Topical Issue Debate

Health and Social Care Professionals Regulation

Deputy Dan Neville

I thank the Ceann Comhairle for selecting this matter as we have discussed the need to regulate psychotherapy and counselling over the past ten years. There is no regulation at present in Ireland for the registration of psychotherapists or counsellors. There is no requirement for a qualification to practise in these areas. It is dangerous for untrained and unskilled people to probe a person's unconsciousness. We are dealing with extreme human vulnerability and serious damage can be done to such delicate people. We have seen it.

The eating disorder organisation, Bodywhys, has been discussing this for a number of years. It has quite extensive complaints about treatment by unregulated counsellors. Back in 2005 the Health and Social Care Professionals Act, which provides for the registration of persons qualifying under the title of a designated profession, was enacted. This is for the determination of complaints concerning the fitness to practise of professionals named under the legislation. Psychotherapy and counselling were not included as the various organisations could not agree. Subsequently, 22 of them made a presentation to the then Minister at his request, and produced the Psychological Therapies Forum report, Submission on the statutory registration of counsellors and psychotherapists in Ireland.

On 20 March, 2014, the former Minister wrote to me saying he intended in the public interest to designate by regulation the professions of counselling and psychotherapy under section 4(2) of the Health and Social Care Professionals Act 2005. The Minister informed me he was obliged to consult the council in the first instance and give interested persons, organisations and bodies an opportunity to make representations to him concerning the proposed designation. The Minister also informed me he had requested that his officials put the necessary arrangements in place to initiate this consultation process as soon as possible.

On 20 February of the same year, the director of the National Office for Suicide Prevention of the HSE, Mr. Gerry Raleigh, stated that people in distress should avoid these services because counsellors may not be fully trained and may not be basing their counselling on best advice. He said it was important that a person seeking psychotherapy and counselling identifies professionals who are members of the Psychological Therapies Forum, which I already mentioned and which encompasses 22 professional organisations. This forum said it provides protection to clients but falls short of optional protection, as under the common law system it is possible for any person to take the title of counsellor or psychotherapist and to practise accordingly without training or competence. Any person can put up a sign and say he or she is a counsellor or psychotherapist and charge the usual fee of around €80 an hour to perform psychotherapy and counselling. The previous Minister accepted that it was extremely dangerous for such untrained people to do so and that regulation should take place.

I have two leaflets here - I have about a dozen more as well - one of which is advertising a so-called advanced diploma in suicide studies. It is a course taking place over seven weekends. There are two weeks for suicide prevention, two weeks for suicide intervention and two weeks for post-intervention. That makes up an advanced diploma in suicide studies. Bodywhys informed me of another diploma programme from the eating disorder resource centre of Ireland, with a certified trainer in practitioner skills for eating disorders and obesity. The diploma is granted over an eight-weekend period. The cost of that is €370 per module, which makes it up to €3,000 for the eight-week programme to obtain the diploma. As the Minister, a qualified professional himself, knows, eating disorders are psychological, psychiatric and physical. It is a very complex area. I got somebody who has no interest whatsoever in eating disorders or any area of psychotherapy and counselling to apply for this diploma, and they got a reply back - I have it here - saying they could start the course the following weekend, without any background whatsoever in any branch of medicine.

As such, I would welcome an update from the Minister on the current situation in respect of the regulation of psychotherapy and counselling.

Minister for Health (Deputy Leo Varadkar)

I thank Deputy Dan Neville for raising the issue and giving me an opportunity to update the House on the ongoing programme of regulation of health and social care professionals being undertaken by the Department of Health. The regulation of the 14 professions currently designated under the Health and Social Care Professionals Act 2005, including the optical professions, is being implemented on a phased basis as the registration board and register for each profession is established. To date, eight registration boards have been set up. The registration boards for the remaining designated professions will be established between now and 2016. In addition, the regulation of the optical professions will transfer from the Opticians Act 1956 to the Health and Social Care Professionals Act 2005 before the end of this year.

Regulation under the 2005 Act is primarily by way of the statutory protection of professional titles, confining their use solely to persons granted registration. The structure of the system of statutory regulation comprises registration boards for the professions to be regulated, a committee structure to deal with disciplinary matters and a Health and Social Care Professionals Council with overall responsibility for the regulatory system. From a public protection viewpoint, a crucial milestone in the regulation of health and social care professions in Ireland was the introduction on 31 December last of the 2005 Act's fitness to practise regime which is similar to that applicable to doctors, nurses and midwives.

