Deputy Healy questions the Tánaiste asking “how can the Government justify the introduction of a new regressive water tax to be paid by families that are already at their wits’ end?”
Séamus Healy (Tipperary South, Independent)
The policies of successive Governments have allowed an elite golden circle of the rich and powerful in this country to obtain obscene levels of wealth at a time when the vast majority of people have seen their incomes reduced and have been struggling day in, day out to make ends meet. The message from last week’s meeting in Davos and from the Paris School of Economics is that Irish society is becoming more unequal. We are hearing the same message from Oxfam, the Central Statistics Office and the Economic and Social Research Institute. That message is supported by the fact that many of the consultants who recently received substantial payments from Irish Water are the same companies and individuals who were paid for bad advice and bad oversight during the boom. The message is further reinforced by the payment of bonuses, the breach of pay limits for Government advisers and the payment of huge pensions. The list goes on.
In a recent study, the Paris School of Economics showed that the wealthiest 1% of people in Ireland own 10% of national income. Ireland is the seventh worst, in inequality terms, of the 18 countries studied. The figures for accumulated wealth are even more significant and stark. The wealthiest 5% of families in this country own 47% of the wealth. Since this Government came to power, the wealthiest 300 individuals in this country have gained €9 billion, or €30 million each. According to the Central Statistics Office, the incomes of the wealthiest 10% of people in Ireland have increased during the course of the recession, while the incomes of the other 90% of people have decreased. That fall has accelerated as incomes have declined.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
A question, please.
Séamus Healy (Tipperary South, Independent)
The Economic and Social Research Institute has independently studied the last three budgets and found them to be regressive, which means the budgets have taken the most from those who have the least. Low and middle income families—–
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
This is a time for questions rather than speeches. Will the Deputy put his question?
Séamus Healy (Tipperary South, Independent)
I am putting the question now. Low and middle income families have had their incomes undermined. They have been fleeced by increased taxes, such as the unfair household tax. They are struggling to make ends meet.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
I will not ask the Deputy again to put a question rather than making a statement.
Séamus Healy (Tipperary South, Independent)
In those circumstances, how can the Government justify the introduction of a new regressive water tax to be paid by families that are already at their wits’ end?
Finian McGrath (Dublin North Central, Independent)
Hear, hear.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
I share with Deputy Healy a wish to see equity in our society.
Peter Mathews (Dublin South, Independent)
Then do it.
Finian McGrath (Dublin North Central, Independent)
Good man, Peter. Give it some welly.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
I want to see fair taxation that ensures those who are in the best position to contribute to the finances of the State do so. The problem is that every time we propose any measures in that regard, Deputy Healy opposes them.
Séamus Healy (Tipperary South, Independent)
Which ones?
John Halligan (Waterford, Independent)
What has this Government done to address inequality?
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
For example, this Government has introduced a number of measures to increase capital taxation. I refer to taxes like capital gains tax, capital acquisitions tax and deposit interest retention tax. To my recollection, Deputy Healy opposed all of those measures.
Billy Kelleher (Cork North Central, Fianna Fail)
The Tánaiste used to oppose water charges at one time.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
When we introduced a property tax, my recollection is that Deputy Healy opposed that as well.
Joan Collins (Dublin South Central, People Before Profit Alliance)
The Tánaiste is talking about the family home tax.
Finian McGrath (Dublin North Central, Independent)
The home tax.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
I am certainly open to hearing from Deputy Healy specific proposals about taxation or other measures that will contribute to greater equity. There is no point coming into the Dáil to bemoan inequality and excessive wealth and then opposing every measure that is introduced to deal with those issues.
Billy Kelleher (Cork North Central, Fianna Fail)
That was the reserve of the Labour Party when it was in opposition.
John Halligan (Waterford, Independent)
Did the Labour Party not propose a wealth tax and a financial transactions tax?
Barry Cowen (Laois-Offaly, Fianna Fail)
That is what got it into government for its short stint.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
If one studies the OECD’s examination of our taxation system, one will find that the top 1% of earners in this country, who were mentioned by Deputy Healy, now pay approximately 20% of the income tax. He also referred to the top 5%, who now pay approximately 40% of all the income tax that is paid in this country.
Joan Collins (Dublin South Central, People Before Profit Alliance)
That is based on income tax only.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
The OECD now considers the Irish tax system to be one of the most progressive among the countries it covers.
John Halligan (Waterford, Independent)
How did they accumulate that wealth? They did it on the backs of the poor.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
I am open to hearing any specific and worthwhile proposals to improve the current position that Deputy Healy might have.
Dara Calleary (Mayo, Fianna Fail)
That would be more than the Tánaiste ever proposed when he was in opposition.
Séamus Healy (Tipperary South, Independent)
We have heard the usual spin and untruths from the Tánaiste. Of course I have made proposals regarding wealth and asset taxes in this Chamber on numerous occasions.
Finian McGrath (Dublin North Central, Independent)
That is right.
