Paul Murphy (Dublin South West, RISE) | Oireachtas source

This is a huge issue affecting hundreds of thousands of people in this country. One in three mortgage holders is paying at least €3,000 more per year than they were just one year ago. One in five is paying almost €6,000 extra a year. This is a huge cost-of-living crisis which has its roots in the same profiteering that lies behind the rising cost of rents, food and fuel. All of them are caused by profiteering corporations and a Government which refuses to do anything about any of these crises. The reason it gives, and the one I presume we will hear from the Minister of State today as to why we cannot do anything about the mortgages, is that we do not want to interfere in the market. We cannot have price controls on petrol, electricity or groceries and we certainly cannot have controls or caps on mortgages because we are meant to have a free market.

The truth is that this free market does not really exist. We all remember 2008 when the bubble burst and so-called private developers and private banks were then bailed out with public money. When the private market no longer suited them, the State stepped in to bail them out. The Government has no problem interfering in the market when it comes to benefiting landlords, developers and bankers but it refuses to interfere in the market in the interests of ordinary working people. Workers are supposed to pay for the high house prices and high rents you get during a bubble. Yesterday we heard that house prices are now 10% higher than they were at the peak of the Celtic tiger. Now, not only do we have the highest rates of homelessness and rents ever but we also have the highest prices ever. Then, when the bubble bursts, workers are expected to bail out the speculators who benefited from the high prices. Workers get shafted during the bubble and get shafted during the bust. But it is a great system for those in the golden circle that Fianna Fáil, Fine Gael and the Green Party represent.

One of the arguments we will hear against this Bill is that it would deter new banks from coming in and competing against the existing banks because interest rates would be capped, the idea being that competition is the answer to the problem here and that the unregulated market we have had and which led to the banking crisis of 2007, 2008 and 2009 is somehow the answer to ordinary people's problems, which obviously it is not. Deputy Boyd Barrett has made the point that interest caps exist in several European countries and the sky has not fallen in. Belgium, France and Italy already cap mortgage interest rates.

I also make the point that this Government, just two years ago, introduced caps on interest rates for moneylenders where something like 187% is the maximum rate that can be charged annually. The Government recognised there are extreme examples of exploitation by these payday lenders and it moved to curb some of the extreme and worst parts of it. It showed it can be done. We can intervene in the market and prevent ordinary mortgage holders being ripped off.

It has been 16 years since the crash in this country during which banks and vulture funds have been free to set whatever rates they like. What we have ended up with through this process of great competition is some of the highest interest rates in Europe and, at the same time, parallel and connected to this, some of the most profitable banks and vulture funds in Europe. We know AIB and Bank of Ireland are now making record profits. Close to €4 billion was made between them last year, and for what? It was literally for keeping billions of euro of our money, our deposits, on deposit with the European Central Bank at 4.25% interest and then charging customers here among the highest mortgage interest rates in the European Union. This is very easy and very nice money if you can get it. We do not have any idea how much profit the non-banks or vulture funds are making, but given they are charging people even more than the banks are, in some cases 7% or 8%, it is a safe case that they have even higher profit margins than the banks.

We in People Before Profit have always said, exactly as Deputy Boyd Barrett has said, that we do not need these vulture funds. If we can drive these vulture funds out of Ireland, all the better. We do not agree with Michael Noonan of Fine Gael who said "vultures provide a very good service in the ecology [because they clean] up dead animals that are littered across the landscape". He welcomed the vultures into this country with open arms. We think that is an offensive way to talk about the 95,000 families in this country with mortgages owned by vulture funds. The kind of service they need is not a carnivorous vulture that feasts on human misery but a not-for-profit banking system run as a public utility, a publicly owned banking system that actually provides people with a reasonable service by giving them access to credit without ripping them off or making their lives hell and, similarly, gives access to credit to small businesses. All of that is too much to ask of this right-wing neoliberal Government.

I will give a couple of examples of what this looks like, because in refusing to cap mortgage interest rates, the Government is saying to the 95,000 households with vulture funds, in particular, that it is going to leave them with these vultures and that it is, effectively, throwing them to the wolves. I give an example of a woman I met a few months ago who lives in west Tallaght in an area of significant deprivation. She owns her house and had, like many people, a crisis. She was with Ulster Bank and went into a personal insolvency arrangement and did everything she was meant to do. She paid all of the money she was meant to pay and then, effectively, when she was coming to the end of that arrangement, Ulster Bank was very clearly preparing to sell the mortgage on to a vulture fund, Promontoria Scariff. As a result, her mortgage interest rate has shot through the roof. In June 2023, she had an interest rate of 3% and was paying just over €1,000 a month. Since then, she has had three interest rate increases and is now paying 5.25% and almost €1,400 a month. This is an increase of €300 a month in the space of less than a year and an increase in her outgoings at a time of all of the other aspects of the cost-of-living crisis.

I will give another example of a woman who contacted me to say that her loan was sold a few years ago to Start Mortgages, which is now transferring to Mars Capital Finance, and she is paying 7.5% on her interest-only mortgage. She is 60 years old and can see no way of getting out of it. She says all they want is money and her house. That is the point with these vulture funds. I was talking to somebody today about something unrelated and he said that now that his mortgage was with Pepper, the minute he misses something, Pepper is on to him. It simply wants a chance to take people's properties and homes off them.

If the Government will not cap mortgage interest rates at 3%, will it at least stop vulture funds from charging working people so much more than the main banks?

What possible justification can there be for allowing this to continue? Why, 16 years after inviting these companies in, is the Government still refusing to take on the vultures and instead take the side of ordinary people? Not only that, why is it continuing to entice in more and more foreign capital rather than using the €65 billion surplus it has to invest in public, social and affordable housing for all?

Yesterday, the Department of Finance published a report stating that €20 billion in housing finance will be needed annually to build the 50,000 new homes a year it says we need. Despite having a massive €65 billion surplus over the coming years, its plan is for 80% of that €20 billion to come from private capital and only 15%, or €3 billion, to come from public money. That means ignoring the recommendations of its own Housing Commission that at least 20% of the housing stock should be public. It means, just as now, that the housing of the future will be private. It will be expensive because relying on private capital to build housing means housing will be an asset built to maximise profit for developers, banks and vulture funds and not to secure the affordable decent homes that people need and should have access to as a fundamental human right.

Our Bill seeking to cap mortgage interest rates at 3% is a small intervention to end the merry-go-round of a boom-and-bust cycle of private housing and the finance market. It seeks to set a limit on the gouging of mortgage holders by banks and vulture funds and to provide that banks, which are making €4 billion a year in profit and received billions of euro in bailout money, and vulture funds that feasted off the crash, should have to give something back and that at least some limits should be placed on their gouging of those workers who bailed them out.

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