My officials and I have reviewed the contents of the recent submission that I have received from the organisation referred to by the Deputy. The Government is acutely aware of the significant difficulties some homeowners are facing in meeting their mortgage and other debt obligations and it is committed to advancing appropriate measures to assist those mortgage holders who are experiencing genuine difficulty.
The Government has put in place a comprehensive strategy to address the problem of mortgage arrears. The implementation of this strategy is overseen at Government level by a special Government Sub-Committee chaired by An Taoiseach, and at official level by a high level Steering Group chaired by my Department’s Secretary General or other senior officials. This Steering Group consists of senior officials from the Departments of the Finance, An Taoiseach, Environment, Community and Local Government, Justice and Equality, Social Protection and Public Expenditure and Reform, as well as the Central Bank and the Insolvency Service of Ireland. This Group meets on a fortnightly basis and its purpose is to co-ordinate and drive the implementation of the strategy across Government and to receive and monitor the reports from the relevant Departments and agencies on the implementation of their respective areas of the overall strategy.
Following on from the recommendations of the 2011 Inter-Departmental Report on Mortgage Arrears, the main elements of the mortgage arrears strategy are:
- Innovative Personal Insolvency Reform: The Personal Insolvency Act, in place since the end of 2012, now provides accessible statutory insolvency frameworks to allow debtors and creditors reach arrangements to resolve unsustainable mortgage and personal debt positions. The Insolvency Service of Ireland, which was officially launched in April, will oversee the operation of the new insolvency frameworks and will very soon be in a position to commence processing insolvency applications.
- Comprehensive Advice and Guidance: In addition to existing arrangements, the Government has introduced a range of information and guidance resources to assist mortgage holders through what can be a difficult and stressful process. A dedicated website, www.keepingyourhome.ie, has been put in place to provide general public information on mortgages arrears issues. In addition, there is a Mortgage Arrears Information Helpline, which was established under the aegis of the Citizens Information Board, to provide more tailored information to individual callers. Finally, a panel of accountants has been put in place to provide “one to one” independent advice to borrowers who have been provided a long term forbearance resolution offer by their lender in respect of a mortgage on their primary home. All of these information services are provided at no direct charge to the users of the service.
- Keeping families in their homes: As a social housing response, a “mortgage to rent” scheme is now in place on a nationwide basis. This option is available to households who have unsustainable mortgages and who would qualify for social housing support. Provided they meet this and other appropriate criteria, this allows families, in the context of an agreed resolution to an unsustainable mortgage, to remain in their home.
- Mortgage Arrears Resolution Strategies: The implementation of sustainable mortgage arrears solutions by individual banks for their distressed customers, with Central Bank oversight, is a key element of the overall framework to address the mortgage arrears problem. The Central Bank initiative announced last March, sets time bound and measurable targets for the main banks, requiring them to systematically address their arrears book. This is a very important step to resolve the impasse on arrears. The Central Bank is initially requiring the main mortgage lenders to propose sustainable solutions to 20% of mortgages that are in arrears (of over 90 days) by end June. The target rises to 30% by the end of September and to 50% by the end of December 2013. The Central Bank will monitor and audit the performance of banks in relation to the targets and, crucially, will also assess whether the modifications provided are in fact sustainable solutions. More recently, the Central Bank also announced a pilot initiative for the restructuring of multiple debt situations to test the viability of a negotiated approach where there is more than one lender involved. In that overall context, and also in the context of the Central Bank’s role in the area of protecting the consumer of financial services, I have also asked my officials to forward the submission from the organisation referred to by Deputy to the Central Bank for its attention and necessary follow up.