Monthly Archives: October 2012

Senator Mark Daly congratulating Kenmare GAA on the order of business on Tuesday the 16th in the Senate,

” Kenmare GAA Club on its victory in the county junior championship final.  Uniquely, the club is in both the all-Ireland hurling final and the club championship final.  Very few clubs have managed to achieve this.“

“As interest rates continue to rise on mortgages and loans, the Government has left thousands of borrowers in Kerry to the mercy of banks despite promises to help,” said Kerry Fianna Fáil Senator Mark Daly.

He added: “I am meeting people every week in Kerry who fear the cost of surviving week-to-week is being put further and further beyond their reach.  The latest increases in variable interest rates by AIB and Bank of Ireland will take more money out of people’s pockets in the weeks before Christmas and there is no sign that this Government is prepared to do anything to help.  As a result of this rate hike mortgage holders will have to pay an extra €30 a month for every €100,000 borrowed.

“The official mortgage data shows almost 11% of occupied properties are in arrears of 90 days or more.  But what are of huge concern to me are the real lives of people in Kerry behind those statistics. When you look beyond the headline figures you see that by value, more than one in four (27%) residential mortgages is either in arrears or has been restructured already. On top of that a recent report by Davy stockbrokers stated over 50% of residential mortgages are in negative equity, including the majority of those taken out since 2000.

“The real problem with negative equity is that the banks hold all the cards.  If the term on a customer’s fixed interest rate is up the bank can increase the rates, knowing the borrower has no choice because they can’t switch mortgage provider.

“Every time the banks increase interest rates they take more money out of people’s pockets, more money out of the economy and actually push those very borrowers closer or into arrears, causing yet more trouble for the banks.  The domestic economy is still in a very weak state and retail sales continue to show a year-on-year decline.  How can it be in the interest of banks to stop their borrowers from spending in the local economy in Kerry, helping a local shop in Killarney or Tralee, which in all likelihood has loans out from those same banks?

Senator Daly concluded: “This Government promised to help borrowers in Kerry but instead what we see every month is more mortgage holders in difficulty and independent reports showing that banks are not lending to businesses in the way they should – and when they are lending they’re doing so at punitive interest rates.  How long is this government going to leave borrowers at the mercy of banks which are showing no mercy at all?”

To view video of this speech, please click here

I call on the Acting Leader to provide time for a debate on the mortgage issue.  Former President Clinton advised the Government at the Irish Global Economic Forum last year that it needed to tackle the mortgage problem here.  All we have seen to date from the Government is activity and no action.  It has introduced a personal insolvency Bill which, if the banks had drafted it, we would not be able to tell the difference.  Fianna Fáil has proposed real solutions to the problems and issues.  To date, 18 months on, the Government still has not taken action.  Without action on the mortgage issue there will be no revitalisation of the economy.  People are not spending, in particular on luxury items such as cars – I am not sure cars are a luxury item if one needs one to get to work – because they are concerned about mortgages.  This is driving down the economy yet there is no action on the part of Government in this regard.

One cannot tackle public sector pay without first solving the mortgage problem because any cuts in this regard would drive public service employees into financial difficulties.  Unless the Government takes action and ceases its activity masquerading as action the problem will not be solved.  The Government is offering no solutions despite the commitment in this regard in the programme for Government.  We need the Government to take action and to do so now.  If it does not, the economy will continue to decline, with people continuing to lose work or emigrate.  The root cause of our problems at this point is inaction on mortgage issues.  We cannot tackle public sector pay and all the other issues which need to be addressed until such time as the root problem has been tackled.  People will not spend money on anything until they are secure in their homes.  This issue can only be tackled by way of a realistic personal insolvency Bill which tackles the mortgage issue, allowing people to write down debt.  We can then revitalise the economy and create jobs and thus retain our young people at home.