Niall Collins (Limerick, Fianna Fail) | Oireachtas source

Behind all the legal jargon contained in the Title, the Bill is purely and simply a mechanism to allow for home repossessions. No amount of legal gymnastics on the part of the Minister can hide from the tens of thousands of struggling home owners throughout the country the fact that this legislation jeopardises their family homes. It places power over family homes firmly into the hands of the very banks which brought this country over the edge. The Bill follows hard on the heels of personal insolvency legislation that shifts the balance of power towards the banks and gives them an effective veto over debt negotiations. It further compounds that shift in power and tightens the vice-like grip banks hold over struggling families. The legislation threatens to open the floodgates of repossessions at the whim of the calculations of the very financial institutions whose predatory lending practices have trapped countless families in the mire of debt in the first instance.

Power over the future of family homes will be placed in the boardrooms and back offices of bankers who are desperately trying to cover up the greed and recklessness they displayed in the past. The impact of an acceleration of repossessions on the fabric of society and on the families concerned will be of little consequence to them. Power will be shifted to balance sheet-driven bankers who have already been bailed out by the taxpayer but who pay no heed to their social obligations.

The term "moral hazard" has been widely used to justify the legislation. However, the moral hazard I see is the sheer immorality of bailed-out banks repossessing family homes. The moral hazard I see is that relating to bonus-laden bankers on more than €200,000 per year making life and death decisions with regard to family homes. The moral hazard I see involves the banks which fuelled a property boom placing the burden of their mistakes on the shoulders of ordinary families. Moral hazard has been exploited as a form of hand wringing on the part of the Government and has been used to depict struggling home owners as being complicit in their financial difficulties. It conveys a sense that home owners are strategically defaulting and avoiding their financial obligations. In my experience of dealing face to face with hard-pressed families in Limerick and across Ireland, I am aware they are not the cold calculating defaulters the concept of moral hazard implies. In reality, which is a long way from the ivory tower, they are ordinary families trying to make ends meet in the midst of an unprecedented recession. They are trying to find a light at the end of the tunnel but are now faced with the banks' forthcoming veto over personal insolvency arrangements and the new arrangements under which the latter will be empowered to repossess their homes. Their fight should be the fight of every legislator in this Chamber but instead the Government has shifted more power into the hands of grossly irresponsible financial institutions.

What of the obligations of the banks which aggressively financed the property boom in the first instance? They are not subject to any moral considerations. Ethical considerations seem to begin and end at the front door of mortgage holders. They do not apply to those in the banks in which those mortgages were given out. At the behest of boardrooms and back office executives, ordinary staff in branches across Ireland will find themselves chasing struggling mortgage holders out of house and home.

In my county of Limerick, I all too regularly meet families that are trying to keep their heads above the rising waters. The crisis represents a major burden on the national economy. More importantly, the statistics are a chronicle of human misery. The emotional and psychological exhaustion owing to the ongoing toll of grappling with apparently unending debt is quietly devastating lives in homes. The untold damage of grave financial difficulty will be further compounded by the impact of this Bill.

Statistics published by the Central Bank on 7 March indicate that, of the 792,096 mortgages for primary residences, 143,851 were in arrears on 31 December 2012, with 94,488 - 11.9% - more than 90 days in arrears. This 90 days plus figure represents an 11.5% increase on the end of quarter three in 2012. A further 28,421 mortgage loans secured on buy-to-let properties were also more than 90 days in arrears on 31 December, representing 18.9% of all residential mortgages secured on buy-to-let properties. These statistics are exacerbated by the fact that the types of mortgage restructuring arrangements agreed to date by banks with distressed borrowers have largely been of a short-term nature, with almost half being interest only or less than interest only. Problems have been temporarily buried but will re-emerge.

