Written Answers Nos. 101-123
101. Deputy Luke 'Ming' Flanagan asked the Minister for Finance the amount of interest the €25 billion we borrowed to buy off the promissory notes is costing us this year; and if he will make a statement on the matter. [16236/14]
View answer102. Deputy Luke 'Ming' Flanagan asked the Minister for Finance the amount of interest the €25 billion we borrowed to buy off the promissory notes cost us in 2013; and if he will make a statement on the matter. [16237/14]
View answer103. Deputy Luke 'Ming' Flanagan asked the Minister for Finance as the new sovereign bonds from the €25 billion in bonds that were issued to the Central Bank on 8 February 2013 are sold off, the amount in interest projected to be paid on an annual basis, for as far into the future as those projections have been made, to the EU fund from which the €25 billion was borrowed and as coupon to the private investors who purchase those bonds; and if he will make a statement on the matter. [16238/14]
View answerI propose to take Questions Nos. 101 to 103, inclusive, together.
The National Treasury Management Agency (NTMA) issued eight new Floating Rate Treasury Bonds to the Central Bank of Ireland (CBI) on 8 February 2013 to replace the Promissory Notes previously held by IBRC.
The bonds have maturities ranging from 25 to 40 years and pay interest every six months in mid-June and in mid-December based on the six-month Euribor interest rate plus an interest margin which averages 2.63% across the eight issues. Total cash interest on the floating rate bonds in 2013 was just under €0.65 billion. Cash interest payable in 2014 is currently estimated to be just under €0.8 billion, the increase compared to 2013 largely reflecting the fact that a full year's interest is payable this year. Interest payable on the bonds is currently projected to increase in the coming years, consistent with the projected increase in the six-month Euribor interest rate.
The CBI is presently the holder of the entire portfolio of these floating rate bonds and on that basis, interest payable is currently accruing to the CBI. The CBI has undertaken that bonds to the minimum value indicated will be sold in accordance with the following schedule: €0.5 billion to end-2014, €0.5 billion per annum in 2015-2018, €1 billion per annum in 2019-2023 and €2 billion per annum from 2024 onwards. Interest payable will accrue to the purchaser of the bonds, rather than the CBI, once the bonds are sold.
104. Deputy Luke 'Ming' Flanagan asked the Minister for Finance if he will clarify what will happen to the €500 million that will be taken in by the Central Bank of Ireland when the first bond is sold this year; and if he will make a statement on the matter. [16239/14]
View answer105. Deputy Luke 'Ming' Flanagan asked the Minister for Finance if he will clarify what will happen to the subsequent €24.5 billion taken in by the Central Bank of Ireland as the remaining bonds are sold; and if he will make a statement on the matter. [16240/14]
View answerI propose to take Questions Nos. 104 and 105 together.
The Central Bank of Ireland is independent in the exercise of its functions and the management of it's investment holdings are a matter for the bank themselves, neither I nor the Department of Finance have any role in the matter.
The Central Bank normally reports in detail on its balance sheet only at annual intervals. The Central Bank annual report for 2013 is expected to be published at end-April.
107. Deputy Bernard J. Durkan asked the Minister for Finance if consideration will be given to the development of a proposal within the confines of public expenditure and reform constraints in accordance with ongoing national and EU targets whereby a Government bond might be considered in which private savers might invest, the benefits of which to go towards major infrastructural or domestic requirements such as addressing the serious housing shortage now emerging and largely due to the absence of a properly focused public housing programme, a situation which he inherited; if any evaluation has been done to identify the potential economic benefit to his Department of such a programme in line with his efforts to maintain strict public expenditure targets in the context of a wider economy; and if he will make a statement on the matter. [9402/14]
View answerThe primary role of the National Treasury Management Agency is to ensure that sufficient funding is available at all times to meet the day-to-day requirements of the Exchequer. It is a matter for the Agency to decide when and how much to borrow in the light of those needs, commercial considerations surrounding the raising of debt on the markets and the need to maintain an appropriate level of liquidity.
