Dáil Éireann debate -
Wednesday, 2 Oct 2013

Vol. 815 No. 2

Leaders' Questions

Deputy Micheál Martin

From last week’s presentation to the Oireachtas finance committee by the Governor of the Central Bank, Patrick Honohan, the Taoiseach will be aware there are now more than 97,400 mortgages in arrears for over 90 days. The Central Bank is warning of a €9.3 billion mortgage debt mountain. The Governor is very unhappy with the response of the banks to this particular crisis which is causing immense distress to thousands of families, affecting their capacity in terms of day-to-day living.

He confirmed that, at the end of June, 74,000 of the 98,000 mortgage holders in arrears for more than 90 days were not yet in arrangements with their lenders. Effectively, 75% of distressed mortgages are not being dealt with. That is an extraordinary revelation by the Central Bank Governor and causes deep concern across the country. He also accused the main banks of engaging in wishful thinking that the mortgage arrears crisis would cure itself. What is more alarming is that not only are the banks not moving fast enough to tackle the problem but that the majority are going down the repossession or surrender route. Almost two thirds of mortgage holders in arrears have been threatened with legal action. Of the 35,000 proposed resolutions offered by the banks by the end of June, 62% referred to surrender or repossession of property.

The Taoiseach has said time and time again that repossession would be the last resort. We now know that repossession and evictions are the first resort, not the last as promised by the Government. Will the Taoiseach intervene and establish an independent office to deal with this issue once and for all and ensure those in mortgage arrears get a fair hearing from their banks?

The Taoiseach

First, the entire mortgage and banking crisis is the central issue of the legacy this Government inherited.

Deputy Mattie McGrath

Change the tape. Change the record.

The Taoiseach

To sit back and do nothing about it would make the situation even worse. I dealt with the mortgage crisis when Deputy Martin asked a question about it yesterday. It is not true to say that the first port of call is repossession. The family home in this country is of fundamental and immense importance to people and their families.

Deputy Timmy Dooley

That is why the Government amended legislation to make it easier for repossessions.

The Taoiseach

Quiet now, Timmy. Quiet.

An Ceann Comhairle

Will Deputy Dooley stay quiet?

Deputy Timmy Dooley

I am just helping the Taoiseach in answering the question.

Deputy Barry Cowen

Timmy, debate is not allowed.

An Ceann Comhairle

He does not need your help.

Deputy Micheál Martin

That is the point we are making.

Deputy Willie O'Dea

Does the Taoiseach admit to that?

Deputy Timmy Dooley

Will the Taoiseach confirm that? Is it that he does not know?

The Taoiseach

Of these, 24,000 are new structures in the last quarter. I have to assume, without the verifiable audit from the Central Bank, that these are sustainable solutions for the borrower and lender which everyone wants to see.

Deputy Timmy Dooley

The only solution is eviction and repossession.

The Taoiseach

The Central Bank has confirmed that 76.5% of the stock of restructures is deemed to be meeting the terms of the restructured arrangements.

From looking at the entire catastrophic mess that Deputy Martin’s party left behind, we have put in place a series of options, including the personal insolvency arrangements, which will provide an answer to everyone’s problems.

Deputy Willie O’Dea

This Government has made matters worse.

The Taoiseach

To those listening, the first imperative is there is engagement between the borrower and lender. Somebody has to sit down and see if they can cut a deal which is in the interests of the borrower and the lender. In cases where people use the Personal Insolvency Agency, the insolvency practitioners will go through all the circumstances pertaining to each person to ensure the best option can be put in place for them.

An Ceann Comhairle

Thank you.

The Taoiseach

I am not happy that the banks have not measured up in the way we would like.

Deputy Robert Troy

Do something about it then.

The Taoiseach

They themselves have their problems in that their people had become used to throwing out money all over the place without being able to deal with the crisis and the consequences of that.

Yes, there are people in mortgage distress. However, this is the evidence from the Governor of the Central Bank as a consequence of the actions put in place by the Government. The Central Bank is the regulator and requires the banks to meet their targets on mortgage arrears and will audit the figures they submit.

Deputy Micheál Martin

The Taoiseach has failed to make any meaningful impact on the mortgage arrears issue.

Deputy Ruairí Quinn

That is a bit rich coming from Deputy Martin.

Deputy Frances Fitzgerald

He does not take any responsibility for this.

