Thursday, 23 April 2015
Order of Business
In both this House and the Dáil, Fianna Fáil has consistently raised the plight of mortgage holders in distress. Despite its public statements, the Government has regularly refused to accept proposals and initiatives put forward by my party to try and alleviate the distressed mortgage holders. Yesterday at an Oireachtas committee meeting, the head of AIB indicated it was almost certain that the bank was going to reduce the variable rate in the coming months. What I find extraordinary is that a leading newspaper, theIrish Independent - a little like The Sunheadline at the time of the Falklands war, "It's The Sunwot won it", is actually claiming credit for having pressurised the Government, the Central Bank and the banking institutions.
Despite the pleadings of our party, the Government sat on its hands on this issue. Although the State had a 99% share and was effectively the owner - on behalf of the people of Ireland - of AIB, the Government washed its hands of it and cried crocodile tears over it as though it could not do anything. Now, outside of the democratic environment and the elected Government of the country, a national newspaper is claiming credit for having moved AIB. This is very dangerous for democracy. Considering the Government was given every opportunity to come out on this, there is a very serious disconnect between it and the people. That has been shown by this issue which, along with child care, is one of the two major issues affecting people. I want to put on record that it is past time for the Government to start looking at the real issues affecting people, specifically in the area of mortgage relief. Why, when we have a 99% share of AIB, does the Government say we cannot really do much to influence the bank's decisions? I have asked this before. Who within AIB, following yesterday's meeting, eventually decided to move towards reducing variable mortgage rates and what are the reasons for the decision?
I say this directly to AIB: Let us not have a token reduction here. Tracker mortgages are on 1%, yet the variable mortgage rate with AIB and its competitor banks is around 4.25%. Any suggestion they are going to tinker with that variable rate in order to placate mounting public anger towards the banks with a nominal reduction of 0.25% is totally unacceptable. I charge the banks, and particularly AIB if it is going to lead on this, to make a significant reduction.
I am sure the House will join with me in remembering the estimated 4,000 Irish men who died at the tragedy of Gallipoli on 25 April, 1915. It was the first day of the landings. An estimated 70,000 Turkish troops were also killed in that awful tragedy of the First World War. Those 4,000 soldiers from all over Ireland, representing the various regiments of the time like the Munsters, the Dublin Fusiliers and, in my own part of the country, the Connaught Rangers, were led "by donkeys", as was subsequently commented. This was to be the most tragic of battles of the First World War. There are still families mourning their grandfathers, grand-uncles and other relations. I hope the House would remember 25 April as a day of infamy where 4,000 Irish men, hoping they were fighting for the freedom of their own country, gave their lives in the most senseless bloodletting of the First World War. Ar dheis Dé go raibh a n-anamacha dílise.
It is appropriate today to commemorate the war dead of the appalling battle of Gallipoli, as Senator Mooney said, and to mark the anniversary. I join him in commemorating the many thousands who died so tragically and senselessly in that battle.
In light of the calls we have been making during the week for a debate in this House on a drugs strategy, I very much welcome the announcement that the Minister of State, Deputy Aodhán Ó Ríordáin, is to be appointed today as a Minister of State with responsibility for the national drugs strategy. I think Deputy Ó Ríordáin will do an excellent job in that role. I am really pleased that a Minister of State will be taking charge of the national drugs strategy. I know he has committed himself to reducing drug related deaths, of which there were more than 600 in Ireland in 2012. It is a serious human tragedy. In light of that appointment we might ask the Minister of State, Deputy Ó Ríordáin, to come to the House at the earliest opportunity to address us on his programme of work for the coming year.
I note and welcome the announcement yesterday that a company called Zalando will be establishing 200 jobs in the Dublin south inner city. The Tánaiste, Deputy Burton, was in attendance to mark the announcement. She noted that it highlights Dublin's strength as a centre for digital excellence and as a city attracting these hugely important tech jobs.
On the issue of the AIB and distressed mortgage holders, many in this House have looked for a debate. I welcome the indication yesterday that the standard variable rate at AIB will be cut. That would greatly alleviate distress for many thousands of mortgage holders but it is clear that more needs to be done. We are aware that the Government has announced it will bring forward a package of measures. Certainly, the change to the bankruptcy law is one of those measures that must be addressed by the Government as part of that package. The Committee on Finance, Public Expenditure and Reform under the very able Vice Chairman, our own colleague, Senator Hayden, played an important role yesterday in keeping the pressure on AIB to ensure rates would be cut. We need to have a debate on the issue with the relevant Minister in attendance to hear precisely what package of measures for distressed mortgage holders is planned by the Government.
