Terry Leyden (Fianna Fail)

I raised on the Order of Business and with the Minister for Finance and the Taoiseach at a meeting of the Fianna Fáil parliamentary party today the issue of the number of young people with fixed rate mortgages. There are mortgages and there are mortgages. However, the Government must step in when a young couple are or single person is effectively locked into a fixed rate mortgage when all about them are falling towards 2.5%.

I bring to the attention of the House the behaviour of a number of operators in the sub-prime mortgage market in this country. I am familiar with one case in particular where Start Mortgages was delighted to advise one customer that it was reducing their rate to 6%. I wish to read to the House how Start Mortgages markets itself. Its website refers to open-minded lending.

At Start Mortgages we offer finance to people who have been unsuccessful in getting a mortgage from the main banks and building societies. Start Mortgages understand that people often face financial ups and downs for reasons outside of their control. We believe that these circumstances should not prevent you from getting a mortgage.

On Monday, 16 February this year, out of the 15 applications made that day to court for repossession, 12 were made by Start Mortgages. On 12 January, two thirds of applications made that day for repossessions were made by Start Mortgages. Understanding my foot.

I suggest, like Mr. Sutherland, that the authorities take a realistic view of cases involving those caught up in the sub-prime market. That might be done through some form of goodwill gesture by the operators or by having lines of constructive communication. I would like to see mortgage companies dealing with repossession orders case by case. I call for an immediate reduction to competitive rates and the introduction of some mechanism or facility whereby those on exorbitant fixed rates can switch to a variable or modified variable rate. In addition, there should be a stay on repossession orders. As we approach Easter and the local and European elections I have no doubt these issues will require much consideration.

The State is now the owner of Anglo Irish Bank. We own 25% of Bank of Ireland and will soon own 25% of AIB. We are now in a position to give people an opportunity to switch from fixed interest rate mortgages to variable rate mortgages. A small fee may be required to pay for the changeover but people should be given the opportunity, especially given that it appears interest rates will remain at a low level for a long time. It would give a tremendous boost to young couples, individuals and families.

As I stated on the Order of Business this morning, the Financial Regulator has not been doing its duty in respect of Start Mortgages, which operates in Dublin and Derry. There should be an investigation into the company's conduct regarding the sub-prime market. I know an individual who is required to make a repayment of €1,100 per month but is unable to do so. The company will not benefit by repossessing houses such as his. It is imperative that companies negotiate, extend the mortgage periods and reduce the interest rates. It is as simple as that.

Many issues arise on foot of the budget. The one that impressed itself on me most was not the reduction in Members' pensions, which has been accepted by everyone, although the individuals affected paid into a scheme, but the withdrawal of the double payment of social welfare benefits at Christmas. This is of great concern. I recall a period during which a 50% bonus was paid at Christmas and a period during which a 75% bonus was paid. I will not raise expectations as this is a very serious budget and I will not make any false promises or commitments but I believe that, as we approach the October budget, we should review all Departments' expenditure to determine where savings can be made to fund the bonus. It is a very welcome bonus for those on lower incomes. I welcome the fact that we have the highest social welfare rates in respect to unemployment benefit and pensions. However, all Departments could examine their budgets before October and determine whether it will be possible to review the decision on the Christmas bonus. I welcomed Senator Hanafin's request in this regard.