Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I thank the Deputy. As he has acknowledged, a significant degree of change is under way with regard to interest rate policy in the future. The European Central Bank, ECB, through its president and the chief economist, has indicated the kind of action it will consider in the future. If inflation in Ireland becomes a core part of our economy for years to come, it will make us even poorer for longer. I accept that a change in interest rates can bring difficulty for those who are borrowing and who want to borrow in the future, but any changes that are made are made with the aim of avoiding inflation and ensuring we are not poorer for longer.

On where we stand in Ireland, we have seen considerable change in interest rates over many years. In 2014 we started off with an average level of fixed interest rates for new lending of 4.1% and in July of this year it moved to 2.5%. A key feature that has developed alongside this is that over 80% - in July the figure reached 88% - of new mortgages being issued are fixed-rate mortgages. That is one of the reasons we have seen a decline in the interest rate in new mortgages, which has moved from 4% in 2014 to 2.6% in July of this year. We are now at a point where the gap between the Irish rate for new borrowing and the average of the eurozone is 0.5%, which is a significant decrease on where we have been for so long. I would expect to see change in the years to come. The Deputy knows what the powers of the Central Bank are when it comes to variable-rate mortgage holders as changes are made to their rates of interest. We have also strengthened consumer protection for those consumers who require certain issues to be considered. We are seeing a narrowing between ourselves and the rest of the eurozone, but we are at a moment of change in these things and the public indications are that just as inflation is staying higher for longer, banks will take that into account in the interest rate decisions they make.