As many of you are aware, there was a decision early this year to end  the Lough Payment Scheme. The scheme is an extension of the Household Budget Scheme and operates for MABS clients.

It is jointly managed by Lough Credit Union and Cork MABS. It facilitates MABS clients nationwide to pay additional creditors other than the Local Authority and utility companies.

Deductions are taken at source from social welfare payments and directed through the Lough Payment Scheme via the Household Budget scheme.

Financially Excluded

The facility is offered to MABS clients who would be classified as financially excluded or vulnerable- for example, they may have health difficulties or they may be on such a low income that they struggle to hold on to money long enough to pay bills.

In early 2014, approximately 25 MABS services supported over 400 clients to pay debts via the Lough payment Scheme. Clients using this facility are generally the most marginalised in our society. Money advisors have identified social isolation, mental and physical health difficulties, rural isolation and literacy difficulties as some of the reasons people choose to have payments deducted at source. The Lough Payment Scheme ensures payments such as caravan loans and private rent are made regularly and for many people this ensures that they do not become homeless.

National Traveller MABS works closely with local MABS services and with other organisations on a number of Caravan Loan guarantee schemes. Such schemes were established on the basis of repayment being made through the Lough Payment Scheme. They have now suspended the guarantee schemes. The reason for this is the decision by the Department of Social and Family Affairs to discontinue the use of the Lough Payment Scheme for the deduction of loan repayments, without putting in place a sustainable alternative. This decision has impacted greatly on many Traveller families and is causing great difficulty for Money Advisors who no longer can give hope of supporting clients in securing decent accommodation.

The Lough Payment Scheme is a positive example of a joint attempt by MABS, the Lough Credit Union and An Post to address the issue of financial exclusion in Ireland. The government commitment to financial inclusion has so far provided nothing in the way of an alternative. Until there is an acceptable alternative, National Traveller MABS call on the Department to reinstate the Lough Payment Scheme.

National Traveller MABS have been joined by many other organisations and politicians in lobbying to ensure the scheme is maintained. To read our positon paper on this please click here.

Published: 26 November 2014