Willie Penrose (Longford-Westmeath, Labour) | Oireachtas source

I thank the delegations for attending. Like my colleagues, I was disappointed with the take-up, particularly by the horticultural sector. I thought part of the programme was to deal with cashflow, support, and addressing the impact of sterling, the exchange rates and lower product prices. I was disappointed that the horticultural sector did not get much from the scheme even though it has liquidity issues.

It has been said that there was a limited opportunity. Nevertheless, there appeared to be a great rush to pull down the shutters on the scheme. Having heard the AIB's presentation, I wish to acknowledge that it did the honourable thing. As far as I can ascertain, the AIB ensured that anybody who had applied for the scheme, notwithstanding that the bank had run out, it extended the same terms to everyone who applied. Am I correct in my assessment of the situation? If so, fair play to the AIB for doing so. I wish all of the other banks had followed suit. I wish to acknowledge AIB for its efforts now in lieuof what I will mention later.

I thought this scheme would provide a flexible source of working capital and it would be used to pay off the more expensive merchant credit, etc. Like Deputy Cahill, having read the presentations, did the banks handle the scheme for the prospective period going forward rather than retrospectively? I thought the loan would be used to pay off debt that had accumulated on a retrospective basis. Unfortunately, that message has not been conveyed in the presentations. Perhaps I have misinterpreted the presentations. I would like the matter clarified.

What amount of subsidy did each bank receive for administering the scheme? The SBCI had made €25 million available. What was the period involved?

Notwithstanding all that has been said about capital ratios and legacy issues, it is hard to dispel the public notion and viewpoint that banks rob people, particularly as interest rates are punitive. The credit union movement has a multiple of billions of euro but it is compelled by law to place its deposits with the banks. However, the banks charge the credit unions for the privilege. What has happened to all of that money? We have made loans cheaper. If the banks are compelled by law to make the money available then why not do so at a cheaper rate? A sum of €9 billion is a lot of money but the credit unions have not got much of a return. The credit union movement would rather invest in property. Again, due to legacy issues the movement is prevented from investing in property and that is why it has sought alternatives. Perhaps the credit unions can help alleviate the mortgage problem and build houses. I hope that the Government will grasp the opportunity and allow the credit union movement to operate in the housing sector.

How does each bank deal with bad debts? Every business has bad debts. I have experience of how one of the banks cut off its overdraft facility for small businesses in the midst of the crisis. That was unhelpful to small businesses and I have real evidence to support my claim. Can the banks assure us that they have no plans to hive off agricultural debt, or people who are in debt, to the vulture funds and they will be allowed to borrow from the banks? Can the banks guarantee that such debts will not be hived off to vulture funds? Only four months ago Ulster Bank was involved in a situation where debts were going to be hived off to vulture funds. We all know what vulture funds have done to people. I hope that the banks are not planning to hive off debts to the vulture funds. People borrowed in particular circumstances and had a particular concept.

I have always held the view that if everybody levels this charge against anybody, let it be in any industry, small, medium or large, farming or anything else, that if there was imprudent borrowing then there was certainly imprudent lending. It takes two to tango. I would be deeply concerned that vulture funds would ever become part of the norm. I would support laws that would curtail such a scenario because I have seen the damage that vulture funds inflicts on people. I hope that the banks will give an assurance that vulture funds will not form part of future developments in the banking sector.

Many people have suffered. A lot of people would state everybody has suffered except the banks. This is a well held and well-founded perception. It may not be a perception, it may be reality, which is different to perception.

We have come through the rough times, and it is individuals and businesses who have come through the rough times in this regard. The Irish people have put their shoulders to the wheel and saved the banking system. I hope there would be reciprocity from the banking system now towards people who may find themselves in extreme difficulty. What is the average overdraft rate charged to the farming community? People can borrow money for virtually nothing. Ulster Bank made a comparison with what is available in England because it has a reach into England, and that is fair enough.

My colleagues in Fianna Fáil are still concerned about mortgage charges and its spokesperson, Deputy Michael McGrath, tabled a Bill which went through the Dáil. He did not do this off the top of his head. He did it because of significant public requests. The witnesses are dealing with a specific sector of banking so I will not ask them to deal with the mortgage situation. It reflects the overall view and where people are at. What is the standard margin the banks charge over the European rate at which they borrow? What is the administration cost of the loans? What are the built-in margins? There are administrative and handling costs and we appreciate this. They must be covered and business is business. There has been a contraction in some of the banks of the availability of service to the public, and there have been closures in recent times and announcements of closures throughout the country. This must be taken into account also. In this regard, what is the standard margin at which the banks operate?