I renew my call to the Leader for a debate on measures to prevent any future dreadful deaths of migrants seeking to enter Europe. Today the EU leaders are meeting at a summit. I hope they will be taking a creative look at measures to alleviate this problem and to address the serious issue of many thousands of migrants seeking to enter Europe and the appalling human tragedy caused by the people traffickers who are putting them to sea in boats that are not seaworthy.
I join other Senators who have mentioned the war dead. Many young boys went away expecting to be home after a couple of months and many of them are still lying where they fell. It is a terribly sad day. I have visited the graves of the war dead in France and I am delighted the Irish Government built the peace tower over there and recognised our war dead.
I wish to raise two issues. I congratulate the Minister, Deputy Noonan, on moving so quickly to get the Comptroller and Auditor General to investigate the Siteserv issue with respect to IBRC. I believe there are questions still to be answered and I would welcome an opportunity to have a debate in this House on the issue.
I propose an amendment to the Order of Business, and I do not do so lightly, that the Minister for Education and Skills, Deputy Jan O'Sullivan, come to the House to discuss the imminent closure of Gaelcholáiste Chineál Eoghain in the Inishowen Peninsula. This is an Irish-speaking school and it is being closed for one reason only, because of an industrial dispute. This industrial dispute has been ongoing for a number of years. I understand the students in the school perform exceptionally well. I was involved in a prize-giving ceremony recently and one of the heartbreaking moments was a child from that school who was a recipient of a prize but neither the child nor the parents were informed that he was the recipient of a national award. This is clearly a serious matter. Ordinarily I would not move like this but there seems to be a train of events in place that is going to close that school for no reason other than there is an industrial dispute between the management of the school and the staff. Apparently the staff are all pulling together and working really well there. I do not intend to bring the House into resolving industrial relations issues but I do not want the one Irish-speaking school in that area to be closed. Principal teachers in the national schools have stopped sending children to the secondary school because of the situation there. That is simply not good enough in this day and age.
I welcome the announcement by Apple that it will apply for planning permission next week for the data centre based in Derrydonnell near Athenry. The application will include an environmental impact survey requesting permission to build a single storey data centre building, a logistics and administration building, a maintenance building, two small fibre huts, a security hut, an ESB substation and 18 standby generators. The site will also include a wastewater treatment plant, rain water harvesting, as well as an amenity walkway around the facility with tree planting and landscaping. This development will be of huge benefit to the local area. It is hoped that construction will commence shortly, with completion in 2017. Together with the recent announcement of funding and permission for a high-speed fibre-optic cable between Mayo and New York, this is a significant boost for the west and a significant step in attracting high-tech industry to the region. This is very welcome news for the west.
I agree with Senator Mooney's remarks about the reduction in interest rates and the banks. While I welcome the announcement by AIB yesterday that it intends to reduce its interest rate, I call on the other banks to do the same. I pay tribute not only to my own party and our representatives in this House and the Lower House who have raised this issue continually over recent months but to all Members who have raised it. This issue affects many people whom we represent and it is time it was addressed. Never in the history of the ECB have interest rates been as low and it is time the banks passed on that low interest rate to their customers.
I support Senator Craughwell who raised the issue of the Gaelcholáiste Chineál Eoghain in the Inishowen Peninsula. I am not fully aware of the circumstances but if an industrial dispute is leading to the imminent closure of the school, it is incumbent on us all to investigate the reasons for that situation. As Senator Craughwell stated, it is the only Gaelscoil in the area and it is unfortunate that as a result of an industrial dispute between the staff and the management, the pupils who live in that area will be deprived of a Gaelscoil. I support Senator Craughwell's call for the Minister for Education and Skills to look into it.
I respect the authenticity and sincerity of Senator Mooney's call this morning regarding rates of interest being applied by the banks. I think we had a successful day yesterday at the hearings of the Joint Committee on Finance, Public Expenditure and Reform. We are all concerned at the gap between the ECB rates and the standard variable mortgage rates that are applicable. In this regard, I asked Mr. Duffy and his colleagues if they would be open to an independent objective assessment in circumstances where the rate they are applying is inflicting undue hardship on the borrower.I had in mind an external agency such as the Credit Review Office, which arbitrates on SME loan applications. To be fair, AIB said it would accept that proposition. It did not think it applies but it said it was trying to engage with everyone. In regard to the number of repossessions, it pointed out that when a notice was served, 50% chose to re-engage, so it has dropped all of those proceedings. From what it said yesterday, it is making a fair effort in that regard.
