Ann Phelan (Carlow-Kilkenny, Labour) | Oireachtas source

I thank the Leas-Ceann Comhairle for allowing me to address this serious issue. There has been news that there have recently been a number of debt write-downs for mortgage holders with AIB. While this is a positive and welcome step, no real detail seems to have been given as to how these write-downs were achieved. In highlighting this issue I do not want in any way to jeopardise any possible deal being done or that may be struck for individuals, as I understand the situation is extremely stressful. However, there is a need for clarity on how these deals are negotiated. The lender has chosen to remain silent on some of them which has caused resentment and angst among those who cannot obtain a similar deal and among taxpayers who are required to finance the deals through their taxes. I understand negotiations can never take place in public. However, it is important that deals are struck, but it is also important that they be as transparent as possible. I have constituents who are at a loss to understand how some individuals have been able to attain deals and they cannot, even though they consider themselves to be in an equally serious position. It seems some of the deals have been leaked to the media, but I do not understand how that helps the situation.

AIB is 99.8% owned by the taxpayer. Therefore, it has a duty to the State and the taxpayer to be fair and transparent. There has been selective leaking of deals to the media, which is not acceptable. We do not know the specific criteria used.

We have information from some sources which seem to be in the employment of AIB but I could be incorrect about this. The danger in reporting these deals to the media without relevant information as to how they were negotiated is that it leads to a false expectation among other borrowers. On this basis there is an urgent need for clarification. It is like a game of "Deal or No Deal". The debtor simply fills out the standard financial statement, AIB examines it through its own process and determines whether it will give the person a deal. I have been informed it applies the minimum standards as determined by the Insolvency Service of Ireland plus 20%. It then writes off the proportion over 130% of the current market value. The Insolvency Service of Ireland was established for a reason, which is in the interest of the debtor. It is fair, open and transparent. Could AIB's present approach impact negatively on the Insolvency Service of Ireland and on the personal insolvency service as a whole?

Is it the case the banks apply guidelines and criteria to benefit themselves and not the debtor or taxpayer? It is clear the banks do not want to engage with the regulated solutions as set down by the Personal Insolvency Act as they stand to lose out. I call for these details to be clarified and for transparency in respect of all deals. Consistency needs to be applied across the board.

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