All monies raised through Government borrowing are paid into the Central Fund and used to fund Government spending as approved by the Oireachtas. It has never been the custom to link borrowing to specific projects as to do so would limit the flexibility of the Government in managing the State's finances.
That said, there are a number of options available to individuals who wish to help support the Government's work in promoting economic growth and employment.
The National Solidarity Bonds were introduced to provide a wider range of options for retail investors. The Minister for Finance in announcing Budget 2010 launched the 10-year National Solidarity Bond, the purpose of which was to allow citizens an opportunity to invest and provide money to the State to stimulate economic recovery and to assist in the maintenance and creation of employment. Following the success of the launch of the ten-year National Solidarity Bond a four-year National Solidarity Bond was launched in 2011.
The NTMA's other State Savings products, available through any Post Office, allow people to support the Exchequer through Savings Bonds, Savings Certificates and Instalment Savings.
There are also possibilities in place for people interested in investing in longer-term Government bonds. Irish sovereign bonds are available through seventeen Primary Dealers recognised by the National Treasury Management Agency (NTMA). The NTMA has published information on their website (www.ntma.i
e) which gives the names and contact details for institutions which sell bonds to the public, and the fees they charge.
The NTMA will continue to encourage personal savers to purchase the National Solidarity Bonds and all the other NTMA State Savings products. The NTMA keeps the suite of State Savings products and the interest rates paid on them under constant review to ensure that the products remain competitive and attractive to retail investors. These products have been an important and dependable component of Government borrowing for many years and make a valuable contribution to the national finances.
I am happy to confirm that the Government remains committed to exploring alternative means of financing capital projects. The Government has announced the creation of the Ireland Strategic Investment Fund (ISIF) to channel investment from the National Pensions Reserve Fund (NPRF) towards productive investment in sectors of strategic importance to the Irish economy. Within its existing statutory investment policy and in line with the ISIF announcement, the NPRF has undertaken a number of investments and initiatives under which NPRF capital will be invested on a commercial basis in Ireland. The NPRF has in particular committed to invest in infrastructure (€250 million) and Public-Private Partnership (PPP) projects (€118 million).
108. Deputy Pearse Doherty asked the Minister for Finance the reason resolution targets for small and medium-sized enterprise debt at the State-owned banks are not published; and if he will make a statement on the matter. [16262/14]
View answerIn June 2013 the Central Bank set quarterly institution-specific performance targets for covered banks to move distressed SME borrowers onto longer-term forbearance solutions. The targets set reflect the banks' capacity, processes and systems. The Central Bank has informed the officials in my Department that the banks have reported that they have met their required targets to date. This perspective has been reaffirmed by both the IMF and the European Commission who report that the workout of SME arrears is progressing and that imposed targets are being met.
Recently published results from the covered Irish banks indicate that both banks are well advanced in restructuring their SME loan books. Bank of Ireland's most recent published results indicate that they had reached resolution in 90% of distressed SME cases. Similarly the AIB's results indicate a resolution level of approximately 65%. It is also worth noting that defaulted loans for both banks have reduced year-on-year.
The Central Bank do not intend publishing these targets. They are of a commercially sensitive nature.
109. Deputy Pearse Doherty asked the Minister for Finance the communications he has had with the European Central Bank regarding the possible sale by the Central Bank of Ireland to the market of Government bonds created following the liquidation of Irish Bank Resolution Corporation. [16265/14]
View answer110. Deputy Pearse Doherty asked the Minister for Finance the way a sale on the market of the floating rate treasury bond linked to the liquidation of Irish Bank Resolution Corporation could affect the State's financial planning. [16266/14]
View answerI propose to take Questions Nos. 109 and 110 together.
The Central Bank of Ireland is independent in the exercise of its functions and the management of its investment holdings are a matter for the bank themselves, neither I nor the Department of Finance have any role in the matter.
