Enda Kenny (Mayo, Fine Gael)
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I propose to take Questions Nos. 8 to 11, inclusive, together.

The Economic Management Council has met 62 times since its establishment. The members have met 25 times so far this year, most recently on 12 July, and have met 12 times since the Easter recess. The Government has been working closely with the Irish banks to ensure that the banking sector supports economic recovery. The members of the council last met with the banks on 26 June. The general topic of the meeting was mortgage arrears and new mortgage lending. The timing of the meeting coincided with the Government's decision to publish the personal insolvency legislation. During the meeting, members of the council took the opportunity to set out the Government's commitment to assisting those in mortgage arrears and set out our strategy to address mortgage arrears difficulties. The council also took the opportunity to seek assurances from all of the banks that they are fully committed to addressing the mortgage arrears of their customers.

Gerry Adams (Louth, Sinn Fein)
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Did the Taoiseach deal with the issue of tracker mortgages with the banks?

The European Central Bank cut rates earlier this month but most of the 250,000 variable rate mortgage holders are not expected to benefit from that. AIB, EBS, National Irish Bank, Bank of Ireland, KBC Bank and Irish Nationwide are still considering whether to pass on the latest cut. Did the Taoiseach take the opportunity to raise that matter with the banks?

Did he raise the issue of bank branch closures, which will have a significant social consequence, particularly in rural areas? According to the figures, upwards of 200 bank branches are threatened with closure, which will make it difficult for people in rural communities to bank locally.

When the Taoiseach has replied, I would like to come back with another question if I may.

Enda Kenny (Mayo, Fine Gael)
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The Economic Management Council has met with the banks on a number of occasions. On the last occasion we had a series of questions about SME credit, including how banks are ensuring that their targets will be met, whether they are taking practical initiatives to assist SMEs in obtaining credit, and whether they show a willingness to implement and support the Government's initiatives as set out in the action plan on jobs. There was also a discussion on the Government's proposed microfinance agency and the partial loan credit guarantee report on freeing up access to credit for small businesses.

With regard to mortgage credit, we asked how banks were ensuring that credit is available to support the Government's budget initiative on first-time buyers, whereby they will have access to mortgage interest relief this year and for years to come if they buy in 2012, but not if they buy in 2013. We asked what checks and balances there are to ensure that conditions on mortgage credit are fair, balanced and not unduly restrictive. We also asked the banks for an analysis of the differences in what is happening in the various regions. In some parts of Dublin city house prices have begun to rise to a small extent, while in other areas prices are continuing to fall or there is a slight fluctuation.

We want to see banks supporting the mortgage interest relief initiative. We sought examples of how banks were dealing with difficulties in regard to mortgage arrears, asked whether they were sitting down with customers to work out solutions in these cases, and asked about their implementation of the Keane report.

At the last meeting, we indicated that we intended to publish the Personal Insolvency Bill and two days later the banks came out with a range of facilities they were offering. That is part of a regular process of meetings with the banks to ensure that the focus is kept where it should be. The pillar banks are both committed to lending €3.5 billion of new money this year. That is for approval for new loans as distinct from loans that are not drawn down. I hope the banks will keep to those targets.

Banks have been encouraged to get back out into the workplace and inform people that they have money to lend, which is available under the normal rules. The Deputy asked for examples of the types of business that have been funded by banks. While funding is not as extensive as one would wish, it is beginning to happen. I hope that will continue. It is a measure of the confidence that is returning to the indigenous economy, which has been very flat for quite some time.

In moving around the country, I have seen that in general the number of new business start-ups is quite encouraging. I know that some businesses have gone to the wall but there are also people who are putting their money where the challenge is. They are measuring up and starting off new small and medium-sized businesses. It is great to see people who are prepared to put their own money into initiatives where they can get access to credit and employ up to ten people where they see such opportunities.

