Mr. Brian Hayes:

Retail financial services, which Senator Burke has raised, is a crucial issue for consumers. I can walk out of the European Parliament tomorrow, go into a KBC branch and get a ten-year mortgage product at 2% for €400,000 or €500,000, whereas a standard variable rate here is about 3.7%. The reason consumers on the Continent are in a better position - and this is where I fundamentally disagree with my colleague - is competition. They have significant banks pitching against one another on rates and conditions. We will not get to a better place in respect of standard variable rates here unless we get competition. We need to encourage banks to come into Ireland, to set up here and either to use the distribution channels that are here or compete against our own banks. This is the only way we will get rates down because competition, ultimately, will ensure we get mortgage products.

I am much more ambitious than Mr. Carthy; I think we can have mortgage products across the European Union. We have done so much in the past decade to stabilise the banks, to put the supervisory system in place and to change the rules from Central Bank of Ireland national competent authorities to the ECB SSM for the big banks. However, we have not done enough for consumers. Regarding the Single Market, in so many areas we have driven down prices - for example, on roaming and the airline industry. These are huge benefits for ordinary people. The one area on which we have done nothing is cross-border financial services, and I am passionate about this. There is so much that can be done.

What can we do to get to what the Senator wants done? If I may be very frank, in our time in government, when I was a Minister of State, the one thing I am most ashamed about is the length of time it took us to get insolvency working. It was a disgrace. The first thing the IMF told us when we came into government was to get our insolvency laws right because the longer one puts off putting the inevitable in place, the more difficult it gets. If there were an EU-wide insolvency regime, I think there would be confidence in moving more operators to Ireland. Furthermore, if there were an EU-wide valuation process with confidence and a kind of gold standard of valuation, I think there would be more new entrants to the mortgage market in Ireland. That is my sense of the matter. The past ten years have been very good for the banks, the supervisors and governments, particularly with Mr. Draghi's doing everything he could to save the euro, which has worked, broadly speaking, but not good enough for cross-border business. Be it insurance or mortgages, we can do so much more to embrace the principles of the Single Market and drive down our standard variable rates. I think it is possible to do this, but it requires political will. What government will put its hand up and say it will go to an EU-wide solvency regime? People will not put money into Ireland if they cannot get it out. They have been burnt enough. This is the nature of risk. We have now moved to a risk-based model - rightly so, given the light-touch regulation Mr. Carthy spoke about. We must embrace the Single Market, and I hope the next ten years can be about taking down those protectionist barriers that exist between member states which drive up the cost of insurance premiums and borrowings for mortgages.