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LOANTOWN BLUES

A subcultural study oflow-income indebtedness

Coinneach Shanks

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TABLE OF CONTENTS

CHAPTER 1. Setting the scene ...............................................................................61.1 Introduction....................................................................................................6

1.2 Extent of debt and responses to debt as a generalised problem.....................61.3 Loantown's housing estates, population and disadvantage............................71.4 Welfare services in Loantown .......................................................................81.5 The response to indebtedness.........................................................................91.6 The study......................................................................................................101.7 The participants in the study ........................................................................121.8 Interview profiles .........................................................................................121.9 An overview of the participants..................................................................161.10 Terminology.................................................................................................191.11 Abbreviations...........................................................................................201.12 Summary of study ....................................................................................20

CHAPTER 2. Getting into debt .............................................................................252.1 Overview.....................................................................................................252.2 Introduction.................................................................................................252.3 Separation and desertion .............................................................................262.4 Family, children and setting up home.........................................................282.5 The 3 Cs - Communion, Confirmation and Christmas ...............................292.6 Children, shoes and school .........................................................................322.7 Ill health and disability................................................................................33

Budget Sheet A Staying Out of Debt............................................................34 Budget Sheet B Getting Into Debt ................................................................36

2.8 Inability to cope ..........................................................................................382.9 Conclusions.................................................................................................39

CHAPTER 3. Living in the dead zone: The world of career debt ..........................423.1 Overview.....................................................................................................423.2 Introduction.................................................................................................433.3 Unavoidable debt ........................................................................................433.4 Displacement borrowing.............................................................................453.5 Administering career debt...........................................................................47

Budget Sheet C: Managing Career Debt .........................................................48 3.6 Dealing with arrears: "The rent man never calls twice" ..............................513.8 Holding the payments back: Fear eats the soul............................................59

3.9 Dealing with help agencies .........................................................................613.10 Conclusions..............................................................................................63CHAPTER 4. Getting out of debt ..........................................................................65

4.1 Overview.....................................................................................................654.3 Community activity: Getting out the house................................................66

Budget Sheet D: Getting out of Debt................................................................67 4.4 The illuminative moment: Key events on the road to Damascus ................704.5 Experience of the Courts: "Here comes the judge" ....................................724.6 Credit Unions..............................................................................................76

Budget Sheet E: Getting out of Debt............................................................79 4.7 Conclusions..................................................................................................81

CHAPTER 5. Community, conflict and the debt process......................................845.1 Overview......................................................................................................84

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5.2 Community suspicion: fear and loathing in Loantown................................845.3 Keeping quiet: the sound of silence............................................................875.4 Social blame and acknowledged debt .........................................................885.5 Towards a money advice service: The community solution........................895.6 Conclusions..................................................................................................93

CHAPTER 6. Debt and the Community Response................................................956.1 Overview.....................................................................................................956.2 Introduction..................................................................................................966.3 Debt workers: Breaking with tradition ........................................................966.5 Awareness and transformation..................................................................102

CHAPTER 7. General conclusions......................................................................105

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Author's preface

" Life is short - and so is money " Bertolt Brecht

This study is an attempt to contribute to the struggle against one of the most perniciousproblems affecting ordinary people. It tries to engage directly with the lived experienceof some of those affected. The reason for such an approach is to tackle questions of process. What is the dynamic of indebtedness? How do people become indebted? Onceindebted how do they survive? Is overcoming debt possible?

So I adopt a very specific orientation for the study; one which I see as way of penetratingthe mechanisms of indebtedness at street level, through accessing everyday experience.In doing this I hope to clarify the situation facing community-based interventionprogrammes. The orientation demands a great deal of attention to meanings and world-view. It tries to see, not merely the point of view of the indebted people, but throughtheir eyes. This requires both identification and empathy with the subjects of the researchand I hope sincerely to have risen to the task. This also leads me to apologise in advancefor any of the statements of participants that give offence to those working with indebtedpeople. In defence, I have to remind readers that in order to reach our objectives, wehave to acknowledge and address both feelings and the way in which different groupssee the world.

The project relies on case studies, but I felt that presenting these individually wouldobscure the factors, which link their common experiences. So I've tried to weave thecases in a narrative that explicates the processes involved. Qualitative studies shouldhave a raw, cutting edge that is necessarily absent from quantitative surveys. I intendedto convey not only the horror, but also the quirks, the inventiveness and maybe evensome of the excitement of continually living in debt.

Chapter 1 attempts to establish the context within which indebtedness takes place.Specifically addressing indebtedness within low income families living in peripheralestates, I have tried to lay out the generality of debt within the variety of social problemsand responses existing in Loantown. The aims and objectives of the study are outlinedand the participants who contributed information are introduced. Finally, at the end of this chapter I have summarised the main findings of the report.

Chapter 2 looks at the factors and forces that pitch those families, otherwise copingwith demands on income, into lives determined by borrowing. Here, various crises -separation, ill health, unemployment and so on - are examined. Cultural factors too aretaken into account. In particular, I have made an attempt to locate both social pressureand pleasure in relation to the celebration and ceremony associated with Confirmation,Communion and Christmas.

Chapter 3 examines factors that consolidate debt, confirming those affected in a state of career debt, where debt becomes the determining feature of their lives. It looks closely atways in which indebted households sustain themselves over lengthy periods through

creative debt management. Here, interactions with moneylenders, rent collectors and

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CHAPTER 1. Setting the scene

1.1 Introduction

This study looks at patterns of indebtedness in low-income families. Naturally, thecontext within which this takes place is a product of the social and economicdevelopment of Loantown and the West. The lives of families in the study are bound bylocation - all the more because their commitments limit mobility, confining them to oneplace. But although many of the families in this study are trapped in this way, Loantownitself has been subject to considerable change. It has seen substantial economic andsocial development both in its own right as a city and within the region.

The reality of indebtedness is riddled with contradictions and this chapter seeks todescribe the framework within which this occurs. It draws on several informationsources including a demographic outline of social exclusion in Loantown and a mid termreport on partnership working; It also tries to depict the town graphically such thatreaders not familiar with the town might have some sense of place.

The indebted families depicted in this study are here firmly located as part of the overallproblem of structural unemployment within Ireland's labour market. Although Loantownitself has as a result suffered greatly with an average of 21% long term unemployed, inthe estates that surround the city centre this figure increases to over 40%. 1 Living at andbelow the level of subsistence low-income families in the estates of Mayfield, South

Park, St Stephens and Westtown often find themselves unable to cope with frequent callsupon their budgets. Every day they face the spectre of enforced borrowing - and theconsequences of mounting debt.

1.2 Extent of debt and responses to debt as a generalised problem

A recent report indicates that nearly 40% of long-term unemployed people have debtsthat cause them serious difficulties. This is a section of the population that finds itsaccess to legitimate credit denied. It is estimated that three quarters have no bank

account and two thirds are not members of a Credit Union. We can envisage that thoseliving on low-income close to benefit levels would increase this figure. Together, thesegroups find themselves subject to increasing housing and electricity arrears and aredriven to seek alternative sources of credit.

Within what conditions do so many people find themselves slipping into indebtedness?Firstly, they live in what is for Ireland, a comparatively large city. With a population of 80,000, Loantown forms the administrative capital of the mid-west region. Loantown'sproximity to a provincial airport has brought it economic development and it has

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acquired the image of a high-tech economic growth area, close to technological parksand nearby industrial estates.

But the development of the region has affected the labour force unevenly, and as theprofessional and technical sector grew, so did the unskilled and manual sector decline.

Between 1971 and 1986 unemployment in Loantown increased by 240%. Even thisincrease was unevenly distributed with suburban unemployment quadrupling. Withmore than 10,000 on the unemployment register during 1992 (half of whom are longterm unemployed), unemployment was climbing by 4.5% per year. Areas of publichousing in Loantown are mainly by those in manual trades - a total of 70% comparedwith 47% in the city. But they are not only more vulnerable to unemployment. Theselocalities too suffer from educational under-achievement with a quarter of the populationhaving left school before 15 compared to 12% for the city as a whole.