In relation to the question of regulating counselling and psychotherapy, the current position is that, while the profession or professions of counsellor and psychotherapist are not specifically designated under the 2005 Act, there are various regulatory controls on many counsellors and psychotherapists operating in Ireland. The profession of psychologist, for example, is a designated profession under the 2005 Act, which means that those psychologists who are counsellors and-or psychotherapists will in time be regulated under the Act. A psychologist registration board is due to be established this year and will be an additional source of advice on the question of regulating counselling and psychotherapy in the interest of protecting the public. Psychiatrists, some of whom practice psychotherapy, are regulated under the Medical Practitioners Act 2007. Also, counsellor therapists working in the publicly funded health sector are required to have the minimum qualifications set by the Health Service Executive under the Health Act 2004.

The previous Minister for Health, Deputy James Reilly, wrote to the Health and Social Care Professionals Council last year seeking advice on the question of specifically designating counsellors and psychotherapists under the 2005 Act. A number of issues require clarification and there are strong differences of opinion on these issues among the various professional bodies representing counsellors and psychotherapists in Ireland. The main questions to be resolved include whether counselling and psychotherapy should be treated as one or two professions for the purposes of regulation, the title or titles of the profession or professions to be protected and the minimum qualifications that would be required. The readiness and compatibility of the professions for designation under the 2005 Act also need to be determined. The council's detailed report on the matter has been received in my Department in recent weeks and is being examined carefully by officials with a view to deciding the next steps.

Deputy Dan Neville

I am pleased the detailed report is now with the Department. Hopefully, steps will be taken to progress matters as it is now 14 months since the previous Minister asked that this be done. There are professional bodies which do very good work on the requirements for entry on their registers, but these are not the problem. The problem is those people who practise without any training or supervision by a professional body. We appreciate the work done by the professional bodies to ensure there is a level of competence among their members, but these are not the issue. The problem is those people who are not members of any association and who are not subject to any regulation. As we know from the NGOs in the area, they can do serious damage to people who are suicidal, have eating disorders or many other psychiatric issues which would benefit greatly from professional psychotherapy and counselling. We look forward to information in the coming weeks on the report of CORU on the registration of psychotherapists and counsellors under the 2005 Act.

Deputy Leo Varadkar

I understand the argument and case that Deputy Neville is making. He is absolutely right that there are a number of very strange people out there advertising their services as psychotherapists, counsellors and all sorts of other things. Not only may they not be very good, they can also do real harm in certain circumstances. If we are going to regulate the professions, we must ensure that we get it right. A number of issues need to be considered, including whether it will be one profession or two, which titles should be protected and which should not, given that people can always invent a new title and start to provide a service under it, what the qualifications should be and the readiness and compatibility of the professions as things stand. We must also look at grandparenting and the assessment of the qualifications and experience of good counsellors, particularly members of religious orders who have been providing a great service, including to my patients as a GP, but who may not fit the criteria. Further issues include the impact on psychology and social workers and international experience. I understand the experience in the UK has not been that good.

I assure the Deputy that the matter is not on the back burner. My officials will take a look at the document, on which I would be interested to hear the Deputy's views also. The next stage will be a further consultation once we know what direction we are going in.

Hospice Services Provision

Deputy Brian Walsh

I thank the Ceann Comhairle for selecting this matter and the Minister for Health, Deputy Leo Varadkar, for making the effort to attend to take it. The Minister is very familiar with this issue which I have raised with him on a number of occasions. I have been working on the plight of the Galway Hospice for the past three years and in that time have met with the Minister's predecessor. I have also met with other members of Government, senior HSE officials and the Secretary General of the Department of Health, but Deputy Varadkar is the first person who really gets to the nub of the issue and appreciates the challenges faced by Galway Hospice. I mean that sincerely and it is very encouraging that we have a Minister who takes that view.

