Martin Mansergh (Tipperary South, Fianna Fail)

I thank Deputy Behan for raising this issue. The Government is fully aware of the level of personal indebtedness in Ireland and the difficulties faced by individuals and households in dealing with this. The Renewed Programme for Government sets out our commitments for introducing measures needed to protect families having difficulties with their mortgage repayments and personal indebtedness under the heading "Protecting the Family Home and Helping Those in Debt".

The scale of the problem of indebtedness is evidenced by the details of private sector credit published by the Central Bank in its quarterly bulletin. While the stock of private sector credit has been falling since June 2009, the Central Bank has noted that much of the decline in private sector credit can be attributed to valuation effects such as the write down of loans, increased bad debt provisions and exchange rate movements in the euro.

House mortgage finance has been declining in recent years. The latest monthly statistics show a net fall of €717 million in the outstanding stock of residential mortgages during March. At the end of March 2010 the outstanding stock of residential mortgages stood at €146.5 billion compared to a peak of €148.5 billion in March 2009. Earlier this year the Minister for Finance expanded the membership of the interdepartmental mortgage arrears group. The terms of reference of the group, approved by the Minister, reflect the commitments made by the Government in the Renewed Programme for Government and in subsequent Government decisions relating to the issues of mortgage arrears and personal debt.

The group is meeting on a regular basis. I understand that the emphasis is initially on exploring the feasibility of a range of possible options for improving the level of mortgage support to homeowners in difficulty. The group will then address the personal debt issue. Proposals will be based on factual information gathered by the group and will take into account the findings of existing reports and mortgage support schemes in operation in other jurisdictions. The Minister will be kept informed regularly of work progress and it is expected that a final report on this phase will be ready by mid-summer. In addition, in the recent budget the Government refocused mortgage interest relief on those who bought their homes at the peak of the market, many of whom now find themselves in negative equity. Where a homeowner's entitlement to mortgage interest relief would expire in 2010 or thereafter, he or she will now continue to receive it up to the end of 2017.

The House will be aware of the other supports available to mortgage holders including the Financial Regulator's code of conduct on mortgage arrears, the mortgage interest subsidy scheme and the services provided by the Money Advice and Budgeting Service, which Deputy Behan rightly praised.

This service falls under the remit of the Minister for Social Protection. It is a national, free, confidential and independent service provided to people in debt or in danger of getting into debt. MABS works with people in order to assist them with their financial planning and budgeting for the future. In 2010 almost €18 million has been provided to assist MABS deal with its workload.

It is also important to highlight that the Law Reform Commission's consultation paper on personal debt management and debt enforcement contains an extensive list of provisional recommendations for reform of the law on personal debt. I understand that the commission is aiming to have its final report available by the end of August 2010. The mortgage group mentioned will take account of these recommendations as it proceeds to address the personal debt aspects of its terms of reference.

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