1.3 Loantown's housing estates, population and disadvantage

Primarily as a result of public spending cuts in the '80s, physical upkeep of housingestates deteriorated. Long streets of physically similar houses now appear quiet anddeserted and an absence of parked cars reflects the low-income of residents (cars perhousehold in public housing stands at 0.25 per household compared to 0.6 in LoantownCity). The estates were designed for high levels of car ownership but residents becameforced to rely on public transport that they found basic, unreliable and expensive.

Many residents in employment chose to leave for the more affluent and accessible inner-city areas, a dynamic influenced by tenant buy-out schemes. The house surrender valueof 5000 persuaded some 15% of tenants to move out of one estate alone, leaving amainly welfare-dependent population. The dependency of the estates is magnified by thepresence of a young population - in the quartile of wards dominated by public housingmore than one third of the population is under 15 years. The relationship between familysize and poverty has been well documented elsewhere. Suffice to say that the totals of 28% of families who have more than 4 children and 21% who are lone parent families,suggest that these those living in the localities under study have a higher risk of poverty.

But to the outsider, Loantown can appear quite comfortable. At its core, the centre isbustling, vibrant and studded with new shopping developments. In common with many

other European cities however, the peripheral housing estates present a grim picture of decaying infrastructure, isolation and social exclusion. Whereas the city centre hosts newshopping developments, busy taxi ranks, and the hustle and bustle of a major regionalcapital, the periphery is bleak, colourless and depressing. Shops are few and telephoneboxes fewer. Iron grills and fences fortify community facilities.

Far from providing an environment of health and leisure opportunities, the proximity tothe countryside of the more distant estates enforces a feeling of remoteness. In the estatesnearer to the centre, trunk road systems designed for through traffic have much the sameeffect. And although Loantown has an undeserved reputation for youth violence, fear of crime is common on estates. In a study of St Mary parish, residents identified youth

behaviour as a major problem. It is within this context that Loantown's community

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groups work to transform their neighbourhoods and it shapes the arena within which aninterventionist debt advice service operates.

1.4 Welfare services in Loantown

Indebted families in Loantown must necessarily engage with agencies that provideservices for low-income households that are typical of the target group in this study. Thearea-based partnership itself provides a framework within which those agencies -together with voluntary and community groups - deal with those who have becomeindebted.

Most importantly for this study, the Health Board (popularly known as "The Clinic") is asource of help for medical cardholders - nearly half the population of the city - who areentitled to free General Practitioner service and prescriptions. Child social work services,including community-based child-care services, are also part of the Board's remit. It isalso possible to approach the Health Board for single emergency payments, and hence itprovides an important focus for people who have become indebted. As a major welfareprovider, its concern over indebtedness and related problems gave rise both to itsinitiative in conjunction with the Credit Union, and its development of the specialaccounts scheme in conjunction with Area based partnership.

The Department for Social Welfare assists a range of client groups and individualswithin the city's 80,000 population. Through its figures for delivery of benefits we canassess to some degree the nature and extent of social disadvantage in the city. In the yearprevious to this study, the Department assisted the unemployed (6203 recipients), elderly(4750 recipients), families in need (3461 recipients) and those affected by illness (2060recipients). Representing a total of approximately 16.5 thousand cases, these figures arelikely to be underestimates. Based on an apportionment of county data, the figures maynot reflect the concentration of unemployment within the city itself.

State supplementary welfare allowances also give some idea of the extent of disadvantage. In 1992 the scheme helped 925 households weekly, making a total of 50,000 payments per annum. This includes payments for basic, supplementary andexceptional needs, clothing and footwear, schoolbooks and school meals. This must beseen as partial since the Department of Education and the Loantown local authority also

assist school expenses. More generally, voluntary organisations - including LoantownSocial Service Centre and various charities - provide financial assistance to low-incomefamilies and individuals.

Housing services form an important focus of this study and arrears for housingcomprises a significant share of total indebtedness in the city. Loantown Local authority,the major authority for housing need, administers 3107 tenants and 2262 tenant-purchasers. Of the tenants, nearly all are welfare dependent. But in a situation whererents rise regularly, many were attracted to the tenant purchase scheme as a way of pegging increases. As we can see from the study, some welfare-dependent familiescontinue to view mortgages (and mortgage arrears) as "rent".

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We have to acknowledge trends in service delivery and use. In particular, organisationshave tended to operate from a top-down perspective that grants little self-determinationto their users. Additionally, organisations overlap in function, whilst applying differingeligibility. Beneficiaries can therefore lose out with one agency because they havereceived help from another. Increasing demand has placed great pressure on welfare

agencies and although voluntary groups have tried to make up the shortfall, the upwardtrend continues.

The response to indebtedness, embodying a strategy of partnership, sought to avoid thistop-down approach. At the core of the study therefore there is a strong commitment todeveloping the kinds of community-based approaches privileged by the EU PovertyThree programme.

1.5 The response to indebtedness

Within the situation of widespread debt, located in a general framework of disadvantage,Loantown agencies began to respond with a variety of measures. As a major provider of welfare services, the Health Board was the first to launch the formal scheme that was toprovide the basis of a more generalised approach to indebtedness. Its initial pilot schemein South Park, one of Loantown's peripheral estates, drew together the Credit Union, theHealth Board and voluntary organisations to tackle the problem. At the same time, theBoard became actively involved in the establishment of the new Loantown partnership.Funded by the EU's Third Poverty Programme, this was to focus on integrateddevelopment projects designed to bring together local groups and statutory agencies inpartnership - to tackle disadvantage, poverty and social exclusion.

Represented at board level within the area-based partnership it was logical for the HealthBoard and the partnership to jointly extend the debt initiative. This proved a productivecombination that allowed both organisations to build on the success of the Health Boardscheme. Thus projects incorporated the knowledge and successful practice of both theHealth Board and the partnerships network of community, voluntary and statutoryadvice services. Importantly, this strategy aimed not only to tackle individual problemsbut also to develop policy measures such as money-lending reform and low-incomecredit options.

Now with joint responsibility, the Health Board and the partnership launched the specialaccounts scheme. Here, as is outlined elsewhere in this study, those who had reached acrisis stage in indebtedness could begin to manage their debts. Following interviews bypartnership or Health Board staff, such clients became able to bring repayments down toa more ordered and manageable level. Through making a single sum payment on aregular basis to the Credit Union for dispersal to creditors, responsibility for multi-payments would be re-located.

Through this special accounts scheme, it was envisaged that:

(1) Fear and anxiety within the home would be reduced.

(2) The burden of debt would be lifted from the family - providing an example to thechildren.

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(3) Provision of support would help to give hope to families.(4) Dignity, self-belief and independence would be restored to families.(5) An option of low cost credit would be provided.

1.6 The study

As part of its strategy in tackling the problem, the area based partnership initiated thisstudy of indebted Loantown families. Its express function is to inform and guide theactivities of a new money advice service. But more generally it aims to provideknowledge that will shape the overall response to difficulties faced by both individualhouseholds and by the community itself.

Families, who owe money and now have difficulties in meeting repayments or payingoff arrears, provide the focus of the study. Through talking in detail to families we hopeto add to the existing body of information on the financial dimension of debt, byrevealing the process of debt - to cast some light on the everyday world of those livingwith debt.

With the active participation of Loantown agencies some 20 families were selected forinterview - so that the range of participants in the study would be typical of those thatthey encountered in their work. People with single and multi-debt problems are included- housing and utility arrears, those who owe money to moneylenders, local shops - oreven to family and friends. Although a single refusal reduced the number of participantsto 19, an informal conversation on reasons for refusal is represented within the body of the report.

The process of debt is the most important focus of this study. An information and adviceservice needs not only to advise those people who already have debt problems but also tohelp prevent this happening. And it needs to draw on the experience of those who haveovercome debt problems. So the study has been organised in a linear way - looking athow people get into debt, live and cope with debt - and at those who have successfullytackled debt.

