Eamon Gilmore (Dún Laoghaire, Labour)

I thank Deputy Ó Cuív for raising this issue. The Government very much shares the concern he expressed about the difficulties mortgage holders are having, both in respect of the interest rates that are being charged by some institutions and also the difficulties they are having in respect of arrears and the pressure on them, and has acted in this area. Last month, in the budget, it introduced an expanded mortgage interest relief scheme for first-time buyers who purchased their home in the boom years between 2004 and 2008, many of whom are in mortgage arrears at present.

The European Central Bank cut its interest rate by 0.5% in the past two months, which immediately reduced the rates charged on tracker mortgages and some banks have announced that reductions will be passed on to other categories of mortgage holders. The Financial Regulator will engage intensively with the banks to ensure certain mortgage customers are not unfairly discriminated against when savings are being passed on.

The Government is taking urgent action on mortgage arrears. We will propose new schemes for the banks and will immediately introduce pilot schemes in local authorities which will allow people to stay in their own homes, if it is feasible to do so. The focus of the Government is to develop and implement schemes to assist those who cannot afford to pay their mortgages while allowing as many people as possible to remain in their homes. We are progressing personal insolvency legislation, which was one of the recommendations contained in the Keane report. Proposals on personal insolvency which will address the difficulties people are experiencing in repaying mortgages are to be circulated to government in the near future.

In addition, to progress the proposals that were made in the Keane report we have established a steering group, effectively a project team, within the Department of Finance. The group is composed of officials from a number of Departments which have responsibility for dealing with mortgage issues, including the Departments of Social Protection and the Environment, Community and Local Government in respect of the housing side of the local authority areas. We are pursuing a number of options which will provide relief for people with mortgage difficulties, including trade-down mortgages, split mortgages, mortgage-to-rent arrangements and a number of other pilot schemes that are being progressed through the Department of the Environment, Community and Local Government.

I assure the Deputy that the difficulties people are having with mortgages, either in respect of the interest rates being charged or the difficulties they are having in repaying them, are being addressed as a priority by the Government. I would be happy to discuss the detail of the different measures we are taking at any time in the House.

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