Micheál Martin (Cork South Central, Fianna Fail) | Oireachtas source

After he was elected, the Taoiseach said the Government would act decisively, forcefully and effectively with the banks and anybody else in the interests of those who held mortgages and were in difficulty in repaying them. Last week, for the second time in one month, AIB announced a major increase in its standard variable mortgage interest rate, to 4%, affecting 70,000 householders in the process. A mortgage expert has described this increase as absolutely obscene. This decision is further evidence that the banks and the Government have essentially abandoned mortgage holders, particularly those with mortgages at the standard variable rate. Deputy Michael McGrath, from my party, has estimated and illustrated that mortgage holders with a tracker mortgage of €200,000 will pay €224 less per month than those with a mortgage at the standard variable rate, a differential of €53,760 over a 20 year period. This will bleed ordinary householders across the country. As Constantin Gurdgiev and other economists have argued, it will also bleed the economy. It will rob it of disposable income and not facilitate the spending required. This is against the backdrop in July of a reduction by the ECB in its rate, but Ireland's pillar banks decided not to pass it on to customers. In fact, AIB increased its rate further by 0.5%. In essence, despite all the loud protestations and rhetoric, it is very clear that those with a mortgage at the standard variable rate are bearing a disproportionate burden and are being absolutely screwed.

The Taoiseach has remained silent on this issue. He indicated some time ago that tracker mortgages could be moved to the IBRC and that this would help the overall restructuring of the banking system, potentially allowing for some relief for customers a the variable rate, but no such action has taken place.

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