Dara Calleary (Mayo, Fianna Fail) | Oireachtas source

I thank my colleague, Deputy Michael McGrath, for giving us the opportunity to debate the issue of mortgage arrears. It has been approximately two years since he first raised the issue of mortgage arrears. In the summer of 2011 he, along with Senators MacSharry, Byrne and Darragh O'Brien, pointed out the need for an independent arbitration agency to address a number of issues that had arisen. However, two years later nothing substantial has been done to alleviate the problem for the 142,000 whose mortgages were in arrears at the end of March. As I look around a relatively empty Chamber, it strikes me that tomorrow evening it will be full as the latest instalment of the drama that is this bubble is played out. A drama is playing out in 142,000 homes across this State and politicians and everyone else in society need to wake up and smell the coffee because the situation is serious. I thank Deputy Michael McGrath for his consistent advocacy on behalf of these people.

We are seeing in the Government's response a watering down of the legal and regulatory defences for distressed mortgage holders in their dealings with financial institutions. The Government amendment to our motion welcomes the Land and Conveyancing Reform Bill 2013 for addressing a lacuna in the law which created uncertainty about the exercise by lending institutions of their repossessing rights. Tomorrow night Government Deputies will vote to welcome an explicit statement on the purpose of that Bill. The Government is in danger of cheering on an avalanche repossessions through such statements.

The code of conduct on mortgage arrears has been watered down. The example outlined by Deputy Browne is a result of that watering down. Over the course of a weekend a person received 15 telephone calls culminating in a threat to repossess the house by the following Monday morning. Luckily this individual had the wit to consult somebody but what if the calls continued over the Monday and Tuesday now that the code of conduct has been watered down? Such behaviour was not permitted previously. We do not have an opportunity to listen to those telephone conversations. We can listen to taped telephone conversations among Anglo Irish Bank executives but we cannot listen to the interaction between whatever bank made those calls and its client. We do not know what sort of threats were made and, most important, the Central Bank and the Department of Finance do not know. Our motion calls for a reversal of this watering down but if we are to accept it, the least we should demand is that the calls be recorded for use in the event of a dispute.

The main issue arising is the lack of an independent mechanism for adjudicating between a distressed borrower and a financial institution on the content of a sustainable solution. Deputy Ó Cuív and others referred to the issue of moral hazard. I do not doubt that some people are exploiting this crisis to evade their responsibilities but we have no way of finding out about that other than by extrapolating figures and making judgments. An independent agency with proper functions could decide what percentage of mortgages holders, whether investment or residential, are deliberately deceiving the system and how many are in genuine distress. The Government appears reluctant to agree to such an approach. When Deputy Michael McGrath and his colleagues made their proposals in 2011, we were told that the personal insolvency service would ride into town to save the day like a hero in an old Western movie. I was my party's justice spokesperson when the heads of the Bill were being debate. I disagree with the Minister for Justice and Equality on many issues but I acknowledge that he engaged on the heads of the Bill. We also heard submissions from a variety of organisations. The central recommendation of the independent organisations which deal with these issues on a daily basis, such as MABS, the Legal Aid Board and the Irish Mortgage Holders Organisation Association, was that an independent element is needed. The Minister resisted that suggestion and, with the Insolvency Service of Ireland, we now have an organisation that is full of good intent but will ultimately hit a wall because the banks are still in control. As long as the banks have a veto over settlements, I do not think people will engage with the service.

All of us deal with MABS on a daily basis. Given the confidence that people have placed in MABS, I would have thought we shared a desire to give it the resources it requires to manage the situation but there appears to be reluctance to do that. Senior people who are retiring from the system should be allowed to get involved. We are not giving MABS the resources it needs.

This problem affects every aspect of society. Approximately 54,000 family homes are more than 12 months in arrears and a total of 142,000 were in arrears at the end of March. These families are paralysed by debt and the fear of what may come. That paralysis extends to their ability to spend. They cannot spend money in their local economy. The Central Bank and the banks cannot even reach agreement on minimum income thresholds. The Government refuses to set out the minimum basic income a family needs to survive. We have given the keys to the banks to define the minimum income. They have the right to go through borrowers for a dose of salts before deciding what they can spend. How can we expect our domestic economy to recover to the point of creating employment or our health service to cope with an avalanche of mental and physical health issues while we have our heads in the sand on mortgage arrears? The figures show that the problem is getting worse because the response is not robust enough to instill confidence.

As we come to the end of another Dáil session, we are putting these issues back on the table. We will raise them again in the coming sessions. We need to put our energies into resolving this issue if we are to restore the economy. The Minister for Finance indicated again today that he will engage with the troika on exiting from the programme. The troika's departure will be welcome but if this issue remains unresolved we will face a bigger challenge. We must allow these people to live their lives.

We must allow them become full citizens of the country again and allow them spend money, money that will give the Minister the kind of revenue he needs to improve the economy and employment and bring the country back to an even keel. Surely everybody shares that ambition.

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