Rising school costs ‘drive parents to loan sharks’
PARENTS are ‘hiding in their kitchens’ from loan sharks as they struggle to pay soaring back-to-school costs, a senator has told the Dáil Education committee.
Independent senator Lynn Ruane made an emotional speech about the shame and stigma families face as they are forced to turn to money-lenders year in, year out.
Those in desperate need who borrow €1,100 have to repay almost €1,500 to cover education costs every August, and once that is paid off, they are taking out further loans to cover the cost of Christmas, Ms Ruane told the committee.
‘When I’ve sat down to talk to parents – or even growing up with my own community and my own friends – one parent said they had to borrow, most years in August, €1,100 from a loan shark. They would repay about €1,430 over a 26 week period,’ she said.
‘Now, this would be somebody on social welfare. So to repay that would cost €55 a week for 26 weeks. That’s probably only covering the cost of one child, so they would have to save or find another way to meet the needs of their other children.’ She added: ‘There’s an option of 26 weeks and 52 weeks for loan sharks. They knock on your door every week, which is not a nice experience. It’s not something that comes out of your bank account or that you can keep from your children either.
‘They get 26 weeks because they’ll also need a another loan at Christmas. This is the cycle they’re in and the cycle doesn’t end. They’re already in consistent poverty and leave themselves in further poverty every year to meet them two costs.’
Ms Ruane, a long-time campaigner for education access, said parents often can’t keep up with the costs of loan repayments.
‘They also have the added shame when a loan supplier knocks on your door and your child is dragged into that space because sometimes you don’t have that €55. You’re hiding in the kitchen because a knock has come to your door and you know you have to pay your rent that week,’ she said.
Ed Farrell, CEO of the Irish League of Credit Unions, told the committee that their studies show parents spend an average of €999 per primary-school child and €1,379 at secondary level.
In a survey of 1,000 people, he said they there is a worrying trend of parents turning away from traditional money-lending institutions. They felt they would be guaranteed the money and that the approval processes in banks and credit unions would be more difficult.
The National Parents’ Council Primary presented a study showing 76% of parents are asked to make ‘voluntary’ contributions to the cost of running schools.
A survey of 1,800 parents showed that an average of €100 is asked for, and some are being asked for in excess of €200. More than half, 54%, said they felt under pressure to make the payment.
NPC CEO Áine Lynch told the committee: ‘Despite many reassurances by the Department of Education and the Minister for Education that this contribution is a voluntary payment and there should be no pressure on parents to pay, these survey results show this is not the reality.’
A department spokesman said: ‘In relation to voluntary contributions which are mentioned, they are permissible provided it is made clear to parents that there is no question of compulsion to pay and that, in making a contribution, they are doing so of their own volition. The Parent and Student Charter Bill 2018 will require schools to publish a financial statement, which will also show how any voluntary contribution is spent by the school. The education budget has increased by €1billion over the last two years.’
‘You’re hiding in the kitchen’