Deputy Micheál Martin

The number of mortgage arrears over 90 days has quadrupled since 2009. It is getting much worse by the day. The Governor of the Central Bank said last week that despite all our efforts far too many arrears cases still remain untreated. Essentially, what he said was tantamount to an admission of failure on this issue. Up to 35,000 proposed resolutions offered by the banks to the end of June referred to surrender or repossession of property.

Deputy Finian McGrath

No surrender.

Deputy Micheál Martin

These are the Governor’s statistics. How can the Taoiseach credibly claim repossessions are a last resort when the evidence from the Central Bank is the opposite? The banks first and foremost are referring people to repossession or surrender of property. That is the reality. The problem is that the Taoiseach surrendered control of this to the banks and put them into the driving seat with legislation after the Dunne judgment and by diluting the protection to the consumers under the mortgage arrears code of conduct. There is a major issue here.

Deputy James Reilly

Even Mattie is quiet.

Deputy Timmy Dooley

Is Deputy Reilly still giving out the medical cards?

Deputy Micheál Martin

This problem is getting much worse by the day.

The Taoiseach

It is a bit rich coming from Deputy Martin when last week he admitted openly that he allowed a situation to develop where taxes became too low, public spending became too high and his Government lost control while billions of euro were wasted.

(Interruptions).

Deputy Timmy Dooley

That was then; this is now. The Taoiseach is going back to the past.

The Taoiseach

A member of that Government was the first to admit, from this seat, that the Government needed no more taxes and that we had enough stamp duty to run the country, and started a housing crisis.

Deputy Timmy Dooley

The Taoiseach was bidding at every auction.

The Taoiseach

The figures I have given are the authentic figures from the Governor of the Central Bank. If Deputy Martin wants to say the Governor is not telling us the facts, he should say so.

Deputy Micheál Martin

The Taoiseach is saying that.

The Taoiseach

Some 80,000 mortgages have been restructured, with 24,000 new restructures in the last quarter. The Central Bank has indicated that 76.5% of those restructures were deemed to meet the terms of sustainable and restructured arrangements. That fact is verified by the Central Bank.

Deputy Micheál Martin

Does the Taoiseach accept the figure of 35,000 from the Governor?

The Taoiseach

The Central Bank is to audit the figures submitted by the banks to the Central Bank as their regulator. We will know the true facts when it does that.

Deputy Micheál Martin

Did the Taoiseach read the presentation to the Oireachtas committee on this?

The Taoiseach

It takes a long time to uncover the dark depths of what Deputy Martin's Government left behind here.

Deputy Micheál Martin

It is getting worse.

The Taoiseach

The people of this country will never let Fianna Fáil forget that its conduct has wreaked havoc and caused crises in family after family. This Government has put in place a suite of measures - a range of options - that will allow for those persons who are in distress with their mortgages to have one of these solutions put in place to get them out of it.

Deputy Micheál Martin

The Government has put the banks in the driving seat.

The Taoiseach

I do not accept Deputy Martin's assertion that this Government has done nothing about it. I am not happy with the situation that the banks have not come up to the mark.

Deputy Timmy Dooley

The Taoiseach is not happy with himself.

The Taoiseach

They have all the options. They have the suite of measures. The regulator is the Central Bank.

Deputy Micheál Martin

The Taoiseach left the banks alone and did not engage with them. He washed his hands of this issue.

The Taoiseach

With Deputy Martin's style of engagement, he never listens to anybody.

(Interruptions).

An Ceann Comhairle

Would Members please stay quiet? I repeat what I said last week. There are time limits for asking and answering questions. Would Members please adhere to them or ask the Whips to change the time allocated? Would Members please allow Deputy Adams to ask a question? They are not impressing anybody.

Deputy Michael Noonan

Deputy Martin was never here when there was trouble. He was in America.

Deputy Gerry Adams

Dúirt an Taoiseach nach bhfuil sé sásta. Inné, d'ardaigh mé anailís Grant Thornton leis, go bhfuil níos mó ná míle cásanna d'anacair morgáiste, a thaispeánann nach bhfuil pingin rua fágtha ag teaghlaigh lena gcuid morgáistí a íoc ag deireadh na míosa.

