Olwyn Enright (Laois-Offaly, Fine Gael)
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Question 4: To ask the Minister for Social and Family Affairs the action she will take to assist the money advice and budgeting service in dealing with the increased numbers of people seeking support and advice on the way to deal with debt problems; and if she will make a statement on the matter. [9373/09]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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The money advice and budgeting service, MABS, is the main Government-funded service that provides assistance to people who are over-indebted and need help and advice in coping with debt problems. There are 53 independent MABS companies with voluntary boards of management operating the local MABS services from 65 locations throughout the country. In addition, the MABS national telephone helpline is available from 9 a.m. to 8 p.m., Monday to Friday, at lo-call number 1890 283 438, and budgeting and money management information can be accessed 24 hours a day at www.mabs.ie.In 2008, more than 16,600 new clients approached the MABS for assistance with debt difficulties and the telephone helpline dealt with almost 11,000 callers. This year, 3,400 new clients have approached the service. The telephone helpline has received 4,200 calls up to the end of February. In 2009, almost €18 million has been provided to assist the MABS in dealing with its workload. Six additional full and part-time staff have been allocated to the local services. The capacity of the telephone helpline has been strengthened and MABSndl, the national support company, has introduced a number of community education and other initiatives to assist the local services in managing their increased caseloads.

There now are 252 money advice staff employed throughout the country in the MABS. Money advisers help clients to assess their financial situation, make a budget plan and deal with creditors. All MABS companies operate an appointment system for meeting clients. Clients with urgent difficulties are prioritised for attention and are dealt with promptly. Less urgent cases are referred to the telephone helpline and to the MABS website. More than 90% of callers to the helpline find that their money management and budgeting issues can be resolved with the assistance of the helpline adviser. Approximately 10% of callers are referred to the local MABS for appointment.

The MABS advises that people coping with debt difficulties should take early action. An approach to the MABS, via any of the channels, can be the first positive step in addressing debt difficulties. The MABS provides a high-quality, personal service to members of the public that helps many in coping with and overcoming the burden of indebtedness that can have such an impact on their lives and that of their families.

Olwyn Enright (Laois-Offaly, Fine Gael)
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I thank the Minister. The MABS does very good work and is to be commended, particularly given the difficult environment in which it now operates. That said, there is a need for a new or different level of expertise within the MABS organisation. Will the Minister give consideration to the idea of allowing the MABS to employ people with expertise in dealing with financial institutions to discuss the issue of loans and possible repossessions? This is a matter that has been brought to my attention repeatedly recently. I encountered an example this morning of someone over whom the threat of repossession hangs but who will be obliged to wait for eight weeks before being able to make an appointment with the MABS because the latter is so busy at present. There is a real need to have a division of MABS that can negotiate with financial institutions because agreements can be reached that would help people. However, the organisational capacity is not necessarily there, certainly not nationwide, to be able to so do for people at present. While the Minister cannot necessarily agree to this today, has she given consideration to this possibility or has she been approached to examine this issue?

In a related topic, the Minister probably is aware that people who avail of the moratorium on their mortgage repayments will have their credit rating damaged as a result, despite the Government's announcement. Has the Minister considered examining this issue to ensure that people's credit rating will not be damaged as a result?

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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I am unsure what the Deputy is asking in her first question.

Olwyn Enright (Laois-Offaly, Fine Gael)
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To explain, my proposal is to have people in the MABS who have the time and the expertise to negotiate with financial institutions on people's behalf. They would negotiate changes in people's mortgage repayments and effectively would prevent repossessions.

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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That is what the money advisers do at present. I am aware the Deputy had a meeting recently to deal with her interests and concerns in this regard but in any company I have visited, the money advisers contact all the different creditors. One problem they are encountering is that those who are approaching them have up to 23 different creditors. In the past, when they dealt with a person who was dependent on social welfare, the problem may simply have been with the utilities, whereas at present, the MABS is finding the problems pertain to the utilities, financial institutions' moneylenders and a range of others. Consequently, each individual person who comes in is taking a considerable amount of time and the MABS is quite extended. However, those money advisers, having met the individual concerned, start negotiating with the banks. Recently the banks have signed up in respect of repossessions of homes and a timescale that would be used in that regard. Moreover, the statutory code of conduct that was introduced last week has meant that when people run into difficulty with financing institutions, they must be referred to MABS for advice. That is the role of the money advisers.

Olwyn Enright (Laois-Offaly, Fine Gael)
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I am not criticising the work MABS is doing. However, dealing with financial institutions, particularly in the sub-prime area, requires different skills to those involved in contacting the ESB or Bord Gáis. The latter and organisations like them take a fairly responsible approach to those who are in debt. I am of the view, having talked to many people about this, that there is a need for an increase in the capacity of MABS to negotiate with sub-prime institutions. Will the Minister examine this?

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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More than 3,000 new clients have presented to MABS in the first two months of the year. It is under great pressure but is responding well to the demands on its resources. I will certainly investigate the issue the Deputy has raised and am willing to discuss it in more detail with her. The sub-prime lenders are a serious concern. MABS money advisers are finding it extremely difficult to get sub-prime lenders to work with them. The main financial institutions are certainly willing to do so and are now signed up to the code of conduct in this regard. Sub-prime lenders persuaded clients to consolidate all their loans into their mortgage. For example, a person with an initial mortgage of €40,000 may have ended up with a loan of €150,000 or €180,000 following the consolidation of all types of other debts. As I said, MABS money advisers are finding it difficult to get sub-prime lenders to engage with clients in difficulty. That is one of the issues we are trying to address.