Dáil Éireann debate -
Thursday, 24 Mar 1994

Vol. 440 No. 6

Adjournment Debate. - Mortgage Interest Supplement Payments.

Mr. G. Mitchell

I am grateful for this further opportunity to raise this matter. It concerns two couples experiencing real hardship having been refused mortgage interest supplement. The first case is in Drimnagh, Dublin 12 where the couple pay £207 per month but only have unemployment assistance of £116 per week. The man concerned worked until 21 May 1993 and while still working got final approval from Dublin Corporation for the purchase of his house on 27 April 1993. The shared owners reference is R459.

The couple did not collect the keys of the house until 28 June after the man became unemployed although they signed the contract a month before he became unemployed. Since he was out of work when the keys were collected, the health board refused to pay the mortgage interest supplement. This couple cannot pay the mortgage and due to a technicality are refused the mortgage interest subsidy. They are at the end of their tether and will have to surrender their house and go back on the housing list whereas if they were given assistance for a few months the problems could be resolved cost effectively.

The second case is similar and concerns a couple in Crumlin, Dublin, where the man was working when the couple signed the contract but had been let go from his job by the time they received the keys of the house. They have an endowment policy on which the payment is £310 per month and cannot meet their repayment out of their unemployment assistance.

In neither case were the people unemployed when the loan was given or the agreement entered into. If they had been the local authority would not have given them the loan. The unemployment took place between the time of signing the contract and getting the keys and in both cases the couples are experiencing extreme hardship.

I know the Minister will be as concerned as I am. It is up to us as legislators to ensure that families do not suffer bureaucratic hardship such as is happening in these cases. If something is not done these couples will lose their deposits and investment and will be thrown back on the State. They will be on the housing list again whereas if they were given help for a few months they would be in a position to meet their commitments.

This is my second time to raise this matter and I appeal to the Minister to issue a directive that these couples be assisted.

Minister for Social Welfare (Dr. Woods)

As the Deputy knows I have been in touch with the Eastern Health Board in both of these cases. Under the provisions of the supplementary welfare allowance scheme, the determination of individual applications for assistance with mortgage interest repayments is a matter entirely for the health board.

Under the guidelines, the issues in each of the two cases involved are quite clear. The people concerned took on mortgage commitments when they were unemployed and not in a position to meet the mortgage repayments.

Deputy Mitchell explained the case accurately. At the time the couple entered into the commitment they were employed but they were not when they entered into the final agreement.

In the first case, which involves a male applicant, the person in question applied in March 1993 to purchase a house under the shared ownership scheme operated by Dublin Corporation. In May 1993, however, this person became unemployed. The sale of the house was closed on 28 June 1993 when the applicant obtained a mortgage of £21,000.

In the second case, which involves a female applicant, a building society mortgage was taken out in 1993 to purchase a house with her partner when both were in receipt of unemployment payments. The person in question applied for a mortgage supplement in June 1993.

In both cases, the Eastern Health Board refused payment of mortgate supplements on the grounds that the persons in question were not in a position to meet the repayments when they entered into the financial commitment. Both cases were appealed and the appeals officer of the Eastern Health Board upheld the decision of the board in each case.

Under the supplementary welfare allowance legislation the Minister for Social Welfare has no function in relation to the determination of entitlement to an allowance or the amount of any such allowance. These are matters for decision by the chief executive officer of the health board. I have again been in touch with the Eastern Health Board in relation to both cases.

The board has advised me that in the case of the second applicant, certain documentation was requested by the board in support of her mortgage supplement application which has not been furnished to date. The board will reconsider her case when this documentation is provided. In the first case the board has advised me that no new facts have come to light which would warrant a reversal of their original decision.

The guidelines on payment of rent and mortgage supplements are being reviewed by an advisory committee involving all the health boards and chaired by my Department. I expect to receive their report shortly. In this context, I propose to review the present supplementary welfare allowance appeals procedure and in particular its ability to deal with exceptional or unusual housing needs as illustrated in these cases.

I am concerned about the appeals procedure and its inability to deal with cases of this nature. If we assume the bona fides of the people who entered into these arrangements it appears that an appeals officer would look sympathetically at the case. Even though the general guidelines do not permit the payment of a mortgage supplement where people are not employed at the time they take out a mortgage the guidelines are being reviewed and I will have the report of the advisory committee shortly. I will then examine the ability of the appeals procedure to deal with exceptional cases and I will bear in mind the urgency of the two cases mentioned by the Deputy.