This report presents an opportunity not only to examine in detail the process of debt, butalso to create a space in which people who have become indebted can speak forthemselves using their own words. The increasing volume of available material on

indebtedness tends to emphasise pressures on income, budget management and effects of indebtedness. But the focus of our study on low-income families demonstrates adissonance between budgets and borrowing, which almost reaches the level of theabstract. It is perhaps this world of "coping" - dealt with in the core of the report - withwhich welfare professionals have to grapple the most. The point in time where peoplebecome enmeshed into debt, where living and survival is only possible through debt, isalso the point where life seems at its most hopeless. Feelings of indebtedness arecharacterised by depression and pessimism - thus those who most need advice andsupport are often those least likely to seek it out.

The study therefore focuses at the level of the everyday - the experiences and feelings of

people living with debt. It looks at processes that are often taken for granted. It examinesthe way in which people make sense of their difficulties and how they present these to

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others. My emphasis on presentation of self is influenced by an interactionistperspective. What people feel and think is important and the subject is privileged. Butthe study goes beyond individual families. It acknowledges that people live within asocial framework - and therefore emphasises community and neighbourhood, both interms of the feelings of the study's participants and in terms of the effect of indebtedness

on community relations. To use a health analogy, a neighbourhood strategy may offersolutions at the preventative level whereas counselling and money advice is often forcedto operate at the curative level.

In 1985, a study undertaken by the School of Advanced Urban Studies in Bristol lookedat the experience of five European cities similar to Boomtown. It identified forces of differentiation, segmentation, segregation and marginalisation that separated out socialgroups and reinforced disparities in employment, housing, access to services, livingconditions and power.

Different types of families and households have the opportunity to develop particular coping

strategies in the face of economic change. Some are able to exercise a large degree of choice ...others are supported through a variety of European and state programmes ... Other households(and areas) however are unable to adjust and are increasingly marginalised and isolated both interms of their socio-economic and their spatial position.

The authors suggested that this marginalisation would become a main focus of concernin the 1990s. The EU's poverty programme, now in its third phase, focuses on social andeconomic exclusion. Its current orientation replaces the terminology of "poverty" in anattempt to build more comprehensive approach and permit a closer examination of theprocesses that lead to exclusion. This report is concerned with a main consequence of that marginalisation or social exclusion, and at the economic level takes seriously the

development of a centre-periphery polarisation that shapes indebtedness.

For advice workers this study may reflect some of their experiences and confirm whatthey already know. No apology is necessary here since the corroboration or verificationof findings should lead to increased awareness. Penetrating the everyday world of indebtedness may help to shape targeting of client group and daily practice. It shouldalso help determine the pitch or tone of the service. The study shows that attitudestowards the Credit Union are influencing take-up of the current special accounts scheme.These attitudes are shaped by the process of indebtedness, the array of social factorsoperating at neighbourhood level.

Whereas studies of poverty focus on a generality of experience, many debt-relatedstudies have hitherto concentrated on the effects of debt on particular cases - oftenisolated in a sea of otherwise financially stable neighbours. Thus programmatic demandsfor social policy emerge, which orientate to the individual. By examining the way inwhich debt affects a whole community we hope to pave the way for strategies that aimfor social change at neighbourhood as well as the policy level. The study therefore looksat the deleterious effects on neighbourhoods and relationships between social groups,and examines community solutions. The locus of the study at the level of the subject andthe everyday taken-for-granted world stresses understanding, in an attempt to feed thisback into practice .

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1.7 The participants in the study

This section attempts to paint an overall picture of the participants in the study.Information from the study's 20 indebted people and their families is intended as typical rather than as a representative sample. Nevertheless, the study's substantially qualitativeorientation does not preclude some quantification where it can shed some overall lighton the dimension of debt. Naturally the usual caution must be applied to such ananalysis.

Additionally, since cases are woven in a comparative and descriptive narrative throughthe study, it was felt that the reader might require a reference point for individualsmentioned in the text. Thus the following brief profiles serve as a reference point for thereader.

1.8 Interview profiles

The necessity of maintaining confidentiality precludes exact descriptions of familystructure, socio-economic status, individual encounters, lest they be recognized in theneighbourhoods or even localities of Loantown. The following information is thereforedeliberately non-specific - e.g. exact number of children, ages and so on. Names havebeen changed, and housing estates remain anonymous.

1. Katrina is a lone parent with children at secondary school. Her indebtedness beganas a result of communion expenses. After borrowing without her husband's knowledge,the problem was compounded when he left her. Although she feels that some debts are

outside her control she blames moneylenders for making borrowing too easy and the rentcollector for failing to call regularly. Although community work has helped her to copeand to join the special accounts scheme, her continuing inability to make simplepurchases and the increasing shabbiness of her possessions makes her depressed. Shefeels that indebtedness has brought tension with her children and provoked the stigma of her neighbours.

2. Lone parent Linda started borrowing to pay for her husband's drink problem. Herchildren are disturbed and have trouble with the police - problems that she attributes tothe atmosphere created by her husband and to her increasing debt. Clearing off ESB andHP arrears through use of moneylenders has merely transferred her commitments and

borrowing from family and friends has left her acutely embarrassed. Currently undermedication for depression she feels lonely, isolated and cries a lot. Nevertheless, herconcern to "keep up appearances" led her to spend large amounts on her home,compounding her debt enormously.

3. After a disastrous marriage marked by considerable domestic violence, Carol 'shusband left her to carry joint debts. Her problems included rent and electricity arrearsand debt to moneylenders, family and friends. Now in a new relationship her partner isunemployed and she continues to face difficulties. Because of her debts, Carol continuesto feel anxiety about answering the door and the trauma of her first relationship requiresongoing therapy. Although a community-based course opened the door to the specialaccounts scheme she has recently received a new court summons for failure to pay theTV licence, and is pessimistic about the future.

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4. After leaving work to have a child Margaret was forced to borrow to finance herhusband's drinking. As a result of this problem and the stress of subsequent debt, herchildren experienced psychological problems, and she made a suicide attempt. Sheblames moneylenders for exerting too much pressure and used to hide from them when

they came to collect. Through a community employment project she came into contactwith the special accounts scheme. Her debts are now under control and she feelsconfident about the future.

5. Christine and William ran into difficulties when Christine's pregnancy led to anunexpectedly lengthy confinement. Expenses for Communion, Confirmation andChristmas led to further debt through money-lending accounts. They were unable tomeet payments of electricity, gas and phone bills and their electricity supply was cut off.Now the health problems that prevent William working have been exacerbated by hisworry concerning debts. After an approach to a charity, both Christine and William wereaggrieved about what they saw as insulting treatment and feel that they have been treateddifferently from others in their neighbourhood. Now on the special accounts scheme,they feel relieved about not having to deal with their creditors personally.

6. Karen blames her own bad management for her indebtedness. Now in arrears forhousing and electricity she feels that her neighbours disapprove of her and is ashamed togo out. Hiding from anyone who calls at her home has communicated stress to thechildren. She found out about the special accounts scheme from a friend but did notapply because she thought that her husband's employment would prevent herparticipation.

7. The cost of a late and unexpected baby drew Deirdre and Patrick into debt.Deirdre had been borrowing without her husbands knowledge, sending him out of thehouse on errands when the moneylender was due. Subsequently all the family washiding from the moneylender, placing everyone under considerable stress. Feelingvulnerable following the eviction of a relative from her Local authority house, Deirdresought help from a friend. Through her advice she is now part of the special accountsscheme.

8. Theresa came from a family in which it was customary to borrow frommoneylenders. With a husband unemployed through ill-health and a late baby on theway, she felt she had no option but to borrow from a moneylender. The stress affected

her health, for which she received medication. She was introduced to the specialaccounts scheme by a friend and is now optimistic about the future.

9. Now widowed, Frances suffers from the after-effects of an old injury. Herproblems started with delays in transferring benefit entitlement. Poor living conditions -bad insulation and a house continually attacked by vandals - have exacerbated hermoney problems. She relies on small jobs from her family to provide her with theoccasional bag of coal or cast-off clothing. She cleared her money-lending accounts afterthe threat of violence from a collector, but still has difficulties making ends meet.Critical of the Health Board and the rent collector whom she finds "moralistic", she has apragmatic approach to bills that she keeps until "critical". She then pays them by holding

another bill back.

