Report by the Interdepartmental Working Group on Mortgage Arrears: Statements (Resumed)

The issue of mortgage and personal debt is having profound implications for the well-being of everyone in society and it will continue to do so for decades to come unless positive action is taken now. I am pleased to see the Government, after such a short time in office, is recognising the severity of the problem and actively examining measures to combat it.

There are few solutions to be found in apportioning blame but it must be acknowledged that there is an element of collective responsibility. Banks lent too much and too freely in the recent past; Irish banks were pumped with money by European banks looking to cash in on the Irish property market; builders built quick and fast and, as we are now seeing, to a less than acceptable standard in some instances; some borrowers accepted mortgages too readily without fully thinking through the consequences of the onerous obligations which a mortgage brings; and the Government failed to provide a proper measure of oversight and regulation with catastrophic consequences.

The new Government set up the interdepartmental mortgage arrears working group to examine methods of assisting those grappling with mortgage arrears. It was also set up to ensure that help is provided to those who cannot pay and not to those who choose not to pay.

There is a consensus, not just on the magnitude and the urgency of the debt crisis but also on the solutions to address it. Most of those engaged in the debate believe that new, reformed bankruptcy legislation is required; most recognise that it is not only mortgage debt, but multiple sources of debt, which need to be tackled in a holistic way; and most correctly believe that the vast majority of those suffering from debt problems are genuinely unable to pay rather than simply refusing to do so. It is these who must be supported by Government.

The report is correct in concluding that a blanket debt forgiveness plan would not be practical or beneficial. The cost of such a scheme would be colossal and, more worryingly, it could provide an opportunity for certain persons to escape their responsibilities. It would also be extremely unfair to those with long-established mortgages who have made sacrifices for ten, 20 or more years so as to be able to pay off their home loans, and it would also be unfair on those who, for whatever reason, choose not to take out a mortgage but to rent a home instead.

I fully welcome the recognition from the group that some mortgages are simply unsustainable leaving people in hopeless situations. It is in no-one's interest that such mortgages be allowed to continue with all the negative effects over-indebtedness can have on individuals and families. Another proposal, that of introducing a mortgage-to-rent scheme, could provide a real solution to some struggling homeowners and would allow families to stay in their homes and the communities in which they have built their lives.

On the legal side of the matter, I positively welcome the Government's commitment to reform the bankruptcy law which began with the commencement of the new bankruptcy legislation on 10 October. A non-judicial debt settlement system must form a significant component of the reforms on which the Minister for Justice and Equality, Deputy Shatter, and his Department are working.

Perhaps the one area which the group overlooks is the existing supports in place. Ireland is quite progressive in European terms in having the Money Advice and Budgeting Service, MABS. Some 53 locally-managed companies, guided by the Citizens Information Board, provide crucial advice and assistance to over-indebted persons. MABS, along with other groups such as FLAC and the Society of St. Vincent de Paul, are working on the ground, hearing directly of the desperate situations. With a wealth of experience and information, these groups are providing a message loud and clear that the Government must listen.

MABS is already well established and has a proven track record in helping people. Any new debt management and settlement system which would seek to address the totality of a person's debt, including mortgage debt, credit cards, personal loans etc., must work closely with MABS. Further support could be provided by experts in the NGO sector who are more firmly consumer-oriented, as opposed to the banks which never have trouble finding resources to fight their corner.

Deputy Kyne has one minute left.

On credit cards, we must also accept the banks continued to raise personal credit card limits by writing to advise that the credit card limit had been raised to €2,000, €3,000 or €4,000, and in the case of a friend of mine, to €8,000 on what was a relatively modest income. The banks have been supported and would not exist were it not for the support given by the Irish people. I welcome the Government's resolve to force the banks to co-operate, to sit down with borrowers in order to find a solution in compliance with the codes of consumer protection and conduct on mortgage arrears. At this stage several reports have been completed and the scale of the problem is widely known and visible in communities across the country. It is now time for urgent action to address the problem because our economic recovery depends on it.

