Mick Wallace (Wexford, Independent)

It was not. People should not be allowed to enter a farmer's property in the middle of the night and take machinery or anything else. That should not happen in a civilised society. Some serious thought should be put into the regulation of debt because things can be done in a much better fashion.

While I will not get to address all of the issues, I would like to draw attention to the case of Norway, which I found very interesting. Norway faced a debt crisis among private households in the early 1990s, mainly caused by rising unemployment and a fall in housing prices. Norway was and is a land of homeowners, with more than 80% of dwellings owner-occupied. In the most exposed areas, houses and apartments lost 50% to 80% of their value. This happened very quickly, particularly in the larger cities. At the beginning of the 1990s, it was roughly estimated that up to 100,000 households were having problems fulfilling their obligations and many of them feared losing their homes. Selling was not a way out because the prices that were attainable were far below the money lent to buy the houses and, of course, there were very few buyers. Many individuals and families lost their life savings almost overnight and many found themselves severely indebted as well. All of this arose from the fact that, in the late 1970s, the Norwegian Government had strict regulations on credit interest rates but the creditor regulations became less effective due to the availability of credit from foreign sources and the growing so-called grey market. In 1994, the Norwegian Government deregulated the credit markets, which caused a significant increase in bank lending. There were certain restrictions on financing but credit was requested by more and more consumers. The Norwegian Government also eased the regulations on owners of co-operative dwellings, the price of which increased along with the co-operative owners' buying power. This also led to a higher demand for owner-occupied dwellings. The Norwegian Government then lowered capital reserve requirements and decreased bank supervision. This was the beginning of the Norwegian house price bubble. It sounds so familiar due to the similarity to our own situation, and it is a pity we did not find out about it earlier. I should have studied the history of banking and the history of money, which goes back over 500 years and which I have been reading about over the past three years. I am sorry I did not understand it better before then. In Norway, if a house was bought for, say, €300,000, they valued it at current prices and if that was €150,000, they decided on a figure of €150,000 plus 10%, which is another €15,000, making a total of €165,000. For the next five years the person would have to pay the interest on it at whatever the rate at the time. If the person did not break his or her commitment to pay the interest on a monthly basis for the five years, that €165,000 minus what the person had paid in interest over that five years, became their new mortgage.

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