Written Answers. - Money Lending Problem.
Jim Mitchell
Ceist:
414
Mr. J. Mitchell
asked the
Minister for Social Welfare
if his attention has been drawn to the case of a person (details supplied) in Dublin 10 whereby this person approaching 60 years of age living on an income of £55 per week has five loans from money lenders totalling £2,700 which amounts to repayments of over £105 per week; if his attention has further been drawn to the fact that this person has had a stroke and has been admitted to hospital and that it was only then that her family learned of these loans; and that, because of these loans, her rent has fallen into very serious arrears, and the local authority concerned is seeking weekly payments of £28.45 per week to assist in clearing the arrears over the next 18 months; if, in light of this case he will give details of the assistance, if any, which is available in cases of this kind where individuals become enmeshed in spiralling money lending webs; whether he has any new proposals to assist in cases like this, and to tackle the money lending problem; and if he will make a statement on the matter.
The Eastern Health Board, which administers the supplementary welfare allowance scheme in the Dublin area on behalf of my Department, has been contacted with regard to this particular case. It is understood that the board has been actively involved in assisting the person in question with her serious financial difficulties which were brought to the attention of the board by a member of her family.
The board came to an arrangement with the person in question and agreed to assist her with her financial difficulties, subject to the claimant also making a contribution towards clearing her debts. This arrangement is being reviewed on an ongoing basis to ensure that the conditions of the agreement are being adhered to.
Under the differential rent scheme there is provision for Local Authorities to reassess rent in hardship cases. Accordingly, it is not the practice of Health Boards to pay rent supplements to persons on differential rents or to assist with arrears
I have been particularly concerned for some time about the problems of moneylending. The 1992 budget provided for a special allocation of £260,000 for the establishment of pilot projects around the country, aimed at building new and more comprehensive approaches to combating the problems of moneylending. I have recently launched five projects which are being set up in Dublin City West, West Clare, Cork City, Limerick City and Waterford City.
Under this new scheme local groups who have already been involved in this work will expand their efforts and try out a variety of new and different approaches to tackling the problems of indebtedness among low income families.
The key elements of the projects include a general money advice element, targeting at families identified as having particular problems with moneylenders, a role for both statutory and voluntary bodies and an emphasis on practical, budget based measures that would have success over the long term in removing people from dependence on moneylenders.
This initiative follows on the experience of the Loan Guarantee Fund which was set up in 1990. The Loan Guarantee Fund is operated by the Society of Saint Vincent de Paul on a day to day basis. While the person in question is not within any of the areas covered by the pilot moneylending schemes, she could contact the local Saint Vincent de Paul Conference.
In 1991 provisions were included in the social welfare legislation to allow for deductions to be made from social welfare payments with the claimant's consent. The amounts deducted could then be paid over to the utilities concerned to assist in meeting bills such as ESB, gas and local authority rent.
I have asked An Post to develop the household deduction facility as part of the development of their services to social welfare clients and I am happy to say they are well advanced with this project. They have secured agreement from the utilities and are working closely with my Department on the proposed system. It is my intention to have this facility available from next January. It will initially be available on a limited basis in Dublin but the intention is to extend this facility as quickly as possible to all areas of the country.
The provision of this facility will be a significant element in combating the problems of moneylending.
