Gerry Adams (Louth, Sinn Fein)
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1. To ask the Taoiseach when the Cabinet Committee on Mortgage Arrears and Credit Availability will next meet. [47672/13]

Gerry Adams (Louth, Sinn Fein)
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2. To ask the Taoiseach when the Cabinet Committee on Mortgage Arrears and Credit Availability last met; the number of meetings that have been held in the past year. [52532/13]

Joe Higgins (Dublin West, Socialist Party)
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3. To ask the Taoiseach when was the last time the Cabinet Committee on Mortgage Arrears and Credit Availability met; and when it is scheduled to reconvene. [7497/14]

Enda Kenny (Mayo, Fine Gael)
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I propose to take Questions Nos. 1 to 3, inclusive, together.

The Cabinet committee on mortgage arrears and credit availability met on 20 January 2014 and has met on nine occasions since January 2013. I anticipate that it will meet again in March.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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I call Deputy McDonald on behalf of Deputy Adams.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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The Taoiseach has told us that the committee has met nine times since 2013. I would like him to confirm that.

Enda Kenny (Mayo, Fine Gael)
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That is correct.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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It met in January and the Taoiseach proposes that it will meet again in March. That does not suggest any great sense of urgency on the part of the Cabinet in respect of this issue. According to the Central Bank's figures more than 140,000 families are in arrears but those figures do not include buy-to-let properties. It seems to me the Government has made no real impact on reducing the numbers of families experiencing mortgage distress. For instance, in September 2009 the number of families in arrears for more than 90 days was approximately 3.3%. The latest statistics show that this figure has increased to 12.9%. Rather than having a solution to this matter we are seeing an escalation of the crisis for families and householders across the State.

The number doubled in the last 18 months of the previous government and it has doubled again in the first two years of this Administration. A research paper by the Central Bank analyst, Yvonne McCarthy, states that three-quarters of all homes in mortgage arrears have at least one person in employment. That is interesting because it means that mortgage distress touches not just those thousands of unemployed people but also those in work. Ms McCarthy notes further that when one examines the figures, employment is not always secure. That raises all sorts of issues concerning security of employment, the misuse of flexible work arrangements and zero-hour contracts.

The Taoiseach amended the Land and Conveyancing Act in such a manner as to leave home-owners at the mercy of banks when the threat of repossession looms. The code of conduct on mortgage arrears has removed some of the protections the code originally offered to home owners. There are also issues around the personal insolvency regime, which was much lauded by the Taoiseach. For many people, however, it is not fit for purpose.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Perhaps we could have a question.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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This does not add up to a confident scenario. Why is this Cabinet committee not meeting until March? Is there not an argument for more regular meetings? What is being done to add a new dynamic and urgency to dealing with this issue? The Taoiseach has said time out of number, both here and elsewhere, that this is one of the great crises facing our people.

If this is one of the great crises facing our people, we do not deduce it from the record of meetings and the actions of the Government.

Enda Kenny (Mayo, Fine Gael)
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I am more interested in taking decisions and action rather than just having meetings. We tend to meet on a monthly basis and devote one Monday in the month to seven or eight Cabinet sub-committee meetings. They start at eight in the morning and go through the day. That is why the committee will meet again in March. It is sometimes interfered with by requirements to attend meetings elsewhere.

The Personal Insolvency Act 2012 has been passed and the legislation introduced three new forms of non-judicial debt settlement arrangement. The Act also reduces the automatic discharge period of bankruptcy from 12 years to three years. The Insolvency Service of Ireland, ISI, was established to regulate the new debt settlement arrangements and it is open to accept applications from applicants in September 2013. As of February, there are 111 personal insolvency practitioners who develop debt settlement arrangements and personal insolvency arrangements. These are two of the debt solutions. There are also 63 individuals capable of acting as approved intermediaries who can develop a debt relief notice. The insolvency service has indicated that there are hundreds of cases in the pipeline at different stages of verification by the ISI before it can be forwarded to the court for a decision. The court may issue a protective certificate, which offers debtors legal protection for a period of 70 days, during which time an arrangement between the creditor or creditors and the insolvent debtor can be put together. To date, two debt relief notices, two debt settlement arrangements and one personal insolvency arrangements have been approved. There is, as yet, no definitive evidence of any banks vetoing proposals. There is some evidence that some banks are trying to reach arrangements with clients short of entering into a formal insolvency process. Banks are clearly becoming more focused in their attempts to reduce the mortgage arrears book and the existence of the ISI is helping as a catalyst in this process.

