Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

My concern here is not just for the individuals whose loans are about to be sold off. The Central Bank report of last April discussed those in long-term arrears of more than 720 days. The Central Bank itself has said that more than 50% of those people are likely to lose ownership of their homes, through voluntary or non-voluntary repossession. That is a significant number of people, and represents some 15,000 homes. No loan is safe from sale to a vulture fund. There is nothing to prevent AIB, Permanent TSB or Bank of Ireland from selling a tracker mortgage or group of tracker mortgages in the morning because they believe them to be loss making. There is nothing that can be done to stop that from happening. In some European countries that would not be allowed. Austria and Denmark, for example, do not allow banks to sell performing loans in that way. Can Mr. Sibley comment on that?

The Department has made known its view on the issue of the constitutionality of the legislation.

I am mindful that the Department, or at least the Minister on the advice of the Department, told us the same thing when we discussed removing the bank veto. However, in 2016 the bank veto was removed and we allowed people appeal to the courts and have debt reduction imposed on banks. We were told that would not be constitutional.

The committee must do its own work and we have a preliminary view on the retrospective nature of the legislation and how it impacts on contracts. It is worth putting on record that this view does not state that the proposal is unconstitutional. We must wait until we have the full advice. With respect, the problem here is that the Department and the Central Bank, which has a role in consumer protection, are batting for the banks. While property rights are provided for in the Constitution, they are subject to clear limitations where social justice or the common good come into play. That is why legislation was introduced in 1976 providing that a married person needed the consent of his or her spouse before selling the family home. A clause in the Constitution relating to social justice and the common good allowed contractual rights to be torn up and it was specified that the consent of a spouse was needed before a house could be sold.

The constitutionality of this legislation must be tested in the courts. We have been here before with Part V, when we were told that it would be unconstitutional. We were also told that removing the veto would be unconstitutional and we have been told by the Department that it has been advised that this legislation would be unconstitutional. This should be tested in the courts and we should allow it to proceed because the social good is not served by allowing thousands of struggling homeowners' loans to be sold to unnamed vulture funds which refuse to come before this committee. None of us knows who they are. These are vehicles that are set up only weeks before the sales go through. We know the banks are rubbing their hands and could not believe that Permanent TSB got away with selling performing restructured loans. They are now all lining up to do the same. That is what is happening and unless we take action, we will see this calamity unfold. This legislation is part of addressing that.

On Deputy Michael McGrath's comment, if this committee agrees to move the Bill to Committee Stage, I hope the Department will proactively try to shape the legislation to ensure it has the best potential outcome, even if Mr. Tobin may have reservations about it. This was done previously when the Department opposed the Fossil Fuel Divestment Bill and subsequently became involved at a later stage. I hope there is a point where our paths meet and we can work together to have this legislation enacted.