Galway Hospice is the only hospice in Ireland that has been accredited by the International Society for Quality in Healthcare and the only one in Europe which has received an international quality award for outstanding achievement in the delivery of health care. The fact that it has achieved both of these awards against a backdrop of chronic underfunding is testament to the dedication, commitment and professionalism of the staff working at the hospice. Galway Hospice receives proportionately the lowest amount of funding of any specialist palliative care unit in the State. It is under-resourced in other areas also. For example, Milford Hospice in Limerick, which is the closest hospice to Galway Hospice, has 7.2 occupational therapist posts and 4.5 palliative physiotherapist posts. By comparison, Galway Hospice has one occupational therapist and no palliative physiotherapist. As a result of this underfunding, Galway Hospice does not have the capacity to provide vital services and is constrained in its ability to meet demand. Patients are occupying precious and scarce acute hospital beds who should be availing of either the inpatient unit at Galway Hospice or, better again, having care provided by the Galway Hospice home care service in the comfort of their own homes.

The extent of the problem is reflected in the fact that almost 50% of all deaths that take place in the acute hospital in Galway are cancer related. By comparison, the figure at the closest hospital to ours, which is Limerick General Hospital, is 18% as there is a properly funded hospice service at Milford. That obviously puts a strain on University Hospital Galway as well as forcing patients to receive end-of-life care in an inappropriate and undesirable environment. While there are plans afoot to deal with the capacity shortage at the inpatient unit, the more immediate challenge is to deal with the explosion in demand for hospice services, particularly home care services.

In 2011 there were 162 discharges from the acute hospital to Galway Hospice. Last year the figure was 363 and it is expected to increase again this year. The system is at near breaking point. The time for the Government to provide additional resources is long past.

One weekend last month there were five patients in the acute hospital in Galway who were approved for discharge to the home care services provided by Galway Hospice. Four of these patients were not discharged because of capacity issues in the home care services. One patient - luckily for him - is a resident of north County Clare and was discharged because he could avail of services provided by Milford Hospice. The Minister knows that the cost of the provision of an acute bed is estimated to be in the region of €1,000 per night. A person availing of home care services could avail of up to ten home care visits for the same resource. This matter is in urgent need of attention.

There is a very negative impact on staff morale. There has been a change in the dynamic between the public and hospice staff and there is now hostility in some cases towards hospice staff because of their inability to provide services. This issue urgently needs the Minister's attention and I look forward to his response.

Deputy Leo Varadkar

I thank the Deputy for raising this issue which I know is of great interest to him. I particularly acknowledge his special interest in Galway Hospice and the service it provides.

It is the aim of the Government that all people will be provided with the type of palliative care service they need, regardless of what diagnosis they have received, how old they are or whether they die in a hospice, an acute hospital, a nursing home or at home. The Health Service Executive has an annual service level arrangement with the Galway Hospice Foundation. In 2014, €3.36 million in funding was provided for the organisation. Funding is provided for local services on the basis of the budget allocation to palliative care services at a national level. It is normal practice for such service level agreements with hospice providers to cover all specialist palliative care services, namely, inpatient care, home care and day care. I am informed that the allocation to Galway Hospice represents the highest rate per specialist palliative care inpatient bed in the country. Perhaps that information is incorrect, but it is the information I have been given. The lowest allocations are for the north east, south east and midlands, where there are few or no inpatient hospices.

The HSE national director for primary care has recently been alerted, through local representation, that there are service pressures in respect of the funding for home care services being provided through Galway Hospice. This is being investigated as a matter of urgency by the executive with local service management in Galway as it raises concerns about the provision of this vital home care service for individuals and their families. It is recognised that hospices are usually funded through a combination of HSE funding and significant voluntary fundraising and this issue will be considered in its totality in the investigation with a view to ensuring value for money is achieved.

I will continue to monitor the position carefully and have asked for an update on progress. On foot of our conversation earlier today, in the debate which the Deputy requested, I was in touch with the director of primary care services who has committed to examine the matter. None of us wants to see terminally ill patients dying in hospital when they could die at home with the help of home care packages. As is always the way with any request for additional resources - it is a very strict rule that I have - the service provider must establish and show that it provides best value for money and that it uses its existing resources to the maximum extent possible before receiving any more.

Deputy Brian Walsh

It is clear that value for money is provided. If the Minister compares the cost of occupying an acute hospital bed with the cost of providing home care services and examines the knock-on and positive impact on things such as waiting lists and trolley counts, when acute hospital beds are freed up, it has to have a very positive impact. The cost of staying one night in an acute hospital bed is €1,000. Ten home care visits could be covered for the same cost. I do not know from where the Minister got the figures for Galway Hospice which show that it receives the highest proportion per acute bed. However, it is worth noting that the only funding it receives is for its inpatient unit beds. I think it is the only hospice in the country that does not receive any assistance from the State for the home care service. Perhaps that is what is throwing up the figures mentioned by the Minister.

