Poverty group warns of debt levels

ONE in every five people are in such a personal economic crisis that they cannot meet their own debt repayment responsibilities, meaning they are at risk of falling prey to loan sharks due to their perilous financial position.

Advocacy group Combat Poverty Agency (CPA) has warned that an increasing number of people are struggling to comply with repayment targets set down by individuals and organisations to which they have fallen into arrears.

During an Oireachtas Joint Committee meeting on Social and Family Affairs, the CPA said that its own research from late 2007 indicated that “over-indebtedness” levels stood at between 7-10%.

However, speaking to the Irish Examiner group spokesperson Jim Walsh said: “What we have seen is that the figure was 7-14% but it is likely to be maybe twice that now because people have far less control on their resources now.

“Mortgage arrears are up by 25% in the two years between 2006 and June 2008, calls to the Money Advice and Budgeting Service are up by about a third from 2007 to 2008, and we have gone from being a relatively secure population in 2007 to the third most at risk of the first 12 EU countries,” said Mr Walsh.

By June 2008, the group’s submission stated that 14,000 people had seen their mortgage repayments fall into arrears — a figure 25% higher than in 2006 which is expected to have climbed significantly in the intervening period.

“Thousands of young people got work easily in recent years in construction work and other things, they maybe left school early to get the work and now that they’re unemployed they are at risk of becoming long-term unemployed,” said Mr Walsh.

As a result, the CPA has called on next week’s budget to focus on “tax income over social welfare expenditure”, to leave children support funds untouched, to tackle the issues connected with over-indebtedness, and to support re-employment for long-term members of the country’s growing dole queues.