Martin Conway (Fine Gael)

We started the day on a very positive note and we are preparing for our holidays. It is somewhat ironic that our last bit of business is this major issue which affects thousands of people. I commend Senator MacSharry for this Bill. I assure him I read his letter and I have studied this proposal which I regard as a genuine attempt at a solution and he has put substantial work into its preparation. It deals with a very important issue and he must be commended for raising the debate and setting the agenda. I do not think anyone has the solution yet, neither the Government nor the Opposition nor anyone else. In my humble opinion, there eventually will be a write-down in mortgages for ordinary people because it was lulu, Monopoly money that existed back in the mid-2000s. As was quoted by a previous speaker, the cost of €104,000 for a three bedroom semi-detached house in Dublin increased to €516,000. That €516,000 did not really exist; it was borrowed when there was no logical reason for lending it. Section 6 is very interesting. Fifty per cent of mortgages given out at a certain point in the past decade would fall into that category as described in subsection 6(2). Were they to be stress-tested and tested in court, it would show that all sorts of shenanigans and fraud took place regarding the preparation of the documents. It is unreal that, for instance, overtime payments and travel expenses were taken into consideration when evaluating a person's income. There is no such thing as a permanent job anymore and yet, overtime and travel expenses were being taken into consideration when deciding to grant a mortgage. This shows how nonsensical the situation had become.

I know of at least two cases in one of the major banks where accountants fraudulently prepared income and expenditure for applicants and this is appalling. There is much merit in section 6. There should certainly be stress-testing of impaired mortgages. I refer to section 6(1) which proposes an interest-only period for a maximum of four years and the write-down of the value and the extinction of the time period. Many of the measures in these proposals have been happening for people entering into negotiations with their banks and once a case goes to court it is beyond such negotiation. I dealt with one case where a mortgage had been an interest-only payment since 2005 and now the person cannot even fund the interest-only payment. There is significant merit in the proposals but we probably need to be make more fundamental and radical changes.

The economic management council is a good idea and it has worked. We have seen what has happened in Brussels and I commend all involved.