The Taoiseach said he was not satisfied with the situation, but when I asked him yesterday to give a commitment to ensure that no family in mortgage distress would be excluded from the insolvency process because they could not pay up-front, he refused. Grant Thornton released another report today showing the enormous burden on low and middle-income families. A family earning €40,000 per year is €6,000 per year worse off under the Taoiseach's Government. Fianna Fáil, obviously, the Labour Party and Fine Gael have done this to struggling families.

Deputy Timmy Dooley

Deputy Adams has also made families struggle.

Deputy Gerry Adams

It is reported that the Economic Management Council will meet today to discuss the total level of adjustment in this year's budget. The people listening today want to know how the budget will affect them. Will they have less money to feed their families, pay their bills and cover their mortgages? Will austerity rule once again? The Taoiseach must believe that low and middle-income families have no more left to give. Austerity is not working for them. On the cusp of the Economic Management Council meeting, I ask the Taoiseach to give a commitment that budget 2014 will not add to the pain and hardship of these families.

The Taoiseach

Ar dtús, chuir an Teachta ceist orm faoi thuarascáil Grant Thornton i leith rud éigin eile. Tá a fhios ag gach duine, mar a luaigh mé sa Dáil le cúpla lá anuas agus níos mó ná uair amháin, go caithfidh an fhaisnéis iomlán a bheith ag duine sula mbeidh sé in ann réiteach a dhéanamh nó rún a mholadh faoi chúrsaí morgáiste do dhuine atá i dtrioblóid. Sin an fáth gur chuir an Rialtas dlí i bhfeidhm agus gur leag sé amach coinníollacha eile do na bancanna i dtreo agus go dtiocfaidh siad ar réiteach do gach duine. Níl sé i gceist go mbeidh duine caite lasmuigh de na coinníollacha sin ach is gá go mbeidh an fhaisnéis iomlán ag an duine agus an banc le teacht ar réiteach.

Deputy Adams asked about the Grant Thornton report and the difficulties and challenges people face. Everybody understands the economic challenges so many families in this country have had to face because of the catastrophic situation left behind by an incompetent Government. I would not believe all the reports one reads in the papers. I am sure Deputy Adams does not. This Government has signed on to meet particular objectives and targets and we will not shirk that responsibility, but we do not intend to go beyond it. A fundamental aspect of the programme for Government is that there will not be any income tax increases. Deputy Adams's assertion that people will be faced with that is untrue. This will be vindicated by the Minister for Finance as part of the programme for Government when he presents his budget on 15 October. It is very challenging.

I note this week's reports that consumer confidence is at its highest level for the last six years, with an average of 3,000 jobs per month being created, and we have had 14 consecutive months of drops in the live register. Unemployment has fallen from 15.5% to 13.2%, which is not where we want it to be, but it is significant progress.

Deputy Timmy Dooley

That is due to emigration.

The Taoiseach

The challenge facing the Government and our country is to continue on the steady path that the Government has plotted and our Minister for Finance has followed, to keep our economy in order, to provide opportunities for job creation and therefore economic growth, to take our country, through this budget, out of the bailout and give us a chance to restore our economic independence, and to give an opportunity to the many young people around the country, some of whom are in the Gallery today. These things matter. That is why we intend in the deliberations around the budget to be as fair and equitable as possible and to use whatever flexibility is available to us to continue essential services, look after the vulnerable and provide opportunities for job creation.

Deputy Gerry Adams

I agree with the Taoiseach about the last Government. Tá ceist shoiléir ann. Cad é an difear idir an Rialtas deiridh agus an Rialtas seo? I also agree that one should not believe everything written in newspapers. I know that from personal experience. I can see what is written in the Fine Gael-Labour Party programme for Government, which promised to build a fair, socially inclusive and equal society. I can also read what was said in the Economic and Social Research Institute, ESRI, report which stated that the last two budgets were the most unfair since the start of the crisis. In 2012 and 2013, the Government's budgets made low and middle-income families pay for the crisis while leaving those with enormous wealth relatively untouched. Why not introduce a wealth tax or a third band of income tax for high earners? That would be fair.

The Taoiseach talked about fairness. Why not ring-fence education and health spending and invest in job creation? That would make social and economic sense. The truth is that austerity is not working, except for the elite.

The Taoiseach's answer was not clear. Is the Economic Management Council meeting today? Will the Taoiseach try to give some assurance to the people listening to us that budget 2014 will protect low and middle income families and place the burden on those who can pay? In other words, those who can pay more, should pay more.