Since March 2013, the Central Bank has set quarterly targets for six banks to make offers of sustainable solutions, and I mean sustainable solutions, to customers with arrears in excess of 90 days. These banks are Allied Irish Banks, Bank of Ireland, Permanent TSB, Ulster Bank, ACC Bank and KBC Bank. The Central Bank has conducted an audit of the banks quarter 2 2013 results and found the banks have achieved their targets for sustainable solutions of 20% of those in arrears for 90 days or more. At the end of September 2013, the lenders in total report that they had issued proposals to 43% of mortgage accounts in arrears, as against a target of 30%. The Central Bank will shortly make undertaken audit of the banks progress against quarter 3 and quarter 4 targets for 2013.

The introduction of the mortgage to rent scheme, which facilitates families to stay in their homes through the transfer of ownership to a local authority or an approved housing body is another issue. To date, almost 1,975 cases have been put forward by the lenders and, of these, 1,360 are being followed through.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Is that mortgage to rent?

Enda Kenny (Mayo, Fine Gael)
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In addition, the Minister of State with responsibility for housing, Deputy Jan O'Sullivan, announced a new €20 million fund to allow local authorities to offer the mortgage to rent scheme to local authority mortgage holders with unsustainable mortgages.

Deputy McDonald also mentioned arrears. The total number of mortgage accounts in arrears has fallen by 5,833 between August and December of last year. The number of mortgage accounts in arrears of greater than 90 days has fallen from 82,624 to 79,782, a drop of 2,842 compared to the end of August. The number of total temporary restructures continues to fall and this indicates a move towards greater utilisation of permanent solutions. The total number of permanent restructures has risen by 9,952 up to December. There has been a significant rise in the split mortgages arrangements, from 2,500 to 6,239. The Central Bank mortgage arrears statistics reinforces the picture of a gradual improvement, although not as quick as one would like. Figures for quarter 3 to end of September in 2013 show that the number of mortgage accounts for principal dwelling houses in arrears fell from 142,892, or 18.5% of the total stock, to 141,520. That is the first decrease since the Central Bank series began in September 2009.

Deputy McDonald mentioned mortgages being sold to portfolio buyers and suggested they would not be regulated by the code of conduct on mortgage arrears, CCMA, of the Central Bank. The Deputy is aware that the sale process for the IBRC residential mortgages is currently under way. The final bidding date is 14 March 2014 and the continued application of the Central Bank code of conduct on mortgage arrears in respect of the IBRC residential mortgage portfolio depends upon the regulatory status of who acquires the portfolio at the end. In 2012, GE Money sold its residential portfolio of approximately 3,500 mortgages to the Australian company Pepper Finance Corporation (Ireland). As the group acquired the entire servicing platform from GE Money, the acquired entity remains regulated and CCMA continues to apply to the transaction. In December 2013, Lloyds Banking Group sold its Irish residential portfolio of 2,000 mortgages to Apollo Global Management. Apollo Global Management met the Central Bank and the Department and indicated clearly that it intended to voluntarily adopt the CCMA to manage the acquired loans. Apollo Global Management believes following CCMA is in the best interests of both and forms part of its core strategy. The Minister for Finance is aware of the concerns of borrowers about the sale of mortgage books to funds not covered by the CCMA. The Minister has instructed his Department to examine the issue in consultation with the Central Bank with a view to bringing forward a solution. Given that it is a complex legal issue, it requires careful consideration so as not to put at risk the application of the code of conduct. We will not know the regulatory status of the ultimate acquirer of the portfolio until the sale process is concluded. The outcome will determine whether we need to do anything. The Fianna Fáil Party proposes to make adherence to the CCMA a condition of the sales process but the insertion of such a condition is legally questionable as it leads to the erosion of the value of the assets from which all creditors must seek proceeds. The insertion of conditions that may erode the value would leave the special liquidators and the State open to challenge and possible compensation.

Under current laws, compliance with the CCMA is a necessary condition for lenders seeking to obtain court orders for repossessions of primary residences. The court will otherwise not allow it. I do not have figures to hand but the vast majority of repossessions have been voluntary. A number have gone down the court route but the vast majority have been voluntary. I can supply the Deputy with up-to-date figures.

