John Browne (Wexford, Fianna Fail) | Oireachtas source

I support the Bill put forward by my colleague, Deputy Michael McGrath, which aims to end the scandal of banks overcharging customers on standard variable mortgage rates. As Deputy Keaveney has pointed out, 300,000 mortgage holders are paying the highest rates across Europe. I thought the purpose of the European Union was to have uniformity. Why should mortgage holders in Ireland have to pay rates of at least 2% above comparable rates in other EU countries?

The Taoiseach told us today that the Central Bank did not request legislation, but its attitude leaves a lot to be desired. It said it does not need legislation, yet it has no clout to force the banks to make proper reductions in interest rates.

Piecemeal reductions, which are really irrelevant, have been made by the banks in recent months.

Fianna Fáil has consistently highlighted over the past two years how the banks are ripping off their variable rate mortgage holders. As it stands, up to 300,000 mortgage holders on variable rates pay hundreds of euro more per month on their mortgages. Fianna Fáil put this issue firmly on the agenda at the end of March, with a motion on the subject of the rip-off variable rates being charged. Since then the banks have sought to deny the existence of a problem or to fob off customers with minor changes to their rates. The Government has been totally lacklustre in its response to the crisis and has failed miserably to convince the banks to reduce the punitive variable mortgage rates. This clearly indicates the Government really does not have the interest in taking, or is not bothered enough to take, decisive action. If the Minister came to my county, and I am sure it is the same in his own, he would see we receive countless representations from people throughout Wexford who are stuck on variable mortgage rates. They are forced to pay up to €500 per month more compared to new mortgage holders with the exact same mortgage but with tracker rates. This is unacceptable when one considers interest rates are at a record low level.

Yesterday I received an e-mail from someone living in Monamolin in Wexford in which he states he hopes I, and my colleagues, will continue to highlight the issue. He states the recent response by the banks to the call from the Minister, Deputy Noonan, for lower rates has been deeply disappointing. He states his mortgage rate with Permanent TSB looks like reducing from 4.5% to 4.3%, which he describes as a miserly reduction that works out at approximately €30 off a monthly payment of €1,500. He describes it as an anti-climax and an insult to customers of the bank. He states people in his circumstances have no option to switch to another bank or to a lower fixed rate. He states they have no option. We receive letters such as this on a regular basis from customers throughout our constituencies. These people do not live in mansions or in nine or ten bedroom houses. The man who sent the e-mail states he lives in a bog-standard bungalow which he purchased at the end of 2008. He and his family are being put to the pin of their collar to meet the repayments on their mortgage. All they are looking for is a reduction comparable to other EU countries.

It is important that the Taoiseach and the Minister take on board what the ordinary people of the country who have mortgages are saying. They want a reduction and they want the Government to take action. They are very supportive of the Bill tabled by Deputy McGrath and what he highlighted three months ago. What they tell me and other Deputies is there has been no action to date and no substantial reduction by the banks, just an insult from week to week by the miserly reduction implemented. It is time for action to be taken by the Government and for the boot to be put in as regards the bankers who refuse to meet the demands of the ordinary people paying mortgages.

The Central Bank has lost all credibility. It continuously seems to tell the Minister and the Taoiseach we do not need legislation because the banks will comply, but the banks have not complied with the request or the way forward the Minister and Taoiseach state they want brought about. It is time the Bill before us was supported by the Government. It is totally wrong that the House would split on this and force it to a vote. Even at this late stage, it is important the Minister take off the chains surrounding him and decide to support Deputy McGrath's Bill.

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