Dáil Éireann díospóireacht -
Tuesday, 9 Jul 2013

Vol. 810 No. 1

Leaders' Questions

Deputy Micheál Martin

The mortgage arrears crisis shows no sign of abating. We heard at the weekend about significant disagreements between the Financial Regulator and the banks regarding the content of a sustainable resolution package for mortgage arrears and the pace of progress being made by the banks. The economic impact of the mortgage arrears crisis is severe. It is hammering consumer confidence and undermining the prospect of a recovery in the domestic economy. More than 95,000 people are now in arrears of more than 90 days. The Government's decision to amend the code of conduct places a substantial number - more than half - of these individuals in a serious situation in respect of the banks and the approaches they may make. There are genuine fears about an impending wave of family home repossessions. People are very worried.

Banks were supposed to have already achieved a 20% target of providing sustainable solutions to people in mortgage arrears. I ask the Taoiseach to update me on the extent to which that target, which was due to be reached in June, was met. They are supposed to reach a target of 50% by the end of this year. My party tabled a motion for constructive debate this evening. We are calling on the Government to amend substantially the code of conduct to give greater protection to those who are in arrears by, for example, establishing a clear definition of what constitutes an unsustainable mortgage, ensuring a minimum protected level of income for people in arrears and reinstating the 12 month moratorium on commencing repossession proceedings. We would ensure that banks record all calls made with those who are borrowing from them lest there be any accusation of aggressive or unacceptable behaviour. We would oblige a bank seeking an order for repossession to first obtain written confirmation from the Central Bank that it has exhausted every other course of action available to it to keep the family in its home.

Does the Taoiseach not accept that it is now time for the Government to intervene directly to offer protection to those in mortgage arrears? Can he outline to us the nature of the disagreement between the Financial Regulator and the banks and outline what he believes a sustainable resolution would comprise?

The Taoiseach

A sustainable resolution is to arrive at a situation whereby a person currently in mortgage distress or arrears enters an agreement with the lender that the person in that situation can be sustainable, in other words, can meet the requirements over a period in a different set of circumstances. Deputy Martin raised two issues, the arrears and the progress being made by the banks on the restructuring of mortgages. He says it is time for the Government to get involved but we have been involved for quite some time. If there had been involvement previously we certainly would not have the mess we are now dealing with. All of the tools are now in place to allow for the accelerated working out of mortgage arrears.

Banks and borrowers are now required to use these tools to reach a fair, sustainable and affordable solution to mortgage arrears. The Deputy and I both know the pressure this causes for people everywhere around the country. There is no doubt that over the last number of years there has been insufficient activity. That is why the Central Bank announced its new targets. These targets will be strictly monitored and enforced so that banks can reach sustainable solutions for families in mortgage arrears. The Governor, Professor Honohan, set out the conditions and he expects to see recommendations from banks against the performance on the targets that have been set. If the Central Bank requires further powers, the Government will always be available to deal with that.

As of the end of March, 79,689 mortgage accounts were categorised as restructured, of which 53% were not in arrears at the end of quarter one. Of the percentage of the total stock in arrears, both early and 90 days plus, 37,454 or 26% were classified as restructured. This does not mean that 47% have fallen back into arrears because restructured accounts in arrears include accounts that were in arrears prior to restructuring, where the balance in arrears had not been eliminated, as well as accounts that are in arrears under the current restructuring arrangement.

The public targets have a number of elements. Quarterly targets have been set in respect of the number of sustainable solutions proposed to customers. The application of the targets commenced at the end of quarter two of 2013 and are being enhanced in subsequent quarters, with 2014 targets to be set in due course. It is expected that 50% of mortgage holders will have their restructured proposals dealt with by the end of this year and the remainder in 2014. Progressively more demanding quarterly targets will be set for the conclusion of the sustainable solutions.

I want to be clear with the Deputy that no targets are being set for repossession of homes. That has to be the last resort and the conditions state that clearly. These targets are deliberately demanding and they are designed to ensure that the vast majority of families in this country will be offered solutions that do not involve house repossessions. We all know how important that is.

