Aideen Hayden (Labour) | Oireachtas source

Several other Deputies would like to speak again, but prior to that I will put several quick points. Professor Honohan spoke about the banks' cost of funds. All of the banks have come before the committee and we have gone through the shenanigans of listening to them justify why the variable rate is higher than the European norm. All of the answers we have received are to do with the cost of funds and historic debt. It is quite refreshing that Professor Honohan has been reasonably honest in saying it is higher than a fair-minded customer might reasonably expect. The interesting point was that Professor Honohan stated that ultimately the answer to this difficulty may lie with the Central Bank, in terms of openness, transparency and consumer protection, and that it might codify a requirement that banks be more open and transparent as to how they set their variable interest rates. How quickly could the Central Bank act in putting in such a requirement? Four banks have come before the committee, and the discussions certainly were not open and transparent to the people sitting in the committee.

My other observations relate to mortgage arrears, on which I echo the comments made by others. I am saddened that we will not have our regular six-monthly meeting with Professor Honohan. Much has happened in the time the committee has been sitting at an historic point for our country. Perhaps the issue which has most dominated all of our discussions has been mortgage arrears. The most recent country-specific recommendations highlight how difficult the situation in Irish banking remains, with the historically high levels of debt and rates of mortgage arrears. What in Professor Honohan's opinion is the fundamental problem that remains in resolving this very difficult issue?

It is troubling to see that at the moment, with most of the banks that have come before this committee, legal action is the option taken in about 40% of the cases where arrears are greater than 90 days, and certainly where they are greater than 720 days. There is a real issue in terms of the whole thing escalating into the legal system. That is one observation we made from our engagement. That has changed significantly over the past 18 months. My last question to Professor Honohan is this: from his point of view, with his stewardship of the Central Bank, how would he rate the Central Bank's performance on the issue of mortgage arrears?