The Central Bank of Ireland provide the Department of Finance with an estimate of expected surplus income to be paid to the Central Fund on a regular basis. This estimate will continue to form part of the Government's overall budgetary strategy.
111. Deputy Brian Stanley asked the Minister for Finance the number of Revenue Commissioner's staff devoted to chasing the property tax as a proportion of total staff; and what the intake would be from redirecting those staff to pursuing black market activity and-or tax evasion. [16285/14]
View answerI am taking it that the Deputy is referring to follow up activity in relation to property owners who are not complying with their Local Property Tax (LPT) obligations. In this regard, I am advised by the Revenue Commissioners that very little activity of this nature has taken place to date and accordingly it is not possible to disaggregate the numbers as requested by the Deputy. The staff currently assigned to the LPT project are involved in a range of activities primarily focussed on supporting voluntary compliance. This includes providing customer support, updating the register and processing returns and payments for LPT. This year, up to 31 March, some 82,000 telephone calls and about 90,000 items of correspondence have been handled by Revenue staff in relation to LPT and Household charge.
As the Revenue Commissioners announced some weeks ago, a final opportunity was afforded to property owners to bring their LPT and Household charge affairs up to date before they begin to focus on tackling LPT non-compliance. This will commence in the coming weeks as soon as Revenue has processed the large volume of payments and correspondence, of which there is about 40,000 items on hand, received up to 31 March. The Commissioners advise me that they expect to deploy 40-50 full time staff initially on this work.
In regard to LPT staffing, it is internationally recognised that property taxes require proportionately more resources to administer compared to other forms of taxation. However, the introduction of property taxes needs to be considered in the context of broadening the overall tax base to achieve a more sustainable fiscal position. I am satisfied that Revenue has prioritised its staffing resources appropriately to ensure the successful introduction of a significant new tax.
The Revenue Commissioners are subject to the Employment Control Framework staffing reductions imposed since 2009 in the context of government policy Revenue's overall staffing levels have reduced from a total of 6,581 at the end of 2008 to its current level of 5,757. Notwithstanding this reduction, Revenue staff resources assigned to compliance activities have been maintained at around 2,000. These front-line activities include anti-smuggling and anti-evasion, investigation and prosecution, audit, assurance checks, anti-avoidance, returns compliance and debt management. I am satisfied that the Revenue Commissioners have accorded a very high priority to tackling tax and duty evasion, including the shadow economy. Revenue is committed to ensuring that despite the staff reductions that this compliance work will continue to be resourced to the maximum extent possible.
The return on investment can vary depending on the activity and the availability of suitably trained and experienced staff. There is a very different grade and skills mix, for example, between LPT and revenue audit activity. Reassigning staff from one activity to another would require significant investment in learning and development before they become fully effective in their new role. Once fully trained, the direct return on investment for a Revenue auditor could be expected to be €10 for every €1 spent.
113. Deputy Eric Byrne asked the Minister for Finance the options available to persons (details supplied) in Dublin 8 regarding a write down; and if he will make a statement on the matter. [16304/14]
View answerAs the Deputy is aware, I, in my role as Minister for Finance, have no statutory function in relation to banking decisions made by individual lending institutions at any particular time. This includes the range of write down options available to borrowers.
Notwithstanding the fact that the State is a shareholder in certain banks, I must ensure that these banks are run on a commercial, cost effective and independent basis to ensure their value as an asset to the State.
A Relationship Framework has been specified that defines the nature of the relationship between the Minister for Finance and each bank. These Frameworks were published on 30 March 2012 and can be found at; http://banking.finance.gov.ie/presentations-and-latest-documents/.
114. Deputy Michael Healy-Rae asked the Minister for Finance his views on correspondence (details supplied) regarding the local property tax telephone number; and if he will make a statement on the matter. [16313/14]
View answerI am advised by Revenue that since the introduction of Local Property Tax (LPT) in March 2013 Revenue has answered in excess of 1,000,000 telephone calls and has replied to in excess of 350,000 letters or emails.
