Enda Kenny (Mayo, Fine Gael)

The Government has reduced stamp duty from 6% to 2% on all commercial properties, removed capital gains tax on property held for seven years and increased mortgage interest relief to 25% for first-time buyers in 2012 and it is to continue it for a period thereafter. We have also had direct meetings with the banks. We received confirmation from Bank of Ireland that it had set aside €1.5 billion for loans on residential properties, from AIB that it had allocated €1 billion, and from Ulster Bank that it was prepared to increase its fund if demand increased. As people become aware that this is a significant year for the purchase of residential properties owing to increased mortgage interest relief, interest is, at least, being expressed. I will not be happy, however, until there is confirmation of the drawing down of mortgages. The Deputy knows that people have had mortgages approved but have not drawn them down, either because of lack of confidence or because such conditions were imposed that they were not able to draw them down.

The economic management council and the Cabinet sub-committee dealing with mortgage arrears and mortgage distress will continue to have this as a priority. We meet regularly about it, on the basis of establishing real progress.

I am not a great defender of the banks but the programmes they have set out, if they can follow them through, are quite constructive. Many of the people who work on the front line in branch offices throughout the country are working hard to re-establish a sense of trust with clients who might be interested in doing business with banks. That is important, in re-orienteering - I mean reorienting - the importance of banks in the general economy.

See this speech in context