This is a no-brainer. It would ensure patients in the later stages of cancer received specialist care in the most appropriate environment. The last thing we want to see happen is loved ones spending the last hours of their lives in a six-bed ward surrounded by a plastic curtain, with perhaps a neighbouring patient watching television or listening to the radio. That is unacceptable, especially when we look at the quality of service that can be provided not just through Galway Hospice but in hospices all over the country.

I mentioned staff. Some staff are, as the Minister said, experiencing hostility from the public because of the inability to meet demand. This obviously affects staff morale. Crucially, it also threatens to adversely impact on the fundraising capacity of the hospice. The people of Galway have been hugely generous during the years and I would hate to see anything happen that would compromise the ability of the hospice to fundraise, as it has plans to develop a new inpatient unit. It is in negotiations with the HSE to develop a state-of-the-art 26-bed inpatient unit, in the provision of which fundraising will be a central part. I hope the Government will include capital funding for that service in the soon to be announced capital plan.

This issue needs to be taken by the scruff of the neck and addressed. We are talking about it long enough. Galway Hospice will not be found wanting in the quality of service and the value for money it provides. One of its directors, Mr. Keith Finnegan, met the director, Mr. Hennessy, earlier today. It was a positive meeting. However, it needs to be followed up. A Government is judged by the way it treats the most vulnerable in society and there is no cohort more vulnerable than those who are preparing for death and for whom the only medical care available is palliative care.

I thank the Minister for taking this issue and showing an interest in it. I ask that he continue to monitor the position in the coming days to ensure funding or resources will be provided to address the issue.

Deputy Leo Varadkar

The matter will be examined and will be examined expeditiously. No one can disagree with the statement that we would all much prefer to see people who are terminally ill looked after in a hospice or their own home. That is much more preferable to them dying in a hospital ward, particularly in a shared room. If something can be done, we will do everything we can to do it. When it comes to the financial aspects, it is never a question of whether it is less expensive to have someone in community or primary care versus acute hospital care. As a rule, acute hospital care is always more expensive than community or primary care, but that does not mean that we should not get best value for the money we spend on community, hospice or primary care services. Nor is it about saving money. Money spent well in providing hospice, community and primary care allows us to treat more patients. There will, therefore, be no penny pinching. This is about enuring taxpayers' euro are spent as best as possible to treat and look after as many patients as possible.

Garda Resources

Deputy Robert Troy

I welcome the opportunity to raise this extremely important topic in the Dáil. I mean no offence to the Minister of State, but I am disappointed that the Minister for Justice and Equality who was in the Chamber only half an hour ago has left.

When I saw her on the monitor, I believed that she would be present to listen to my concerns.

Recent years have seen an erosion of the Garda's manpower and resources. Compared with four years ago, there are 1,600 fewer gardaí and 139 stations have closed. In Granard in my constituency, a senior position has remained unfilled for a long time, creating a lack of leadership for stations. Some Garda cars have 300,000 km or 400,000 km on their clocks. I compliment the Garda on the job it is doing in difficult conditions.

I raise this topic in the context of recent bouts of anti-social behaviour in my home town of Mullingar. For the most part, Mullingar is a safe, quiet and well-policed town. We benefit from CCTV, which acts as a deterrent and has helped to solve many crimes. Recently, the town was awarded the internationally recognised purple flag for its level of safety and the manner in which its gardaí respond to incidents.

Unfortunately, the past few months have witnessed a series of substantial anti-social incidents. On the night of St. Patrick's Day, a full street had to be closed. Gardaí were quick to intervene, but three of them were assaulted with one requiring hospital treatment. A number of members of the public were also assaulted. This was the third time that anti-social behaviour emanated from the venue in question. There was a further incident on Easter Monday night, albeit not to the same magnitude, thankfully.

This anti-social behaviour stems from one licensed premises. In recent days, the Garda has secured a temporary closure order against that public house and a number of the individuals involved have been brought before the courts. However, these measures are not strong enough if people can bring a street to a halt and cause serious anxiety among residents and visitors. Businesses that conduct themselves properly have had to close their doors because of the level of anti-social behaviour. All that the legislation enables the Garda to do is to give a slap on the wrist, close the venue's doors for five days and hope that, when they reopen, all will be resolved.