Joe Higgins (Dublin West, Socialist Party)
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The inescapable reality is that the Taoiseach has no real appreciation of the huge crisis and distress in the lives of so many of our people as a result of unsustainable mortgages. Over the ten-year criminal property bubble, a generation of young people were blackmailed into paying prices for the simple human right of a roof over their heads, the level of which has now imprisoned them. With the number of crisis mortgages having doubled under this Administration, as the previous Administration did, putting forward that it has reduced somewhat, to just 80,000, as a major step forward does not in any way recognise that these are 80,000 individuals, or often families, who are hugely distressed.

The Government has come up with no alternative of a sustainable variety that would provide a quick way out for those in distress. In his reply, the Taoiseach was at pains in referring to the 13,000 IBRC mortgages to look out for the interests of creditors, or in other words, the financiers that are involved. Their interests have always been put first.

Is the Taoiseach in any way ashamed that his Government is handing over 13,000 individuals and families to vulture funds from God knows where? Despite what he said, these people do not and will not have guarantees if the mortgages are bought by outside interests based in the United States. Is it not the case that those home owners could be subjected, for example, to increases in interest rates and put under intolerable pressure with regard to repossession by means of threats or debt collection agencies pursuing them if the vulture fund wants to change or implement a sell-off in the portfolio?

Is it not quite shocking that as far as the Fine Gael and Labour Government is concerned, the financial institutions, bondholders and the hedge funds which were up to their necks in creating the financial gambling casino that was the international financial markets in the ten or 15 years to 2008 - a cabal that reaped obscene profits on the backs of vulnerable mortgage holders-----

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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We cannot have speeches now, as this is Question Time.

Joe Higgins (Dublin West, Socialist Party)
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They crashed the economy as a result but the Government is now handing over the victims of the crash for further torture to the very people who caused it. Does the Taoiseach not see a massive irony, to say the least, in that?

Some of the outlined solutions, such as split mortgages, are simply a matter of maintaining in bondage home owners into old age and even passing on the debts to their children. Is it not the case that a bold policy is required in the interests of our people rather than the financial markets? It should write down generally to today's prices the level of blackmail mortgage debt that people were forced to take, calibrate downwards monthly mortgage payments and give security to the people now in distress. It should also release hundreds of millions of euro per year into the domestic economy that would otherwise go into dead banks. It would be part of a process of rebooting the economy. Is that not the real issue? Has the Cabinet committee even discussed the IBRC mortgages or will the matter be discussed urgently in order to change the Government's implemented policy?

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Before the Taoiseach replies, I should point out that these questions are purely statistical, requesting the number of times a Cabinet committee has met. The line Minister is responsible for policy. We cannot go on at this rate, as we have spent almost 20 minutes on three statistical questions when other Deputies have important questions. I ask people to recognise that these sorts of issues should be raised with line Ministers rather than during Question Time for the Taoiseach. I ask everybody to be conscious of that.

Enda Kenny (Mayo, Fine Gael)
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I remember when I used to sit where Deputy Martin is now and I would get no answer at all from the Government as there is no requirement to make any answer about Cabinet sub-committees. It is an important issue and I have indicated to Deputies that there can be a series of priority questions regarding particular issues.

With regard to Deputy Higgins's contribution, we are talking about the recovery of the economy. The number of people in work is increasing and the number of people on the live register has been decreasing for 20 consecutive months. That is helping a number of people get out of their mortgage difficulties and provide the opportunity to make progress. I have given the figures to Deputy McDonald. There is a modest recovery in house prices, so that will lessen negative equity, although it does not apply all over the country by any means. It is a small but welcome development.

Deputy Higgins is well aware that at the height of the so-called Celtic tiger we were building 100,000 houses when we needed 30,000 houses per year but we are now building 6,500 houses when we need 25,000 or 30,000 houses per year. To get to a point where we can catapult this goal into action, we must consider where planning permissions were issued that are not suitable for building, where other planning permissions are under consideration and the requirement for good contractors to be able to have a stream of income so as to develop a site and build houses. That requires a lending opportunity from a lender or lenders. There is clearly much pressure for detached and family houses in the greater Dublin area and that will be the focus of housing discussions here and at a special Cabinet meeting I called for next week.

The Deputy specifically mentioned the IBRC. There are legal requirements to maximise the returns in all these cases and at the end of May there were 17,411 residential loans in IBRC outstanding to 13,000 customers. Taxpayers have already incurred far too high a price from this bank and no further costs should be imposed on them. It is important to note that the special liquidators have confirmed that all borrowers are permitted to pay their mortgage at par value and there are no legislative barriers to that. If the bids received are not in excess of the valuation set out, the portfolio will be sold to NAMA. As I indicated to Deputy McDonald, in two previous cases in 2012 and 2013, the full compliance not only of the contracts applicable to the mortgages but also the extra code of conduct requirements set up by the Central Bank were adhered to. The latest interested group has stated clearly that it wishes to be regulated and voluntarily submitted to abide by the codes of conduct if it ends up completing the acquisition. That is the interests of everybody.

