Regina Doherty (Meath East, Fine Gael) | Oireachtas source

We would be hard pushed to find somebody in the country who does not know some or many of the hundreds of thousands of families in serious mortgage crisis. The Minister for Justice and Equality, Deputy Shatter, last night indicated that one of the main priorities of the Government has been to put in place some of the best possible solutions for people living under the burden of unsustainable debt. With the establishment of the Insolvency Service of Ireland, ISI, we now finally have an insolvency regime to address the needs of our Irish population. The range of measures available through the ISI have been designed to provide quality insolvency solutions to debtors in a very important, transparent and customer-focused manner that is fair to all. It is in everybody's interest, including borrowers, lenders and society as a whole, to ensure that the appropriate mechanisms are put in place to facilitate this development, with timely provision of appropriate and sustainable resolutions for borrowers facing or experiencing mortgage arrears.

I agree that restructuring arrangements agreed to date have primarily been of a short-term nature, with interest-only or even less than interest-only arrangements accounting for 46% of restructuring processes. As of end of December 2012, there were over 106,000 mortgage accounts in arrears for which no restructured arrangement had been put in place. With this Government there is a clear priority to deliver an effective regulatory and consumer protection framework that would be in the best interests of borrowers, lenders and the wider economy. We all recognise that the process has started, although it is slow.

It is interesting that the Bill before us makes no acknowledgement of the Personal Insolvency Act or any of the other strategic steps taken to address the mortgage arrears problem. Along with that Act we have the Insolvency Service of Ireland, the Central Bank revised code of conduct on mortgages and the Land and Conveyancing Act. This Government's strategy is to assist people and families in mortgage distress, with four distinct measures in the form of the personal insolvency process, the mortgage advisory service, the mortgage to rent scheme and proactive engagement with banks.

I will refer to the code of conduct on mortgage arrears, which stipulates that mortgage lenders should allow for a flexible approach in the handling of arrears and pre-arrears cases, aiming to assist the borrower in genuine difficulty rather than procrastinating or avoiding the problem. They should genuinely assist, in as much as possible, having regard to the special circumstances in families. In particular, the code provides that the lenders' arrears support units must base assessments of the borrowers' cases on the full circumstances, including personal circumstances, overall indebtedness, information in the standard financial statement, current repayment capacity and previous history. Form should be taken into account.

This revised code provides robust protection to consumers in mortgage difficulty and is vital in solving mortgage difficulties faced by too many families. The Personal Insolvency Act provides for the introduction of three new debt resolution processes, which although requiring court approval are essential non-judicial procedures.

Based on my constituency experience in working with people for the past year who are in major financial distress, we are beginning to see long-term sustainable solutions being put forward for them. I agree that it has taken too long to get here, but people are seeing the light at the end of the tunnel. Lorcan O'Connor fills me with hope that there will be a resolution in the short to medium term for the 106,000 families in arrears. In the United Kingdom 65% write-downs are the norm for its insolvency service given the number of people in debt. This is to be welcomed and I am confident that the ISI will be able to do the same for people here to enable them to rebuild their lives which have been shattered in the past few years.

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