Paul Connaughton (Galway East, Fine Gael) | Oireachtas source

The issue of mortgage arrears and the pressure that this in turn is putting on households all across this country is to the fore in every Deputy's mind. The figures are stark, but the stories behind the statistics are even starker. The Government has acknowledged that this is one of the most serious social and economic problems. It has taken determined action to ensure that those most in need of support are supported in a proper and timely manner.

Thankfully, the number of new families in mortgage arrears is falling, but there remains a significant number of mortgages, over 94,500 for private dwellings alone, that are over three months in arrears. The targets have been set out by the Government to tackle this crisis. For example, by the end of June of this year, the banks should have proposed sustainable solutions for 20% of distressed borrowers, rising to 30% by the end of September and 50% by the end of the year.

Much has been made of the dangers of moral hazard. We are not looking for a write-off of debt that can be paid, but where a mortgage is in distress and there is not enough money to meet the mortgage then the bank must pull out all the stops to reach a workable arrangement for that family. For too long the talk has been about the distressed mortgages and the pressure of these on the banks. The focus must be and must remain on the distressed mortgage-holders and the families involved, in cases where what was once an ambitious mortgage is now sucking the economic lifeblood from a family.

It is not just families that have been affected. Our towns and villages are suffering from a severe case of economic inactivity as all of the available spending in the local area is sucked into faceless banks to pay interest on vast sums borrowed during the boom. If we are to ensure that the banks deal properly and fairly with these distressed families, then funding is not the sole issue to be discussed. We must not focus on providing a carrot for the banks but rather a stick in terms of bank oversight and heavy repercussions for banks who fail to meet the targets set out to reach sustainable solutions for families in real distress.

The Taoiseach and Ministers must set out a clear plan of how banks will be dealt with in the event that they do not live up to these targets. I welcome the fact that the Central Bank is to set demanding quarterly targets for the conclusion of sustainable solutions. People want to see firm action, especially as the Government has in recent years provided the wherewithal to ensure the very survival of these banks.

I refer to the issue of remuneration for bank personnel. People are sick listening to the defunct argument that in order to get the top people, we must pay wages that compare well internationally. For decades, Irish bankers have been earning top wages at a time when the banks they were overseeing were teetering on the brink of total collapse. The money paid to top bankers during the boom was wasted. In my view, banks that have been bailed out by the Government, whether to a large or small extent, especially in cases where they continue to lose billions annually, must show restraint in terms of wage levels at the top of the tree. The danger is that the public perception becomes tainted to believe that bank personnel are paid too much. The vast majority of ordinary bank workers have been through a torrid time in recent years, unsure of the future of their jobs, facing irate customers on a daily basis, dealing with people in huge financial difficulty, while also dealing with their own financial reality of reduced wages and increased costs.

I support the Government's counter-motion and look forward to thousands of ordinary families reaching workable solutions with the banks in the remaining months of this year.

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