Micheál Martin (Cork South Central, Fianna Fail)
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325. To ask the Minister for Finance his plans to tackle the mortgage crisis; and if he will make a statement on the matter. [35206/14]

Michael Noonan (Limerick City, Fine Gael)
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I have informed this House previously that the Government has developed a comprehensive cross-Departmental strategy in response to the mortgage arrears issue in line with the main recommendations of the 2011 Keane Report. The implementation of this strategy is overseen at Government level by the Construction 2020, Housing, Planning and Mortgage Arrears sub-committee, which is chaired by the Taoiseach, and at official level by a mortgage arrears steering group which is chaired by the Department of Finance.

 A number of key measures have been advanced in this regard, including;

1. An intensification by the Central Bank of its engagement with mortgage lenders to require them, under the Mortgage Arrears Resolution Targets (MART) process, to propose and conclude sustainable and durable alternative arrangements with their customers in mortgage arrears. Targets have been set to the end of 2014 and by this date the relevant banks covered by the MART process will be required to have proposed sustainable solutions to 85% of mortgages which are more than 90 days in arrears and to have concluded solutions with 45% of such mortgages;

2. Significant reforms to personal insolvency and the establishment of the Insolvency Service of Ireland (ISI), to provide more accessible and flexible statutory frameworks for people with unsustainable personal and mortgage debt to address their position;

3. The launch last month of the 'Back on Track' Information Campaign for People in debt by ISI, which, among other things, provides for the elimination of application fees to encourage a greater take-up of ISI services by people in debt;

4. Updating the Code of Conduct on Mortgage Arrears to provide additional safeguards to cooperating borrowers, while also promoting and encouraging efforts by both lenders and borrowers to meaningfully address mortgage arrears or pre-arrears. Monitoring compliance with CCMA continues to be central to the Central Bank's work programme and is also an enforcement priority for the Bank.  The Central Bank will be commencing on site inspections of a number of mortgage lenders in the coming months;

5. Mortgage to rent which is now available as a social housing response to allow people to remain in their house, where possible; and

6. The provision of an independent mortgage information and advice service.

The Central Bank's latest 'Residential Mortgage Arrears and Repossessions Statistics' publication for the end of Q2 2014 shows that the number of mortgage accounts for principal dwelling houses (PDH) in arrears, fell for the fourth consecutive quarter, and, at the end of June 2014, 90,343 PDH mortgage accounts (11.8 per cent in total) were more than 90 days in arrears, representing a decline of almost 3% over the quarter.

The data also shows that almost 102,000 PDH mortgage accounts were classified as restructured and, of these, 81.2 per cent were deemed to be meeting the terms of their current restructure arrangement.

Separately from Central Bank quarterly reports, a monthly reporting regime on mortgage restructures and arrears for the six main banks covered by the Central Bank's MART process has been put in place by my Department.  The latest publication, with data for the end of August 2014, shows that the number of PDH mortgage accounts in arrears of greater than 90 days has fallen by over 8,500 accounts when compared to the end of Q1 2014 while the total number of PDH mortgage arrears of any duration has fallen by almost 11,000 accounts in the same period.

Taken together, the overall strategy and framework is in place to enable banks to work with distressed homeowners to reach sustainable solutions for dealing with their personal indebted situations.  The data published by my Department, as well as the Central Bank data, would appear to demonstrate some success by the lenders in addressing the accounts in mortgage arrears, as well as measures to prevent borrowers from going into arrears. Nevertheless, relevant Departments and agencies will continue to keep the position under review and can make any further adaptions to the overall framework, as considered appropriate. Early and effective engagement between borrowers and lenders remains key to resolving most cases of mortgage difficulty.  Where there is effective and meaningful engagement by all parties regarding a mortgage difficulty, the data shows that an increasing number of durable long term mortgage restructures can and are being put in place.  However, increased engagement by the financial institutions with borrowers in long-term arrears will be necessary to appropriately address unsustainable mortgage loans.