Will the Minister of State inform the Minister that we need stronger and more robust legislation to ensure that there are serious consequences for the sections of our communities that believe they can flagrantly break the law, namely, they might lose their licences and their premises might be closed down? We must send a strong and clear message to the effect that this type of behaviour will not be tolerated. It is not fair on the people living next door. If it not fair on the businesses that are conducting their business appropriately. The reputational damage that such behaviour can do to a town like Mullingar is not fair. At a minimum, will the Minister of State commit to considering legislation so that we might resolve issues such as this? I am sure that similar incidents occur in other provincial towns. When the next batch of Garda recruits graduates from Templemore, Mullingar Garda station should be given priority for additional resources so that people in its community know that this type of behaviour is not tolerated.

Minister of State at the Department of Justice and Equality (Deputy Aodhán Ó Ríordáin)

I thank the Deputy for raising this issue. As he will appreciate, the Garda Commissioner is responsible for the distribution of personnel among the Garda regions, divisions and districts. Garda management keeps this distribution under continual review in the context of crime trends and policing priorities so as to ensure that the best possible use is made of resources.

The Deputy will be aware that the Government is committed to resourcing An Garda Síochána. Restarting recruitment was a key priority and we started to deliver on this last September with the first recruitment of new gardaí since 2009. From September 2014 to the end of this year, the number of new recruits entering Templemore will total 550.

I assure the Deputy that the Minister is in ongoing contact with the Garda Commissioner regarding the overall response to the problem of antisocial behaviour. A key priority for the Garda is to tackle public disorder and anti-social behaviour by working with communities to reduce this type of behaviour and to enhance community safety. This approach includes a strong focus on quality-of-life issues and collaboration with local authorities to help address the causes of antisocial behaviour.

A range of strong legislative provisions is in place. These include measures under the Criminal Justice (Public Order) Acts and the Intoxicating Liquor Acts. The Garda has powers to deal with anti-social conduct that is attributable to excessive drinking, including through exclusion orders in respect of premises and closure orders in respect of licensed premises and catering outlets. The Deputy alluded to one such premises in Mullingar. In addition, gardaí have powers to seize alcohol to forestall public disorder or damage to property or where a person is under age. Where anti-social behaviour is directed at property, the Criminal Damage Act 1991 provides for a range of offences and penalties, including imprisonment for a term of up to ten years upon conviction.

The existing provisions provide the Garda with a wide range of powers to deal with offences associated with anti-social behaviour, including juvenile and adult cautions, fixed-charge penalty notices and the bringing of prosecutions. There are also provisions under the Criminal Justice Act 2006 for civil proceedings in respect of anti-social behaviour by adults and specific provisions dealing with anti-social behaviour by children. These provisions set out an incremental procedure for addressing anti-social behaviour.

In engaging with the Garda Commissioner on these issues, the Minister has asked her whether there are further legislative options we might consider that would be of assistance to the Garda. We are actively considering legislative measures.

Deputy Robert Troy

I thank the Minister of State for his reply. The most positive aspect that I can take from it is that the Minister has engaged with the Garda Commissioner to determine whether there are further legislative options that we can consider. There are further options. Every section of our community has rights. No one disputes that, but every section also has responsibilities. A particular section of Mullingar's community is not being appropriately responsible to wider society in its actions. A level of anti-social behaviour has materialised at a licensed premises in recent months and we do not want that one premises to cause reputational damage to our whole town.

I compliment gardaí on intervening as quickly as they did, but they are stretched to their limits. I met the superintendent and asked whether additional resources were needed, to which the response was that all stations needed additional resources because of the reductions in recent years. The superintendent would not say "No" to additional resources. Gardaí also need robust legislation that enables them to enter licensed premises, apply closure orders and go to court to ensure that such premises never reopen, thereby sending a clear message to their wider communities that this type of behaviour will not be tolerated.

I hope that through the engagement between the Minister, the Department and the Garda Commissioner, we can bring forward proposals to ensure that when behaviour such as I have outlined occurs, the licensed premises in question will no longer continue in operation.

Deputy Aodhán Ó Ríordáin

I am trying to read between the lines of what the Deputy is saying. It seems to me he is touching on rather dangerous ground if he is attempting to pit one community against another. We must be very careful as to how we describe issues within communities. If we set out to address anti-social behaviour purely as a policing issue, then we miss the point almost entirely. As I said in my reply, An Garda Síochána and other agencies are constantly working on strategies to empower communities. Where anti-social behaviour occurs, it is clear evidence that there already has been a failure right across the board.