I welcome the opportunity to debate the findings of the Keane report. The issue of mortgage arrears is a very serious matter which many constituents have brought to my attention over the past months. Not only are such people in mortgage arrears but they also have high levels of personal debt, credit card, bank loans or credit union borrowings. In fact, some have advised me that their mortgage not only purchased their house but also their car and, in some cases, their honeymoon. The recklessness which led us to this place during the so-called Celtic tiger years was widespread. The Government and the Financial Regulator appeared to have a total hands-off policy during this time of house-buying mania, allowing the banking system to not only loan money to people without proper scrutiny but to allow them offer unsolicited loans to customers. Encouraging older home owners to release equity in their homes to enable the next generation to get on the property ladder was the order of the day. It was all about commission, as far as I can see.

It is staggering to learn that by June of this year, 45,000 households were in mortgage arrears for more than 90 days. From conversations with my constituents it appears there are different types of borrower affected by mortgage debt. First, the borrower who should never have been loaned the money in the first place, because of an unstable income stream or a low level of income which could not sustain regular mortgage payments or take any kind of loss of income. Second, the borrower who could afford a mortgage but because of pay cuts or the loss of a partner's income, got into difficulties with payment and is also in negative equity. Third, the speculator who may already own his or her own home or have a small outstanding mortgage but who dabbled in becoming a landlord and purchased another property to let. The needs of these borrowers are all different and any attempt to address their situations must reflect these differences.

People in this country are not sleeping at night due to the stress of their indebtedness and the potential loss of their home.

I have heard from one constituent who is contemplating moving to a garden shed at the back of his sister's house, such is the financial pressure on him. This is not right and it is appalling. Others have told me that they want to stay in their home and they want to pay their bills but they need some assistance to do so. Keeping people in their homes must be the cornerstone of our efforts to tackle this problem while freeing up household incomes to service mortgage debt and to get money circulating in the economy once again. Losing homes will not benefit anyone.

The credit institutions who were so helpful in lending money whether it could be afforded, must now take a collegial approach by assisting customers to restructure where possible in order to repay their loans. Restructuring will not work for everyone and the challenge for both the Government and society is to provide help for those who need it while being cognisant of our scarce resources.

To this end, some of the recommendations in the Keane report have merit. The suggested mortgage to rent schemes in which approved housing are involved and leasing to local authorities, are interesting proposals which could provide support to more than 10,000 households. I look forward to the Minister of State, Deputy Penrose's pilot proposals. Trade-down mortgages, split mortgages and sale by agreement, all have their merits but each mortgage problem must be considered on a case-by-case basis. I am most interested in hearing the views of the banks about these proposals.

I commend MABS, the money advice and budgeting service, on its excellent work in assisting people to deal with their finances while acknowledging that the Keane report considers that a more specialised mortgage advocacy service is needed. The Minister for Justice and Equality has undertaken extensive work on a personal insolvency Bill to tackle the current problems of bankruptcy and personal insolvency law without which we cannot solve the mortgage arrears problem. I also look forward to the implementation strategy which will be set out at the conclusion of this debate by the Minister for Finance and the Minister for Justice and Equality to assist those in difficult mortgage situations.

Deputies Seamus Healy and Tom Fleming have ten minutes between them.

I welcome the opportunity to speak in this debate. I agree fully with the previous speaker. This is an horrendous situation for people and all of us meet people in our clinics who are in very difficult situations. Many find it difficult if not impossible to sleep at night and many are terrified of the situation in which they find themselves. The vast majority, if not all, are people who want to pay their bills, who want to keep the roof over their head but for various reasons such as unemployment or a reduction in wages or working hours, find themselves unable to meet their mortgage repayments. Many of them will go to extreme lengths to meet those repayments. For instance, they will reduce their food bills or avoid going to the doctor. They will do almost anything to ensure they can meet their mortgage repayments in order to keep the roof over their head. There is something in the Irish psyche that creates a desire to own one's own home and we are prepared to pay for it. However, many people simply cannot meet their mortgage commitments.

