Gerry Horkan (Fianna Fail) | Oireachtas source

It feels almost like we are at a finance committee meeting between Senator O'Donnell, Senator Conway-Walsh, Deputy Pearse Doherty and a former member of the committee and newly-appointed Minister of State at the Department of Finance, Deputy D'Arcy. I congratulate him. We will see him at a different side of the table at future committee meetings. I wish him the best of luck in his new role.

I welcome the opportunity to speak on the Central Bank and Financial Services Authority of Ireland (Amendment) Bill 2014, which Fianna Fáil will be supporting. However, we would not have supported the move to accelerate the passage of this Bill through the Seanad in one day, as to do so would have made a mockery of Seanad procedure and set a very poor precedent. Sinn Féin wished to push the Bill through the Seanad quickly in one day, but to be fair to Senator Conway-Walsh, she did take on board the concerns of Fianna Fáil and others and decided that only Second Stage would be taken today. We will support Second Stage and as a party Fianna Fáil has supported the thrust of the Bill and what it is trying to do. We know it is a genuine move by Deputy Pearse Doherty and his party in the Dáil and Senator Conway-Walsh and her Seanad colleagues. A lot of the time we work together fairly well on the finance committee.

The Financial Services and Pensions Ombudsman Bill 2017 is a Government Bill on the same issue, and it seems to be a case of one party wanting to claim a little bit of political credit over the other. That is understandable. Committee Stage of that Bill will be taken in the Dáil soon and it covers many of the provisions set out in this Bill.

On the back of the financial crisis and the consumer problems that followed, the Free Legal Advice Centres, FLAC, issued a report on the financial protections for consumers of credit and other financial services in Ireland. Fianna Fáil published a similar Bill before the FLAC report that sought to strengthen consumer protection in the financial services sector. In an open market economy such as Ireland's, a healthy financial services sector and the provision of credit to consumers is essential. Deputy Pearse Doherty’s Bill seeks to provide for the strengthening of the functions of the Financial Services Ombudsman, the consumer complaints procedure and related matters. Overall, we support the intention behind the Bill, as it extends the time limits for long-term financial services similar to section 51 of the Government's Bill.

In 2005, the Financial Services Ombudsman expanded the definition of "consumer". Companies with an annual turnover of less than €3 million and partnerships, clubs, charities and trusts were deemed consumers and could avail of the Financial Services Ombudsman, FSO, process. However, there were concerns with that arrangement. It was believed that the definition was too broad and used up valuable FSO time and resources and, second, that the Financial Services Ombudsman Council may have exceeded its power. The original Bill sought to address those concerns with the use of the term "commercial consumer" and that will be incorporated as part of the Government's Bill.

The Free Legal Advice Centres reported that there has been a lack of evaluation of the various components of the financial service complaints process in terms of effectiveness for consumers. They found a level of complacency in the process. With regard to the fact that many complaints involve alleged breaches of statutory rules, FLAC advised that the term "in an informal manner" should be amended to reflect that.

Currently, as has been indicated, the Act limits the time for a complaint to be made to six years prior so, in other words, any complaint that arrives into the office can only reflect something bad that happened within the previous six years. Senators Kieran O'Donnell and Devine outlined examples of where people bought a product thinking it was one thing but ten or 12 years later they discovered it was not what they thought it was. They want to make a complaint but because the original transaction was older than six years they were limited, as cases outside the timeframe cannot be investigated under the current process. Senator O'Donnell said he would use the term "abused" but it was not a case of the banks abusing the process but pointing to the clause in the law saying they do not have to do such and such. Let us ensure we change the law so that in future that get-out-of–jail clause, or whatever phrase one wishes to use, is no longer there. Let us make sure that people who have genuine complaints can have their complaint investigated and find out whether there is merit in their complaint. I am sure in many cases there will be and in other cases the complaint will not be valid.

The Bill seeks to loosen the situation by inserting another limit which would give consumers a three-year limit from the time they become aware or ought to have become aware of the consequences of the conduct - whichever of the two limits occurs later will be used. That will also be incorporated by the Government's Bill.

When the regulated financial service provider against whom the complaint has been made refuses to engage with the voluntary mediation process, this amendment would compel the provider to provide the FSO with convincing reasons for refusing to engage in mediation.

The Bill seeks to reflect more accurately the nature of the finding by expanding the finding categories. Current categories are: is substantiated; is not substantiated; and is partially substantiated in one or more specified respects but not in others. The new categories are: upheld; substantially upheld; substantially rejected; and rejected.

I welcome this discussion and I hope we can reach agreement on the key issues involved in the Bill over which I am led to believe there is wide agreement. The Government has said for quite some time that it will review the six-year rule, and I hope that it can be done. I welcome the new Minister of State. I have no doubt he will bring a new energy and impetus to his role. He knows from his time on the finance committee, the banking inquiry and other fora the issues that are involved. I commend the Bill to the House. We are supporting it on Second Stage. Let us hope we can all work together for the benefit of all those people who are affected by the current rules.