Deputy Micheál Martin

The Taoiseach did not quite answer the questions I asked him. Does he accept the proposals we are tabling tonight on strengthening the code of conduct in order to protect those in mortgage arrears? I outlined a series of constructive steps we believe should be taken to give genuine protection to those who are in arrears. The Government's only intervention to date has been designed with the Central Bank to facilitate more repossessions of family homes. There is no other way of assessing the situation. The Land and Conveyancing Law Reform Bill 2013 has been changed to facilitate repossessions without conditions. The Government has diluted many of the protections contained in the previous code of conduct in regard to the level of contact banks are allowed with customers and other areas. It has also reduced those entitled to mortgage subsidy. The entire agenda has been to put families in arrears into further jeopardy in terms of their relationship with the banks. There is a disconnect between official utterances and the reality on the ground as experienced by people in mortgage arrears. This is particularly the case for those with equity in their houses, in regard to whom the banks appear to be adopting a more aggressive approach despite the fact that they have the capacity to take up split mortgages or other alternatives. A statistic that speaks for itself is that only 140 split mortgages have been agreed in the last two years. That sums up the inertia and lack of action that have allowed the problem to worsen.

The Taoiseach did not answer my question on the targets. What percentage of sustainable solutions was achieved by the end of June? It was meant to be 20%. What is the actual figure?

The Taoiseach

It will be another two weeks before the Central Bank is able to publish the level of adherence by the banks to the targets. I do not have that information to hand and it will not be available for two weeks.

Deputy Micheál Martin

Does the Taoiseach expect me to believe that?

The Taoiseach

Yes I do, unlike what I heard when I was in here for many years previously.

Deputy Micheál Martin

He is obviously on top of it.

The Taoiseach

We cannot leave 100,000 families locked in limbo. That is why the Government put in place a comprehensive programme of action to assist struggling householders.

Deputy Mattie McGrath

The eviction law.

The Taoiseach

We had a long discussion about the insolvency arrangements, with bankruptcy being the ultimate mechanism applying.

There is no strategy for or policy on forcing householders to have their homes repossessed. It is not within the Deputy's keeping to make such comments. Everybody recognises the value-----

Deputy Micheál Martin

What does the Taoiseach mean by it is not within my keeping?

The Taoiseach

It is not the Deputy's normal practice. Everybody in the country recognises the value of the family home, more so than in most other countries. We want that to be the end of it, which I know the Deputy accepts.

Deputy Micheál Martin

The Secretary General of the Department of Finance has said there will be a tax.

The Taoiseach

The Government strategy was set out in five points which I have made known to the Deputy previously. They include comprehensive advice and assistance, introducing innovative new measures to deal with these cases, rebalancing personal insolvency legislation, the introduction of measures to assist families to stay in their homes, if possible, and challenging the banks to live up to their responsibilities in this crisis through the speedy roll-out of their own range of solutions.

Deputy Timmy Dooley

Is that a memo from one of the banks?

An Ceann Comhairle

As the Deputies do not wish to listen to the Taoiseach, I ask him to conclude.

The Taoiseach

I hope that in two weeks time when the Central Bank publishes the evidence from the banks, we will see whether they have lived up to the targets set. The targets will become progressively stricter and more detailed in the quarters ahead.

Deputy Micheál Martin

It is now 9 July.

Deputy Gerry Adams

Ba mhaith liom mo chomhbhrón a dhéanamh leis an Teachta Joe Higgins ar bhás a mháthair agus comhbhrón a thabhairt dá teaghlach uilig.

I am trying very hard to understand the role, remit and purpose of the public interest directors who serve on the boards of the banks. In some cases, some of these directors are senior members of Fianna Fáil, Fine Gael and the Labour Party and some are former Ministers. I have learned that these directors are exceptionally well paid. Alan Dukes received €102,000 in 2009; Ray MacSharry received €69,000, and in 2011, for 60 days work, Dick Spring received the mighty sum of €59,000. These amounts are on top of their ministerial or Member's pensions.

Deputy Timmy Dooley

That is small beer in comparison to the sum of €25 million.