Yesterday, on the matter of repossessions, I also queried the practice on voluntary assisted sales and recommended that where the homeowner surrenders the house and assists in the disposal process, the bank would write off the balance of the debt once the asset has been sold. Again, that was accepted and it said that this is, or will be its practice. I know the Senator meant well and I agree with him but the bank did point out that there are four component parts to its charge for money and it is keeping them under review. There is movement and it is downward. The bank did seem to promise or commit, in the short term, perhaps within a few months, to reducing the rate.
Having an external agency to arbitrate could help, especially where a customer is able to show that, in its particular case, the bank is inflicting undue hardship. We need to continue to monitor the situation. Next week, Bank of Ireland and Ulster Bank will be before the finance committee and we will pursue this matter further with them as well. Things are going in the right direction. No one wants to see repossessions. As has been said by Senator Bacik, the Government will have its own suite of measures very quickly.
Tomorrow, 24 April, marks the 99th anniversary of the Easter Rising and it is appropriate that this House should acknowledge that fact. Saturday, 25 April, marks the commemoration of ANZAC day, which saw 3,000 Irish men and boys dying on the shores of Gallipoli. Those 3,000 people are as Irish as the heroes of the 1916 Rising.
The complexity of our history is illustrated nicely, or tragically perhaps, by Commandant Mike Malone, commander of the Irish forces who opposed the British at Mount Street Bridge. He rightly takes his place among the pantheon of Irish heroes. It is interesting to note that Michael Malone's brother was killed the year before, in 1915, during one of the pushes by the Dublin Fusiliers in France. This nicely illustrates the complexity of the birth throes of our nation. In the weeks, months and years ahead, we would do well to remember the complexity of our history. Instead of pigeonholing one side or the other into goodies and baddies, it is important that we have a balanced view and recognise that within our State at the time, and probably still today, there was and is probably two traditions or two nations equally deserving of our respect.
I welcome the indication given yesterday by the CEO of AIB that the bank is likely to take some action on variable interest rates. I do not think any newspaper should be claiming credit for the movement we saw yesterday.
Every public representative and every politician in this House and the other House, of all parties and none, have raised this issue over a long period of time. I hope we will soon see some developments. I support the idea put forward by Senator Coghlan of the independent objective assessment of the rates being charged and likely to be charged. There is a lot of merit in the idea.
I repeat my call for a debate on banking, banking charges and our banking system. There is another element to this, namely, the hardship being endured by small businesses, particularly cash businesses, on which I spoke earlier in the week. I ask the Leader to arrange that debate so that we can flesh out the issue and give it the sort of prominence that the variable interest rate issue has received.
I join with Senator Bacik in welcoming the appointment today of the Minister of State at the Department of Justice and Equality, Deputy Ó Ríordáin, to head up the national drugs strategy. We have a drugs abuse crisis in this country and it is of major proportions. Young lives and families in every town and village are being destroyed. Major costs are being inflicted on our health service as a result of drug abuse and drug problems. The cause of much criminality in our communities is linked to the drug trade. There is evidence that many suicides in the country are a result of drug abuse or pressure inflicted on young people by people in the drug trade. I welcome the appointment of the Minister of State, Deputy Ó Ríordáin, and would very much welcome an early debate in this House on all aspects of the drugs problem in this country and how we can devise a major campaign and strategy to address this crisis for once and for all.
I had a guest in the Visitors Gallery and beg the Leas-Chathaorleach's pardon.
I wish to make a contribution on the issue of the engagement with AIB yesterday. A number of speakers have mentioned it and the positive outcome that it is willing to look at variable interest rates in the near future, which is to be welcomed. Despite the nation's shares in AIB, the fact remains that even though the shareholding is 99.9%, it still has a commercial mandate. I personally favour taking AIB into 100% State ownership and changing its mandate, but that is a debate for another day.
There were a number of other aspects of the engagement yesterday which I would like the Leader to take on board in terms of a debate in this House, which many of us have called for, on the wider issue of the mortgage crisis. One of those aspects is that AIB, in determining whether a mortgage is sustainable, not only accepts the recommendations of the Insolvency Service of Ireland but then adds 25%. That is part of the reason why a number of AIB mortgages are more sustainable in the longer run than those in other lending institutions.
