Sunday 23 July 2017

Government opposes FF plan on mortgage arrears

Fianna Fáil finance spokesman Michael McGrath said the current system for helping 76,000 households in mortgage arrears is 'broken'. Photo: Stephen Collins/Collins
Fianna Fáil finance spokesman Michael McGrath said the current system for helping 76,000 households in mortgage arrears is 'broken'. Photo: Stephen Collins/Collins
Cormac McQuinn

Cormac McQuinn

The Government is opposing Fianna Fáil's proposal to set up an independent mortgage resolution office aimed at providing extra protection for householders in arrears.

However, while Justice Minister Charlie Flanagan has argued the proposal is unconstitutional, support for the Bill from Sinn Féin and Labour means it is likely the Government will be defeated when it comes to the Dáil vote.

Fianna Fáil finance spokesman Michael McGrath said the current system for helping 76,000 households in mortgage arrears is "broken".

He said the banks essentially have a veto over mortgage restructuring deals and his Bill would effectively remove that veto with the new mortgage resolution office having the final say on such arrangements.

He hit out at the Government for opposing the Bill, claiming: "Whenever the Government doesn't want a proposal from the opposition to progress, the constitutional flag is raised."

He said the Bill should be allowed to undergo scrutiny by an Oireachtas committee to see where it can be improved and address concerns.

Mr Flanagan said mortgage arrears is an issue of high priority for the Government, but said Fianna Fáil's Bill won't solve the problem, arguing it's not compatible with the constitution.

Mr Flanagan said Fianna Fáil is proposing the creation of two independent quasi-judicial bodies - the mortgage resolution office and an appeals officer - with "extremely far-reaching" powers.

Under the Bill there is no appeal to any court, Mr Flanagan said, arguing this is a "fundamental flaw".

He also said the Government is concerned the Bill could discourage financial institutions from new lending and this would exert a negative impact on a recovering housing market.

Mr Flanagan insisted the Government has taken "extensive measures" to solve the mortgage arrears problem, including providing for a mechanism to appeal decisions, which he argued removed the bank veto.

Mr Flanagan said that while arrears and repossessions are still too high, they are falling steeply and the Government is determined to reduce them further.

Sinn Féin's TDs are supporting the Bill, with Pearse Doherty saying it should be allowed to pass and to go to committee. Labour is also supporting the Bill.

Irish Independent

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