Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)

Ba mhaith liom buíochas a ghabháil le Páirtí an Lucht Oibre as deis a thabhairt dom labhairt ar an rún rí-thábhachtach seo. Bhí an ceart ag an Teachta O'Sullivan nuair a dúirt sí go raibh gá leis an rún seo a ghlacadh anois. Cé go bhfuil an t-am thart le rud a dhéanamh do go leor daoine, tá an t-am tagtha le rud éigin a dhéanamh agus ba chóir dúinn déileáil leis an fhadhb seo go práinneach.

This is an appropriate and timely motion and the Labour Party, Deputy Ciarán Lynch in particular, has put forward a sensible proposal. I welcome the motion and agree it is urgent to deal with the issue. If one was unaware of the urgency, one would only need to look at the ESRI report of two weeks ago which stated that a further 35,000 families would be unable to pay their mortgages next year. What is in store for these people? They are at the mercy of the banks and credit companies who harass them and they face legal repossession and all that entails.

We should remember that when people take out a mortgage their intention is to purchase a home in which they will live and put their personal mark. They invest in a property and their future. They do not want to be in a situation where they default and endanger their investment and home. They want to be able to come up with some way to hold on to their home until such time as they can overcome the financial problems they face currently. In the main, these financial problems and the predicament in which they find themselves are not of their making. I know nobody who would gladly walk away from his or her investment. The problem is these people are faced with no alternative, because the Government, despite warnings this was what was going to happen, has not moved in any urgent way to address the problem.

The only criticism I would have of the motion is that it does not deal with the issue of the banks which are not covered by the guarantee. We need to find a mechanism to ensure that those institutions are covered by the proposal put forward in the motion. All of them operate under a licence given by the State. Therefore, there is a mechanism to deal with the issue, but we must ensure we enforce it. We must ensure that all banks and lending institutions, such as the Smart Mortgages or Start Mortgages are included. These companies seem to be intent on throwing out anybody who defaults for even one week or month on a mortgage. Such companies operate under licence here, but the State has not moved to ensure they respect and have compassion for the people undergoing great financial strife.

I do not expect the Government to do anything about this, because this is the same Government that allowed the financial institutions to have 190% interest rates in some cases. Some credit companies are licensed by the State to charge that amount. Therefore, I do not expect the Government to act. However, we on the Opposition side of the House must try to force the Government to pay heed to what is happening. We should remember that this is the Government that allowed a situation develop where mortgages of 100% and even 110% were offered to people who could not afford the repayments. These are now the people stuck with a noose around their necks. They have 30 and 40 year mortgages, but given their age they will not be able to reschedule them.

There has been wanton breaches of the guidelines and the laws laid down by the Central Bank on lending. However, the people who will be punished for the breaches are not the bank managers or the financial institutions that allowed these practices but those who took out mortgages. They were encouraged by the Government and many others to invest and had no alternative. The Government wanted people to have mortgages because this gave them the cash cow called stamp duty. It raked in the duty for years but now is not willing to pay back people who paid duty. If even a small portion of the amount of money taken in stamp duty had been set aside to help people in trouble in the current difficulties to reschedule their mortgages, bail them out or buy some type of equity in their homes in order to prevent repossessions, the stamp duty they paid would at least have some benefit. However this is not the case. All the benefit went to the Government. Not only did the Government get stamp duty, it also gained significantly from VAT.

The only people who benefited were property speculators with friends in the construction industry who managed to avail of special tax incentives and reliefs. They did not play their part as taxpayers but benefited from the Celtic tiger. They may be struggling now, but they are the ones who are being bailed out. I guarantee that many of them have personal wealth hidden away which will not see the light of day here. We on the Opposition side of the House are being encouraged by the Government to support the bailout of these people through NAMA.

What should happen is that empty and completed houses all around the country should be confiscated and given to local authorities so that if people end up on the street because of repossession there will be some kind of social housing available for them. We already have a huge crisis with regard to local authority housing because local authorities do not have sufficient stock. There are some 40,000 families on waiting lists. If we consider the 35,000 families facing repossession next year because they will not be able to afford their mortgages, we could end up with 75,000 families on the housing waiting list then, with no Government plans to build or purchase any more social housing.

The Minister has an opportunity to act now. Given that the State is bailing out developers, he has the opportunity to confiscate - not subsidise, pay for or compulsorily purchase - and transfer free of charge these homes and half-completed estates to local authorities. He could even transfer them to co-operatives of residents or tenants who would be able to put some money towards completing them. I put that suggestion to the Minister. It is a pity the Minister of State with responsibility for housing, the Minister for Environment, Heritage and Local Government or the Minister for Finance is are present. We are going through major negotiations with banks and once NAMA is enacted, that will be the end of the negotiations and we will no longer have any opportunity to have these remedies pushed through.

This motion is a credible attempt to address the problem. However, we also need to address the scandal of fixed rate mortgages. People on these mortgages are being screwed day in and out by banks we are bailing out, yet they are making no attempt to help those caught in the bind of a fixed rate mortgage. We need to address this issue and ensure that no penalties are applied to those who want to reschedule their mortgages to take account of the substantially lower interest rate that pertains currently.

The big challenge for us is that enactment of the legislation means we need a property boom in the future if NAMA is to be successful. That means that interest rates will increase and those who are currently in dire straits will not benefit. Unless we address their problems now, they will not be in the housing market in the future, they will be homeless and the State will have to pick up the tab. That is why I encourage the transfer, free of charge, to local authorities of empty housing stock across the country.

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