Noel Rock (Dublin North West, Fine Gael) | Oireachtas source

I thank the Minister, Deputy Noonan, for agreeing to share his time with me. While I appreciate the position from which Deputy Michael McGrath approached this issue when he drew up this legislation, which seeks to confer powers on the Central Bank, we should ask whether those powers will be used. In this case, the answer has arrived long before the question has even been asked. These powers will not be used. The Bill before the House provides only that the Central Bank "may" issue directions in respect of interest rates. It does provide that it "will" do so. The Minister, Deputy Noonan, has outlined the measures he has taken in regard to interest rates. I believe that is the approach that should be followed.

While I agree with some of what Deputy McGrath has said, I would favour more consultation, collaboration and fruitful engagement between the Central Bank and legislators. Such an approach, as advocated in my Central Bank (Supervision and Enforcement) (Amendment) Bill 2016, would produce better outcomes and would actually be used. I suggest it would produce a stronger legislative framework in collaboration with the Central Bank, rather than a legislative solo run which seeks to confer powers of dubious constitutionality on the Central Bank. The bank itself has said that it will not use such powers. As the Minister, Deputy Noonan, has rightly pointed out, the prospect of such powers being legislated for has already had an effect on the markets.

A cap relative to the market average, as seemingly inferred in the Bill before the House, would be useless if all variable rates were equally high. If the average is uniformly high, a cap relative to the average is useless. The quarterly monitoring of competition by the Central Bank, as proposed in the Bill, could override the remit of the Competition and Consumer Protection Commission. I suggest it would be preferable if the Central Bank were to maintain its focus on the kind of regulatory oversight and market supervision that was badly needed in the aftermath of 2010. The Central Bank has become much better at such supervision following bitter experience. This measure seems to dull that focus. It would pass powers from the Competition and Consumer Protection Commission to the Central Bank. I would not agree with that.

Reference has been made to the risk that the measure being proposed in this Bill will politicise the Central Bank to some extent. We will set a dangerous precedent if we invite politicians to routinely and regularly call on the Central Bank to move prices unilaterally. While I understand the pressures being experienced by families and borrowers with variable rate mortgages, I believe a better mechanism can be found to discuss how to approach their difficulties. If an independent Central Bank is to work, the Dáil, regardless of the shape it is in - we can see what shape it is in now that we are in a minority position - cannot be leveraging a public body with tasks that will not solve the problems that people on all sides and in all parties are equally keen to see solved. I would like to ask a question on that basis. When Deputy McGrath and his Fianna Fáil colleagues proposed this Bill, had they engaged properly with the Central Bank on it? Was it consulted properly? I suspect it was not. If new politics is going to work, we need a responsible Government and an equally responsible Opposition.

The usefulness of a Bill like this and regulations like these depends entirely on the willingness of the Governor of the Central Bank to use such regulations. It seems crystal clear that the level of willingness in this instance would be zero. Naturally, I support the amendment that has been proposed by the Minister, which would provide ample time for scrutiny and fruitful engagement in this case.

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