I know of a public servant who had an affordable mortgage of €278,000. The same apartment in the same development was on the private market for €475,000. The owner had been able to repay the mortgage but after two reductions in pay and a pension levy and with the apartment now only worth €150,000, he is in negative equity and is put to the pin of his collar to make the repayments.

This is probably one of the better cases because in many cases people are unable to meet their repayments. A constituent contacted me today. She has lost her job and is now in receipt of social welfare payments and is unable to meet the mortgage repayments. I welcome this report and any contribution to this debate is welcome as we strive to solve the problem. It is regrettable that other stakeholders in this area were not involved in the compilation of this report such as MABS and New Beginning and those who are in mortgage arrears. The report would have benefited from such inputs.

Every part of the Irish establishment was effectively telling people to get on the property ladder and that this was the time to start. It was predicted that, at worst, the landing would be soft. People were effectively forced to take on mortgages by the establishment, the banks and by the media, with newspapers publishing property supplements on a daily basis. There was no talk of moral hazard when the banks were bailed out, but there appears to be a huge moral hazard with regard to bailing out mortgage holders who are in disarray and difficulty. Properties should be revalued at current prices and mortgage repayments should be based on the current valuation. That is the only way this matter can be solved.

The ongoing debate regarding arrears in mortgage repayments, personal loans and utility bills is often trivialised by some commentators who prefer to link the problem to that of over-borrowing. People who use this simple but incomplete argument are not being thorough in their examination of the scale of the problems facing families today.

A number of reports published by the European Union and the Council of Europe in recent years attribute the issue of indebtedness to unforeseen events such as unemployment, sickness or changes in family situations. In one report, the Council of Europe concluded that a high level of consumer credit use is not necessarily an indicator of debt problems.

In recent years, Ireland has experienced a severe income crisis affecting everyone. Repayment capacity is likely to deteriorate for some time to come as a recent spate of cost increases take their toll, including increases in fuel costs, mortgage repayments, insurance costs and inflation in general. It has been argued that Ireland must return itself to a state of competitiveness. I agree with this policy, provided it achieves the right result and gets the country back to work. However, in the meantime, we must accept that reducing all our wages will have a severe negative impact on some people, especially their capacity to service their debts, loans, repayments and utility bills. There is no simple solution to the income crisis and the resulting debt crisis facing families. I believe we must collaborate on what has been suggested up to now. We must tease out the inter-departmental report, the Keane report, and identify what is practical and workable within it to assist the more than 70,000 borrowers in arrears, a number which is increasing rapidly and which will probably reach 100,000 within a short period.

I welcome the Bill proposed by Deputy Michael McGrath, which is not before time. As I pointed out in this Chamber last May, the Law Reform Commission report has been left gathering dust on the shelf since last December. It should be implemented as it provides personal debt management and debt enforcement strategies and argues for the overhaul of laws that govern debt in Ireland. Its recommendations make sense and represent a breath of fresh air in an area of law that has long been forgotten. We still operate with laws that are antiquated with regard to dealing with debt in society. How can we ask people to accept lower incomes and yet not change the law to address their diminished capacity to service their debts.

I commend Deputy Michael McGrath for drafting realistic proposals, mechanisms and a formula to implement them. We must have a system that deals with people individually and on a case by case basis and must deal with the crisis in a holistic manner. We need to update the laws on personal solvency and bankruptcy. We are in the middle of an income crisis, not just a debt crisis. Families who are affected most need the laws that will protect them. We must act immediately. The Law Reform Commission recommendations and the best input from the Keane report provide the House with the means to act. We cannot delay as protecting homes is paramount.

I welcome the opportunity to speak on this issue. Last Friday week, I listened to Mr. Matthew Elderfield in University College Cork and during the course of an excellent discourse he spoke about the importance of the Central Bank and its statutory duty to protect the consumer and safeguard the stability of the financial system. He is right. It is the twin job of the Central Bank to mind and protect people.