AIB has also said it is willing to look at having an independent body decide on what is a sustainable mortgage. This has been one of the big issues in terms of the number of reconstructions of mortgages going back into arrears, feeding into the courts system, and feeding into repossessions. It is something the other banks should consider very carefully and they should also move in that direction.
AIB also indicated that the engagement of an independent body, the Irish Mortgage Holders Association, which is independent of the bank, does facilitate the engagement of borrowers with the bank and it has been very satisfactory in terms of bringing a number of cases to conclusion. This is something that is very important and should be fed back to the Minister.
There are a number of issues. To be fair to the finance committee, AIB was the first bank to be called before it. On a number of the questions that were raised, it gave progressive and positive responses. I suspect we will not be getting such positive responses from some of the other institutions which will come before the committee.
I have said this so many times it is becoming like a broken record but I will again reiterate that, like other Members, I want an engagement with the Minister for Finance in this House on the issue of mortgage arrears. Requests for his attendance in the House have been ongoing for in excess of 12 months. It is disrespectful to this House that he has not deemed fit to come in here and address the issue.
One of the most important areas of business opportunities is tourism. Senator Mooney regularly reminds us of that, but every time we look for changes to encourage tourism, there always seems to be someone saying that those changes do not suit.The recent effort in Dún Laoghaire to erect a cruise ship berth is being criticised by the local yacht clubs because it will interfere with them. Let us ensure we have one approach that sees an opportunity and a challenge and does something about it. Tourism has been successful in recent years. It has been particularly helped by the Government's decision to reduce the VAT rate applicable to that business. That is not enough. Can we get everyone in the country saying let us get behind anything that is going to bring about change?
Another area of concern is the small businesses that have websites but are not equipped to trade on those sites. This is a big opportunity. A huge amount of business can be done through online trade. I recall going into a small shop in Estonia where two or three people worked but I was taken upstairs where there were half a dozen working on the Internet, trading around Europe. This is another opportunity we can do something about. It would be well worthwhile debating it in this House to get a wider view, not just that of the Oireachtas Joint Committee on Jobs, Enterprise and Innovation.
I support Senator Hayden’s comments on the mortgage arrears crisis. While a full debate in the House will not resolve the issue, the presence of the Minister for Finance and a debate would be helpful. This request was made some time ago. It would be appropriate for him to give a favourable response soon.
I also support Senator Gilroy’s comments on our sometimes selective presentation of our shared history on this island, which comments are appropriate as we plan for the centenary of 1916 and beyond. Almost nine years ago I asked in this House that we have a detailed and properly planned run-in to the 1916 centenary commemorations because of the sensitivity surrounding them. The Government is getting the balance as right as it can. It is a challenge to us all in this House and to the public to have an open mind about our history and not to be as judgmental as we can sometimes be. Whether citizens died on O’Connell Street or soldiers died in Gallipoli, they were all Irish and deserve to be remembered equally.
Senator Craughwell raised the issue of Siteserv. I think it was Peter Mandelson who, when advising Tony Blair, pointed out that if an issue remained on the front page of the newspapers for three or four days, it was a serious political issue. This is becoming an issue which requires full disclosure and debate. While the Comptroller and Auditor General may have a role, I heard the view expressed that legislation would have to be passed to enable him or his office to enquire into Siteserv. Ministers can make very clear, concise statements in these Houses on current events, and it would be helpful and appropriate if the Minister in question would come to this or the other House to put on the record the history of the sale from his perspective. Public confidence needs to be restored on commercial decisions where there was a political involvement. The saga of the sale of Siteserv needs to be clarified. It involves taxpayers’ money. There was a significant write-down and the taxpayer is funding the deficit. Clarity and full disclosure of information are required.
Senator Mooney spoke about variable mortgage rates. He should not believe everything he reads in the newspapers. It is not good for anyone to believe everything. I take on board what he says about one newspaper claiming credit for AIB reducing its rates, which is a bit far-fetched. In its statement of priorities the Government recognises that promoting and encouraging competition for new entrants into the banking sector is required to put downward pressure on interest rates for variable rate mortgage customers, new and existing. The action taken by the Government to promote competition in the banking sector includes the establishment of the Strategic Banking Corporation of Ireland, SBCI, the credit guarantee scheme and amendment of section 149 of the Consumer Credit Act 1995 to encourage new entrants to the Irish financial sector. The mortgage interest rates that independent financial institutions operating in Ireland charge to customers are determined as a result of a commercial decision by the institutions concerned. The Minister for Finance and the Central Bank do not have a statutory role in respect of the mortgage interest rates charged.
