Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

I have the comments Professor Lane made in this morning's newspapers. I was not surprised by them, although I was disappointed with the view expressed. We have discussed it previously and we will discuss it again next week when the Bill goes through pre-legislative scrutiny. There is a bit of a trend here on the part of the Central Bank of Ireland, the European Central Bank and the Department of Finance. When Members of this Parliament and members of this committee bring forward legislation that they believe to be in the interests of consumer protection, the response is what I would argue is scaremongering. The Central Bank of Ireland has informed us that my Bill will increase interest rates. We had the same attitude from the bank with respect to Deputy Michael McGrath's Bill seeking to cap mortgage interest rates. The Department of Finance has indicated that the regulation of vulture funds will increase interest rates for consumers. That Bill was signed into law six months ago and it has not had that effect. I take some of what is being stated with a pinch of salt. However, there are other matters we must discuss in the context of pre-legislative scrutiny.

Much focus has been put on securitisation. It is not the intention of the Bill to prevent that type of passive securitisation. Section 3 may need to be clarified further but vehicles would be set up within the banking group, such as AIB's system, for securitisation. It is not the intention to prevent that. I make no bones about it that this is about giving power to the borrower to prevent the sale to a vulture fund if he or she thinks it is the right course of action. Professor Lane has made the point on a number of occasions that there is no difference between a bank and a vulture fund.

If that is the case, then the borrowers will have no problem giving their consent. The reality, however, is that there is a big difference. Many of these vulture funds do not offer the types of solutions and restructuring arrangements that the banks have offered. We know they have short-term interests, whereas banks have long-term interests. It is always better for those who want to keep a roof over their heads, and who are making a genuine attempt to do that, to be with a bank than with a vulture fund.