This is a very difficult time for people here and the issue is not just about statistics or about a report which is left on a shelf. The issue is about ordinary citizens who are struggling, i dtrioblóid, faoi bhrú and under pressure. I welcome the fact that the majority of people are meeting their mortgage and personal financial commitments. However, these are extraordinary times and people in their personal and business lives are going through a medley of emotions which have huge implications for and a profound impact on the quality of their lives and those of their husbands, wives, children and communities. These are difficult times which I hope we can overcome and there is an obligation on us all to put in place a plan to ensure this happens.

A particular obligation lies on the Government, the banks, the lending institutions and borrowers to work together. Banks, in particular, must work with people. The Minister of State present, Deputy McGinley, will understand what I am about to say. Our banks must not frighten and intimidate people, but must engage, co-operate, work and collaborate with people to reach an agreement. I am not interested in the fly-by-night merchants who are trying to rip off the system or who want to renege on their debts and responsibilities. I do not speak for them. I speak for the ordinary man or woman who bought a house or invested in a business to create jobs and who now find themselves, often through no fault of their own, in trouble.

Our banks have not helped at all. I go so far as to say that they are telling lies to us. They are lying to the Minister, the Government and even to their employees, because they are not working with and helping people in difficulty. Despite the rhetoric, the statistics and the reports they publish, they are not working with people. They must do so. People are looking to us and to Government, the Central Bank and Mr. Elderfield. I heard Deputy McGrath speak earlier on the Central Bank (Supervision and Enforcement) Bill. I wish we had Matthew Elderfield earlier and a proactive regulatory system sooner, but we did not. Fianna Fáil wants the Government to bring up workable solutions.

I note that the interdepartmental working group puts forward two core objectives which are worth analysing and tweaking. These are to assist those facing real difficulties to remain in their own homes where appropriate and to ensure a distinction between those who cannot afford to pay their mortgages and those who choose not to pay their mortgages. Is it not an extraordinary indictment of the Government of the past 14 years that today in our cities, towns and throughout the country there are men and women struggling to remain in their homes? I was very struck by Mr. Elderfield's remarks in UCC that the State, through its taxpayers, has already assumed too great a burden in this crisis. These are the words of our Financial Regulator when speaking on the issue of mortgage arrears in Cork.

Like unemployment, mortgage arrears are a juggernaut set in motion by the financial crisis that has shattered the hopes and dreams of so many families. The report under discussion makes solutions and suggestions, such as trade-down mortgages, split mortgages, mortgage to rent, and a specialised mortgage advice service. However, this must only be the starting point in developing mechanisms for dealing with mortgage arrears. There are two distinct groups who need separate consideration in the devising of a solution to the problem, the owner occupiers and those with buy-to-let mortgages. In June, some 7.2% of owner occupier mortgages were in arrears by more than 90 days. That is up from 3.3% in September 2009. This is a massive increase. Arrears in the buy-to-let category are also increasing rapidly. The report has urged a case by case handling of distressed mortgages. That makes practical sense because no two loans or entities are the same and the changed financial circumstances of the borrowers will not have the same impact in each case. However, we cannot leave it to the banks to pick a solution from a menu of options. The banks cannot press a button and select an option. The ultimate concern for banks will be the impact of rescheduling on their balance sheets, not the impact on the life of the borrower. The borrower is a person, a husband or wife, a person with a family or a person alone living in a community and these events have a knock-on effect. The Government, as the majority shareholder in the Irish banks, must use its influence to achieve equitable solutions. It must assert its position with the banks. Perhaps there could be a role for a mortgage advice service and, instead of simply advising, it could dictate to the banks the most appropriate form of rescheduling. The Minister is correct when he says there are no easy options. Whatever solution is put in place, our concern must be to enable borrowers to fully participate in society. Whether they purchased a primary residence or a buy-to-let property, they could never have envisaged such economic devastation. They could not have anticipated jobs disappearing, salaries being cut, personal debt accumulating and mounting mortgage arrears.