Behind the figures, mothers and fathers, husbands and wives, couples and ordinary workers in kitchens and sitting rooms in every community are trying to make the numbers add up. Today's Bill is another direct blow to them and their fight to keep their homes. The Government needs to take steps to protect them rather than the banks. Instead, it has fundamentally tilted the balance of power in favour of the financial institutions. Last week, we witnessed the unedifying spectacle of a partly Government-owned bank that received €5 billion in taxpayers' money to bail it out from its self-inflicted financial woes rewarding its chief executive with an €843,000 per year pay deal. This issue is not about cruel populism or bank bashing, but about fairness. For any society to work, there must be a degree of solidarity among people. In hard times of severe cutbacks, wage reductions and high unemployment rates, we must ensure that everyone plays a part. The appalling vista of chief executives in Government-supported banks being paid extraordinary amounts while the Government empowers the very same institutions to repossess family homes is a step too far. The bonds of solidarity cannot withstand such gross unfairness.

The Government has already refused to place an extra charge on people earning incomes of more than €100,000 per annum in order to help meet our fiscal requirements fairly. The implementation of this legislation marks another departure from the concept of fairness. The image of exorbitant wages paid to bailed out bankers overseeing family home repossessions is a damning indictment of the Government's failure to follow a fair road to recovery. Instead, it has trod a path strewn with broken promises.

Tomorrow is 1 May, the date upon which some 1.6 million households across the State are due to be evaluated for the imminent property tax. For the families close to the edge, the raft of additional charges coming down the line will be the straw that breaks the camel's back. For the homes mired in negative equity and grappling with the burden of mortgage arrears, the property tax on the family home is the wrong tax at the wrong time in a way that is far more immediate than the Government seems to understand. The impact of additional charges will push them over the edge while the future prospect of onerous water charges will keep them there. This legislation is another step by the Government towards the abandonment of the route of fairness. It will throw struggling home owners over the edge. The plethora of charges placed upon families will fatally undermine their capacity to continue to make ends meet while this Bill will take away their security.

The Government's financial strategy is condemning more embattled homes to its equally flawed personal insolvency process and the cold arms of the banks. The much vaunted personal insolvency regime is running months behind schedule. All the while, thousands await the chance for a fresh start to end their financial nightmare and the country awaits the boost of removing the crippling millstone of unsustainable debt from its neck. The black morass of debt facing home owners throughout the country is a deeply personal crisis for those families struggling to keep things together in tough times amid a national crisis that is dragging the economy down in a vicious spiral. Instead of a personal insolvency regime that gives home owners under pressure a fighting chance to come to terms with their banks, the Government has given all of the cards to the financial institutions. The process is fundamentally flawed, as it has no commitment to an independent process at its heart. Instead of an independent arbitrator and appeals mechanism, the Government has created a banker's veto on progress in tackling debt.

Today's Bill is yet another step in that direction, placing additional power in the hands of the banks. Home owners will be left with only the final desperate nuclear option of bankruptcy to save themselves if the banks wield their powerful veto over any arrangement. Home owners now face the real prospect of losing their family homes.

I wish to address a number of issues raised by the Minister. He has outlined the origins of the Bill in terms of the 2010 Dunne judgment and a lacuna in the original Land and Conveyancing Law Reform Act 2009. It is not necessary for me to thrash out the finer detail of that judgment, but it is important to address the context of the original Act and the Minister's complacent dismissal of this Bill as simply addressing a legal oversight.

The 2009 legislation was a sweeping Act reforming many areas of land law, including ownership, trusts, co-ownership, conveyances and, relevant to the current Bill, mortgages. The purposes of doing so were to simplify existing land law, which stretched back into the mists of feudal times, and to enable the introduction of e-conveyancing. The Act was a product of a detailed Law Reform Commission, LRC, project undertaken by Mrs. Justice Catherine McGuinness and Professor John Wylie. The LRC project began in 2003, with the Bill introduced in the Oireachtas in 2006 with all-party support. Mortgages were one part of a major overhaul of a complex set of law. The Bill was a product of a different economic and social context of a country experiencing high levels of economic growth. The prospect of a collapsing housing market and a mortgage arrears crisis on the scale that we are now witnessing was never considered by any party in this House.

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