Professor Patrick Honohan:

The Government should be cautious about committing public funds in this area. We are concerned about a systemic risk, namely, that property prices could topple again. A previous Government got involved with an actual guarantee, but we do not want the current one to get involved through an indirect guarantee.

This is what the Government got into in the past with an actual guarantee but we do not want it to get involved in an indirect guarantee through this means. I do not see a Government device being effective here.