We spoke about restructuring, which there is much of in our banks. I welcome the fact that there will be a plan and that we will be able to help people. Where borrowers actively engage with lenders, negotiating a rescheduling of the mortgage must not affect their ability to earn a living and carry on a business. Therefore, it is imperative that the credit ratings of these people cannot be affected because of a negotiated rescheduling. It is equally crucial that the Government, hand in hand with attacking the issue of mortgage arrears, reforms the personal insolvency legislation. The Money Advice and Budgeting Service, MABS, makes the point that "it is counter-productive to address mortgage arrears without simultaneously seeking to manage the issue of personal debt". The Minister for Justice and Equality has commenced reforming this area but it is also important that we do not delay in rolling out a new personal insolvency regime that facilitates people in negotiating reasonable and practicable settlements.

In conclusion, mortgage arrears is a complex problem that needs careful, balanced consideration. A solution will be difficult but we must seek a fair balance between the competing interests of the taxpayer and the social impact on the lives of those faced with unsustainable mortgages. In saving the banks, the burden borne by the taxpayer has been great. It is now time to ensure that our equity interest results not just in a financial return but also in a social dividend.

We waited in hope for the report on mortgage debt because we all know just how serious the issue is. I was greatly disappointed by two major failures in the report. One was the exclusive nature of the people who put it together and the second was the conservative nature of the report and the piecemeal solution it proposes. Some of the measures are worth doing but it is not a solution. It has prompted a debate in this Chamber and among other organisations. A recent press conference at Buswells Hotel featured a number of organisations, such as FLAC, Threshold, Focus Ireland, the Society of St. Vincent de Paul, New Beginning, Northside Community Law Centre, Ballymun Community Law Centre and Respond!, outlining what they describe as nine key principles to overcome the personal debt crisis. The Law Reform Commission report was an extensive document and had some worthwhile components, some of which have found their way into Government policy. The organisations describe themselves as having "a strong track record of working and campaigning on anti-poverty issues including debt and credit, social housing, social welfare, homelessness and tenants' rights". We must recognise that they are front line organisations. Instead of highlighting the disappointments in the Keane report, I want to highlight some of the measures the document produced by these organisations identified as part of the solution.

The document defines the problem as over-indebtedness, which we know. This does not just involve mortgage arrears, we must have a much broader response. The Law Reform Commission proposal says the same. There must be a multidimensional response and it must be co-ordinated and strategic. The document describes the kind of problems that lead to people being unable to pay, including loss of employment, failed enterprises, ill-health and relationship breakdown. Some of these elements are intertwined. People who are paying the highest amount for credit are those who can least afford it. They often end up with sub-prime mortgages. The lending practices facilitated by regulatory, statutory and Government inaction and indifference are highlighted by the report. The document points out that it is not a question of people deliberately choosing not to pay but lacking the capacity to pay. That is something I recognise because I have had such people come into my office and the fact that I have a box of tissues there permanently describes the stressed state they are in. One person told me that she and her two children eat once a day. Another person told me that he had to sell his home before it was repossessed. He had put the home together brick by brick but now he has lost that and just about covered his costs by selling it. It had been worth much more but he sold it for less. Another person told me of having lost their business, lost their home and having debts following them. The one thing that person wants to do is wake up without the fear one morning. These are real people with real problems and that is why it is so disappointing that front line people dealing with these cases on a daily basis were not part of the deliberation. Consider the peace process in the North, which only worked when we got the two sides together. In this case, we need to get the two sides together.

The document refers to a war of attrition if one only looks at mortgage debt and does not consider other debt. Today'sIrish Independent refers to “400,000 families in arrears as energy firms step up drive to install pay meters”. That amounts to one in every four households. One cannot look at mortgage debt alone and make arrangements for people to pay if one does not consider their ability to pay, which is linked to the amount of their indebtedness. It is not only mortgage indebtedness.