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10. Sean's family currently cares for a handicapped relative and confines itself to oneroom to save heating. Difficulties began after moving house, when related expenses andproblems in benefit transfer forced Sean to approach a moneylender. Now administeringa series of accounts not only in his own name, but also in those of the rest of his family,stress has caused him a nervous breakdown. His arrears include milk and coal bills and

his cable TV has been terminated. Despite the complexity of his debt Sean prefers toclear utility bills by generating further money-lending accounts. His outlook ispessimistic and he forecasts that Christmas and Communion expenses will double hisdebt.

11. Liam's problems began with a delay in benefit transfer following an accident thatmade him unemployed. This was exacerbated by a heavy fine that he could only pay byusing either licensed or licensed moneylenders. Although his mother helped him pay off one account, he is in considerable difficulty and has been attacked by one of hiscreditors. Suffering periods of mental illness has threatened his relationship with his wifeand he has made two suicide attempts. He is generally pessimistic about the future and iscynical about community schemes since his experiences lead him to believe that othersless deserving are more successful in obtaining benefits. Now under notice of electricitycut-off and eviction he feels a need for professional advocacy on his behalf.

12. After her separation Sheila had difficulties in paying bills, and blames this on herown inexperience. Now she uses any one of three different moneylenders to clear utilityarrears, and forecasts that she will generate another account for Christmas. Her father'shelp in looking after one of her children allows her to do a small part-time job but nowshe owes him money too. The pressure of being unable to pay her various moneylendersand keep up with bills has driven her to a suicide attempt, and her son was so badlyaffected that he chopped up the furniture. Sheila won't consider joining the specialaccounts scheme because it would prevent her organising another loan to see her throughChristmas.

13. Living with an unemployed husband and 4 children, Lisa's debts have reached acritical stage. She has several accounts with moneylenders but they are so much indefault that they will now only supply her with goods rather than cash - so now sheobtains goods on credit and resells them to pay bills. Her neighbour has been paying Lisacash weekly to obtain goods for Christmas through one of her accounts - but Lisa hasspent the money and doesn't know how she is going to cover it. Her electricity supplyhas been terminated 5 times and her housing arrears are continually mounting - a

situation, which she blames on the failure of the rent collector to call. With additionalarrears for coal, cable TV and HP her personal outlook is bleak.

14. Ann's problems began with her husband's drinking and often she would be beatenif she failed to come up with the cash to finance it. Subsequent trouble between her sonsand the police, which she blames on the stressful and violent domestic atmosphere,exacerbated money difficulties. When her front room was gutted by fire she held back rent until repairs, using the cash to reduce money-lending accounts. As a result she nowhas substantial housing arrears. Nevertheless, Ann believes that she will somehowstraighten out her financial affairs, but would prefer an agency to negotiate on her behalf.

15. After a difficult confinement Dolores gave birth to a child with a congenitaldisorder, putting a strain on the family that led to separation. Her husband subsequently

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died and despite the split, she bore the cost of her husband's funeral, consolidating herindebted position. She now finds herself unable to cope, suffers physical and mental illhealth and is currently under medication for depression. She feels uncomfortable withthe idea of advice and feels she needs support to help her access advice services.

16. With finances that balance on a knife-edge, Thelma is living on the very edge of indebtedness. Despite having a husband and daughters in work she has a severelyhandicapped son and heavy expenses of care. Although she was the only person in thisstudy who has access to a car, a necessity in her case, this only served to place anadditional burden on the family economy. She lives in fear of her daughters leavinghome since it is only through their contribution that she can service her Credit Uniondebt for housing adaptations. She feels that advice should be independent, private andnot administered locally.

17. Sarah says her debt problems began with financing Christmas for the family. Nowshe can't remember when she last paid the rent. With her husband unemployed, housingarrears amounting to 2500 and enduring violent threats from her moneylenders, she haslost weight, developed chest problems and suffers from eczema. As a result of herfinancial and health difficulties her children have not been to school for a whole term.Now threatened with eviction Sarah hopes that her application to the special accountsscheme will rescue her.

18. With mounting rent arrears, a husband who has been made redundant and continualpressure from her children for clothes and schoolbooks Moira feels unable to cope. Herhusband blames her for their son's refusal to go to school whilst she feels it is caused bydomestic stress. She says she is terrified of the Housing Local authority and thinks thateveryone in the neighbourhood is pointing her out. Moira feels that the Government is toblame for failing to provide an adequate income for everyone and that information onthe problems of debt should be more widely available.

19. Kathleen feels that the ever-increasing expenses of children growing up caused herdebts. She now finds herself unable to pay what she owes to her neighbourhood grocerystore and can no longer shop locally. Although she survived an eviction order throughthe partial contribution of a local charity, she could not keep up the increased housingpayments she negotiated in court. Now, two years later, she is threatened with evictiononce again and has substantial electricity arrears. Kathleen admits that she cannot copeand is unable to envisage a solution.

20. Paula and Marcus are in multiple debt and have asked for assistance in clearingthat which they owe. After two unsuccessful visits the interview was abandoned sincethey decided they no longer wished to take part. The two conversations that took placeindicated that they could only focus on strategies that involved third parties takingresponsibility for their debt. Once they had established that taking part would notdirectly assist them, they were unwilling to participate.

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1.9 An overview of the participants

A quarter of interviewees were lone parents, all female. One was a single person livingalone. Remaining interviewees were two parent families. In all but two cases, women

provided the information. Only in one case did a male solely provide information, and inanother the male was the lead interviewee in a family group.

Family size clearly has an affect on living standards. Walsh's study states that familieswith children have a 23% risk of poverty, compared with 13% for non-child households.This rises to 29-35% for lone-parent and larger families. Family size ranged between 2and 6 children. Although this averages as 3.6 children per family we can see that justunder half the group had four or more children.

Most families were living in accommodation rented from the local authority. Theremainder had bought their Local authority house but had done so instrumentally to"peg" the rent. As such they tended to regard their payments as rent. This wasconsolidated by the fact that local authority rent collectors also collect mortgagepayments.

All of the respondents were typified by low-income - whether benefit or employment ora combination.

Over one third of families were unemployed, with a further 4 participating on state

Table I : Family size

No. of children 2 3 4 5 6

Lone parent 2 1 - 3 -

Two parent 3 3 3 2 1

N = 18

Table II : Employment of respondents

Employment

Unemployed 8State scheme 4In full time work 3In part time work 3Informal economy 1

N = 19

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schemes. Respondents on state schemes were not confident about subsequentemployment and hence these two categories could be grouped to provide a total of 12,nearly two thirds of the whole group.

Almost everyone in the study either had or used to have loans from moneylenders. Two

had cleared their accounts with moneylenders and 3 are now paid through the specialaccounts scheme. No one with existing money-lending accounts was up to date withpayments.

The onset of indebtedness was treated differently from the participants' apportionment of blame for the problem. Respondents were asked to trace the beginning of indebtednessand in general identified the point where things first became unmanageable.

The largest single explanation is associated with events, mostly seen as inescapable, inwhich the family is obliged by custom to participate. Commitment to children isimportant here as the study will go on to examine in depth. Expenses of pregnancy,particularly late and unexpected ones - and confinement after childbirth constituted aquarter of cases.

Delay in receiving benefit after a house move, onset of disability or after maritalseparation accounted for nearly a third of cases. A quarter of respondents just couldn'tcope with expenses on their level of income and this category includes those whomentioned increasing expenses associated with children and inflation.

Table III : Reasons for becoming indebted

Expenses of Christmas, Confirmation, 7Communion, weddings or funerals

Delay in benefit payment due to 6moving house, separation ordisability

Pregnancy and childbirth including 5unexpected hospital confinement

Just couldn't cope with expenses 5

Husband's or child's ill health 3

Husband's drink problem 3

Expenses associated with courts 2

N = 19

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More than two thirds of cases were in arrears to moneylenders and to the local authorityfor rent. The Electricity Supply Board constitutes the third largest group of creditors.Importantly for this study, more than one third had already borrowed from the CreditUnion, although one family in this group was up to date with payments.