The Taoiseach

Yes, the Economic Management Council is meeting today and now that I have an opportunity, I refute the myth and the allegations surrounding the council that it is some sort of quartet that makes all decisions for the Government.

Deputy Willie O'Dea

Is it three? Is the Taoiseach denying there are four?

The Taoiseach

That is nothing other than a myth being used by people who want to put forward the proposition that there is some sort of autocratic, dictatorial body. The Constitution which I defend -----

Deputy Timmy Dooley

The Taoiseach has obliterated all of the others.

The Taoiseach

----- means that the Government has collective responsibility for budgets and that it is accountable to this House.

Deputy Michael Healy-Rae

How did the book launch go last night?

An Ceann Comhairle

Please allow the Taoiseach to reply. There is a time limit.

The Taoiseach

It is not accountable to the EMC, a facility to streamline measures for consideration and decision by the Government. The Cabinet has collective responsibility and meets in full.

Deputy Timmy Dooley

To convince them. Ministers do not have much to say.

An Ceann Comhairle

Will the Deputy learn to keep his mouth closed during Leaders' Questions?

The Taoiseach

Deputy Gerry Adams asked what was different. That is a legitimate question, but sometimes Members do not want to hear the answer. What is different is that we are not blocked out of the international markets. Our integrity is not in shreds; our reputation has been restored; interest rates on international markets are not 15%; we have dealt with the promissory note, got interest rate reductions and loan maturity extensions. These are all matters that are important to the economy. Also, during our Presidency, driven by the Minister for Finance, the questions of banking union, capital directives, supervision and supervisory requirements were all dealt with. These are in place as we move towards dealing with further issues, with support from our European colleagues. That is what is different. The confidence that is palpable all over the country, felt at the ploughing championships which the Deputy attended, is evidence of the people believing their country has come through a very rough time and that it is making progress.

The Deputy will not have heard anybody on this side of the House talking about green shoots or having turned corners or saying we are out of the mess. We still face a series of challenges, but we are focused on the country, the economy and the people. The specifics of the budget will be decided by the Cabinet in toto when it sits around the table. I confirm this as fact, despite what the Deputy may hear from some of those on his left hand side or what he may read.

(Interruptions).

An Ceann Comhairle

Please allow Deputy Seamus Healy to ask his question. I will arrange for copies of Standing Orders to be reprinted in case some Deputies have lost theirs. Perhaps they might have a chance to read them during the recess.

Deputy Seamus Healy

This year the Government has cut the capital allocation for local authority and voluntary housing by over €106 million. This is in the context of huge reductions already, from €1.5 billion in 2008 to €585 million in 2013. Recent figures for waiting lists for local authority housing have reached the shocking number of approximately 100,000 or, to be precise, 98,318. The level of social housing building in Ireland is at zero. Local authority housing has been decimated. The local authorities' budget for house building has been reduced from €367 million in 2010 to a paltry €65 million in 2013. Capital funding for voluntary and co-operative housing this year has been cut by €15 million, from €70 million to €55 million, a reduction of 21%. The public house building programme is almost non-existent and because of this, the numbers on housing waiting lists have increased hugely, from 56,000 in 2008 to 98,000 - the most recent figure - an increase of 40,000 families languishing on housing waiting lists. The Government has abandoned the social housing building programme. This is another reason the Labour Party is at 6% in the polls. It had a proud record in providing local authority housing, but it has done a U-turn on this issue also. What is happening is that house building has been privatised and developers and landlords are being paid, instead of putting the money into building houses. They are being paid through schemes such as the rent supplement scheme and the paying of mortgages over and over again through the rental accommodation scheme and the long-term leasing scheme. In view of the huge numbers languishing on local authority house waiting lists, will the Taoiseach agree that a major public house building programme should be commenced by the Government? Such a programme would provide a major stimulus for the economy, create thousands of jobs, provide badly needed homes for families on waiting lists, reduce social welfare expenditure and save money. Will the Government immediately commence a major house building programme for the 100,000 families languishing on housing waiting lists?

The Taoiseach

I thank the Deputy for his comments and questions. Clearly, there is an increase in the number of applicants for adequate and proper housing, many of whom are on local authority lists. NAMA has offered 4,000 houses, of which, I think, 2,000 have been taken up by local authorities.

Deputy Sandra McLellan

A couple of hundred only.

