Seanad debates

Wednesday, 22 June 2011

6:00 pm

Photo of Ivana BacikIvana Bacik (Independent)

I join colleagues in welcoming the Minister of State to the House. I thank him both for his commitment to the House and for his thoughtful and considered response to the issues raised in the motion. The Labour Party is delighted that he responded to the content of the motion and to the broader issues it raises of how we deal with the huge social and economic problem of mortgage holders in significant difficulty with repayments. We thank him for that.

I pay tribute to Senators Hayden and Moloney for raising this issue within the Labour Party and for bringing it before the House. We have had a strong debate on the motion in the best tradition of the Seanad. We framed this as a non-partisan motion aimed at trying to generate discussion on ideas and creative and constructive solutions to deal with this problem. It is deliberately reflective in tone and we are grateful to Opposition Members who indicated their support for the motion and who mostly addressed it in the non-partisan manner in which it was intended. Like Senator Gilroy, I am trying to refrain from partisan comments. We all accept that this is a matter of deep concern to everyone, whatever the genesis of the problem. We have a strong view on that but we are trying to suggest solutions in this debate.

The difficulty is the growing scale of the problem. As Senator Hayden said, repossession, which is generating so much distress for families and individuals, is the great fear and there is anxiety that there will be a large number of repossessions. That point is made in the programme for Government. As the Minister is well aware, under the section dealing with housing and distressed mortgages the recommendations of the Cooney report, which he has addressed in such detail, are inadequate to address the scale of the current crisis. That is the real difficulty and that is the reason we are putting forward more radical proposals for consideration by the Government. We thank the Minister for his response to the proposals we have raised.

Turning to those proposals, and again I pay tribute to Senator Hayden and Senator Moloney, in particular Senator Hayden's years of experience with Threshold, the housing agency, there is an interest and a great deal of merit in exploring the Scottish scheme further. That is the scheme set up by the Scottish Government under its homeowners support fund which offers supports to householders with a view to ensuring families are kept in their own homes and ensures better use of public money rather than simply putting it into the rent supplement currently eating up so much of our public finances here. It is to try determine how we can keep families in their homes, take pressure off social housing lists and target funding in a more effective way and in a way that addresses the real needs of families. In that regard, the two schemes outlined in the motion and which were outlined in more detail by Senator Hayden have great merit.

The mortgage to shared equity scheme, where the Scottish Government takes a financial stake in a home but the applicant continues to own the home, live in it and have the responsibility of maintaining and insuring it but with a reduced amount due to their lender each month, has huge merit. The Minister pointed that the difficulty with adapting that scheme in the Irish context is that it generally depends on the owner having a loan not exceeding 75% of the value of the home. Where a large number of mortgages are in negative equity the scheme would have to be adapted. Changes would have to be made to ensure it would work here but, equally, there will be people here in difficulty with mortgages who have built up sufficient equity in their home to whom the mortgage to shared equity scheme could apply.

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