The position with regard to repossessions is very clear and I do not accept at all the Deputy's scaremongering tactics and argument that people will have investigators outside the back door telling them to move because the house is in negative equity or the mortgage holder is in arrears. If the bids are not received to value, NAMA will acquire these loans, and it complies completely with codes of conduct. Repossession is the last resort, and as I stated in response to an earlier questions, the vast majority of cases have been voluntarily submitted, as distinct from being a decision of the court. People make up their minds when they identify in their particular circumstances what is the best course of action.

As the Minister for Social Protection has often pointed out, the fact that a person in a household is working allows for a solution to be brought about. The banks have set targets to offer people sustainable solutions by the end of the year and we want to keep the pressure on. This will be the subject of discussions at our forthcoming meeting.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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I will allow very quick supplementary questions from Deputies Martin and Boyd Barrett. They should relate purely to the statistical element. We cannot have a long discussion about policy.

Micheál Martin (Cork South Central, Fianna Fail)
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I will not have such a discussion. When will the committee meet again to specifically discuss those 13,000 mortgage holders affected by the IBRC liquidation, as the Taoiseach has mentioned March? The vast majority of these are rank and file people and they are being thrown to the wolves. They are very insecure and anxious about this issue.

It is remiss of the Government not to have thought something through regarding this cohort of mortgage holders. In essence, their loans can be sold to concerns that will not be regulated by the Central Bank and that will not have obligations under the code of practice. When one talks to people, it seems that those higher up the scale get sorted out and looked after, while mortgage holders do not. Will the committee be meeting specifically on that issue in the very near future?

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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With regard to the meetings the Taoiseach has had or intends to have, will he offer clarification because I did not quite hear what he said? He mentioned a debate or discussion on housing. As he knows, I have called for such a debate for two years. Owing to the mortgage arrears crisis and the potential for people to lose their homes or not to sustain their mortgages, something must be done urgently to provide affordable housing. Council housing-----

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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We are not moving on to affordable housing.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Will the Taoiseach clarify when the discussion by the committee will happen? Will it happen in the Dáil? Has the committee discussed the potential implications of the winding up of the mortgage interest supplement scheme and how it may take more people into mortgage arrears? What will be done about it?

Many people in the mortgage arrears resolution process – I received a letter about it this morning – are saying they are finding it extremely difficult to engage with the banks. One person who wrote to me had engaged an accountant to try to represent him before his bank in regard to updating his mortgage arrears resolution process agreement. He had adhered to it fully, but it was coming to the time of expiration and he was trying to renegotiate it. The accountant received a letter from the Central Bank stating it would not deal with the person's representative because he was not approved.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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The Deputy cannot proceed with this.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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This seems to run contrary to what the Central Bank is supposed to be doing, namely, assisting people in mortgage distress in dealing with the banks, rather than backing up the banks against mortgage holders.

Enda Kenny (Mayo, Fine Gael)
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The Central Bank is the client’s own bank. Obviously, the Minister for Social Protection, Deputy Joan Burton, has made quite a number of significant changes to the way we are dealing with the live register. The extent of mortgage interest payments - a figure of 50,000 comes to mind - was so high as to keep people out of work, despite the fact that getting them into work is the priority of the Government. I do not want to set out what the agenda of any Cabinet committee should be, nor am I entitled to say. Clearly, however, the discussion centred around these issues and the need to require banks to get on with offering sustainable solutions to people with mortgage problems or in mortgage arrears or distress. The targets I have set out have been met.

In the two cases I have mentioned, in 2012, GE Money acquired 3,500 mortgages and complied fully with the code of conduct and the contractual obligations. The same applied in the case of Lloyds. It acquired 2,000 mortgages. It sold its mortgages to Apollo Global Management and voluntarily committed to honouring the codes of conduct set down by the Central Bank. The Minister for Finance has been very clear about this. It is a complex issue which warrants careful consideration. The Minister has written to the Central Bank outlining his concerns. If the bids do not reach the valuation, they pass to NAMA. NAMA complies fully with both the contractual obligations and codes of conduct set down by the Central Bank. As stated, repossession is the last thought in anybody's mind. The objective is to work out a solution in each case.