Thursday, 26 September 2019

Ceisteanna (75)

Michael McGrath

Ceist:

75. Deputy Michael McGrath asked the Minister for Finance the number of mortgage switches undertaken each year since 2003 and the associated value of those mortgage switches in tabular form; the work completed by his Department to make mortgage switching easier for the customer; the tangible measures being taken in that regard; the physical signatures that are required when it comes to mortgage switching under section 10 of the Electronic Commerce Act 2000; if he has reviewed this Act with a view to making mortgage switching easier for the customer by making electronic signatures available; and if he will make a statement on the matter. [39261/19]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Finance)

Data provided by the Central Bank indicates that mortgage switching (defined, for the purposes of this response, as loans issued by one lender to refinance an existing mortgage with another lender) in Ireland peaked in 2006, when approximately 27,000 mortgages switched provider.

Between 2009 and 2014, switching decreased significantly, reflecting subdued lending activity in the overall Irish market at that time. From 2015 onwards, the number and value of switcher loans has increased and, in 2017, just under 5,400 mortgages switched provider.

The number and value of mortgage switches from 2003-2018 is detailed as follows in tabular form.

Year

Value €m

Re-mortgages

2003

1,775

14,247

2004

2,737

18,121

2005

5,038

25,944

2006

6,067

26,565

2007

6,675

25,937

2008

5,295

21,374

2009

1,130

5,774

2010

461

2,722

2011

174

1,137

2012

64

455

2013

51

292

2014

100

503

2015

319

1,433

2016

524

2,438

2017

703

3,070

2018

1,242

5,377

As part of a range of competition measures agreed with the European Commission under their respective EU-Restructuring plans, AIB and Permanent TSB were required to provide funding for a public awareness campaign to raise awareness and promote customer switching. A total of €1.8 million is committed as part of the restructuring of the banks. There is no cost to the taxpayer in relation to this public awareness campaign.

The Department of Finance oversaw a contract for the provision of research, design and media buy services for a public awareness and customer switching campaign in retail banking markets. This campaign has focused on encouraging people to compare financial products such as current accounts, credit cards and mortgages and directed them to the website www.switchyourbank.ie which provides information on how to switch. The campaign has run on a variety of media channels, including TV, radio and digital. Of the overall budget for the public awareness campaign of €1.8 million, over €1.5m has been spent to date. The Department of Finance is currently in consultation with the European Commission regarding how the remaining funds will be spent.

Section 10(1) (b) of the Electronic Commerce Act 2000 excludes “the law governing the manner in which an interest in real property (including a leasehold interest in such property) may be created, acquired, disposed of or registered, other than contracts (whether or not under seal) for the creation, acquisition or disposal of such interests,”.

Subsections (2) and (3) of section 10 provide, however, that the scope of the Act may be extended to excluded areas or subjects by means of regulations made by the Minister for Communications, Climate Act and Environment where the Minister is of the opinion that:

“(a) technology has advanced to such an extent, and access to it is so widely available, or

(b) adequate procedures and practices have developed in public registration or other services, so as to warrant such action, or

(c) the public interest so requires,”

The Minister for Communications, Climate Act and Environment must consult with Ministers who have a sufficient interest or responsibility in relation to the area or subject being considered.