Brennan to clamp down on loan sharks

SOCIAL Affairs Minister Seamus Brennan is to clamp down on loan sharks charging 39% as he revealed 10,000 people on low incomes with debts of €65 million sought help last year.

Mr Brennan launched an outspoken attack on licensed money lenders during an interview on The Political Party on TV3 when he referred to the huge numbers seeking help from the Money Advice and Budgeting Service.

He said he had instructed officials in his department to prepare legislation that would make it illegal to charge such exorbitant rates of interest to low-income families.

“At the start of the 21st century we still have an underbelly of debt in the country and I’ve instructed my department to prepare legislation on this,” he said.

“I’ve discovered that a whole range of these people who are in debt, it’s a new kind of debt. In the old days it was money lenders, a back street thing but today these are official legal lenders and in one case they were charging 39% interest to people who were borrowing money to pay for First Communions, to pay for bereavements, to pay for Christmas, to pay for family events or just to pay their rent.”

The minister said it was outrageous that people on very low incomes, who owe around €65m, were facing exorbitant rates of interest.

He also cautioned pilots at Aer Lingus from buying shares in the company to ward off the hostile takeover bid by Ryanair, saying: “Pension funds have trustees; it’s the job of the trustees to act on behalf of the pensioners not to have any other objective. If in that case their objective is to protect their pensioners and to make sure that their pensioners have decent income in years to come — fine.

“If it’s their objective, on the other hand, to get into some power play as to who owns the airline and that’s their main objective then I would caution against that.”