Séamus Healy (Tipperary South, Independent)
I have also done so in my budget submissions. The top 1% in this country, and indeed the top 10% in this country, have a completely disproportionate share of national income. The Government has refused to implement a wealth tax or an assets tax.
Finian McGrath (Dublin North Central, Independent)
Hear, hear.
Séamus Healy (Tipperary South, Independent)
The Tánaiste is on record as opposing water charges. I would like to quote something he once said.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
This is not about statements.
Séamus Healy (Tipperary South, Independent)
He said “the PAYE taxpayer has already paid enough for local services and should not have to pay again”.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
Would you put a supplementary question, please?
Séamus Healy (Tipperary South, Independent)
In 1994, he said that the Fianna Fáil-Labour Party Government had “imposed Residential Property Tax and now they are making us pay for water”.
Anne Ferris (Wicklow, Labour)
That was 20 years ago.
Séamus Healy (Tipperary South, Independent)
When water charges were abolished in 1997, he said the Government of the time was right to do that because they were “a form of double taxation”.
Timmy Dooley (Clare, Fianna Fail)
He was not in the Labour Party then.
Barry Cowen (Laois-Offaly, Fianna Fail)
He could have been in any of three or four parties.
Dara Calleary (Mayo, Fianna Fail)
He might have been in New Agenda.
Barry Cowen (Laois-Offaly, Fianna Fail)
Or Democratic Left.
Timmy Dooley (Clare, Fianna Fail)
That was before he went away and became an altar boy.
Séamus Healy (Tipperary South, Independent)
The vast majority of people in this country have been fleeced and crucified over recent years. In those circumstances—–
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
Sorry, would you put your question?
Séamus Healy (Tipperary South, Independent)
—–and in light of the possibility of imposing wealth and assets taxes on very rich people in this country, will the Government withdraw the water charges that are proposed to commence in November of this year?
Finian McGrath (Dublin North Central, Independent)
Hear, hear.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
Okay. I will comment on the issue of wealth taxes.
Séamus Healy (Tipperary South, Independent)
Is the Tánaiste accepting that I made a proposal in that regard?
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
The Deputy should listen to Tánaiste’s reply, whether he likes it or not.
Séamus Healy (Tipperary South, Independent)
I am making sure he tells the truth.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
There are three essential forms of wealth: property, pensions, which account for a large part of wealth these days, and money. This Government has introduced additional taxes in each of those three areas of wealth. We have introduced a property tax.
Joan Collins (Dublin South Central, People Before Profit Alliance)
It is a family home tax.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
We have introduced additional capital taxes. We have introduced an additional tax on pensions that yield over €60,000 a year. We have also introduced additional taxes on money. The idea of coming in here and saying “let’s tax wealth” is all very well. It is a grand idea.
Tommy Broughan (Dublin North East, Labour)
We are talking about net wealth.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
It sounds great and wonderful until—–
Barry Cowen (Laois-Offaly, Fianna Fail)
Until one gets into government.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
—–the Government actually comes to do it. The reality is that when the Government comes to do it—–
Róisín Shortall (Dublin North West, Independent)
It flunks it.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
—–Deputy Healy opposes it every time.
Róisín Shortall (Dublin North West, Independent)
It does not have the bottle for it.
Tommy Broughan (Dublin North East, Labour)
The Labour Party’s bosses in Fine Gael say “No”.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
Deputy Broughan, please.
Patrick O’Donovan (Limerick, Fine Gael)
The Deputy had his chance but he did not stay around and stand his ground for long enough.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
We are over time. If Deputies do not want to hear the Tánaiste’s reply, I will just cut off the debate.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
On the issue of water, the Government has decided—–
Billy Kelleher (Cork North Central, Fianna Fail)
To make the ordinary people pay.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
—–to make sustainable provision for water services in this country for probably the next quarter of a century or more. That is a prudent thing to do.
Séamus Healy (Tipperary South, Independent)
The Government has decided to fleece families.
Joan Collins (Dublin South Central, People Before Profit Alliance)
People will have to pay for dirty water.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
The previous Government failed to do that. We made it clear in the programme for Government that a charging arrangement based on a metered system, with a free water allowance for households, would be introduced.
Séamus Healy (Tipperary South, Independent)
I thought we had free water now.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
We said that charging for water would take place on a metered basis beyond that free allowance.
John Halligan (Waterford, Independent)
We have not even been told what that allowance will be.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
Rather than exaggerating and telling people that this cost will be very excessive—–
Michael Healy-Rae (Kerry South, Independent)
The Government told lies about the property tax.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
—–Deputies should be assured that the Government is on the side of families and households on this issue.
Billy Kelleher (Cork North Central, Fianna Fail)
The Tánaiste opposed water charges three years ago.
Barry Cowen (Laois-Offaly, Fianna Fail)
He certainly opposed them when he was in the Workers Party, Democratic Left and New Agenda.
Seamus Healy TD raises the issue of monster pylons, the anger in rural Ireland and the 35,000 public submissions to EIRGRID in opposition to Government plans.