Health - particularly mental health - was in general poor. Nearly two thirds (13) of thecases mentioned depression. A total of 8 of these were under medication of some kindand 4 had made suicide attempts. Almost all respondents mentioned the effect of domestic stress on their children, but in 5 cases children had become seriously disturbed

or were refusing school.

Most respondents could identify the circumstances within which they became indebted.When asked if they blamed anyone or anything for their situation a different set of responses emerged (some respondents gave more than one reason).

Although roughly a quarter blamed themselves for poor personal management, few wereprepared to shoulder total responsibility. "Moneylenders make it too easy" was a typicalresponse. A few identified the Government in some way, in terms of policy regardingthe benefit system or employment strategy. Cases involving a partner's drinking - usually

Table IV : Current creditors

Money-lenders 15

Local authority (rent/mortgage) 14Electricity Supply Board 9Credit Union 7Family/friends 6Shop 3HP 2Coal 1Solicitor 1

N = 19 (includes those now paying through the special accounts scheme)

Table V : Allocation of blame for indebtedness

Self 5Ease of Obtaining a loan 5Government/economic policy 3Partner's fault 3Children 3Other 3

N = 19

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associated with domestic violence - were sufficiently strong for blame to be apportionedat a personal level. The financial pressure of children's expenses also makes an impacthere.

In general there was little difference between the family economies of those on benefit or

those where a partner was in full-time work and despite the small number of cases, noparticular variations in patterns of indebtedness emerged.

Caution must be observed with all these groupings since obviously the level of selectionstructured the set of interviewees. Nevertheless it is interesting to note that the shape of information is similar to that collected by Walsh and Daly and others. Hence we canpositively conjecture a recurring replicability in results.

We therefore encounter a group of cases typified by low-income and who are for themost part welfare-dependent. In all cases they are managing levels of debt with whichthey cannot cope. Critical identification of reasons for personal indebtedness waspossible and results broadly match those of other studies. Effects of indebtedness were attheir most extreme in the area of mental health - particularly depression and suicideattempts - and it must be recognised that indebtedness can form part of a multiple"bundle" of problems that appears insurmountable.

1.10 Terminology

This study strives to take the words and language, which people use, extremelyseriously. In so doing a heavy onus to explain terms falls upon the presentation of thisreport. In order to promote clarity and to avoid the clumsy formulation of she/he, thefollowing conventions have been used.

1. Because those who bear the brunt of living with debt and take responsibility for itsmanagement are generally women, indebted people are generally (although notalways) represented as "she".

2. Money-lenders, rent collectors and so on are for the most part men and are referredto as "he".

3. People looking after children alone are referred to as lone parents. However whereparticipants in the study referred to "single parents" this formulation has beenretained.

3. Informal economy replaces black economy, black work or "the lump".

As already mentioned, the sensitivity of the subject demands a particularly seriousapproach to confidentiality. Thus names, locations, and some family details have beenaltered in a way that does not substantially affect findings. Some information howeverhas been omitted, since it too clearly identifies the participants. The author is drawn tothe naturalistic use of exact words of participants but ironically the quantity and richness

of the material forces some abbreviation and consolidation. In so doing I have attemptedto represent the spirit of discussions, whilst clarifying the original text.

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Within quotations, phrases in brackets indicate an added clarification, whilst (...)indicates a transcription edit.

1.11 Abbreviations

CIC Citizens Information Centre

CU Credit Union

ESB Electricity Supply Board

EU European Union

FAS Fora Aiseanna Saothair - The Training and Employment Agency

HP Hire Purchase

SVDP St. Vincent de Paul (charity organisation)

TD Teachtai Dala - Member of Parliament

1.12 Summary of study

(i) Where debt is the product of structural unemployment, low-income and poverty, itbecomes an all-embracing system within which people negotiate and determine newsocial relationships. Where the dividing line between "borrowing" and "indebtedness" isvery thin, periodic emergencies can very quickly pitch an individual or family intoindebtedness, into a path of career debt . Once it commences, people find it difficult toinfluence the debt process without the help of others. Advice agencies find themselvestackling the process at a late stage when crisis produces self-referral or referral by anagency.

(ii) This study looks at the process historically - following cases sequentially as the debtprocess takes place. It examines the stages - getting into debt, managing debt and gettingout of debt - in succession, to illustrate that the process isn't fixed and that it is possibleto tackle it at the level of social intervention. It takes the view that the process is verymuch a social one. Rather more than budget management on a low-income, this processrepresents a complex negotiation of social relationships that can limit the effectivenessof advice and counselling. Moreover, the damage to people who become indebted is notlimited to individuals and families. Sustained damage to communities affects theframework within which debt advice and counselling takes place.

(iii) The start of the debt process is centred in the family. The emergencies that promptborrowing are typified by separation, unexpected pregnancy, difficult confinements,childbirth in quick succession, expenses incurred in Confirmation/Communion and

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education. Ill health and handicap are often child-related. In addition, leaving work because of ill health in the home also creates the conditions for indebtedness.

(iv) Expenses associated with a move to a new house shape borrowing patterns andconsolidate debt. Social isolation follows, forcing the focus of the family inwards. An

amplification of this process takes place as celebration within the family became moreimportant. Here Christmas joins Communion and Confirmation in influencingborrowing. But cause and effect are difficult to extricate. Whereas ill health causes debt,it is also the result of debt. Anxiety and depression, in turn, influence maritalrelationships, and tensions within households result in behavioural problems of childrenand young people.

(v) This is not to say that only emergencies cause debt. There are those who merelyfind coping on a limited budget impossible. They are unable to identify any single factorthat leads to debt, but tend to attribute the high cost of children's clothing as aconditioning factor in its intensification. Coping with the demands of education-relatedspending is consistently mentioned throughout interviews.

(vi) Once in debt, it becomes impossible to meet payments. This part of the process,described as career debt , is typified by coping strategies. The indebted individual orfamily is continually forced to raise loans to meet lump sum commitments like theelectricity bill or expensive items of clothing. As payments increase, the less flexibilitythey have to manage this system. Adaptations to the system include allowing theaccumulation of arrears, then settling them with a loan from the money-lending market.Pressing creditors force the indebted family to raise other loans to pay for them. Thispart of the debt process enforces a sophisticated system of extending re-payment periods,often to more than triple that of the original agreement. It is a system of somecomplexity, where the indebted person instinctively judges how much non-paymentcreditors will tolerate. Through testing the system to its limits, indebted persons reach acrisis stage. This can take the form of eviction, threat of violence from unlicensedmoneylenders or ill health. Anxiety, depression and suicide attempts are typical of thisstage. It is this stage (or shortly before), which is more likely to produce debt-counsellingreferrals.

(vii) During career debt, new relationships are formed, as the social milieu of indebtedpeople contracts and changes. Debt and its management becomes the dominant featureof life. At this stage the drive to secure additional income becomes more intense, and the

study notes the tendency for the Credit Union to become enmeshed in borrowingpatterns. This has severe implications for the success of the Special Accountsindebtedness programme. Those still in debt to the Credit Union feel that the scheme isclosed to them, whilst others cannot face the financial commitment of saving for therequired qualifying period.

(viii) Both the social benefit system and voluntary social welfare organisations becomesubject to the debt process. With marginal flexibility for cash injections, families rely oncash or kind benefits in the form of emergency payments. Much conflict arises from theperceived arbitrary nature and unfairness of the system. The stereotypical views of thosewho see others successfully negotiating payments, distort relationships within the

community. Agencies do not appear to be immune from these stereotypes and the studynotes that the less articulate seem more likely to be recipients of charity donations. In

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contradistinction indebted families perceive themselves as respectable; as havingstandards below that they would not sink. Refusing to play the system as they see it, theyintegrate welfare and charity rejections into a social explanation for their continuingindebtedness.

(ix) Agencies suffer during this period. As isolation confines social activity to the home,violation of the indebted person's private space sharpens doorstep exchanges. Inparticular the rent collectors suffers through a combination of lack of sensitivity andincreased tenant hostility. Comments on household acquisitions glimpsed through thedoor increase the propensity for the door to stay closed. This situation is alleviated insome cases through removing collection points to social facilities and increasing visits tocoincide with benefit payments. Relationship with the ESB is subject to the same factorsand its power to cut off electricity with ease is much feared.