The Taoiseach

Significant numbers of families are living in very small apartments, which is causing frustration and concern for many. I met the Construction Industry Federation the other day and I am aware that there are quite a number of good contractors and developers who have never been in NAMA and are not in the league of those deemed to be rogue builders or cowboys. The people concerned want to see a construction centre that has integrity, can be trusted and will measure up. This is an issue the Government will look at, but I am not going to confirm what moneys, if any, can be made available in the capital budget for it.

On the live register, there are at least 80,000 people who were involved in the construction sector in one way or another and there is clearly scope for a programme. For example, in the regeneration projects in Limerick and other locations there is a significant amount of public housing being built. I expect the response from local authorities to be improved in terms of the offers made by NAMA. As part of the budget, the Government will consider what is the best thing to do in respect of the increasing pressure from families on public housing lists.

Deputy Seamus Healy

It is obvious to everybody that the Government is refusing to fund a significant local authority and voluntary house building programme. However, will it at least spare the disabled, the ill and the elderly from cuts and give them some quality of life in their remaining years? This year the Government has cut the funding for housing adaption grants for persons with disabilities and ill and elderly people by €15 million, or 36%.

An Ceann Comhairle

Can we have a question, please?

Deputy Seamus Healy

We now have a situation where we have ill and disabled persons who must crawl up the stairs and cannot have a shower or a bath, not because they have been refused a housing adaption grant, but because they cannot even be considered because the funding has been cut by the Government and the money has run out. Does the Government have any compassion for the people concerned?

Will the Government show some common decency and restore the €15 million that was cut from the scheme so these people can have reasonable living conditions in the later years of their lives? Will the Taoiseach at least spare the disabled, the ill and the elderly from these cuts?

Deputy Finian McGrath

Hear, hear.

The Taoiseach

Compassion and common decency are not exclusive to members of the Opposition.

Deputy Seamus Healy

I hope everybody in the House has compassion and common decency.

The Taoiseach

This is why we listened to the sad saga of the women who were in the Magdalen laundries.

Deputy Seamus Healy

I did not ask about the Magdalen laundries. I asked about housing adaptation grants.

An Ceann Comhairle

Please listen to the reply.

The Taoiseach

This is why we are acting in respect of the people evacuated from their firetrap houses in Priory Hall. It is why the Minister of State with responsibility for housing, Deputy O'Sullivan, and the Minister for the Environment, Community and Local Government met NAMA last week to discuss-----

Deputy Seamus Healy

Every Deputy knows what I said is true. They deal with it every day of the week.

Deputy Finian McGrath

Deputy Healy is dead right.

An Ceann Comhairle

Deputy Healy asked his question and I ask him to listen to the answer.

Deputy Seamus Healy

The Taoiseach is not answering the question.

Minister for Health (Deputy James Reilly)

As this is a service matter I have referred the Deputy's question to the Health Service Executive for direct response.

Deputy Barry Cowen

He never said that.

Deputy Seamus Healy

I said everybody in the House should have common decency. That is why I am asking the question.

An Ceann Comhairle

I ask Deputy Healy to stay quiet, please.

The Taoiseach

It is why the Minister of State with responsibility for housing, Deputy O'Sullivan, and the Minister for the Environment, Community and Local Government met NAMA last week-----

Deputy Barry Cowen

It is a pity they did not meet the Priory Hall residents a couple of years ago.

The Taoiseach

-----to discuss the question of speeding up transfers from NAMA for social housing.

Deputy Seamus Healy

Will the Taoiseach restore the cuts made to the housing adaptation grant? He will not.

The Taoiseach

It is why the programme of voluntary housing and building takes into account many of the people Deputy Healy mentioned.

Deputy Seamus Healy

Are ill and elderly people going to have to-----

An Ceann Comhairle

I ask Deputy Healy to stay quiet.

Deputy John Halligan

He is just trying to get an answer.

The Taoiseach

It is why, in consideration of whatever limited capital is available for this area, priority will be given to the elderly and the disabled in the forthcoming budget.

Deputy Seamus Healy

Ill and elderly people cannot get a stairlift.

The Taoiseach

The Minister of State with responsibility for housing has already made this point very clearly. I cannot deal with the specifics of what will be allocated, but within these constraints the Minister of State with responsibility for housing has already referred to the priorities that will be dealt with.

Deputy Seamus Healy

It is shameful.