Deputy Gerry Adams

What are the functions of public interest directors? We learned last week from Alan Dukes, a former leader of Fine Gael, that he was aware of the existence and content of the Anglo tapes. Both the Taoiseach and the Minister for Finance have said they did not know about the existence of these tapes, but clearly, it is in the public interest that they should know. Alan Dukes says he knew about them. What did he do about the existence and content of these tapes which have angered and scandalised so many ordinary decent people? Does the Taoiseach know whether he reported them to the Department of Finance and the Central Bank? I cannot believe Fianna Fáil did not know what was going on and that the Government did not know either. Alan Dukes is a former leader of the Fine Gael Party. He says he was aware of the tapes and their content, but we are led to believe he did not tell anyone. Who was he supposed to tell? Who are the other public interest directors who are still in place? To whom are they supposed to report?

The Taoiseach

The public interest directors were appointed by the late Minister for Finance, our late former colleague, Brian Lenihan. As a public interest director, I had words with the former leader of our party in respect of our party's view that Anglo Irish Bank should be wound down. I listened to the interview given by Alan Dukes last week and he clearly indicated that he had given all of the documentation of which he had possession to the Garda, in respect of an inquiry following the serving of warrants by the Garda, for transmission to the Director of Public Prosecutions for the preparation of books of evidence. He confirmed that this documentation had been handed on by Anglo Irish Bank. He also confirmed, in respect of the decision to be made by the Government, that as a public interest director he was more than willing to come before any such inquiry or committee to answer any question put to him regarding his knowledge, information and responsibility as a public interest director of that former bank.

Deputy Gerry Adams

The Taoiseach has avoided my question entirely. I asked him what was the function of public interest directors. They may have been appointed by the previous Government, but they were retained in place by the Government. What is their function? It would only be news if Alan Dukes had said he would not go forward to any inquiry. He has stated the obvious. What is his function? These directors are public interest directors. To whom are they supposed to report in the public interest? It is very clear that they are not acting in the public interest. It is my strong suspicion that they are there to act in the political interest and keep the status quo intact. That is clear if we look at the record. I remember that the Taoiseach once said he would keep a report card on Ministers. He has got rid of that idea for Ministers, but surely if he looked at the report card on these folk, he would see there was room to change the system. We were told they had been appointed to act as watchdogs for ordinary decent citizens. That was the spin behind it, but, clearly, they are lapdogs. What is the Taoiseach going to do? Some of these directors are still in place. They are there on his watch and he cannot blame Fianna Fáil for them. They are described as public interest directors. I asked what their function was, but the Taoiseach did not answer. I would like him to answer that question now. Will he tell us to whom the public directors in place in the other banks are supposed to report back?

The Taoiseach

As I understand it, the appointments of public interest directors by the late Minister were made from outside the bank circle. However, as directors, they must adhere to company law. I know that Alan Dukes, a former distinguished Minister, is nobody's lapdog. He has regularly attended Dáil committees and just last week said he was willing to attend any inquiry, investigation or committee we set up and to answer every question asked.

Deputy Gerry Adams

What is his function?

The Taoiseach

The appointments were made quite a number of years ago. They were additional directors from outside the bank circle but are bound by company law. Whatever information this particular public interest director has, he is quite willing to talk on it during any investigation or at any committee or inquiry we set up. It is important to remind the Deputy that Mr. Dukes, as he would be well aware, cannot cross over into the independent work ongoing in the context of the preparation for criminal trials in respect of which charges have been preferred against a number of individuals. An inquiry or investigation is one process, but the criminal process is independent of it and operates through the courts where justice is dispensed by a judge and jury. Alan Dukes has already pointed out publicly that the information available on the tapes was transmitted to the Garda and that he will have no difficulty, as a public interest director, in attending Oireachtas committees, inquiries or investigations or whichever option the Government decides to follow in due course.

Deputy John Halligan

The Taoiseach may be aware of a situation where a man who has spent two weeks outside the Dáil is now on the 23rd day of a hunger strike. He has been taken home by his family to his home in Trim, County Meath and although weak, he is continuing his protest. A number of Deputies from different parties, including Deputies Barry Cowen, Willie O'Dea, Clare Daly and others, have spoken to this man and tried to persuade him to end his protest. I have a doctor's note which was sent to me at 2.09 p.m. today. It states this man's blood pressure is extremely low at 78/67 and that he has lost 29 lbs in weight.