Gerry Adams (Louth, Sinn Fein)
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I appreciate that the main focus of the Taoiseach's meeting concerned the Government's Personal Insolvency Bill. Sinn Féin has welcomed the publication of that legislation but we are disappointed that the banks are being allowed to have a veto. Would the Government consider an independent agency, as we have sought, which is empowered to enforce legally binding settlements on debtors and creditors?

Did the banks give the Taoiseach an assurance that they would work within the terms of the Bill and engage constructively with mortgage holders?

Has the Taoiseach had any opportunity to consider the apparent change in the European Central Bank's policy on burning senior bondholders? If press reports of remarks by the ECB president, Mr. Draghi, are correct, this would be a significant change. Has the Taoiseach had an opportunity to consider the matter? Can he cast any light on reports that Mr. Draghi's proposals for the Spanish banks were rejected by EU finance ministers? I do not know whether that is true, but perhaps the Taoiseach has an inside line on it.

Enda Kenny (Mayo, Fine Gael)
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To answer the Deputy's first question on the Personal Insolvency Bill, I met with a number of representatives of Money Advice and Budgeting Service organisations around the country, which have been dealing with debt and distress arising from credit cards, car loans and other financial issues, as distinct from mortgages. If people wish to go down the road of personal insolvency under the legislation, a personal financial statement must be prepared. Under the legislation, they have access to skilled accountancy expertise for two hours, which is paid for by the banks. At that stage, they are required to put up all the information about their indebtedness. The point made by MABS was that it would prefer a more comprehensive response. If someone is going down the road of personal insolvency resolution, all indebtedness must come to light, including the expertise that the MABS personnel had been dealing with, together with the expertise available from accountants, which will come from a panel of accountants.

As far as the ECB is concerned, the matter was discussed at the eurogroup meeting. There were differences of opinion and the matter has not been finalised. Ireland has paid off most of the bondholders for the past number of years. The requirement is for Ireland to get the best deal it can on the outcome of European Council meeting, where the eurogroup was charged with putting flesh on the decision. That is part of the reason the Minister for Finance is in Frankfurt speaking to Mr. Draghi. This country has paid off the bondholders but, in the case of Spain, I understand it is talking about banks that would become defunct. The impending crisis meant the Spanish Government of the day encouraged people to save and some of those savers may get caught in that situation if it was to apply in Spain. Irrespective of the decision on Spain, we want the best possible deal for our restructuring of debt. The fact the European Council meeting made a specific point about equality of treatment is important. At the eurogroup meeting, that was followed by similar requirements in respect of Ireland. The matter has not been concluded. Members are aware of the statement of Commissioner Rehn that he would like to see this concluded for Ireland by October. The approach has been endorsed by Commissioner Barnier, the IMF and Europe, which has been far more supportive of the challenge faced by the Irish people in regard to safeguarding Europe and meeting the challenge. Now is the time for analysis and negotiation so we can have the best deal possible secured for our people arising from these negotiations, which will take place between now and October.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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There was widespread disappointment at the Personal Insolvency Bill. It failed to do what should have been done, which is to provide for the writing down of unsustainable mortgage debt left on the backs of people through no fault of their own. It happened because of the pumping up of the property bubble by the banks, the developers and their friends, Fianna Fáil, in government at the time. People have been left with this disastrous situation, which is no fault of their own. They hoped there would be real relief in writing down the debt and recognising it was a debt artificially created by the greedy and imposed on the back of people who want nothing more than to put a roof over their heads. Instead, there is an arrangement-----

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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We are not discussing the Personal Insolvency Bill. Deputy Boyd Barrett should ask a question.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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-----where the banks have a veto and the last say. Is this the meeting where the Taoiseach decided to give the banks the last say? They seem to have the last say on everything. Is this the meeting at which it was all agreed, whereby the bank said that any debt settlement arrangements and insolvency arrangements would be subject to the banks having the last say and the Taoiseach just accepted it? It is a pretty poor show given what the banks have done and are doing to this country. Once again, they come in and tell the Taoiseach what to do and he obeys.