Revenue has confirmed to me that some delays were experienced in accessing the LPT Helpline in the days leading up to the 31 March LPT/Household Charge (HHC) compliance deadline. The delays were a direct result of the very heavy volumes of telephone queries received, which exceeded 40,000 for the three days up to and including 31 March.
In response to the service demand, Revenue extended the compliance deadline from 31 March to 5pm on 2 April and significantly increased the number of call agents on both the Helpline and on the internal customer support service. Revenue also extended the opening hours from 9am/5pm to 8am/8pm up to the extended deadline.
Significantly, Revenue confirmed through its various media campaigns and through recorded messages on its Helpline that anyone who left contact details on the Helpline recording system would receive a call back as soon as possible and would be considered compliant providing the issue/s in question was dealt with in a timely fashion once the call back was received. Equally so, anyone who corresponded in writing or by email would also be considered compliant on the same basis.
I would like to remind the Deputy that the due date for payment of HHC arrears was 1 July 2013 while the due date for payment of 2014 LPT was 1 January 2014, with the exception of the single debit authority (SDA) payment option deadline of 21 March. On that basis, property owners have had significant periods of time to get their affairs in order. Considering the statutory deadlines have already passed, Revenue is to be commended for the efforts it has made through the extended deadline/s to give people the opportunity to meet their obligations without having to suffer the consequences of extra liabilities that can be levied in the event of late or non-payment.
The Deputy should also be aware that, to assist taxpayers meet their LPT/HHC obligations at a time that best suits individual circumstances, Revenue has developed an easy to use online system, which includes the full suite of available payment, deferral and exemption options. The online system is available 24 hours a day and in most instances removes the need for liable persons to make any contact with Revenue.
It needs to be borne in mind that Revenue has taken LPT from concept to a fully functioning tax in a very short period of time a task that included the drafting of legislation, the building of a brand new property register and the provision of customer service to such a large volume of taxpayers. LPT has contributed €533m to the Exchequer in respect of 2013 and 2014 year to date.
115. Deputy John Browne asked the Minister for Finance if his attention has been drawn to the fact that some financial institutions are advising customers that the statutory codes of protection for mortgages are just aspirations; and if he will make a statement on the matter. [16322/14]
View answer117. Deputy John Browne asked the Minister for Finance if there is a discrepancy in the code of conduct on mortgage arrears where it states that lenders must act in the best interests of their customers when certain lenders are clearly not acting in the best interests of their customers by refusing to engage with their customers other than seeking sale or surrender; his views on whether there should be a clause which requires lenders to co-operate with borrowers; and if he will make a statement on the matter. [16324/14]
View answer122. Deputy Terence Flanagan asked the Minister for Finance if lenders have the legal authority to seek a standard financial statement in regard to arrears on a non-principal dwelling house mortgage; and if he will make a statement on the matter. [16345/14]
View answerI propose to take Questions Nos. 115, 117 and 122 together.
The Code of Conduct on Mortgage Arrears (CCMA) sets out requirements for mortgage lenders dealing with borrowers facing or in mortgage arrears on a mortgage secured on their primary residence. The CCMA was put in place under section 117 of the Central Bank Act 1989 and lenders covered by the Code are required to comply with it as a matter of law. The Central Bank has the power to administer sanctions for a contravention of the CCMA.
The CCMA provides a strong consumer protection framework to ensure that borrowers struggling to keep up mortgage repayments are treated in a fair and transparent manner by their lender, and that long term resolution is sought by lenders with each of their borrowers in mortgage difficulty. It also sets out that mortgage arrears and pre-arrears cases must be handled sympathetically and positively by the lender, with the objective at all times of assisting the borrower to meet his/her mortgage obligations.