I had a meeting this morning with representatives of YoungBallymun to discuss the advancement of the area-based child poverty, ABC, initiative, with which the Deputy will be familiar from his work as party spokesperson on children. The whole point of that programme is to empower parents and communities to look more profoundly at the issues that affect them, including issues around parenting and advancements in education. If the only response from parliamentarians to anti-social behaviour is a legislative or policing one, that is to miss the point. Of course we must be strong in defending our streets and towns against anti-social behaviour, but working out the reason that behaviour is happening is often the more difficult question to answer. That is why policy makers often shirk from answering it. We need to investigate more deeply why these incidents take place. In my own constituency there are instances of endemic anti-social behaviour. We can put 100, 200 or 300 gardaí out patrolling estates and they may deter some people from engaging in such behaviour, but the incentive to engage in it is still there. We must ask ourselves why that is the case. Why are young men and women from certain backgrounds and in certain areas not getting enough empowerment from mainstream society? Why are they seeking empowerment through these types of activities?

I take the Deputy's points very seriously. I am sure he is anxious, as am I, to hear what the Garda Commissioner has to say in response to the approaches the Minister has made to her. However, I would caution anybody against moving potentially onto dangerous ground by pitting one community against another.

Mortgage Interest Rates

Deputy Peter Mathews

I welcome the Minister for Finance, Deputy Michael Noonan, to the House and thank the Ceann Comhairle's office for selecting this Topical Issue for debate. It concerns a hugely pressing issue for hundreds of thousands of households in this country. As public representatives, we must always seek to convert statistics and figures to give us a sense of how they impact on people. The Minister understands that better than anyone. It is what politics and fairness are all about.

Deputy Michael McGrath introduced a Bill in this House on 31 March concerning the standard variable rate being applied by the banks to residential mortgage accounts. That debate was very important. Deputy McGrath highlighted that Allied Irish Banks which, together with Bank of Ireland, is one half of the duopoly of pillar banks, has 130,000 variable-rate mortgages, Permanent TSB has some 80,000 such customers, and Bank of Ireland has approximately 70,000. AIB is charging, on average, a variable rate of 4.15% on its mortgages, while Bank of Ireland and PTSB are charging, on average, 4.5%. However, the current eurozone average for variable standard-rate mortgages is 2.5%. In other words, these banks are charging a shocking and extortionate rate of almost 70% more than the eurozone average. That is not right.

The two main banks should not be allowed to retain a duopoly hold over the nation in respect of loans they advanced into the credit pyramid and bubble they created. I have in front of me figures which illustrate the calculable culpability of all the banks by reference to their funding models, as they call them. In fact, there is no such thing as a funding model. Rather, there are funding principles, because the principles of banks funding their assets are determined by bank boards. Unfortunately, that issue is not even being addressed in the banking inquiry, which is a shocking indictment of the approach being employed. By referring to the banks' balance sheets, which are the financial evidence of what the bank boards decided as policy, over the seven years from 2001 to 2008, we see there was a reckless departure from 90% loan-to-deposits ratios to a 173% weighted average. That was wrong. It is wrong that people who have the legacy loans from that era are being forced to pay an extortionate super-profit margin above the normal new loans margin.

Today I took a walk to visit some the nearby branches of the main banks. AIB on Lower Grafton Street has a sign emblazoned above its door advertising a mortgage awareness day which took place on Saturday, 21 March 2015 from 10 a.m. to 3 p.m. There is a great deal of irony to contemplate there. By God, that bank's variable standard-rate mortgage holders are very much mortgage aware. In the case of Bank of Ireland, there was an advertisement showing a house and the text: "Need to move? We pay your stamp duty to the value of 1% of your mortgage." Of course, there is no mention that this 1% will only apply, at most, to 80% of the cost of the property. That is another illusion, a lie to tempt people innocently into tying themselves to Bank of Ireland, as the bank describes it, "for small steps, for big steps, for life". The bank's 80,000 standard variable-rate mortgage holders certainly are in it for life, paying a 2% super-profit over eurozone rates for a euro loan. That is simply wrong.