The other Bill being discussed this week also considers the lack of hard evidence on the level of indebtedness. There is a lack of statistics on consumer credit arrears as well as rent and utility debt. We need to find a way of quantifying precisely the extent of the debt. The authors of the report to which I referred argue that the Central Bank should require arrears data from all lenders. That is a positive and achievable proposal.

The report also calls for an independent evaluation of current policy, with a rolling assessment, in order to ensure evidence-based, informed and responsible policy making. The report is measured in its statement that there are no quick-fix solutions, which I accept. It calls for a comprehensive policy framework rather than continuing merely to muddle along in the hope that the situation will improve. That is no longer acceptable. The report points to the consequence of continuing in this mode, including the cost for welfare budgets, the cost in terms of crime and the type of disintegration that will happen in both families and communities. We are already seeing households under great stress in the face of unsustainable debt.

Action is being taken on some of the report's recommendations, including the introduction of legislation on personal insolvency. That Bill must be brought forward as soon as possible. The report uses the term "settlement, not forgiveness" and makes reference to moral hazard and people being categorised as either "deserving" or "undeserving". The authors argue that this is a shallow characterisation of such schemes as debt forgiveness. They highlight what is available in other European countries as a norm in terms of dealing with debt problems. We are not the first to deal with this issue and we should employ best practice in other countries. There are other models from which we can learn.

The report also refers to a debt resolution agency, something we discussed last week in this House. The authors point out that the housing debt problem is worsening. While one in ten households was in mortgage arrears at the end of 2010, this had increased to one in nine by March of this year and to one in eight by the end of June. The report indicates that the average amount of arrears is €21,000. We are heading towards a situation where people will surrender their homes rather than waiting for repossession. I have seen evidence of that in my constituency.

The blame game which casts those who purchased homes during the boom as foolish ignores the fact that there was a media consensus at the time, as evidenced by the extensive property supplements, which served to stoke the boom. The Government encouraged people to purchase property and we were told the banks were well capitalised. People queued overnight to secure homes in new developments and thus avoid the inevitable price increase of €10,000 or €20,000 in the next phase. Every expert under the sun was wheeled out to urge people to get onto the property ladder. One cannot blame people for believing what they were told from every quarter. We must have a fair and proportionate response for those who find themselves in an entirely untenable position. The report produced by these groups is a useful addition to the debate.

I welcome the opportunity to contribute to this important debate on the Keane report on mortgage arrears. The combined issue of personal debt and mortgage arrears is a significant social and economic problem facing thousands of households across the State. The Keane report is not the Government's final response to the mortgage crisis. Rather, it is a measure of our commitment to it. It is a prescriptive document — a blueprint for action which sets out a suite of options to be considered by the Cabinet in the coming weeks in conjunction with various stakeholders.

It is important that we infuse this debate with some element of positivity. It is important for the people who depend on us to have a robust and mature debate in seeking a solutions-based approach to this issue. We should not contribute to public misery by criticising all attempts to address the problem and by pandering to vested interests. There will be many who will not welcome the solutions proposed in the Keane report. We must stay focused. At the heart of this problem are thousands of families under enormous pressure. Themodus operandi of Government in seeking to resolve these difficulties must have these people at its centre, not those on the periphery and certainly not those who would seek to be messenger boys and girls in this House.

The publication of the Keane report is a measure of the Government's ability and commitment to tackle the mortgage and debt crisis. It is a crisis which sees some 45,000 households in arrears of more than 90 days, including 32,000 in arrears of more than 180 days. In addition, a further 56,000 households have restructured loans, equating to approximately 70,000 mortgage accounts. We must consider the Keane report against the backdrop of the key and guiding principles which underpin it. The first principle is that people in distressed situations who are making honest attempts to meet their financial obligations will not be put out of their home. That was a key principle of the Labour Party leading up to the general election, it is a key principle of the programme for Government and a key recommendation and outcome of the publication of the Keane report.