This was not to be my Leaders' Question today but I was approached by his partner, his mother, his father and his friends, who asked me to ask the Taoiseach to intervene. There are two questions. Tony Rochford is the man in question and he is self-employed. As we are aware, if a person is self-employed and unable to work, it is almost impossible to receive State support. In other words, most people who are self-employed and lose their jobs cannot receive unemployment benefit. This is an ongoing issue that was to be dealt with over recent years but it has not been dealt with. Under present economic circumstances, this has driven many people, through no fault of their own, into dire financial hardship, where they are relying on the Society of St. Vincent de Paul and other agencies for support. Will the Taoiseach address this problem?

An Ceann Comhairle

Thank you.

Deputy John Halligan

His second issue is that he made a stand against the household property tax by refusing to pay. This was a conscientious decision, and we all know the conscientious decisions that have been made in the Dáil over the past number of weeks, which people are entitled to make. Because of this, if he was to receive work-----

An Ceann Comhairle

We are over time.

Deputy John Halligan

-----he would not be able to gain a tax compliance certificate, which would prevent him from working. Will the Taoiseach consider this issue? With all of the measures we have introduced, with the extra fines and people not being able to purchase their houses and so on, this is an extremely harsh measure in dealing with somebody of conscience, except that-----

An Ceann Comhairle

Thank you, Deputy.

Deputy John Halligan

-----a majority of people are compliant with the property tax, albeit against their will, because of the high fines. If one likes, a whole swathe of people have been bludgeoned against their will, which I believe is probably the reason the Government is becoming one of the most unpopular of recent years.

An Ceann Comhairle

Thank you.

Deputy John Halligan

These are the two issues. As I said, it was not my choice for Leaders' Questions-----

An Ceann Comhairle

Thank you very much, Deputy. I call the Taoiseach to reply.

Deputy John Halligan

-----as I had other questions lined up, but I could not but-----

An Ceann Comhairle

We are over time.

Deputy John Halligan

The Taoiseach might come back to me on that.

The Taoiseach

I thank Deputy Halligan for raising this personal issue with the man concerned and I commend Deputies Barry Cowen and Clare Daly on having discussed his circumstances with him. I was just made aware of this before I came into the Chamber. From what Deputy Halligan said, and I do not know the individual or the circumstances involved, it is principally an issue with the property tax.

Deputy Mattie McGrath

It is unfair.

The Taoiseach

The legislation is very clear in respect of property tax being paid and a contribution being made by every person, but it also clearly includes the opportunity for a deferral of the payment of the tax. I do not know the man's circumstances in that regard.

The right of protest is perfectly legitimate in this country.

Deputy Michael Healy-Rae

Thanks be to God.

The Taoiseach

I meet various elements of it around the place all the time, including in Waterford yesterday. The point is that nobody wants to see something like this happen, where an individual feels they must resort to a hunger strike.

In respect of the second issue raised by the Deputy about jobseeker's benefit, I know from reports from the Minister for Social Protection that very substantial numbers are receiving jobseeker's benefit who were self-employed.

Deputy Mattie McGrath

Very few.

The Taoiseach

I do not know the actual financial circumstances of the individual involved here. Clearly, this is a matter we can have examined. I do not know whether Deputy Cowen or Deputy Daly have an up-to-date set of facts about Mr. Rochford's financial circumstances but, from what Deputy Halligan has said, first, he is entitled as a citizen to a deferral of his property tax, depending on his circumstances, and he would be entitled to have that examined. Second, as I can certify to the Deputy, there are very substantial numbers who receive jobseeker's benefit and jobseeker's allowance who were self-employed and might have lost their job, got work again and lost it again, as, unfortunately, happened to so many thousands during the course of the economic crisis. I would hate to think that a citizen of our country would be outside the gates of the Houses of Parliament in a situation where he is on hunger strike and where we cannot deal with the circumstances. We need to know what those circumstances are and I would be very happy to have them examined.