(x) Priorities within payments systems are generally food and lights. But interferencefrom outside the indebted persons' priority system can quickly change this. Interferencefrom the courts and from violence (or its threat) are evident. If a creditor is particularlypressing, this results in an inequitable distribution of available funds and health damageto the family. Increased money-lending debts often follow the threat of eviction, fines orunrealistic arrangements for arrears repayment. Participants confident enough to makearrangements find that they break down after a short while, but also recognise that, if they make the effort to keep paying something, then they are left alone.

(xi) Money-lenders play an ambiguous role within the community. Evidence suggeststhat although there is a clear difference between licensed and unlicensed moneylenders,that there is unevenness in the system. Top-up loans in particular, enmeshes families infurther and disproportionate debt - but they are easier to obtain. The drive to secure thatsmall flexibility in income leads borrowers to negotiate ineffectively. The study detects adifference between national/regional companies and more locally based unlicensedmoneylenders. In either case however, moneylenders are known on first name terms andtake on the status of household acquaintances. Moneylenders are always introduced byfriends, neighbours or family.

(xii) Observation with a money-lending collector reveals a capacity to remember thefamily details of a large number of clients and visits are marked by conversation. Trustplays a part in this relationship. Doors are left open and payments left under doormats oreven in drawers in unoccupied homes. This openness is typified by considerable honesty

when clients are unable to meet payments. This quickly breaks down where accounts gobadly out of order. Yet this can happen with one moneylender and not with another. Ingeneral a borrower can judge when this is going to happen and manipulate a network of different firms to maximise income.

(xiii) The study suggests that moneylender and community form a symbioticrelationship. The indebted family needs the moneylender to satisfy emergency needs inthe form of small loans. The moneylender performs a "service" for the community. Buthis doorstep proximity often leads him to have first call on monies. As a result the rentgets left back , and as top-ups continue he diverts available finances away from the Localauthority. Thus public money flows into private hands and away from the community.

The study indicates that a more community-orientated collection strategy for Localauthority rent payments can partially stem this flow.

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(xiv) The study looks at those who are in the process of overcoming debt - both thosewho are now involved with the new special accounts scheme and those who, throughother methods, are tackling increasing indebtedness. People who have slipped into debtand are unable to understand the process that now embraces them, are more likely to

have reached a crisis and been referred by an agency like the Local authority. Here, debtcounselling engages in a more difficult operation of rescue or damage limitation, e.g.preventing eviction. Others were persuaded by their friends to seek help and often thesefriends had been through a similar process. Some were prompted to review theirsituation through accumulation of experience or a key event that allowed them to look back critically. In the latter case, described as the illuminative moment , an observedevent, such as an eviction, allows the viewer to generalise to her own experience. Inother cases a remark by a child, indicating its fear of answering the door, unveiled theeffects of indebtedness. The realisation that events were out of control constituted thecumulative moment. All of these give the impetus to seek help and support.

(xv) The re-integration of indebted people with a wider social milieu also brings aboutchange. Employment and other social schemes not only increase friendship and supportsystems, but also expose the indebted person to information. In this way the indebtedperson or family member increases opportunities to overcome debt. In breaking downthe isolation of indebted people, such courses also improve links within the community.The success of this factor will depend on the ability of the person to maintain socialcontact and on the capacity of the community sector to provide support systems onconclusion of courses. Such schemes provide an important referral point for debt adviceand counselling.

(xvi) The courts represent a chance to help indebted people overcome debt, but neglectthe opportunity to so do. In agreeing to unrealistic arrangement requested by creditorsthey confirm paths of career debt. Unrealistic fines are paid off with moneylenders, thusintensifying indebtedness. Unorthodox methods of survival, which result in criminalconviction and imprisonment contribute to family indebtedness, e.g. by applying a largefine the court reduces the beneficial effect of a community service order. Participants arenot prepared for the publicity they receive in court and find themselves labelled as"indebted" in the community.

(xvii) Those who took advantage of the new Special Accounts intervention, which takesresponsibility for payments, reducing them to a manageable level, proved extremely

successful. Participants experienced a strong sense of liberation and empowerment, andexhibited both enthusiasm and optimism. Drawn in by recommendation and communitycontact at neighbourhood level, they are now anxious to assist others in the same way.The informal style and community-orientated approach is proving extremely effectiveand closely matches the kind of service that indebted people want themselves. Someindebted people wish to avoid being identified. Service delivery will have toaccommodate the demands of privacy and confidentiality, and ensure its compatibilitywith a local approach.

(xviii) The study identifies a strong subcultural influence on indebted people typified bya common network of money-access, language, values and world-view. In this case it

constitutes both strength and weakness. Its valorisation of the home contributes to itsisolation and minimises the effectiveness of debt services. Child-centred value patterns

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increase the propensity for debt acquisition, and disavowal of social activities reduceopportunities for support. Nevertheless it forms a coping strategy, which can besustained for many years. Its oppressed position forces it to critically examine the socio-economic structure and it exhibits a clear understanding of the social dynamics of money-lending. Its common experience could be of practical value in anti-debt

initiatives. In a sense it contains the seeds of its own salvation.

(xixx) The dynamics of neighbourhoods, however, are profoundly affected by suspicionand the feeling of being under surveillance by neighbours. This is expressed in terms of arational assumption - they must know, it must be obvious. Combined with the feeling of unfair treatment by welfare agencies, this produces an unsettled, uneasy existence withincommunities that would otherwise be supportive. Declining housing stock anddeterioration of interior contents and resources are contributing to demoralisation atneighbourhood level. The study nevertheless notes a high degree of communitycommitment and looks at possibilities of reversing the process through communityinvolvement.

(xx) People express a desire to make a fresh start but would like an opportunity to repaytheir debts. The study proposes an examination of community solutions, where at avoluntary level arrears could be discharged through community-oriented work withinneighbourhoods. The study also examines the possibility of re-routing existing charitablemonies to resource facilities within the community. Based on the notion that seed-bedfunding creates disproportionately high achievements, it constitutes a value-for-moneyoption that should be examined. Such an option should primarily address the basic needsof the community - amongst them provision of household necessities. The studysuggests that the partnership arrangements now in place provide a strong base forcommunity development at neighbourhood level, stressing participation andinvolvement. As such it would provide for a reduction in the social exclusion affecting asignificant sector of the population.

(xxi) The study locates indebtedness in the overall framework of high unemployment.A sizable surplus population is socially and economically excluded, its pathways intothe labour market restricted. The study notes the response of indebted people to theirsocial position as a subcultural one. In an alternative analysis to those that depictindebted people as passive it sees innovative debt-management as an active copingresponse - a collective subcultural adaptation that forms an imprecise but tenaciousresistance to social exclusion. As Robinson and Gregson point out, through the

acquisition of things that are valued in society it demonstrates a logic of self-interestthat subsumes the values of the wider (non-excluded) society.

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CHAPTER 2. Getting into debt

2.1 Overview

This chapter sets out to examine ways in which low-income families become indebted.By engaging with the process of indebtedness it identifies the causes that precipitate adebt career - where individuals and families become bound into a system whoseexistence is determined by the continuing need to borrow for everyday expenses. In thisrespect it identifies marital separation, the pressure of providing for children, the burdenof school expenses and obligation and cultural expectation in relation to rites of passageand of religion. It also distinguishes "unexpected" features such as late pregnancy andthe onset of illness or handicap, which often gives rise to interruptions in the flow of benefits to the household. Here the study charts the pressure to resolve the crises throughlimited available credit and locates both legal and illegal moneylending as beinginstrumental in the path to ongoing indebtedness.

This part of the study notes the flow of available monies away from the community andthe local state and into essentially private non-local hands of finance entrepreneurs. Itsuggests a review of administration and eligibility criteria for benefit payment andrecommends a consolidation of partnership of agencies; such that a rational co-ordination might more rationally meet community need and retain funds within thecommunity.

