Seán Crowe (Dublin South West, Sinn Fein)
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Question 190: To ask the Minister for Finance his views on the fact that, according to findings of the EU Survey on Income and Living Conditions (EU-SILC) 2005 published by the Central Statistics Office in November 2006, almost 40% of persons in lone parent households in 2005 reported having debt problems, along with 15.3% of persons in other households with children and 10.2% of households with two adults and one to three children; and if he will make a statement on the matter. [4054/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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The issues that give rise to debt problems for people in these household categories include the cost and availability of credit for people on low incomes, the barriers they face in accessing mainstream and affordable forms of credit and the challenges low income households encounter in managing their finances, in addition to factors such as changes in employment status or earning capacity.

At the outset, it is important to emphasise the important role of the credit union movement in providing affordable loans to persons on low incomes. There are currently 427 credit unions registered with the Financial Regulator with around 2.5 million members and assets of around €13 billion. Research carried out by the Irish League of Credit Unions highlights the work of the movement in supporting members with indebtedness problems.

With regard to regulatory arrangements, the Financial Regulator's Consumer Protection Code obliges regulated financial services providers to act in the customer's best interests and only provide financial products that are suitable for their consumer. The Financial Regulator also makes available a wide range of consumer information on financial services.

The Deputy may wish to note that the Money Advice and Budgeting Service (MABS) was set up to help people in managing their money with a view to regaining control of their finances including how to avoid falling into difficulties in relation to debts. MABS provides an extensive range of money advice, personal budget and community education services where necessary and liaises with financial institutions on behalf of its clients on a nationwide basis.

The Government has also taken a number of significant measures in the areas of social welfare and taxation to raise the disposable income of low-income households, which reduces the risk of these households experiencing difficulties with debt.

Budget 2007 contained a €1.4 billion social welfare package, which includes substantial social welfare benefit increases for many of the categories of people referred to in the question. For example, the maximum rate of the One Parent Family Payment increased by over 12%. Since 2002, the maximum personal rate of the One Parent Family Payment has increased by 56%, which is well ahead of the increase in overall consumer prices and average earnings over the same period. Other social welfare benefits are also payable such as child benefit and, subject to income and other eligibility conditions, the Back to School Clothing and Footwear Allowance payment and Family Income Supplement. More generally, the aggregate of social inclusion spending across all Government programmes is estimated to be about €26.9 billion in 2007, an increase of €2.8 billion on the 2006 position.

The Finance Bill 2007 also confirms measures announced on Budget day including increases in the personal and PAYE credits to ensure that those on the minimum wage will stay out of the tax net in 2007 and increases in the standard rate bands to ensure that those earning the average industrial wage will not face a liability for the higher rate of tax in 2007.