Paul Kehoe (Wexford, Fine Gael)
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274. To ask the Minister for Finance if he is considering any measures to specifically mitigate the impact of recent and future ECB rate increases on homeowners with variable or tracker mortgages who will be facing increasing mortgage repayments in the midst of a cost-of-living crisis; and if he will make a statement on the matter. [54708/22]

Paschal Donohoe (Dublin Central, Fine Gael)
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The European Central Bank is independent in the formulation and implementation of monetary policy and, as the Deputy is aware, in its efforts to combat inflation it has increased official interest rates in recent months. 

These recent monetary policy decisions will influence the level of interest rates in the economy more generally, including the interest rate charged by lenders for mortgages and other loans.  However, the actual price lenders charge for their loans is a commercial matter for individual lenders and as Minister for Finance I cannot determine the lending policies of individual banks or other lenders, including the interest rates they charge for mortgages and other loans.  

A 2017 addendum to the Consumer Protection Code requires regulated entities to explain to borrowers how their non tracker variable interest rates have been set, including in the event of an increase. The measures also improve the level of information required to be provided to borrowers on variable rates annually about other mortgage products available from their lender which could provide savings for the borrower. The lender must also signpost the borrower to the CCPC’s mortgage switching tool.  However, in this context it should also be noted that most new mortgages are now fixed interest rate mortgages and this will protect those borrowers from interest rate increases for the period the interest rate is fixed.

The Central Bank has in place a range of measures in order to protect consumers who take out a mortgage or other loan.  This consumer protection framework, which includes the Code of Conduct on Mortgage Arrears (CCMA), seeks to ensure that lenders are transparent and fair in all their dealings with borrowers and that borrowers are protected from the beginning to the end of the mortgage life cycle, for example, through protections at the initial marketing/advertising stage, in assessing the affordability and suitability of the mortgage and at a time when borrowers may find themselves in financial difficulties.

In particular, the CCMA requires that regulated entities pro-actively encourage borrowers to engage about financial difficulties which may prevent a borrower from meeting his/her mortgage repayments and, if necessary to address a genuine repayment difficulty, they must explore all the options for an alternative repayment arrangement offered by that regulated entity.   

More generally of course, Budget 2023 was a 'Cost of Living Budget' and many of the tax and expenditure measures it contained were focused on helping individuals and families deal with rising prices and in doing so the Government was especially mindful of the fact that the rising cost of living has hit hardest for those on lower incomes.