Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I welcome the opportunity to contribute to the Second Stage debate on the Markets and Financial Instruments Bill 2018. It is broadly a technical Bill. The European directive was transposed in August 2017. However, primary legislation is required to give effect to elements of that directive. It is principally in the area provided for in section 5 of the Bill. I refer to the provision around a "relevant defence", the definition of that and the penalties provided for. There is also the amendment to the Credit Reporting Act 2013. Section 9 of the Bill amends the Financial Services and Pensions Ombudsman Act 2017.

My party is supportive of the Bill. We will engage constructively on Committee and Report Stages in respect of the passage of this legislation. However, it is timely to get a reminder of the need for accountability and for strict penalties to be put in place where financial regulation transgressions occur. The tracker mortgage scandal is the dominating consumer issue at the moment. In that context, this is a reminder for the Government of the need to re-examine domestic legislation. I refer to legislation on the Statute Book holding people accountable.

Most people monitoring the evolution of that scandal will want to know at the end of it that there are answers. They will want to know that there is some accountability as to how it could happen across all the main lenders. How did they all happen to make the same mistake and, ultimately, who will be held accountable for that. The Central Bank has now confirmed that enforcement investigations are under way in respect of the five main lenders. I welcome that and ask the Minister to engage constructively with the Central Bank on any requests it has for additional powers. The whole area of white collar crime has to be prioritised by this Government. We need to strengthen the provisions on our Statute Book. This Bill, which derives from a European directive, is a timely reminder of the need to do that.

The Bill also provides an opportunity to call on the Government to redouble its efforts to support at a European level the need for a Single Market in respect of financial services. I have raised this issue on a number of occasions and at the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach. Consumers elsewhere in Europe are benefitting from much lower interest rates on mortgages and business loans. We are meant to have a European Single Market. Why can consumers in Ireland not access credit from a bank in France, Italy, Spain or Germany? The reality is they cannot. The wheels are moving very slowly at a European level to deal with that. That issue is relevant as well in the context of insurance. We consistently need to raise this issue at ECOFIN, at the Eurogroup and at the European Council to try to drive on that process. We do not have a European Single Market in respect of some key services people rely on in their day to day lives. This Government should be prioritising and dealing with that issue.

We often get press releases from the Central Bank warning people about unauthorised firms. I refer to firms that are not regulated and are trading in this country, trying to sell services and products to people here. It is important that we build awareness among consumers as to what regulation means and what are the benefits of regulations. We have to also improve the awareness of the difference between where firms are regulated in Ireland prudentially and where they are regulated here for conduct of business purposes only. We all hear at the end of the advertisement on the radio or the television that a certain firm is regulated for conduct of business purposes.

2 o’clock

The Setanta Insurance saga is rumbling on and there is still no end in sight for many people, despite the Government statement some months ago that claimants would get 100% of what they are due. There is deep frustration among many people who were caught up in that scandal. We are now four years on from the collapse of Setanta Insurance. In some cases, the relevant accident had occurred seven years prior to that. I know of cases that go back seven and eight years and where the claim is still outstanding because at the point of the collapse of Setanta, the claim was not settled. The policyholders got caught up in the quagmire of the liquidation of the firm.

This really needs to be dealt with. Some people have got zero while others have got 65%. It is not only an issue for the claimants but for Setanta policyholders as well. They are completely innocent. They took out a legitimate insurance policy in this State. Yet, they still have legal letters on their kitchen tables suggesting they could be held personally liable for any shortfall in a claim made again them. That is not acceptable. I welcome the Government commitment to deal with the issue but we need greater urgency. We need to get the issue closed off as quickly as possible.

The final issue I want to raise with the Minister of State relates to the Financial Services and Pensions Ombudsman. I fully supported the legislation brought forward by Sinn Féin. Deputy Doherty did good work on the six-year rule. Our party produced a Bill and there was Government legislation as well. The six-year rule was amended to introduce a discoverability clause. To complement the six-year rule an additional provision was made whereby a complainant had three years from becoming aware of the subject matter of the complaint or from when he or she ought to have become aware of it.

I am aware of difficulties with the application of this. I have discussed the matter of whole-of-life insurance policies with the Minister and I have raised it before as well. The way people in this country have been treated with these policies is a scandal. When the policy comes up for review, whether it be after five years or ten years, the premium people are expected to pay can increase dramatically to such an extent that it is simply unaffordable for many people. They have no choice in that they are locked in, essentially, to the product. Such cases are taken before the ombudsman. I have raised this issue before. I have issued press releases on whole-of-life insurance policies. There seems to be some blockage and difficulty with the ombudsman in dealing with where the statute of limitations issue arises. Will the Minister examine the matter in the context of this Bill? We may bring forward amendments but I am keen for the position to be absolutely clear. Consumers must have a right to bring cases of mis-selling to the ombudsman where they have only become aware in recent years of a difficulty with a product. That was the intention of the legislation brought forward by Deputy Doherty, as well as the Department and the Government legislation, but there are difficulties in its application. Certainly, we want that issue dealt with.

We look forward to the full debate on the Bill, including Committee and Report Stages. We will engage constructively. We will be supporting the Bill.

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