The CCMA sets out the framework that lenders must use when dealing with borrowers in mortgage arrears or in pre-arrears. This framework is known as the Mortgage Arrears Resolution Process (MARP) which sets out the steps which lenders must follow:
Step 1: Communicate with borrower;
Step 2: Gather financial information;
Step 3: Assess the borrowers circumstances; and
Step 4: Propose a resolution.
In order to determine which options for alternative repayment arrangements are viable for each particular case, a lender must explore all of the options for alternative repayment arrangements offered by that lender having assessed the borrower's financial circumstances using the Standard Financial Statement (SFS).
If a borrower is offered an alternative repayment arrangement, the lender must give the borrower a clear explanation of the proposed arrangement and how it works, including the reason why the lender considers it to be appropriate and sustainable for the borrower. The lender must also provide the borrower with the advantages of the offer and explain any disadvantages.
If the lender is not offering the borrower any alternative repayment arrangement, the lender must give the reasons why in writing. The lender must also inform the borrower that a copy of the most recent SFS is available on request, and provide the borrower with details in writing, including:
· other options available to the borrower, such as voluntary surrender, trading down, mortgage to rent or voluntary sale and the implications of each option for the borrower and his/her mortgage loan account
- the borrower's right to make an appeal to the lender's internal Appeals Board
- the website of the Insolvency Service of Ireland
- that legal proceedings may commence three months from the date the letter is issued or eight months from the date the arrears arose, whichever date is later
- that the borrower should notify the lender if his/her circumstances improve;
- the importance of seeking independent legal and/or financial advice.
Borrowers can also make an appeal to the lender's Appeals Board if they are not happy with the alternative repayment arrangement offered or where a lender declines to offer an alternative repayment arrangement or if they believe they have been wrongly classified as "not co-operating". If a borrower is not happy with the way that their lender is dealing with them, or if they think the lender are not complying with the CCMA, the borrower can make a complaint to their lender. If the borrower is not happy with the outcome of the complaint made to the lender they can refer the matter to the Financial Services Ombudsman (FSO). Further information on how to make a complaint to the FSO is available at www.financialombudsman.ie.
The Code of Conduct on Mortgage Arrears (CCMA) applies to the mortgage loan of a borrower which is secured by his/her primary residence and it also applies to a buy-to-let mortgage where the buy-to-let is the only residential property in the State owned by the borrower. A lender is only required to use a SFS to obtain financial information from a borrower in arrears or in pre-arrears where the loan is a mortgage loan to which the CCMA applies. However, this does not preclude a lender from using the SFS in respect of other loans.
116. Deputy Dan Neville asked the Minister for Finance the position regarding local property tax in respect of a person (details supplied) in County Limerick. [16323/14]
View answerI am advised by Revenue that a key aspect of the work undertaken in regard to Local Property Tax (LPT) was the development of a comprehensive Register of residential properties in the State. The Register was populated using data drawn from a range of sources including Revenue's own databases, the Local Government Management Agency database and data from various utility companies. The various data sets were cross-checked by Revenue to ensure the accuracy of the information in respect of each property being included on the Property Register.
However, given the scale of the project it was inevitable that there would be some errors and in a small number of instances, properties were either duplicated to, or omitted from, the Property Register. Revenue clearly indicated this possibility in all of its communications in regard to LPT and stressed that in such circumstances the onus was on property owners to make contact and provide the correct details.
In regard to the specific case to which the Deputy refers, the person in question did not receive any notification in respect of either his 2013 or 2014 LPT liabilities from Revenue because the Property Register did not hold any record of his property.
Revenue has confirmed to me that the Property Register has now been updated to reflect the property details and the person will receive all future correspondence and notifications.
Revenue has also confirmed that the person has filed and paid in respect of both his 2013 and 2014 LPT liabilities at this point and has committed to pay his arrears of Household Charge (HHC) as soon as possible. Revenue has assured me that once the arrears of HHC payment is received, the person will be fully compliant with his LPT obligations.
