Séamus Brennan (Dublin South, Fianna Fail)

I have held up the legislation because of the complexity of trying to get around this issue. The legislation allows moneylenders to charge up to 188%. The Financial Regulator's report on the licensed moneylending industry, published last week, shows that they charge this amount. The legislation allows them to charge even higher rates in certain circumstances. The report shows that 71% of people did not know what interest they were paying.

I took the time to get it right and the legislation is now completed and will shortly be considered by Government. What took the time were discussions with the Irish League of Credit Unions, the Irish Bankers Federation and the Financial Regulator. It was also necessary to have sight not only of the Financial Regulator's report, but that study in tandem with the Combat Poverty Agency study, Financial Exclusion in Ireland. I wanted to go through all that data to see what type of solution we could come up with. Obviously, it is not possible simply to introduce legislation to fix interest rates. That is a complex and difficult area involving the economy generally across the board, so that is not an easy option.

As I hinted in my reply, the model I looked at seeks to bring the expertise of the MABS organisation to bear on the whole area of licensing of moneylenders. That is the approach I am hoping to adopt in the legislation, giving MABS some input into that process. Owing to the complexity of the issues, however, it has taken longer than I thought. I believe the result is a good one. Whether it is I or someone else who will introduce the legislation, it is now on a very solid footing. It will make a real difference and will give MABS, which has frontline experience of poverty, direct involvement in interest rates on some basis yet to be determined.

On the Deputy's reference to luxury and clothing items, the view I expressed was based on what MABS, the Combat Poverty Agency, the Financial Regulator and the banks tell me, that the nature of credit is changing. There would not have been credit card debt ten or 15 years ago, but it is now a major feature. Some credit card debt is for motor cars and other items regarded in some ways as essential, which ten years ago would not have appeared on any list in the same way as would, say, clothing and food items. All the expertise indicates that the nature of credit is changing as expectations rise. The line between absolute poverty and lifestyle is becoming more blurred every day. That is based on all research. Some goods, which would have been regarded as lifestyle items in the past, are now included as poverty items. Regardless of this, our job is to try to make an impact on the problem. The different welfare and economic policies of the Government have made substantial progress on the poverty area in recent years.

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