2.2 Introduction

In the social world of Loantown's housing estates, there is little mystery about the natureof debt and its causes. In general the participants in this study live on low-incomes -usually state benefits. With no bank accounts and little choice of credit facilities theirlevel of income leaves no room for manoeuvre. So any departure from everydayexpenditure can prove catastrophic for families. This section is dominated by life-eventsthat might otherwise appear normal - births, deaths, marriages and separations.Children's expenses present a continuing challenge to the economic system of thehousehold, where the three 'C's - Communion, Confirmation and Christmas - generate

crisis rather than celebration.

For women especially, separation has both an emotional and a financial impact. Death of a partner leaves a legacy of funeral expenses with which the remaining partner findsdifficult to cope without borrowing. In both these cases difficulties and delays in changesto an individual's social benefit creates a time fraught with extra expense, within whichborrowing provides the only means of survival. Difficulties associated with child bearingconstituted a major factor in the study as did ill health and handicap. Health difficultiesnot only reduce income but entails extra expense. Mental health problems - alcoholismand drink-related conditions particularly - can lead to borrowing; the pressure here oftenfalls on other members of the family.

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Although participants are often able to identify a single cause for incurring debts, thereare cases where no simple causal factors apply. Sometimes a complex variety of factorscombine. In some instances people find themselves unable to cope with managing a tightbudget and cannot pinpoint any single event or sequence of events, which had led toindebtedness. The consolidation of debt that results is examined in Chapter 3.

The results of the study suggest that there is a distinct difference between " career debt"and " crisis debt". For many participants in this study, living with debt becomes a normal,unavoidable phenomena where holding back payments for housing, electricity andtopping up small loans with private moneylenders is a way of survival for many families.Some seem to have the capacity to extend this almost indefinitely and are trapped in apattern of career debt. Crisis debt involves a recognition or acknowledgement that theirprivate debt-management system will no longer cope. For those who are otherwisemanaging, this is often typified by an additional and unexpected factor, such asseparation, unexpected pregnancy or ill health, but is more likely to be an externalfactors such as a threatened eviction.

The implications for advice may be more difficult to establish for the beginning of theprocess - at commencement of career debt. Nevertheless it is here we must start if weare to estimate the scope for preventative work in the community. In this section weexamine both causal relationships and those where the relationship between debt and thehousehold is more complex. In addition we look at those cases where households haveslipped into debt within general rather than specific circumstances.

2.3 Separation and desertion

I have to cry sometimes to get along, Good Lord I just can't hardly get along.Can't hardly get along. Johnny Lewis

Where relationships founder, the financial pressure on either or both partners can beconsiderable. Partners left with child-care responsibilities are in the most difficultposition. In this study female lone-parents identified the breakdown of the marriage as acause of debt, and debt as a contributing factor in separation. Here the causal elements of

debt and problems within the relationship intertwine to create a volatile and destructivesituation.

In Sheila's case, the break-up of her marriage led directly to borrowing. Her husbandhad always taken responsibility for family finances so separation left her unprepared forbudgeting in her new role. Her husband's control of household finances allowed him toremove any savings and left her in a vulnerable position.

When we split up my husband broke in and took any money and everything of value (that'swhen I got into debt with my Dad). I just got deeper and deeper in. I had to start replacingeverything. (My husband) used to handle the bills and just give me house money so I hadn't aclue what to do. When we split up I had three weeks rent still to pay and it just piled up until Iowed more than 200. So this loan shark came along and I got a loan from him.

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Here, the pressure to pay rent resulted in the use of a moneylender to pay off arrears -and this transference of debt proved to be a common theme linking almost all the casesstudied. Sheila's husband requested a separation agreement for which a solicitor wasengaged, but his failure to pay the fees left her with a further bill of 124 - resulting infurther borrowing from a moneylender. But whereas her husband leaving the family

home directly caused Sheilas problems, most other separations were tied to debt in amore complex way. For Katrina a marriage break-up served to consolidate increasingborrowing and repayment difficulties. In common with several cases in the study she hadbeen borrowing without her husband's knowledge.

My marriage broke down and left me with more debt. The electricity (ESB) bill really hit me -its substantial. I was on my own with 5 kids, trying to manage with the allowance and allthese bills coming at me. I didn't know how to cope without letting them go ... before we splitmy husband coped with the ESB and the Credit Union. But he had no idea what it cost todress a child. So I was with moneylenders without his knowledge for Confirmation becausehe never helped. I couldn't cope. I'd get 200 loans - up to 800 at one time. It went on foryears.

Here, an established practice of borrowing from moneylenders was located within arelationship where neither partner knew the full extent of household outgoings. Theincreased pressure of trying to cope with unfamiliar payments led to failure to pay theelectricity bill. Familiar with coping through borrowing from moneylenders Katrinabrought the ESB payments up to date through loans. But the monthly purchase of children's clothes and shoes was only possible by continuing to mobilise further loans.At this stage she felt the situation had gone out of control.

In the following two cases, moneylenders formed part of a daily existence prior toseparation. Ann , a mother of six, now living with 4 children in a local authority house, iswithholding her rent due to lack of maintenance and has arrears of 400. The threat of domestic violence led to borrowing from moneylenders and eventual separation

I was borrowing money for drink for my husband. That's when it all started four and a halfyears ago. If I didn't get it then I used to get a beating and everything. I often had to run upand down the road looking for money for him ... I was debt free when he was barred from thehouse.

Now paying 30 a week to three moneylenders from a lone-parents allowance of 120,Ann blames her husband's violence not only for indebtedness but also for her son'sproblems with the police. His imprisonment is now an additional financial pressure.

In a deteriorating relationship Linda 's husband had retained most of his unemploymentbenefit, forcing her to borrow from moneylenders to finance everyday expenditure. Hisrefusal to acknowledge the problems of budgeting persisted - despite being taken back during a period of illness sometime after their initial separation.

The early years were all right - more than 20 years ago. So long. He would give me a certainamount - he had his money even if it was dole money. But a lot of my problems come fromhis drinking. When he went to the pub it would be 20 gone and I couldn't pay things. Therewere moneylenders then, with debts in my name ... It was hard I tell you. Rent arrears too.The kids were all at home and I'd find it hard to even dress them. Any extra shilling you got,

they were always needing shoes all of the time. The budgeting was all my business. "You gotyour money. Do what you like with it and don't bother me - I don't want to know!" He'd sit andsay it was my fault I couldn't pay the bills.

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With help from the FAS training allowance, which supplements her deserted wivesbenefit, Linda is clawing her way out of debt and feels that her two children havebenefited from the removal of the threat of violence. Nevertheless she continues to livewith multi-debt to moneylenders and the Credit Union - and she still feels responsible for

outstanding repayments on her husband's 600 moneylending debt. Her story is typicalof those cases where the process of debt began during marriage - but was expressly tiedto the problems within the relationship that eventually led to its breakdown. The benefit-dependent household is operating with little slack in its economic system. Withoutcooperation and communication between adult partners even normal expenditurecontinually needs supplementing through borrowing.

"When poverty comes in the door, love flies out the window". The old saw distils thecomplexity of this problem to a causal relationship. In an examination of the relationshipbetween marital problems and default, Janet Ford's work on indebtedness 1 drawsattention to the duality of this process. Where debt causes relationship problems andrelationship problems cause debt, a money advice agency has to place debt in contextand shape its approach to individual clients accordingly.

2.4 Family, children and setting up home

Expenses associated with children constitute a major theme of this study. Severalparticipants in the study could find no other reason for their debts than the general costsof clothes, shoes and schoolbooks. Pregnancy itself can be an additional expense for afamily but where it takes the form of unexpected late pregnancy the financial pressurecan prove devastating. Moving to a different house creates a desire to "set up home".The need to take possession of a house and make it one's own is part of the process of coping with change - but can prove more expensive than is first imagined. Whenparticipants were asked about what they lacked - but really needed - responses tended tobe couched in terms of decoration, floor coverings or basic furniture. In the two casesthat follow, living with debt began following a move into their new home. Setting uphome drew them to rely on moneylenders, to whom they were referred by acquaintancesin the neighbourhood. A crisis point was reached when both suffered unexpected latepregnancies. Deirdre explains how this affected her.

