Pearse Doherty (Donegal South West, Sinn Fein)

At the end of March of this year, there were 116,288 mortgage holders in serious distress. This represents an increase of 8,580 since December 2011. If we look from January through to March of this year, 95 mortgage holders fell into distress every day. That figure is stark and worth repeating. It is a shocking figure and also represents a significant acceleration of the mortgage crisis. There has also been a significant increase in the number of repossessions in the first three months of the year. Some 170 families lost their homes to repossession the first quarter - an increase of 28% on the last quarter of 2011. Of course, these figures do not include the tens, if not hundreds, of thousands of households which are not yet in serious distress but who are struggling every week to make payments and meet their mortgage payments, nor do the figures give us the real sense of hardship and stress caused to families from the crisis. Let there be no doubt but every night there are people who must try to decide whether to pay their mortgage or put food on the table for their children. That is the stark reality behind all these figures. These families are struggling to cope with the impact of unemployment, under-employment or loss of income. Their daily struggle is being made all the harder by VAT increases, the household charge and other measures imposed on them by the Government in last December's budget.

It is worth remembering that Fianna Fáil created the mortgage crisis - it took place on its watch. The policies of Charlie McCreevey, Bertie Ahern and Brian Cowen inflated the property market and saddled an entire generation with an astronomical level of personal debt. While Fianna Fáil drove this economy over a cliff, hundreds of thousands of ordinary decent Irish citizens were left to pick up the pieces. After 2009, when the full extent of the mortgage crisis became clear, what did Fianna Fáil do? It formed an expert group which produced two detailed reports. Did Fianna Fáil act on the recommendations in these reports? Did it devote time and energy in its last months in office in an attempt to undo some of the damage it brought upon distressed mortgage holders? It did not. It sat on its hands and did nothing. Throughout the debate on the Personal Insolvency Bill, the role of Fianna Fáil in this crisis must not be forgotten.

On coming into office Fine Gael and the Labour Party made a big promise. They promised to deal with the issue of mortgage distress. Almost a full page of their programme for Government was devoted to this issue but just like Fianna Fáil, the new Government commissioned an expert group to come up with solutions to the crisis. The Keane report was published in October with a further round of recommendations. It was, like Fianna Fáil's predecessor, cautious in approach, offering little in the way of real solutions to the vast majority of people affected by the crisis.

Eight months have passed since the publication of the Keane report and 15 months have passed since Fine Gael and the Labour Party took office. In all of that time no meaningful measure has been put in place to stem the growing number of home owners in mortgage distress or to assist those weighed down by the pressure of arrears. The approach of Fine Gael and the Labour Party to the crisis is characterised by exactly the same attitude as Fianna Fáil. Until now they have adopted a hands-off, leave it to the banks approach - kicking the can down the road in the hope that something else or somebody else will address the problem.

The quarter on quarter increase in the numbers of households in mortgage distress and the growing number of repossessions is evidence of the failure of the Government to take the mortgage crisis seriously. Finally, after much delay - much of it at the behest of the banking industry - the Government published the long promised personal insolvency legislation. Sinn Féin has been calling for this legislation to be introduced for a long time. My colleague, Deputy Jonathan O'Brien, outlined in detail our position on the Bill and he will do so in further detail on Committee Stage.

While we welcome the publication of this long overdue legislation, it will be a source of disappointment to the thousands of families in mortgage distress who were eagerly awaiting it and who held out hope that it would be a resolution to their problems. When the heads of the Bill were published, Sinn Féin said that it was essential that the proposed insolvency service be independent and that a more humane approach to bankruptcy was needed. We also argued that it should be non-judicial, include an appeals process, and, crucially, have the power to force reasonable solutions on lenders. Unfortunately, this Bill gives lenders a veto over the personal insolvency arrangements. This is not the right approach.

The only other option open to people in serious arrears is bankruptcy. The suggestion that the threat of bankruptcy gives the distressed mortgage holder some kind of leverage over their lender is a very dangerous one. If it were the intention of the banks to genuinely work with home owners to make their mortgages more sustainable, then we would not be seeing such an increase is the distress figures. The banks, like the Government, are not doing enough to assist families remain in their homes. Sinn Féin will be seeking to amend this crucial legislation, in particular this crucial section, because without an element of compulsion on lenders, the mortgage crisis will, unfortunately, continue to grow. It is also deeply disappointing that there is no appeals process built into the legislation. Again, Sinn Féin will try to bring forward amendments to deal with this issue.

While we welcome the shortening of the bankruptcy term from 12 to three years, we are mindful that anybody entering bankruptcy will lose all their assets, including their family home. Since the start of this crisis, Sinn Féin has argued that the most important principle which must underlie Government policy is working with distressed mortgage holders to enable them to remain in their family home. This will require, on a case-by-case basis, restructuring mortgages to make them sustainable and the lenders to absorb a portion of the losses in many cases.

We have never argued for a blanket debt write-down. However, we strongly favour a targeted debt resolution process in which banks accept responsibility for their part in the crisis.

Given that last year alone the pillar banks received over €17 billion of taxpayers' money in recapitalisations there is simply no justification for banks refusing to absorb some of the cost of this crisis. There is sufficient capital in the pillar banks to cope with a portion of the losses.

Across the country people are looking to this House for solutions to the crippling level of debt and mortgage distress with which they are living. They need the Government to intervene to give them some kind of hope that there is light at the end of the tunnel. The Personal Insolvency Bill has the potential to provide tens of thousands of families with that hope, but only if it is amended appropriately.

I hope the Minister will keep an open mind on the issues raised when we deal with the Bill on Committee Stage.

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