The Minister must bring the banks to heel on this issue. Bank of Ireland, in particular, is out of control. Until nine months ago, its board of directors included an individual who made a profit of €500 million from his small investment of €350 million, which was a one-way bet into profit. He has since gone back to America. It is instructive to consider the backgrounds of the 12 remaining directors. The governor is British and has mainly been involved in the Lloyds Banking Group. Kent Atkinson is also British and previously with Lloyds TSB. Next we have Richie Boucher, who spent a lot of time at the Royal Bank of Scotland. Pat Butler was in the resolution group in McKinsey & Company. We have Tom Considine, a former Secretary General of the Department of Finance, former member of the advisory committee of the National Asset Management Agency and a former board member of the Central Bank of Ireland. James Herron is British and formerly of Invest Northern Ireland. Andrew Keating is only a young man but formerly worked with Ulster Bank. Patrick Kennedy, like Pat Butler, was formerly with McKinsey & Company. John Moran, like Tom Considine, is a former Secretary General of the Department of Finance. Davida Marston is another director who is British. My point is that most of these people have no empathy for or understanding of their Irish customers, yet they are the men and women who decide the policy of the bank and decide what the variable rates will be and if and when they are changed.

Bank of Ireland reported a profit of €1.1 billion in 2014, which followed a loss of €1.7 billion the previous year.

Acting Chairman (Deputy Charlie McConalogue)

The Deputy is over time. He will have two minutes to ask a supplementary question after the Minister responds.

Deputy Peter Mathews

I understand the rules, Acting Chairman, but this is an issue of national importance. In the space of a year, the bank turned a loss of €1.7 billion in 2013 into a profit of €1.1 billion, a turnaround of €2.8 billion. The Minister knows well that this is all to do with the manipulation of provisions. It is not to do with the health of the bank or its normal operating profit. The same applies in regard to AIB. All of this is seriously wrong and we must be courageous and honest about it for the sake of the Irish people whose lives are being impacted by it.

Some 300,000 mortgages equate to approximately 1 million people. Therefore, the issue needs to be addressed.

Minister for Finance (Deputy Michael Noonan)

I thank the Deputy for raising this important issue. As he is aware, the statement of Government priorities 2014-16 recognised the need for competition in the banking sector to put pressure on banks operating in Ireland to reduce the interest rates charged. This issue was also discussed in the context of a Private Members' motion brought forward in the House just before Easter. It has also been the subject of a number of recent parliamentary questions.

I met the Governor of the Central Bank, Patrick Honohan, on 2 April to discuss the issue. The Governor provided me with an update on the ongoing work he and his officials were carrying out on the issue of the standard variable rates, SVRs, charged by the lenders. At the meeting we spoke about the fact that the SVRs charged in Ireland were higher than those charged in other euro area countries and had not fallen in line with ECB wholesale rates. The Central Bank will continue to research why this is the case and will publish results shortly. The Governor will update me on progress in due course.

As the Deputy will be aware, it is a commercial matter for each lending institution to determine the rate it charges its customers, depending on a number of factors such as cost of funds and commercial considerations such as competition, risk pricing and the impact on deposit rates. However, the Government expects, as the cost of funding for the banks reduces, this to be reflected in the interest rates charged to both new and existing customers.

As the Deputy will also be aware, the Central Bank has no statutory role in the setting of interest rates by regulated entities, apart from the interest rate cap imposed on the credit union sector in accordance with the provisions of the Credit Union Act 1997 and the requirement to be notified of penalty or surcharge interest imposed in respect of arrears. Nonetheless, as I have said, the issue of regulation of interest rates remains a policy area under active review and has been the subject of recent correspondence between the Department of Finance and the Central Bank. The current position is that the Central Bank does not have new proposals for the additional regulation of interest rates.

The Governor of the Central Bank, in his opening statement to the Oireachtas Joint Committee on Finance, Public Expenditure and Reform last November, stated that in Ireland, as in most advanced economies, it had long been understood tight administrative control over the rates charged by banks would be counterproductive in ensuring a sufficient flow of properly priced credit on a lasting basis. Such control would strongly discourage new entrants when, in fact, ongoing competition in the banking sector will be crucial in ensuring the economy is provided with efficient and cost effective banking services. In this regard, there have been some movements on mortgage interest rates of late by a number of institutions which suggest the market may be entering a new and more competitive phase.