118. Deputy Billy Timmins asked the Minister for Finance the number and the reason home loans of the ICS Building Society (details supplied) which is part of Bank of Ireland Group have to be offered for sale as they face the risk of being sold to unregulated funds; and if he will make a statement on the matter. [16327/14]
View answerAs the Deputy may be aware, in July 2013 Bank of Ireland agreed an amendment to its Restructuring Plan which had been agreed with the European Commission in respect of State Aid received by the Bank. This allowed the Bank retain its life assurance subsidiary New Ireland. As part of this amendment, the Bank committed to certain substitution measures including the sale of the ICS distribution platform together with, at the option of a purchaser, up to €1bn of mortgages and up to €1bn of matching deposits. The purpose of the ICS substitution measure is to support new entities in entering the Irish market and thereby increasing competition to the ultimate benefit of the consumer.
In order to facilitate the sale, the State committed to enact appropriate legislation, the effect of which is to extend the same powers to building societies that currently exist for banks to transfer assets and liabilities to other banks. ICS is the sole remaining building society in Ireland.
As the decision to acquire loans is at the option of the purchaser of the distribution platform, and as the value of loans so acquired can range up to €1bn, it is not possible to know, or even estimate with any accuracy, the number of loans that may be sold. I can confirm, however, that the total value of the ICS loan book is c.€6bn and the number of loans is c. 40,000.
Although the proposed legislative change does not preclude an unregulated entity from acquiring a portion of the ICS mortgage portfolio, the probability of such an outcome must be considered in conjunction with the purpose of the commitment and the safeguards included in the Restructuring Plan. The Restructuring Plan includes a provision that "In order to be approved by the Commission, the purchaser must meet the Purchaser requirements" which covers, inter alia, that the Purchaser "must have the financial resources, proven expertise and incentive to maintain and develop the Divestment business as a viable and active competitive force in competition with BoI and other competitors".
With reference to the wider issue of CCMA protection for residential mortgage borrowers who have had their loans sold by a bank to an unregulated entity, the Deputy will be aware that The Sale of Loan Books to Unregulated Third Parties Bill, which is listed in the Government legislative programme, was always intended to address concerns surrounding the continued applicability of the code after the sale of loan books to unregulated entities. The Government is committed to bringing forward legislation to protect mortgage holders and will work with other interested parties to achieve the best solution for consumers. Officials in my Department are examining this fully with the Central Bank and the Attorney General's Office.
119. Deputy John Browne asked the Minister for Finance that allowing local property tax as a deductible expense against the income of a business which lets private residential property would reduce the yield from the tax and the way that equates with fairness in the tax system, notwithstanding his acceptance of the Thornhill group’s recommendation that it should be deductible at a future date; and if he will make a statement on the matter. [16328/14]
View answerLocal Property Tax (LPT) is a tax arising from ownership of a property that is payable regardless of whether the property is let or not. In general, the owner of the property is the liable person.
The introduction of deductibility of LPT for rental properties would have negative revenue implications in net terms for the Exchequer.
While the Deputy points to the perceived unfairness the non-deductibility of the tax for those in business letting private residential property, the system nevertheless aims to treat taxpayers who are in similar positions in a similar way. Accordingly, all landlords in similar circumstances are treated in the same manner.
As indicated in replies to previous Parliamentary Questions, I have accepted in principle the recommendation in the Thornhill report that LPT should be a deductible expense in calculating a landlord s taxable rental income and that this deduction be phased in over a number of years with the start date being determined by the economic and budgetary situation. The manner and timing of this change has not yet been considered, and will require a change to section 97 of the Taxes Consolidation Act 1997.
120. Deputy Noel Grealish asked the Minister for Finance if he will confirm that the Central Bank’s code of conduct for business lending to small and medium enterprises is applicable to all buy-to-let properties which are subject to mortgages from regulated bodies; if any other statutory codes are applicable to buy-to-let properties with mortgages; and if he will make a statement on the matter. [16330/14]
View answerI am informed by the Central Bank that the Code of Conduct for Business Lending to Small and Medium Enterprises (SME Code) applies to regulated entities when providing the following credit products within the State to SMEs operating within the State:
- overdrafts;
- loans;
- term loans;
- leasing;
- hire purchase; and
- invoice discounting.
