John Crown (Independent)

I support the proposals put forward by Senators Marc MacSharry and Thomas Byrne. The key message that must go out from this House is that, collectively, the body politic understands the effect, at a micro level, of what has happened at the macro-economic level. We must demonstrate an understanding that decisions made at high levels which led to major economic problems have had serious consequences for individuals. The message must be that the same level of consideration we are giving and seeking at national and international level for our national debt problems will be applied to individual citizens of our Republic who find themselves with unsustainable debt burdens which could lead to the loss of their family home. I have offered suggestions in this regard which I hope we will pursue in the autumn. They include the mobilisation of personal pension funds and the repatriation of foreign-held national pension assets which could be used domestically if an appropriate, modest bank were set up with some portion of the funds.

The Taoiseach and the Minister for Finance have appropriated a certain amount of credit for the renegotiation or rescheduling of our national economic commitments. They have done on a larger scale what Senator MacSharry and his colleagues are proposing we do on a smaller scale for individual citizens. The recent changes to the terms of Ireland's EU-IMF deal are essentially the slipstream collateral benefits of Greece allowing the mortgage on its national home to be put on an interest-free basis for several years. We found ourselves in the same continental ghost estate as Greece and, as a result, a certain amount of collateral benefit accrued to us. These are the same types of arrangements that some distressed home owners in this State have been offered by their banks and the same type of renegotiation of mortgage terms that this legislation proposes should be extended to all distressed home owners.

A rather vicious disinformation campaign is being waged in those countries that provided the assets which were unwisely given as loans to Irish home owners. The basic thrust of this disinformation is that we were irresponsible, dissolute, feckless drunks who borrowed the savings of German hairdressers to go on a ten-year binge of oysters, Mercedes and holidays in Marbella. On a point or order, I understand "feckless" is an appropriate word for use in the Chamber; it would only be inappropriate if I were to omit the "less" part. We all know that is not an accurate portrayal of what happened in this country or of the behaviour of the great majority of people who now find themselves in distressed circumstances.

The great bulk of the debt which was ultimately incorporated into our banking bailout, and which has become the noose with which we are being strangled internationally, arose as a consequence of the decision by a large number of individual citizens to do as their parents, grandparents and great-grandparents had done, namely, to purchase a house. They did not necessarily buy plush mansions or lavish palaces. In general, they bought the same types of houses their ancestors had bought, the difference being that they paid grossly inflated prices for them. They did so because they were advised by professionals, who had a fiduciary responsibility to provide good advice, that the old rules had changed, that one no longer had to think in terms of two and a half times one's salary but instead should aim for a multiple of three, four or five. People were no longer limited to borrowing 80% of the purchase price and in some cases were lent more than 100%.

People did not necessarily make irresponsible personal decisions. While everybody who purchased a home at an unwisely inflated price - I include myself in that group - has a degree of personal responsibility, the reality is that for many of our citizens, they did it because the very priest class of advisers - bank managers, mortgage advisers, accountants, people whose advice one could trust on the basis that they knew more than oneself about these matters - told them the rules had changed. All we are doing here is seeking to apply the same justice and logic to individual home owners that we are asking, on the macro scale, of the Germans, Finns and French. Authorities in those countries also had a fiduciary responsibility to their pension fund holders - the German hairdressers and so on - to invest their funds wisely; instead, they invested in the bubble Irish real estate market. We are asking that the same level of consideration be shown to distressed home owners that we are asking others to show to us.

I welcome and support the legislation. We must give high priority to the issue of family home protection by way of this and other measures in the coming year.