I welcome the proposals being put forward by Fianna Fáil on this issue. I am favourably disposed to solutions-based approaches but I am taken aback by the speed with which that party has rushed to the aid of distressed mortgage holders. Heretofore, the only solutions available to borrowers and lending institutions were forbearance or foreclosure. The Keane report offers several possible solutions, including mortgage-to-rent schemes, trade-down mortgages, split mortgages and sale by agreement.

One of the key recommendations is the early introduction of new judicial and non-judicial bankruptcy options. The true extent of Fianna Fáil's concern for home owners was highlighted in the autumn of 2009 when the Labour Party brought forward a Private Members' motion in which we indicated that a mortgage crisis was fast approaching and called for a structure to deal with stressed mortgages. Since then the number of people falling behind by 180 days in their mortgage payments has doubled. On that evening, Fianna Fáil, then in Government, talked down the extent of the problem. The stock Government response was to wait to see what happened.

Further highlighting the extent of Fianna Fáil's concern is the fact that two reports commissioned by the former Government into the problem were never acted upon. The Cooney report was published on the day the Dáil went into recess in the summer of 2010 and it was not debated in this House. Nor were its final recommendations, which were published in November last year. It is wildly disingenuous of Fianna Fáil Members to talk about the urgency of holding a debate on this issue when, on two specific occasions, that party refused to facilitate debate in this House.

There is a growing agenda within certain circles which promotes blanket debt forgiveness. It is in the interest of those promoting it to undermine the key recommendations and the robustness of the Keane report. The Government, in line with the report, is crystal clear on where it stands in regard to blanket debt forgiveness, namely, that it will not happen. Banks are already dealing with arrears on a case by case basis. That may be unpalatable but it is absolutely necessary.

My colleague, the Minister for Social Protection, Deputy Joan Burton, has invited the various stakeholders in the mortgage and personal debt debate to a forum to be held in November. Their views and recommendations on the Keane report on mortgage arrears are welcome and will form part of the solutions that will deal with the complex problems of mortgage and personal debt.

It is incumbent on each of us in this Chamber and in the Seanad to put forward positive, solution-based approaches and not come in here and pander to an elitist circle who have no interest in seeing the recommendations of this report materialised. This report is for people with mortgage arrears, not for vested interests.

I welcome this report and compliment Declan Keane and the other members of the working group on publishing it. Unlike some of the previous speakers this evening and during last week's debate on this subject, who seem to make a virtue of the fact that they are having sleepless nights about two bankers participating in the working group, out of a total of 17, I will lose no such sleep because at the end of this process it is not two bankers or 100 bankers who will decide on this document or the legislation but the people elected to this House.

There has been much critique of this framework document which states clearly that it does not pretend to have the answer to every problem. I compliment the Minister for Finance because after only 20 weeks this group was up and running, so to speak, and in a limited framework of nine weeks we are here discussing it. This problem did not arise last February or March. As my colleague, Deputy McCarthy, pointed out, people were having a problem with mortgage debt in late 2007 and early 2008. We should deal with facts in regard to it.

This document is not a solution to every problem but for those of us in the Labour Party as part of this Government and our colleagues in Fine Gael, the bottom line is to keep people at risk of losing their family home in their homes. Whatever about the other facets of it the bottom line is that no one will be declared homeless. That is what this report is about, and when the legislation comes before the House it will be for all Members of the House to ensure that it is fit for purpose and that no family should be declared homeless as a result of difficulties with their mortgage.

This is a compassionate document about a human problem where there are children involved, etc. I read some of the critique of it and some people seem to have a hang-up about the possibility that some people may become council tenants. I say to those, without naming them, that I was born in a council estate. My parents were council tenants. I now live in a council estate and I am proud of it. The fear that some people may be declared council tenants is rubbish. Have we learned nothing from the Celtic tiger years when we got carried away, and some people are still being carried away? I look forward to the legislation and have great confidence that this Government will deliver a compassionate resolution to the difficulties of mortgage debt.