Deputy Richard Boyd Barrett

Will the Taoiseach meet him?

The Taoiseach

I do not have any difficulty at all meeting Mr. Rochford but I need to know what the circumstances are so the Minister for Social Protection, the Minister for Finance and the Revenue Commissioners can deal with this question of the property tax. As I said, I do not know his circumstances but I am willing to find out and, hopefully, have the matter resolved to some extent.

Deputy John Halligan

I thank the Taoiseach for his compassionate reply. This is inevitable under the present economic circumstances, with the hardship that hundreds of thousands of people are feeling. My worry is, as it has always been, and I have spoken about this in regard to many issues at public meetings, that somebody might go to the end because they are at the end of their tether with regard to how they are being treated and dealt with - people on unemployment benefit, people on disability and people without mobility. This is my worry. Many of us in this Chamber would not wish that to be the case and, as I said, a number of Deputies met this man and urged him not to do this, and it is not what I would want him to do. However, the harsh reality of everyday life in Ireland today is that people have come to the bridge and they are at the end of their tether. I believe it is inevitable that, if this ongoing economic crisis continues, where we continue to allow almost 700,000 people to live in poverty and abandon half the population-----

An Ceann Comhairle

Thank you.

Deputy John Halligan

-----something serious will happen and we will all be responsible for it. I thank the Taoiseach for his reply. I believe he said he would be prepared to meet him. He is quite a nice guy. I think he has made a principled stand and, while I do not agree with it and think it is not the way to do it, he has two very good issues. By the way-----

An Ceann Comhairle

Thank you, Deputy.

Deputy John Halligan

-----I am looking at Deputies shaking their heads because many of us know it is not the case that it is easy for many people who were self-employed to go onto unemployment benefit.

An Ceann Comhairle

Sorry, Deputy, you are over time. Will you please co-operate with the Chair?

Deputy John Halligan

That is not the case. The Taoiseach can ask across his own party and they will tell him the truth. It is not the case. It is almost impossible for the self-employed to get it when they become unemployed.

The Taoiseach

It is not true to say that former construction workers or those engaged in the construction sector in general have been completely ignored.

Deputy Michael Healy-Rae

They have been.

The Taoiseach

As the Deputy is aware, the situation was that over 7,000 jobs a month were being lost for nearly three years, most of them from the construction sector. At least 100,000 people have had direct contact with the Department of Social Protection in one form or another and many of those were involved in the construction sector. One of the changes that was made concerned the age-old problem we always had in this country, where a construction worker lost a job and it used to take six to eight weeks to get back on unemployment assistance or unemployment benefit. That has all been changed and if a former construction worker now gets a job for, say, three weeks, five weeks or ten weeks, the payment is just suspended and renewed when the work ceases.

It is also a fact that the level of social welfare payment and remuneration in this country actually reduces the risk of poverty by up to 60%, which is by far the highest of any of the European Union countries. Having spoken to some of the people of Spain, Portugal and Greece recently, I know there is no social welfare at all there after a two-year period. Whatever state we have been in here in Ireland, at least the level of assistance reduces the risk of poverty by up to 60%.

An Ceann Comhairle

Thank you.

The Taoiseach

I note the confidence that is beginning to return is evident in the fact that 2,000 jobs a month are now being created and there were 16,000 individual start-ups last year. We need to build on that. Clearly, we are not at the level where we need to be, but it is heading in the right direction. I noted this morning reports from a number of organisations that business sees confidence beginning to return. Obviously, there is quite a distance to go and there are implications in terms of the challenges that other European countries face - for example, we see the difficulties that arose temporarily in Portugal last week and other countries in programmes are being challenged.

In respect of the Deputy's question about the man outside-----

Deputy Joan Collins

His name is Tony Rochford.

The Taoiseach

-----I will certainly be willing to have his circumstances checked. Hopefully, we can at least have this explained in a way that the man does not have to be on hunger strike outside the gates of the Irish Parliament.

Deputy Richard Boyd Barrett

Will the Taoiseach meet him before it is too late?