A Garda body has blamed Budget pay cuts and levies after its members clocked up more than €13m of “doubtful” debt with their chief credit union.

The Garda Representative Association (GRA) said reckless spending was “unlikely to be the reason” that St Raphael’s Credit Union, in Dublin, has slapped a €60,000 cap on loans.

The credit union’s annual report says it is already experiencing reduced demand for new loans due to cuts in its members’ incomes.

It reveals one outstanding loan it is pursuing is for €750,000, while it is seeking repayment of over €3m arrears in 20 cases.

The GRA said many young Gardai faced “financial ruin” and it has already negotiated the setting up a helpline with the EBS dedicated to members struggling with mortgages.

GRA President Damien McCarthy said a large number of Gardai were in negative equity and struggling to repay loans following the public sector and Budget reductions in pay.

Those on starting salaries have seen their pay after tax slashed by €50 a week since 2008, while those between six and 10 years’ service are down just under €100 a week.

A lot of young Gardai are in financial ruin and negative equity,” he said.

“It is not reckless spending. Very few went on tour around the world. I know from working side by side with them that many are struggling to cope, even with the costs of travelling to work.

Most got money to buy a house that was massively overpriced. The cap on loans is not a solution as the horse has bolted but members could go to credit union staff to restructure their loans.”

In its annual report, St Raphael’s says a cap of €60,000 would be placed on loans from this year.

“The coming year will continue to be challenging for our members,” it says.

“Already we are experiencing a reduction in demand for new lending. This is a direct consequence of the financial situation and, in particular, due to a reduction in members’ income levels.”

The credit union, which has 31,200 members is managing assets of almost €350m and has reserves of €41m.