Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

I thank Deputy Pearse Doherty for tabling this question. Tackling mortgage arrears is a priority for the Government. A whole-of-government approach has been adopted in addressing this issue, with a view to maximising the level of loan restructuring arrangements and minimising the number of home repossessions. Initiatives such as the reform of personal insolvency legislation, the establishment of the Insolvency Service of Ireland, the introduction of a mortgage arrears information and advice helpline and the availability of mortgage-to-rent schemes ensure that borrowers are assisted in dealing with their arrears.

In March 2013 the mortgage arrears resolution targets, MART, framework was introduced. This sets out demanding quantitative targets for mortgage arrears resolution at six Irish mortgage lenders which account for 90% of the mortgages in Ireland. The six lenders - AIB, Bank of Ireland, Permanent TSB, Ulster Bank, ACC Bank and KBC Bank - are required to meet targets at quarterly intervals. In addition, the code of conduct on mortgage arrears, CCMA, sets out requirements for mortgage lenders dealing with borrowers facing or in mortgage arrears on their primary residences. The CCMA provides a strong consumer protection framework to ensure that borrowers are treated in a fair and transparent manner by their lenders and that long-term resolutions are sought by lenders with each of their borrowers. Under the CCMA, a lender may only commence legal proceedings for repossession after it has made every reasonable effort to agree an alternative repayment arrangement with the borrower or his or her nominated representative, and where specific timeframes have been adhered to, or where the borrower has been classified as not co-operating. It is clear that the Government has put in place a number of initiatives to assist homeowners in difficulty, including reform of personal insolvency legislation, the provision of independent advice to those dealing with debt issues and, as already stated, the introduction of MART targets and the revision of the CCMA.

The most recent ISI results show an increasing take-up of its services, albeit from a low base. For quarter 4 of 2014, the ISI reported that it was dealing with debt of €1.5 billion and that the number of personal insolvency arrangements approved in quarter 4 had increased by 148% over that for quarter 3. The ISI also report that 75% of proposals are supported by creditors. The decision in 2014 to waive fees for the insolvency service, coupled with a targeted awareness-raising campaign, is likely to lead to greater engagement with the office.

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My Department and the Central Bank monitor the situation in regard to mortgage arrears on an ongoing basis. Data published by the Central Bank in early March for the end of 2014 showed continued improvement in the number of personal dwelling house, PDH, accounts in arrears of greater than 90 days, which decreased by 7.4% over the quarter, representing the fifth consecutive reduction in the number of accounts in arrears for this category. In addition, the number of borrowers reaching agreements with their banks to restructure their mortgages is increasing, with almost 115,000 mortgages classified as restructured at end December 2014. It is also encouraging to note that approximately 85% of these restructured accounts are deemed to be meeting the terms of their current restructure arrangement.

This is, however, an area which remains under continuous review. More and concerted action is required by the banks to assist customers in arrears and, as the Taoiseach has previously announced, my Department is considering a range of options to support the existing framework and to improve the take-up of personal insolvency solutions.

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