Michael Healy-Rae (Kerry South, Independent) | Oireachtas source

I confirm my support for the legislation and commend Deputy Collins for introducing it. It is very important, timely and necessary. Above all, the idea contained in it has worked elsewhere. This is crucial to note. It has been tried and tested and has been successful elsewhere.

I commend Deputy Joe McHugh of Fine Gael, who made a very reasonable and reasoned speech earlier this evening.

This legislation is necessary because the current insolvency legislation, passed in this House recently and now in operation, is seriously flawed and deficient. It is seriously flawed because it gave a veto to the banks and seriously deficient because it is now quite clear that a significant number of distressed mortgage holders will not fulfil the criteria in the legislation. We must simply listen to what Mr. Patrick Honohan said last week. He said 62% of the sustainable solutions offered by the banks to meet the Central Bank guidelines involved voluntary sale, voluntary surrender or repossession. Over the weekend, personal insolvency practitioners have confirmed that, in their experience to date, as many as 43% of people coming to them will not be able to avail of the personal insolvency services because they have no disposable income.

This Bill deals specifically with those two issues. It will remove the veto from the banks in regard to owner-occupied properties. We are talking about people who made mortgage repayments when they were in a position to do so. There are trying to pay now and would love to be able to do so. We are talking about family homes.

The second key point of this legislation is that it deals with negative equity pertaining to owner-occupied properties by revaluing the security of the asset at 110% of today's value. The negative equity will become unsecured debt and this will reduce the mortgage repayments to a more affordable level. These measures cover the two areas that are causing difficulty for ordinary, decent families who want to pay their mortgages.

We should remember what Patrick Honohan and others have said. Mr. Honohan said 62% of the offers by the banks involved voluntary surrender and repossession. Both of these solutions effectively mean eviction from the family home. I have seen letters from banks suggesting to distressed mortgage holders that they engage in the voluntary sale of their property. Did one ever hear the like of it? There are no mortgages being made available for ordinary people; therefore, there are no sales of properties. Down the country, certainly in my constituency, it is not possible to sell homes such as the ones in question. There are no mortgages and people do not have the cash that some investors may have to buy homes in south County Dublin in such places. We are talking about anything from 40,000 to 60,000 families effectively being evicted. If this occurs, they will be put on a local authority housing list. Local authority housing lists already have 98,000 families. I commend the legislation to the House.

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