Michael McGrath (Cork South Central, Fianna Fail)
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28. To ask the Minister for Justice and Equality when the dedicated new court to deal with mortgage arrears, as promised in the programme for Government, will be established; if all bank and non-bank institutions that hold mortgage debt in Ireland will be subject to it; if she plans to establish a preferred hierarchy of mortgage solutions to be applied to arrears cases; if she plans to give a statutory right to mortgage holders to certain solutions; and if she will make a statement on the matter. [10762/16]

Frances Fitzgerald (Dublin Mid West, Fine Gael)
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The Programme for Government states, as the Deputy notes, that the Government will 'establish a dedicated new court to sensitively and expeditiously handle mortgage arrears and other personal insolvency cases, including through imposing solutions', including those recommended by a new national service which will be established 'to standardise the supports available to borrowers in mortgage arrears'. It adds that the hearings of this Court 'could be held in private if requested by the debtor'.

As the Deputy will know, the commitments in the Programme for Government are under active consideration by the Government as part of the Government's housing strategy. An action programme will be announced in the coming weeks.

The objectives underlying the commitment regarding a dedicated new Court are, as indicated, to ensure that mortgage arrears cases can be handled sensitively and quickly. We are already looking at a range of possible solutions to serve these objectives, up to and including the establishment of a separate specialist court by legislation. Work is progressing to explore and assess the options available to government to implement this recommendation as speedily and as effectively as possible.

Currently, the vast majority of repossession cases are heard by the Circuit Court for the circuit in which the house is situated. The High Court hears a small number of cases regarding very high-value houses. The Circuit Court cases are heard by the ordinary Circuit Court judges, at over 30 venues around the country: preliminary issues may be heard by the Registrar, before a case is transferred to the judge for hearing. Some circuits reserve a specific date for repossession cases, while others hear repossession cases along with other civil law cases such as family law or commercial cases. The courts sit in public as is the general rule: legislative change would be needed to allow them to hear repossession cases in private.

Based on the data provided by the Courts Service, the number of repossession orders is falling. In Q1/2016, there were about 95 possession orders per month - less than half the monthly average in Q1/2015. And in over twice as many cases (200 per month on average last quarter) the repossession application was struck out, refused or withdrawn. However, I fully agree that the number of repossession cases remains undesirably high, particularly in terms of the worry and stress experienced by borrowers who are struggling with their debts. I have already taken extensive action to address these problems under the previous Government. This Government wants to keep people in their homes, and the new Housing action programme, to be announced shortly, will evidence our strong commitment to putting solutions in place.

In terms of giving a statutory right to mortgage holders to certain solutions, as the Deputy will be aware, where the borrower's home is in mortgage arrears the borrower may already be entitled to a Personal Insolvency Arrangement (PIA), which is a protected statutory solution, under the Personal Insolvency Acts.

In addition, last year I introduced an important reform for mortgage holders in arrears, especially those at risk of repossession, in the Personal Insolvency (Amendment) Act 2015. Section 21 of that Act introduces a new ‘court review’, where creditors such as a mortgage lender refuse an insolvent borrower’s proposal for a Personal Insolvency Arrangement to resolve debts which include the mortgage on their home.

Previously, the creditors’ rejection was final. Under the new provision, the borrower can seek review by the relevant Court of the creditors’ refusal. The Court will consider the borrower’s proposal using criteria set out in the 2015 Act. If the Court considers on those criteria that the proposal was fair and reasonable, it has power to impose the personal insolvency arrangement proposed by the borrower.