We only moved in with an old bed, and a friend that I'd just got to know was telling me aboutthis credit man. And I got 600 to start me off, three and a half years ago -then got anotherone ... but it all came to a head when I had the baby. I was taken off birth control and after 18months I got caught. I had just got rid of the baby things and we had to start from scratch - soI found it hard. I wasn't on top of things as it was and then he cost me 30 a week with foodand cream and things and you only get 15 a week (extra) on the Labour. I get paid on aMonday and I literally have nothing left on Monday night - so I have to start borrowing onTuesday morning .

Theresa 's story is similar. Accustomed to moneylenders during her childhood in aworkless family, it seemed "normal practice" to borrow to meet everyday expenses.Thus her career debt commenced with a move to a new home where funds borrowed forre-decoration were quickly sucked into household expenses.

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I can't remember living a life without moneylenders knocking on the door. In my mother'shouse or down here it just carries on. I got this house 7 years ago - we didn't have nothing. Awoman down the road said that she could get me the loan of the 100. It went on wallpaperand eventually just vanished with everything else. When I'd finished that, I'd take out anotherhundred and carried on from there for 7 years. So you could be down to 20 repayments. I'dsay "Any chance of a loan of 100?" You deduct the 20 out of it and end up with 80 butyou still have to pay 127 to get 80 in your hand. Theres a big catch there! But this year Ihad the baby I wasn't expecting. The baby things that had belonged to his brother I hadpassed on and had to start all over. I borrowed 300 for a pram, clothes, nappies. I had beengoing to finish but well, we're going to need (moneylenders) now - there's nowhere else to gois there?

The process of debt here begins with the most basic of human needs. The importance of the home led both of our participants to approach moneylenders to fund decoration orfurniture to start family life, and for both Deirdre and Theresa, living with debt becamecommonplace. It was a key occurrence - a major crisis - that forced them to seek alternatives. Both families were forced to address the implications of continuing expense

associated with another child.

After she was born I got to thinking. The eldest of mine now is coming up from his first HolyCommunion this year. I said "Oh God! Don't tell me I'm going to have to borrow a couple ofhundred off a docket man to see him through that". I said to John "It's '93 and here we arestarting off already. We're going to end up going to the moneylenders for May forCommunion. It's not on!"

For Lisa a move also proved too expensive for the family budget and an inability to copeled directly to an approach to a moneylender. Top-up borrowing (whereby the lenderissues a new and larger loan incorporating the outstanding sum) has now builtrepayments to more than 50 a week.

When I came here there wasn't any spare money. That's when the money lending came. Afriend of mine said I can get you someone that can give you a hundred pounds. Then it was ahundred and a hundred and a hundred. I'd let it get down and then have another one to clearthe old one. Then you get into the shop because you can't pay your moneylenders.

Lisa's family now has multi-debt problems encompassing rent, electricity, coal, TV hire,TV license and moneylending accounts. An inability to keep up with the rent means thatthe family is forced to live in poor conditions. The house has severe damp problems,which the local authority refuses to rectify unless the rent is brought up to date, a factor

common to several participants. The local authority comments that this is a circularproblem, which continually amplifies, holding that the financial impact continuallyrestricts its ability to provide an adequate repairs programme.

2.5 The 3 Cs - Communion, Confirmation and Christmas

Many studies of debt refer to the shrinking social world of the indebted person. For low-income families the pleasure of setting up home turns in on itself and the home sets theboundary of their lives. This will be examined in detail in the section "Living with debt".It is also an important factor in the start of the debt process where isolation andconfinement in the home leads to a greater emphasis on ceremony. Life events marking

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transition, rites of passage particularly those defining adulthood - here represented byCommunion and Confirmation - take on an increased significance. And in a situationwhere the possibility of "having a good time" is severely limited, the pressure to enjoyChristmas is almost unbearable.

These expenses were identified as a major financial pressure. Where children were closeto each other in age, the annual sequence of Communion and Confirmation expensesproved responsible for a steep accumulation of debt. Christmas in particular marked aperiod where parents in this study felt the stigma of low-income most severely - and itemerges as one of the sharpest pressures in encouraging borrowing and accumulation of housing and utility arrears. The study suggests that families living with debt constructprivate debt-management strategies around the Christmas period, determining theirborrowing requirements and repayment strategies for the following year. Christmas forone participant in the study was responsible for her feeling unable to cope. Sarah'schildren's expenses could only be subsidised through borrowing from a moneylender.

It was Christmas that set it all off with the moneylender. The children were looking for this andthat and new clothes. That's how I started off. The original sum borrowed was 40. I paidback 70. Then I had a new one for 40 or 30. He would give me a new loan but I had touse it to pay off the other one. The moneylender is the main problem. I pay 120 a week topay him off and he adds interest all the time.

Despite rent arrears of 2,500 for which the family face eviction, Sarah feels that themoneylender has become the major difficulty. Now in considerable ill health, which sheattributes to anxiety, she coughed continually throughout the interview. Sarah said thatshe hadn't been eating so that she could pay off the moneylending debt. Similarly, Linda took a similar route into moneylending via children's expenses during Confirmation,

Communion and Christmas.Communion, Confirmation, Christmas. You know! The dressing of 4 teenagers is justunbelievable. I've had a communion or a confirmation without a break for 9 years. They causean awful lot of heartbreak and a lot of borrowing. I have had 2 moneylenders and 2 accountswith each one. One in my name and one in my husband's name - and he hasn't lived here for6 years. But I took out a second loan in my husbands name with the same lender. So it wasfour bills I was trying to cope with.

Ethno-centrism often leads us to deny the centrality of the ceremonial in comparisonwith those of other cultures. But a comparison with more "traditional" societies revealsthe same process of indebtedness. Ceremonies "... indicate the passage from non-existence to birth, from childhood to adolescence and parenthood, from life to death.They are inescapable obligations ... carefully scrutinised by others ... jealouslycomparing the cost, costumes or the food available for guests. Competition inceremonies is unavoidable and failure to live up to the current standard involves seriousloss of face and lasting shame." Whilst here Paul Harrison 1 is referring to Asiancommunities, it equally describes the pressures shaping indebtedness in Loantown'speripheral estates. Resorting to debt is an international phenomenon where those wholack resources are forced onto the loan shark market with its high rates of interest.

Christmas for Sean was (and remains) the most important time of the year. But it was acombination of moving house and changing benefits, which drained his availablefinances. Christmas and Communion started his debt problem - and the pressure of subsequent Christmases has confirmed this process.

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When we moved here I had a claim that never came through for three weeks. We had a fewbob saved. I went to find out why it wasn't coming. I had been knocked off and hadn't evenbeen told. I went into the local TD and he told me there was nothing I could do - I lost 4 weeksmoney by the time I found out they'd transferred me from one benefit to another. They saidyou lived for the three weeks - what did you live on?

Sean is careful to emphasise his family responsibilities and despite a disability feels thatit is his duty alone to provide for the family. He ensures that rent and electricity are neverin arrears. He dislikes charity and is aware of his obligations to his creditors.Nevertheless his experiences with the benefit system may have been responsible for astrategic and manipulative approach to borrowing.

It was the pressure of Christmas 2 years ago. I thought about what a wonderful Christmas wewould have and go out and have a good time. Not for a drink - but to go into a shop. We hadno debts at the time. We weren't in arrears. It was great. But I thought - Christmas? Athousand pounds? Incredible! So it was a great Christmas - and now its a great 30 a week!

Now in a position of multi-repayments to moneylenders totalling 63 per week,accounting for a third of the total family income, Sean feels that the family can onlysurvive through borrowing. Again the financial pressure of ceremony is aggravated bymigration. Where members of the family have moved abroad (usually the UK) directcommunion expenses extend to travel.

Last summer I took a holiday and I borrowed a total of 600 off this fella under three separatenames. My son's grandmother couldn't come to his Communion - she had one of her ownchildren making a Communion. I said if she couldn't come