Dessie Ellis (Dublin North West, Sinn Fein)

Everybody in this House is aware that people throughout the country are struggling. In many cases, it is measures introduced in this Chamber, by this Government and its predecessors, which have landed people in difficulties. They are doing everything they can to keep their heads above water and make it to the next week with a little in their pockets and enough to pay the bills. The problem is that not every expense can be foreseen and even those who are not too badly off and have managed to budget will be hit. It might be a family illness or bereavement, the breakdown of the family car, or even a debt to a drug dealer. It is not possible to plan for such eventualities when one is barely making ends meet.

This is the point at which the moneylender comes in. Those lucky enough to have some convincing way to prove they can pay can go to a licensed moneylender and get the few hundred or few thousand euro they need to tide the family over and allow them to bob back up above the crisis that is unfolding and carry on the ordinary struggle.

The problem is not that the interest rate charged by the moneylenders is high but that it is extortionate and is not subject to a cap. In some cases, the annual percentage rate, APR, has been found to be 200%. It is argued that such high rates are required for the loan to be profitable given that they are made on a short-term basis and APR is an annual rate. This argument has some validity because short-term loans necessitate charging higher interest rates if they are to be financially viable for the lending company. However, elsewhere in Europe moneylending businesses get by just fine charging rates which are subject to a more strict cap than that proposed in the Bill. Sinn Féin proposes to limit to 40% the APR which can be charged by licensed moneylenders. Of 27 European Union member states, 13 have imposed legal caps on the interest that can be charged by licensed lenders. Spain, for example, applies a cap of 10% APR, while the upper limits imposed on APR in Belgium and France stand at 19.5% and 21.6%, respectively.

Like many other Deputies, I have dealt with people in my office who are unable to sleep at night because they worry about their inability to repay a loan they may have secured to pay the costs of a hospital stay or essential dental work. People are being taken advantage of and are having the incredibly difficult circumstances they face exploited by moneylenders who operate without restriction. If people are desperate, they will say "Yes" to any interest rate. The Government has a duty to stop some of the current practices, not least because of the highly damaging effect its policies and those of the previous Government had on the livelihoods of ordinary working class people, the very people who are the customers of moneylenders.

The Government's argument that the proposed limits would put moneylenders out of business is not good enough. To argue that businesses cannot operate unless they are able to charge exorbitant rates of interest is not acceptable. Having pursued all manner of policies which have taken money out of the local economy, it is shameful that the Government now rises to the defence of the moneylending industry. I am not sure whether its approach to the Bill reflects a simple refusal to support any measure proposed by Sinn Féin or the Opposition or if it is based on genuine concern for those who would charge 60% interest on a loan to pay for a medical procedure. Either way, it is extremely disappointing.

The policies of the Government will not do anything to help those who are already deep in debt to moneylenders. It is now refusing to prevent more people getting into similar circumstances. Some 300,000 people have loans from moneylenders and the 1.8 million people who have less than €100 at the end of the month are ripe for their picking. The Government stands not in the defence of such people but in defence of the industry that will exploit them in their time of need, simply because the concerns of those who elected it are not its priority.

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