Seanad debates

Tuesday, 25 September 2012

2:30 pm

Photo of Darragh O'BrienDarragh O'Brien (Fianna Fail) | Oireachtas source

I request numerous debates, many of which are refused. In general I take the Leader's point. As the situation in Syria is very serious it is important that the House discusses it properly and puts forward its view.

Yesterday, thousands of mortgage holders received a letter from the ICS Building Society and Bank of Ireland, dated 31 August. That letter informed them that Bank of Ireland and ICS Building Society, part of the Bank of Ireland group, are increasing their variable mortgage interest rate by 0.5%, that ICS Building Society has a new lending rate of 4.49%, a net increase of approximately ¤100 per month on a ¤300,000 mortgage. The situation is getting out of control. CSO figures issued last week indicate that 83,251 mortgages, nearly 11% of private residential mortgages, are in arrears of 90 days or more, a further 40,000 have been restructured and 65,700 are in arrears of 180 days or more. The Central Bank report states that increasing the higher variable rates to compensate for the losses incurred by ICS and Bank of Ireland on tracker loans is a risk which may be counterproductive and continue to exert upward pressure on arrears. Everyone in the House will be concerned about this issue. The pressure that the rate increase exerts on mortgage holders and families is becoming extremely hard to bear and they are at breaking point. Numerous people have been in contact with me about it. I telephoned ICS yesterday.

After waiting almost 25 minutes to get through, the first choice one is given is to press No. 1 on the telephone if one has a difficulty with one's mortgage or envisages having a difficulty with it. There will be many more people pressing the No. 1 button after this increase. When I eventually got through I asked the bank's representative why the bank, in the letter it sent to mortgage holders, did not give a justification for the increase. The person said it was due to the cost of covering the bank's increased deposit rates, which is nonsense and, frankly, a lie.

I ask the Leader to arrange for a proper, non-partisan debate on the ongoing mortgage crisis. There has been an increase of 50% in arrears since last June. If ICS, Bank of Ireland and the public interest directors in Bank of Ireland think that asking an average mortgage holder to pay ¤100 net more per month will get them out of a hole, be any good for their customers or will improve the arrears situation, they are living in cloud-cuckoo-land. This cannot be allowed to continue. The taxpayer owns 15% of the Bank of Ireland and ICS group and that institution is still covered by the bank guarantee. Now, however, tens of thousands of mortgage holders have received this arbitrary statement, which the bank did not even have the guts to give to the media. The fact that the bank sent a letter dated 31 August which arrived in people's houses on 24 September is a joke.

I believe we must give time to this issue. We should schedule a debate this week with the Minister for Finance, Deputy Michael Noonan, or the Minister of State, Deputy Brian Hayes. Perhaps they could tell us whether the Central Bank has received from the lending institutions their long-term mortgage arrears strategy and the list of new products they will be offering, something for which the Government set a time deadline of 30 September. This crisis cannot continue. People cannot afford these mortgage interest rate increases. With the ECB base rate at 0.75% why do Bank of Ireland and ICS believe they can charge 3.5% more to their clients, who are already put to the pin of their collars? It is an absolute disgrace and it requires more than me, the Leader or Government Ministers saying it is terrible. It requires action, once and for all, because there is no doubt that people are at breaking point.

I ask the Leader to arrange an urgent debate this week and show that the Seanad will deal with this matter. I hope the Leader can refer back to me tomorrow with a scheduled time for a debate on it in order that we can ask the Minister what the public interest directors are doing in Bank of Ireland if they are not protecting the public interest.

Comments

No comments

Log in or join to post a public comment.