Did the Taoiseach invite distressed mortgages holders to the meeting? Did he invite the credit unions, which are more in touch with ordinary people? There will be no debt write-downs for them and no bailout but the banks get the bailout and still do not engage in debt write-down.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Can the Deputy stick to the question?

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Did the Taoiseach talk to ordinary people affected by this problem or did he listen only to the banks?

Enda Kenny (Mayo, Fine Gael)
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I am not too sure Deputy Boyd Barrett would recognise a happy day if he saw one. Does he think we live at one remove from ordinary people? Does he not think people walk in to the offices of members of Government parties to talk about their problems? Does he not think they express their concerns, anxiety and distress about the challenge they face every day in their lives? They do, and the Personal Insolvency Bill is an incentive for banks to get on with it. They have been recapitalised to the extent that they can deal with mortgage arrears, mortgage distress and people's concerns. At the Economic Management Council meetings, we have encouraged the banks to put teams together to sit down with people, to work out solutions from the Keane report or from another facility, such as mortgage to rent, split mortgages, mortgage to lease or part write-downs without having recourse to personal insolvency. There is a real incentive for the banks and lending institutions to sit down with their customers and work out individual solutions. That is what it takes because a particular formula does not fit every case. Each case is different given the human circumstances, where the people live, and whether they are working. We encourage that process.

In the case of Deputy Boyd Barrett, impossible is the measure of his satisfaction. I do not know who Deputy Boyd Barrett meets in his constituency or whether he has a good word to say about anybody ever. We tried to help in the best way we can those who are in distress and who have concerns and anxieties. For Deputy Boyd Barrett to suggest you do not meet people like this everyday is complete and utter nonsense.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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I will talk about this issue in more detail later in the week. I got my brief on the Bill from someone who is in mortgage distress.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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We are not talking about Deputy Boyd Barrett's brief.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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I went to someone in the situation of unsustainable mortgage arrears-----

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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We are talking about a meeting of the Economic Management Council.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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-----and I asked the person to read the Bill and provide me with a critique of it. The person said the Bill was rubbish because it left the power in the hands of the banks.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Deputy Boyd Barrett can make that point on Second Stage.

Paul Kehoe (Wexford, Fine Gael)
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Deputy Boyd Barrett finds everything to be rubbish.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Was it at this meeting that the Taoiseach gave the banks the veto? Why did he not tell them that the Government was going to tell the banks what to do and that it was going to impose fair debt settlement arrangements because the Government is now the boss of the banks and, having recapitalised them, they should serve the people rather than their own interests? Why did the Taoiseach not do so? Why did he allow the banks to have a veto? Did the banks tell the Taoiseach that at the meeting?

Enda Kenny (Mayo, Fine Gael)
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They did not. I am sure that if Deputy Boyd Barrett sat down, as he knows most things, he could have devised a solution for the person he is talking about.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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I spoke to someone affected by the problem.

Mary Mitchell O'Connor (Dún Laoghaire, Fine Gael)
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We know about that.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Why did the Taoiseach not get such people to write the Bill, not the banks?

Enda Kenny (Mayo, Fine Gael)
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The Personal Insolvency Bill is one of the most complex items of legislation to come before the House in many years. Leaving aside the Bill, the fact that banks were recapitalised to the extent they were-----

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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By us, the people.

Enda Kenny (Mayo, Fine Gael)
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-----the fact that the Keane report produced recommendations on how to bring about a resolution for distressed mortgages and those in arrears and in difficulties, is the reason the lending institutions have an incentive to sit down with everyone and work out an individual solution for each case. There are those who have had solutions worked out where the house is not being taken from them, where one of a variety of things has been put in place and people know they will have a roof over their heads and have a sense of an end in sight for their problems. It works both ways because people make adjustments and the lending institutions make adjustments. That is why the taxpayer recapitalised banks to that extent. Banks said they need to put teams of competent people in place in order to do so. The trend in banks for many years was to throw out money. The more they threw out, the more they got paid. This seemed a complete contradiction and certainly led to this country standing on the cliff edge. I share the Deputy's view in that regard.