Joan Collins (Dublin South Central, Independent) | Oireachtas source

I move amendment No. 8:

In page 14, between lines 21 and 22, to insert the following:“27. The Minister is to review section 11 of the Social Welfare and Pensions Act 2013 that closed the Mortgage Interest Scheme and shall prepare and lay a report before the Houses of the Oireachtas within 3 months of this Bill being enacted, setting out the options for introducing a targeted use of the Mortgage Interest Supplement to assist people with short-term mortgage arrears problems.”.

I proposed the same amendment on Committee Stage. The Free Legal Aid Centres, FLAC, and Community Law & Mediation sent a number of requests that we propose such an amendment. While we cannot propose amendments that might incur a cost to the State, it is important to examine it again. I recently put down a parliamentary question to the Minister. He made the point that 2,200 people are in receipt of mortgage interest supplement, costing the State €6 million. He advised that people go through the mortgage arrears resolution process, MARP, go to the Money Advice & Budgeting Service, MABS, or go to the new service, Abhaile, the Mortgage Arrears Resolution Service, about it. Mortgage interest supplement was introduced because people found themselves out of work for short periods due to, for example, a broken leg, cancer or a longer illness than usual, and they found it difficult to make the interest payments on their mortgages.

The scheme was introduced to assist these people but obviously became difficult to manage following the crash. As a result it was closed to new entrants in 2014.

I am not a fan of the banks, as the Minister is well aware. They ripped us off and we are paying to bail them out at great cost to individuals, families and society in general. Regardless of whether the supplement is paid to the banks, it was introduced to protect people. The free legal advice centres and Community Law & Mediation are of the opinion that it should be a targeted short-term payment lasting for up to 24 months. If the mortgage holder is in an unsustainable position after such a period, he or she should go through the mortgage arrears resolution process.

The Minister was adamant in our discussion on Committee Stage that he would not consider this option. The Joint Committee on Housing and Homelessness shares our view on the issue and recommended in July that a targeted use of mortgage interest supplement be restored to assist people with a short-term mortgage arrears problem. The scheme should be reinstated in the context of the current housing and homelessness crisis and the Minister should have a report done on the number of people who would benefit from its reinstatement and potential costs of doing so. He should then indicate to the committee whether its proposal would work.

While the payment would ultimately be made to the banks, the mortgage interest supplement scheme would offer protection to people in mortgage difficulties for a short period. No one is required to enter the mortgage arrears resolution process if he or she is out of work for six or eight months due to illness. The scheme should be targeted and short-term in nature and those who find their mortgage repayments are unsustainable after the process should enter the MARP.

The Minister indicated people could renegotiate their mortgages, for example, by extending them by one year. This does not provide a definitive resolution and would require the agreement of the mortgage holder's bank. The mortgage interest supplement would be made available immediately to people who find themselves in difficulty repaying their mortgage.

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