Áine Collins (Cork North West, Fine Gael) | Oireachtas source

The mortgage arrears crisis must be dealt with urgently both for the sake of mortgage holders and their families and for the good of the economy. Banks should realise that the quicker the crisis is resolved, the sooner we can return to a normal economy where the population as a whole feels secure. People must return to feeling confident that they can meet their obligations under new arrangements agreed with the banks. A benchmark or 35% of one's income should be used to pay a mortgage. People should then have the choice as to how they spend the balance. The constant talk about mortgage arrears along with recent speculation about guidelines on lifestyle choices that may be imposed on those seeking an insolvency arrangements is terrifying for the people who are facing this reality.

It must be stressed that very few people will eventually opt for insolvency. Banks and borrowers will quickly realise that a reasonable resolution between parties is more effective for everybody. Prominent solicitors and accountants have said that the insolvency legislation is designed in a way that it will not be used to any great extent. Its very existence, however, will force banks to reach agreements with mortgage holders. The banks themselves caused this crisis in the first instance. Through their total incompetence and greed for quick profits, they bankrupted themselves and the nation and placed ordinary taxpayers in a terrible situation. Citizens were entitled up to now to believe that banks were professional institutions. They believed banks would advise them correctly and would only lend money at appropriate levels to those who were in a position to repay. The banks failed in their professional duty to advise customers of the risks involved and encouraged the ordinary citizen to borrow huge sums of money that could not and will not ever be paid back.

The banks ruined the future of a generation, wiped out their shareholders and destroyed the economy. I accept that in these circumstances many people are sceptical and in fear about their ability to solve this problem in a reasonable way. We can be sure of one thing, namely, that bankers will be bankers and they will behave in a way that restores their profitability. For this to happen, the economy must recover. It cannot and will not recover without resolving the mortgage crisis. Not only is it affecting those people in mortgage arrears, it is also affecting the willingness to spend in the real economy of those who have savings and income. Constant talk of unaffordable lifestyle choices creates a fear of spending across the whole population. If we continue along this road, there will be no recovery in the real economy, no increase in retail sales and no opportunities for employment. We can now depend on the banks to act in a way that will benefit themselves. They must realise that unless the economy recovers, they themselves will never recover. For the sake of us all and for the sake of the future of banking itself, these problems must be resolved quickly.

It is in the interest of banks to work hard to reasonably and sustainably resolve the mortgage crisis. The Minister for Finance and the Governor of the Central Bank will insist that the banks make this resolution process work or take immediate action to impose a stricter process. A stricter process would not benefit the banks or return them to long-term profitability. I can well understand the great anger of ordinary people about the banks' behaviour up to now. They have been telling people to give up Sky Sports, health insurance and child care when it was the banks that caused all the trouble through their lack of professionalism and addiction to greed. This is very hard for people to listen to. The banks cost citizens billions of euro and they are now lecturing the hard-working people who bailed them out about where they should shop. No one wants to be told how they should spend their money, particularly by the very entities that cost them so much.

It is also disingenuous of the people sitting across from me to now think that they can advise on how to solve this problem. They are the ones who were entwined in the causes of the situation we find ourselves in today. Fianna Fáil was co-conspirator in the get-rich-quick actions of the Celtic tiger, which seemed the norm at the time, and its members must recognise the damage they have caused to the people of this country. The banks were definitely culpable, we now need them to be capable.

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