The objectives of the SME Code are to:
- facilitate access to credit for sustainable and productive business propositions,
- promote fairness and transparency in the treatment of SMEs by regulated entities, and
- ensure that when dealing with arrears cases, the aim of a regulated entity will be to assist borrowers to meet their obligations, or otherwise deal with the situation in an orderly and appropriate manner.
In the case of buy-to-lets, a lending institution must consider the capacity in which the customer enters into the 'buy to let' transaction. If the consumer is considered to be acting within his or her business, trade or profession and meets the definition of 'small and medium enterprise' or 'smaller enterprise' contained in the SME Code, the provisions of the SME Code would apply. If the consumer meets the definition of 'consumer', i.e., a natural person acting outside the person's business, the provisions of the Consumer Credit Act 1995 would apply. In addition, the relevant provisions of the Consumer Protection Code 2012 would apply to buy-to-lets for consumers (as defined), including, in the case of personal consumers, the provisions of Chapter 8 relating to arrears handling. The Code of Conduct on Mortgage Arrears (CCMA) would apply to buy-to-lets where the buy-to-let is the only residential property in this State owned by the borrower.
121. Deputy Terence Flanagan asked the Minister for Finance if the relationship frameworks with banks prevents him or the Central Bank from giving a direction to ensure that a full suite of standardised mortgage resolution measures are offered by all banks; and if he will make a statement on the matter. [16344/14]
View answerAs the Deputy will be aware under the Relationship Frameworks the State does not intervene in the day to day operations of the banks or their management decisions regarding commercial matters. This includes giving any direction with respect to particular products offered by these banks.
I have also been informed that the Central Bank does not direct the banks which products it should offer customers either.
Having said that a sustainable solution has been broadly defined in the Central Bank's published MART document as one of the following:
"a) An arrangement concluded under a bank's MARP in accordance with the CCMA, where the borrower is cooperating under the MARP and the bank has satisfied itself that the arrangement provides a sustainable solution which is likely to enable the customer to meet the original or, as appropriate, the amended terms of the mortgage over the full remaining life of the mortgage, including repayment of the original or an agreed revised principal sum where offered. This may include an interest only or other temporary solution for a period if it is likely that full repayment of the original or revised principal will be achieved over time, or where there is a payment plan to return the account to sustainability through the clearance of arrears.
b) A personal insolvency arrangement effected under the Personal Insolvency Act 2012; or
c) If an arrangement could not be reached or is not appropriate, that the PDH and BTL property securing the loan has been voluntarily sold or, failing that, any situation where a Specified Credit Institution takes possession of the property including by way of voluntary agreement with the borrower or by Court Order or otherwise".
A range of sustainable solutions have been utilised by each of the lenders to date. These include, but are not limited to, the following:
- Term Extensions
- Split Mortgages
- Permanent Interest Rate Reductions
- Voluntary surrender solutions
123. Deputy Terence Flanagan asked the Minister for Finance if his attention has been drawn to statistics per lender to indicate the number of lenders that have accepted the mediation process offered by the Financial Services Ombudsman when agreed by customers in mortgage arrears; and if he will make a statement on the matter. [16346/14]
View answerFirstly, I must point out that the Financial Services Ombudsman is independent in the performance of his statutory functions. It would not be appropriate for me to comment on how he performs his duties.
I have been advised by the Financial Services Ombudsman that in respect of all cases the Financial Services Ombudsman's Bureau offers mediation to the Complainant and the Provider.
On the issue more generally, both parties to the complaint must be willing and elect to participate in mediation before mediation can take place. If one of the parties wants to mediate the complaint and the other does not, then no mediation will take place and the matter will proceed to investigation and adjudication.
In 2013 no mediations took place in relation to Mortgage Arrears.
