John Browne (Wexford, Fianna Fail)

I thank Deputy Michael McGrath for tabling this motion on behalf of this side of the House. This is a motion on which the House could agree. In my view, a strong agreed motion in this House would give a message to the banks and the lending institutions to show we are not happy with the current situation. Such a motion would also strengthen the Minister of State's hand. I heard the Minister of State speaking recently on the radio and he seemed to be frustrated with the lack of action by the banks and the difficulties for the Government in that area. Business people up and down the country are finding it practically impossible to access loans or proper credit facilities to enable them to protect their businesses and existing jobs and to create new jobs. The absence of credit is causing businesses to reduce their workforce or even to close down in some instances. In my 30 years as a Deputy I have never seen so many business people coming to my clinic. They are very concerned about their business and about the lack of finance available from the banks. In many cases, they have told me that overdrafts are being withdrawn and the banks are asking clients to convert the overdraft into a short-term or long-term loan. This is causing severe problems for business people who are trying to survive. A total of 750,000 people are employed in the small and medium business sector and many of them employ up to ten employees. Printing works and small businesses in my area were doing reasonably well in the past are now finding it very difficult to survive because of a lack of credit.

Every town in Ireland has businesses and shops which are closing down. The lack of Government policies means there is less money to spend. However, the two main reasons for these closures are at the door of the banks and the local authorities. The banks are not lending and the local authorities are certainly acting like highway bandits squeezing the life out of business by charging exorbitant rates for water, refuse and rates. These two reasons are causing severe difficulties for business people.

Last year, the McCarthy report stated that savings of half a billion euro could be made by cutting out waste in local authorities and yet this Government has not seen fit to bring about those savings. If the local authorities could make those savings this revenue could be passed on as savings in commercial rates. The combination of rate charges and the lack of funding available from the banks is putting severe pressure on business people up and down the country. These are the existing businesses while those wishing to develop new businesses are wasting their time going to the banks as no loans are available.

The decision-making for lending has been taken away from the local bank manager and the regional bank manager and decisions are now being made in Dublin by people sitting behind computers or an iPad who do not have a clue about the acumen or the credit-worthiness of a local business person. The local bank manager has the local knowledge about the local business people yet the decisions are being made in Dublin.

I concur with the view that the greatest rip-off merchant in the banking industry is the Permanent TSB. It is charging ordinary householders exorbitant interest rates in order to pay for the mistakes made in other areas of its loan allocations. This cannot be allowed to continue. The Government must intervene to bring about a reduction and I understand talks are under way. More than talk is needed at this time; we need action. For example, a customer with a loan of €300,000 from AIB over 30 years will pay €1,264 per month while a PTSB customer will pay €1,666 per month, a difference of €402 per month. This is not acceptable, it cannot be allowed to continue and it is putting severe pressure on those with loans from Permanent TSB. I ask the Minister of State to continue to fight the battle with the Permanent TSB to ensure that the interest rates are reduced in line with other banks in this country.

This is a very important motion for a reduction in interest on loans from PTSB to small and medium businesses. I hope the House will unite on this motion to send a loud and clear message to the banks that we are unhappy, that a change is required and that even more business people will go out of business if this change is not brought about quickly.

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