Michelle Mulherin (Mayo, Fine Gael) | Oireachtas source

We are here because the situation of the IBRC mortgage holders has brought this issue to the fore. We heard the assurance given by the special liquidators last week that in the event that these mortgage holders - approximately 11,000 of whom have mortgages on their own principal private residences, with 4,200 in arrears - get into difficulty, the code of conduct on mortgage arrears would be accepted and applied, on a voluntary basis, by non-regulated entities from outside the State. This is a very serious and solemn issue for people, especially those who are in arrears at the moment. It beggars belief that there must be a public outcry before consumer protection for these mortgage holders comes into play or is offered at the eleventh hour. I attended the Oireachtas committee meeting with the special liquidators last week and I must say that an assurance of a voluntary signing-up to the code of conduct on mortgage arrears, with nothing in writing, does not hold water. One only has to read the New York Times or the Wall Street Journal to know that Ireland has been identified as a soft target for hedge funds and venture capitalists. Such entities do not come in and try to have nice relationships with mortgage holders. They come in, strip assets in certain cases and in other cases, they sell the loans on again. Even if they stick to their word, the next purchaser of the loans may not do so.

We need legislation on this issue sooner rather than later. Otherwise we will only store up more problems for ourselves in terms of these mortgage holders. If they fall into arrears, they will look to the State for assistance. The State will have to deal with the problem then but we might have some control over it now, especially in the case of IBRC. It is not impressive to hear the special liquidators peddling the proposition that a voluntary agreement is in some way binding and represents a solution for people. Of course we must consider the taxpayer's position in this but there is fine balance to be struck. Given what has happened in the banking sector here, there is no way that we should allow a situation to develop whereby people in mortgage distress, dealing with IBRC, should be left on their own when their loans are sold to non-regulated financial institutions. We must act sooner rather than later. I welcome the acceptance by the Government of the concept of consumer protection as provided for in this Bill but legislation must be enacted sooner rather than later.

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