As part of the Central Bank’s work on mortgage arrears, lenders were asked to consider all avenues to help customers in arrears, including interest rate reductions. Regulation of interest rates remains a policy area under review and it has been the subject of correspondence between the Department of Finance and the Central Bank. At a recent meeting between the Minister for Finance and the Governor of the Central Bank, the issue of mortgage interest rates was discussed. The Governor provided an update on ongoing work that he and his officials are carrying out on the issue of standard variable rates charged by lenders. The Governor and the Minister noted that the standard variable rates charged in Ireland are higher than in any other euro area countries and have not fallen in line with the European Central Bank wholesale rates. The Central Bank will continue to research why this is the case and will publish results shortly. The Governor will update the Minister for Finance on progress in due course.
As Senator Paul Coghlan and others stated, the Government will have its own suite of additional measures which will be announced soon. I hope when those measures are announced we can invite the Minister for Finance into the House to explain the position and have the debate on mortgage interest arrears and the banking sector that has been requested numerous times.
Senator Mooney and several others, including Senators Gilroy and Bradford, asked us to remember the approximately 4,000 Irish men who lost their lives in the First World War at Gallipoli. Senator Gilroy also spoke about the fallen of 1916 and recalled the complexity of our history. There is a need for balanced comment on this issue. I am sure we will all remember the Irishmen who died in 1916 and in Gallipoli and elsewhere in the First World War.
Senators Bacik and Mullins welcomed the appointment of the Minister of State at the Department of Justice and Equality, Deputy Aodhán Ó Ríordáin as Minister of State with responsibility for drugs strategy. Members on the other side of the House also asked several times for a designated Minister of State. Everyone will be pleased that this responsibility will rest with Minister of State, Deputy Ó Ríordáin. We will have statements on the drugs strategy with either the Minister for Health, Deputy Varadkar, or the Minister of State, Deputy Ó Ríordáin, when the drugs and alcohol briefs have been newly assigned by the second week in May.Senator Bacik also spoke about the plight of migrants seeking to enter Europe. I am sure that the problems facing so many migrants will be discussed at the EU summit today.
Senator Craughwell welcomed the announcement by the Minister that the Comptroller and Auditor General is to investigate the Siteserv issue. Senator Bradford also commented on that issue. I gave a comprehensive reply on it yesterday. Senator Craughwell also proposed an amendment to the Order of Business calling on the Minister for Education and Skills come to the House today for a debate on the closure of a school in Donegal. I suggest that the Senator table that issue for discussion as a Commencement matter, in respect of which the Minister could come to the House to give a reply.
Senator Naughton welcomed the planning application submitted by Apple in respect of the data centre. There is no doubt but that this is an exciting development for Galway, the west and the country. It is hoped the planning permission will be granted in early course and that this major development will be up and running soon.
Senator Wilson spoke about variable interest mortgage rates, on which issue I have already responded. Senators Coghlan and Hayden also spoke on that issue. The work done by our Oireachtas committees is not often recognised. I take this opportunity to pay tribute to the finance committee, of which Senator Hayden is the Vice Chairman, for its work on that issue. I wish all members of the committee well in their endeavours in terms of their querying the other banks as they appear before it over the coming weeks. The committee will probably have more difficulty with them than they had with the representatives of AIB.
Senator Quinn spoke about encouraging tourism and overcoming local challenges that may arise from time to time. That is an important point. People often object to various aspects of tourism development. It is important from a national point of view that we can overcome these challenges. We have been very successful in terms of our tourism product but we cannot rest on or laurels. We must continue to develop the wonderful tourism product that we have in this country. I note the Senator's point on businesses not being equipped to trade online, on which issue the Minister of State, Deputy Dara Murphy, recently made a statement. There is a need for businesses to get more involved in online trading, particularly in the context of development of their own business.
I do not propose to accept the amendment to the Order of Business as proposed by Senator Craughwell.
Senator Craughwell has proposed an amendment to the Order of Business: "That a debate with the Minister for Education and Skills on the imminent closure of Gaelcholáiste Chineál Eoghain in the Inishowen Peninsula be taken today." Is the amendment being pressed?
No. I have just received a message that the Minister has agreed to meet the three local Deputies on the issue. I would ask, however, that the Leader would relay my concerns to the Minister and place her on notice that if we do not hear positive news, I will propose this amendment again.