Arthur Spring (Kerry North-West Limerick, Labour) | Oireachtas source

-----who allowed the developers to ride into the sunset with all their money are now telling us they have a solution for the 140,000 families in mortgage arrears. That is harsh but fair. The only thing missing from Fianna Fáil's motion is the apology its leader gave for what he did to the country. I am sorry, but it will not go away because every day I meet people who are dealing with the legacy in the form of their mortgages. They may be paying interest only or some of the capital on 30 or 40 year mortgages, some of which were for 100% or more. I respect Deputy Michael McGrath, but it is difficult to stomach the motion.

On the idea that Irish banks are somehow against Irish people, if the Central Bank is licensed by the Government, it must do the right thing by the people. It is of paramount importance politically that we are astute about what is happening. The consequence of leaving people in houses when they do not make repayments is that the individuals concerned never get on with their lives, the bank never finds a resolution, the country never gets its money back and we are in limbo forever and a day. The banks want to be sold, but in order for them to be privatised and the money to come back to the State, they need to be in good order and their mortgage books need to be subject to due diligence by prospective purchasers who will examine whether the mortgages are sustainable. That is independence and objectivity on the part of a potential buyer. If the banks have not done their work properly, we will not be able to sell them.

David McWilliams advised us to go the mart if we wanted to see people bargain and trade. Unfortunately, we are leaving people to the skill of the pits. Their awareness and capacity to speak are being withdrawn a little because comparability is necessary in my book. People need to go to the bank to say they will declare bankruptcy if they are not given a split mortgage or another sustainable solution. They would rent a home and be back in the market in three years and could hope to save towards purchasing a house in a depressed market because the housing market will be in an even worse position that it is if there is no movement to that effect.

There is no doubt about this. People can offer banks the choice of either having a bad debt on their books or a potential contingent liability through a split mortgage.

Some people are coming here with real solutions. Deputy Stephen S. Donnelly suggested a debt for equity solution, but I do not know of many financial institutions that would buy into such a bank. I have a proposal for people of my generation. We should look at how we go about making our mortgages sustainable. Currently, mortgages offer nothing other than a form of air space in which many of us do not want to live as they cannot support sustainable families. Often all that we have are apartments, but we want to trade up and move into homes. Can we include these apartments and first properties in a private mortgage which could be isolated in a pension investment? In other words, could we convert them to a personal pension fund that would be tax efficient for us? I have suggested this to the Minister of Finance on many occasions. Rather than investing, this would be a way to deal with the issue.

On the code of conduct, I believe the banks are delighted with the idea of having a watchdog and a central bank. The majority of bankers I know are good, honourable people, but they hang their heads in shame because they are associated with particular institutions and certain political parties that are largely responsible for what we are talking about tonight. I believe there are two big issues for the Government. The first concerns the need to deal with the mortgage arrears crisis, while the second concerns the need to deal with the unemployment crisis. We are doing everything we can to deal with these issues, but it is not helpful to suggest that a code of conduct that we will supervise and watch is not the way to move forward on this issue. It is also unhelpful to tell people that we have not done right by the banks. They do not feel confidence in the integrity of the institutions as a result of their being undermined.

The Central Bank is in a much better state than it has been heretofore. I believe that when individuals contact MABS, banks, solicitors and personal insolvency trustees, they will find that there is a way for them to support sustainable debt and for the economy to become buoyant again, rather than for bankers and developers to make exorbitant profits and run off into the sunset. There is a way for people to have a decent standard of living and to have aspirations to trade up and sustain and develop families. The MABS welcomes applications. Banks also welcome approaches from people. The Central Bank knows what it is doing and has targets.

Not being partisan on this issue, it is for this House to observe the Central Bank and ensure it does the right thing. We can, through freedom of information requests and parliamentary questions, ensure it does the right thing. I urge Deputies in non-government parties to do this also. People of my generation who are bearing the brunt of this problem are either emigrating or dealing with mountains of debt. I urge them to go to the banks and seek a solution. The Personal Insolvency Bill is coming down the tracks and will have the greatest impact on our society at this time because people will be able to get on with their lives and the banks will no longer be the burden they are on the Government and the people.

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