deputy can be assured that we will cover a lot of the points and the legislation will come in this year because it has to be in place by 1990. I can assure the Deputy it will be in place.
Would the Minister not agree that the review which the Government have announced is totally redundant given this directive and that the Government are, in effect, playing for time to cover their inactivity in this area?
I do not accept that. There is a need for a general look at the position taking into account not just the responsibilities of the Minister for Industry and Commerce but also the area of justice because of abuses that have been widely publicised in very good investigative work done by "Today Tonight" and other teams. It is well to look not only at the directive but also at the justice elements of the legislation.
Will staff be diverted from the work on the directive to deal with this review?
No. The review has to be in by January 1990 and it will be in place.
Would the Minister agree that it is urgent that the legislation governing moneylending, which has serious shortcomings, should be amended as quickly as possible? Would he also agree that there is little monitoring of the operations of moneylenders, some of whom are operating outside the law, at a time when there is so much poverty that some people are the victims of moneylenders?
In relation to the poverty question, the Deputy will appreciate that the Government in their budget last week have gone a long way to tackling some of the underlying poverty problems in relation to families, in particular with the increases of 12 per cent for long-term unemployed and the changes in the legislation generally in the taxation area. As regards abuses by moneylenders, I agree that improvements are needed. This has been accepted by Government and we are working on it in both the Department of Justice and in the Department of Industry and Commerce.
The Minister should not feel he has done a lot to relieve the lot of the poor.