The Central Bank (Supervision and Enforcement) Act 2013 introduced changes to section 149 of the Consumer Credit Act 1995, which regulates fees and charges, in order to attract new entrants to the Irish banking sector. There is some evidence of improvements in the banking sector, with a number of institutions introducing new products and adapting their business models. In the past 12 months there have been a number of new entrants to the Irish mortgage market, bringing additional and welcome competition to the sector. While not an option for all borrowers, those who are in a position to move mortgages should look into their options to do so. The banks must be convinced that they are at risk of losing customers if they persist with SVRs higher than what is available to customers in other banks. The Competition and Consumer Protection Commission's website at consumerhelp.ie contains useful information on the process. It also contains comparisons of mortgage products and information on incentives institutions will give to encourage switching.

As set out in the statement of Government priorities 2014-16, supporting increased competition in the banking sector is essential to put downward pressure on interest rates. Increased competition between existing and new entrants will have the effect of reducing prices to consumers, which in the mortgage sector means reducing the SVR.

Deputy Peter Mathews

In case I was muddled in my initial contribution, I wish to clarify that AIB reported profits of €1.1 billion for last year, as against a loss of €1.7 billion for the previous year, a turnaround of €2.8 billion. Similarly, Bank of Ireland reported a profit of €920 million in 2014 and a loss of €500 million in 2013, representing a turnaround of €1.5 billion. We have two banks in a duopoly with a turnaround figure of €4.3 billion, set against the reality of customers being insulted, in operational terms, by them. I have first-hand experience of this. I am a former commercial banker in a State-sponsored bank for businesses, small and medium enterprises, a worthy bank that understood the principles of banking and kept really close to its customers. What is happening now is that the banks are becoming remote. I gave as an example the board of Bank of Ireland. Four members are foreign, while the remainder, bar two, have all had experience working outside Ireland. They are remote and unfeeling. I do not mean that they have to be lovey dovey, but in the sense of having a heart, they are out of touch with households and those in jobs and who work in businesses. It is not right.

The last bank I passed by was a branch of PTSB. An advertisement displayed read as follows: "Ready to buy your first house? Yes, give me a debt! Permanent tsb back to basics". Given what has happened, that is the philosophy, if it could be called that, the three banks should not be allowed to have. I will give the Minister the paper to which I referred and which I sent to the Chairman of the banking inquiry. The evidence shows that it was banks' boards and auditors who were clearly at fault. We do not need the processional. Does the Minister remember in May last year that there was a proposal to have in the terms of reference that every member of every board from 2001 to 2008 should be required to be in attendance in the one place to listen to the reports on their own accounts and their own financial engineering and the lack of principles during those eight years, with the auditors sitting behind them, in order that the people of Ireland would be able to see how a credit pyramid grew, which went out of control in terms of the figure for domestic banking in Ireland growing from three times to more than five and a half times national income? That was unacceptable and so wrong but nobody has said so formally in this House. I say it again - it is so wrong that this fact has not been understood and it needs to be. Advertisements such as the one mentioned, given what has happened, should not be allowed to be placed at the entrance doors to banks.

Acting Chairman (Deputy Charlie McConalogue)

The Deputy's allocated time of two minutes is up.

Deputy Peter Mathews

The banks are selling loans, spanning 30 years, to financial funds in the American markets, denoted in dollars which is a strong currency, which are mopping them up. Those who will be paying monthly instalments for 35 years do not realise their payments are being channelled and funnelled through the financial markets to funds which have bought their loans.

Acting Chairman (Deputy Charlie McConalogue)

The Deputy's time is up.

Deputy Peter Mathews

I ask for the Acting Chairman's forbearance to make one final point. The loan my wife and I took out with one of the duopoly banks was securitised, without much notice. We received a little note on it in the post and, as I had a lot of experience of banking, I knew what it meant. When we paid off the loan in full, the bank was unable to find the title deeds to our house because as a result of securitisation the loan had been channelled through funny vaults. They were found eventually, but that is wrong. That is what happens, however, when the relationship entered into for 35 years does not continue with the same institution for the 35 years. It is nothing personal, but I hope the Minister understands.

Deputy Michael Noonan

I thank the Deputy for his comments. Some of the issues raised in his second intervention will I hope be addressed by the banking inquiry. He delved into very important but more general issues than variable mortgage rates. As I said, the Governor of the Central Bank informed me that work had commenced in the Central Bank on this very issue. It is establishing the fact based position in terms of what level of margin is excessive. Very shortly, when that analytical work has been completed-----

Dáil Éireann debate - Thursday, 16 Apr 2015