I, too, welcome the opportunity to record my views on the Keane report. I do not have any hang-up about the composition of the committee referred to by the previous speaker. It is a pity some people have a hang-up about that because it was the bankers, in the main, who got us into this mess and their expertise, if they have any left, should be sought out. They have a role to play in that regard.

I hope the Keane report will not be another report left on the shelf. I compliment the Minister, Deputy Noonan, on setting up the working group and on the membership he chose. I welcome the timely publication of the report and it is important that we discuss it.

It was welcome to hear Government speakers say that any final decisions will be debated in legislation here and voted by Members of this House. That is important because like previous speakers I do not want to cause a scintilla of additional concern or anguish to the parents, siblings and children of the families affected for whom this problem has become a nightmare. We are aware that over 70,000 family units are experiencing serious problems. That is a tragedy coming off the back of the Celtic tiger and the expectations created during that time when the flames were fanned by the media, the previous Government, most economists and everybody. Enormous pressure was put on anybody under 30 years of age who had never known stringent times. I have children of that age and they do not understand when we talk about the last recession and learning from our past mistakes but we have learned nothing from previous mistakes. Accountants, solicitors, auctioneers and so on got busy and it was a case of buy the house today or it will increase by €10,000 tomorrow. New catch words are being used such as moral hazard and people not deserving something but after we have cherry-picked parts from this report we must ensure that no family home will be taken away. The primary family residence must not be taken from the family.

An aspect of the Keane report with which I do not agree is that the bankers have got out under the wire again. The banking system practically forced the money on people, although I accept they signed for their mortgages but when applying for the mortgage they added in the cost of a holiday, an SUV or whatever. It was all done on a commission basis for the people behind the counter. Many thousands of good, decent people work in the banking industry but the senior and junior managers were zealous to get extra profit for themselves. The problem was greed, which is a horrible word. Those people should not be let slip under the radar again.

The Central Bank or the regulator must get an accurate figure in terms of the full extent of this problem and deal with it. Blanket debt forgiveness is not a realistic option because I refer primarily to the family home. I am not talking about people my age or younger who have 20 houses at this stage. The word "greed" comes to mind again because those people fanned the flames of the market but the ordinary couple who wanted to get married, settle down and purchase their own house did not have a hope. I do not know how the people who bought all the houses thought they would maintain that. We all know people who had enough to maintain one or two but I am not talking about those people. They have to deal with those problems and it has created a problem in their own personal situations but that is another day's work. They were small, medium and big speculators but I am talking primarily about the family home.

Some of the solutions put forward in this document are unrealistic. I have no problem with anyone in a county council house but I have a problem where it affects a family who have been paying their mortgage for 15 or 20 years. I do not know where the county council will get the funds to take back the houses and rent them. That is not fair because the bank will win again. The taxpayers and the home owners are carrying the can.

So a victim should be given rent allowance, is that it?

I did not interrupt Deputy McCarthy. I am not talking about a victim. I am saying we have to protect them.

What is the alternative?

We can examine aspects but it is not realistic to expect a family who have not speculated to give up their home. They merely tried to put a roof over their heads and provide for their family and it is unrealistic to expect them to relinquish their stake in that house and rent again.

How is that——

We have only a few minutes left.

The banks approved the massive mortgages and they are not expected to take any of the hit. That is unrealistic. The banks must take a hit. When the Deputies opposite were in opposition they were shouting about the senior bondholders in banks. I appreciate what they are trying to do but we must have a level playing field. We cannot have the banks getting off.

We also must reform the bankruptcy laws——

——because people will be demonised for ten, 15 or 20 years or for life. That is killing the spirit of the Irish people. They are in enough trouble at the moment but it is killing entrepreneurship in terms of anyone who is self-employed. Anyone who is trying to work every day and face that every night must find it impossible to sleep.

Debate adjourned.
The Dáil adjourned at 10 p.m. until 10.30 a.m. on Wednesday, 26 October 2011.