Thomas Pringle (Donegal South West, Independent) | Oireachtas source

I welcome the opportunity to contribute to this debate on the mortgage and social housing crises. The Technical Group raised the mortgage crisis in the Dáil in 2011 during Private Members' time, at which time there was a crisis in respect of mortgages. However, almost two years later, we remain in crisis and that crisis is only deepening to the point where at present, one mortgage in four is in arrears of 90 days or more. This is the biggest crisis facing the country. It is a crisis that is holding back the domestic economy and has taken spending out of it. Moreover, it ensures that no growth can be achieved and that people have no confidence and are completely unable to spend because they are lumbered with such massive mortgage debt and mortgage arrears and their sole purpose is to try to keep a roof over their heads. It has gone beyond time that the banks are obliged to deal with this issue. They must do so by providing write-downs and this is essential. It is the only way we will emerge from this crisis. It is clear the steps the Government has taken thus far are not working and will not work because there is a lack of engagement with the banks in dealing with people in a way that will allow them to manage their debts and to continue living, working and spending in the economy. Unless the Government does this, the country will be faced with another recapitalisation of the banks this year in order that they can deal with the losses they will be obliged to take into account on their balance sheets. Is this what will be done?

Everyone claims there is a moral hazard involved in the question of how one deals with people in mortgage arrears but the bigger moral hazard is to allow the situation to continue. The banks have been let off scot-free by bailing them out. There is no moral hazard for bankers or bondholders in this society but yet there is a moral hazard for those who simply wanted to provide a home for themselves and their families. It has gone beyond the time at which this matter must be dealt with. Write-downs must be provided to make sure that people can manage their debts and to encourage spending back into the economy again. Allied to this crisis is another in social housing, whereby the Government has completely privatised the provision of social housing across the State. A social housing capital fund must be put back on track to enable local authorities to provide housing for those who need it, that is, for those who, through circumstances beyond their control, will never be able to gain access to mortgages and provide for their own needs. The Government must address these two issues and must so do as a matter of urgency. It must force the banks to deal with this in the only way it can be dealt with, namely, by providing write-downs.

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