Michael D Higgins (Galway West, Labour)

We can go into such detail on Committee Stage. I hope the Minister will agree to hold Committee Stage in plenary session so that all of us who have gone to the trouble of going through this Bill in detail will have an opportunity to ask him questions of this nature.

As we look at this moving object, there is an assumption that the property market has bottomed out. The Minister has suggested that an increase of just 10% in property values is needed if NAMA is to be a viable vehicle. The first mistake with that assumption is that we will be moving 10% from where the Minister thinks we are. When one considers the evidence that was presented before the High Court in the recent Zoe Group case, it is clear that we are dealing with a declining entity, rather than a stable one. Therefore, one's 10% will have to be stretched a little further if one is to finish ahead at the end of the period suggested by the Minister. The detail of the Bill seems to indicate that the Minister believes NAMA will restore liquidity in the real economy. When the Taoiseach allowed himself a flourish earlier in this debate, he extended that point and said it would lead to renewed growth. We all want that to happen. We agree that we want the real economy to flourish My problem is that the Bill is based on the Minister's assumption that he can expect a change in this country's banking culture without a fundamental change in the boards of the banks. Approximately 80% of the board members are still in place. The Minister seems to think that those who engaged in wild lending — most of the commitments into which they entered were abroad — will suddenly fall in love with the real economy. When the Minister responds at the end of Second Stage, I would like him to spell out where he sees the evidence that he will be able to extract that liquidity from people. The ratio is improved through the issuance of a guarantee which they can in turn use as collateral for getting real money. What is to stop them from reducing externally based liabilities rather than those which are internal to the Irish economy? I looked through the legislation for the answer but the Minister is not taking any powers which would enable him to address that issue. If he had gone down the road of temporary nationalisation and decided to enter discussions with the European Central Bank on using the mortgage books of lending agencies as the assets on which he would issue bonds he would be in an easier position in respect of preventing home repossessions. I accept the good faith of Government Members in this regard. Nobody wants to see repossessions. Thus far, however, all we have achieved are tenuous six and 12 month agreements from banks which I simply do not trust. That is where we probably differ.

The matter is full of politics. One should head off interest rate increases by putting in place a mechanism that protects the home if a person falls into arrears because of interest rates. This is partly addressed by the aforementioned agreements but we should be able to turn mortgages into forms of lease, develop insurance mechanisms or transfer mortgages into tenancy purchase options. I remind Deputies that in many cases both partners have had to work to sustain outrageous and unsustainable mortgages. If conditions improve, people could move back along the chain and we would have a stable housing market. Not to do that is to wait until the end of this or next year, when the banks begin to issue court proceedings or people start to apply to local authority housing lists. I am simply suggesting an outline and if the Government does not pursue the matter I will advocate that the Labour Party establish its own commission under someone such as Professor Drudy to produce options which would ensure that even in the worst of economic conditions the family in the home will not suffer.

I look for the paragraph in the NAMA legislation which deals with liens on lending institutions for preventing home repossessions. This is not an abstract or academic point. Similar proposals have been considered in the context of the insurance model in the United Kingdom and some of the mechanisms put in place in the US approach to avoiding home repossessions. One would have expected similar proposals in the Bill before us. I am not worried about what such a mechanism would be called.

I have outlined a number of questions which I believe must be answered if we are to restore trust. We need more than an assurance that we are creating a new culture of banking. We need to see significant change on the boards and to receive all the information on how we arrived at this juncture and what was discussed with the European Central Bank. We need to know why certain options were rejected and why NAMA was chosen above other solutions. We must also reform the Bill on Committee Stage to give it the transparency it currently lacks. Above all, we must be able to head off the worst of the consequences. The option before us is a disastrous one. It puts an albatross around the necks of this and future generations. Even if the Bill passes Second Stage, let us at least put in place protections on Committee Stage so that families can remain in their homes until they climb out of the trough of unemployment and crisis economics.

Let the odd person out of the 166 Members of this House recognise this paradigm of greed has failed both in Ireland and internationally. Not everyone is guilty. Like many people who built houses, I am aware that some craftsmen can cut timber or lay blocks while others can estimate the price of building a house or lay out a curved wall. All these were replaced by people who put no value on these skills and who were told by banks to borrow on the basis of fantastic property inventions and price escalations of 300% or 400%. Leading players in the banking institutions lashed money at these individuals. These are the guilty parties and the Irish public wants answers to the questions I have posed.

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