Deputy Healy asks the Taoiseach to suspend the pylon project until at least an international, independent assessment is carried out.
Statement on Behalf of Seamus Healy TD 087-2802199
AT Last Government Admits That There is a Problem for Low Income Families with Distressed Mortgages
Minister Quinn admits that more needs to be Done by Government to Keep People in their Homes
At leaders questions to-day Seamus Healy TD, for the third time, raised the question of low income families losing their homes under current debt resolution arrangements. Three weeks ago, Taoiseach Enda Kenny insisted there was a solution for all distressed mortgage holders which would enable them to stay in their homes. Two weeks ago, Tanaiste Eamonn Gilmore denied that the problem existed.
BUT To-DAY after Deputy Healy raised the issue a third time adducing irrefutable evidence, Minister Ruairi Quinn admitted that there was a problem ad that the Government would have to do more to keep people in their homes.
Under persistent pressure from Deputy Healy the government has shifted its position. Continued pressure is now required to make the Government act on its commitments.
The live debate can be viewed by clicking here wp.me/p1Uvd5-vu
The Dail Record is appended below
Paddy Healy 086-4183732 on behalf of Seamus Healy TD 087-2802199
Dail Record
Deputy Seamus Healy: I join with all Members in the Christmas and New Year’s greetings, particularly to the staff of the Houses of the Oireachtas, including the ushers, caterers, clerical and administrative staff who serve and support us.
The right to keep a roof over their heads and to continue to live in their family homes is one of the most cherished aspirations of the Irish people and people the world over. I make no apology for returning to the question of families being bullied out of their homes or legally compelled to leave by banks bailed out by the Irish people. The Taoiseach and the Tánaiste have refused to answer the question in recent times and I appeal to the Minister to address the question and answer it. It is very straightforward and I appeal to the Ceann Comhairle to ensure the Minister answers the question. For thousands of people, the fear of losing the family home is palpable and traumatic. It is giving rise to serious mental health issues. People fear the sight of the postman in case he or she has the dreaded letter from the bank demanding the sale or repossession of the family home. Since I raised the issue a fortnight ago, the rating agency, Fitch Ratings, has borne out my contention that up to 30,000 families face the loss of their homes under the insolvency arrangements put in place by the Government.
[Deputy Seamus Healy: ] Fitch puts the figure at 26,000 families on the basis of information given to the company directly by the banks. We are talking about people on low incomes whose only asset is a family home. They have fully engaged with lenders but have no disposable income.
This argument is widely accepted by people engaged in the mortgage distress area, such as the advocacy group New Beginnings, the free legal aid centres, the Phoenix project in Portlaoise, Grant Thornton and various personal insolvency practitioners across the country. New Beginnings has 1,000 distressed mortgage applications from people who see no out except for bankruptcy. Grant Thornton has a similar figure and when it studied 1,000 cases, it saw that up to 50% faced bankruptcy.
I want to ask a question I have already posed to the Taoiseach in the past couple of weeks. Does the Minister accept there is a serious problem and there are thousands of families on low incomes, below the minimum living expenses, who cannot avail of the insolvency process and who are facing the loss of the family home? What does the Government intend to do about that?
Deputy Ruairí Quinn: I agree with the Deputy in that we should extend our best wishes and appreciation to all members of the staff for the way in which this House runs so efficiently. With regard to the Deputy’s first question, my answer is “Yes”, and I accept that we have a problem. We have known that from the very beginning and since we came into government. It was one of the many problems we inherited from the previous disastrous Administration.
Deputy Ruairí Quinn: In respect to the Deputy’s second question, I accept that thousands of families are currently living in fear, and people in my constituency are struggling with the issue. As there has been a de facto moratorium on house building over the past number of years, there has been a significant increase in house rents, as Deputy Ó Caoláin noted. That has happened across the country and not just in the greater Dublin area, Cork and Limerick. We are trying to ensure, through massive change in the area of insolvency and mortgages, that systems can be worked out by families and lending institutions, including the two main banks, which have been massively recapitalised by the taxpayers in this country. That was so the banks could do what they were supposed to in this area.
Deputy Barry Cowen: We are getting that back in July, according to Enda.
Deputy Seamus Healy: I am not clear as to whether the Minister accepts the problem I outlined. Does he accept that there is a category of individuals – rather than individual families – numbering up to 30,000 families who cannot avail of insolvency arrangements put in place by the Government? As a result, they face the loss of their family homes. That will add another 20,000 or 30,000 to the 90,000 people already on our local authority house waiting lists.
Deputy Finian McGrath: Hear, hear.
Deputy Seamus Healy: They will also have to avail of rent supplement, at much cost to the State. Currently, the only solution for these families is bankruptcy. Does the Minister accept that as a solution for these families, as I certainly do not? What changes will the Government make in insolvency arrangements to ensure that this category of distressed mortgage holder can be helped? I repeat that these are blameless people on low incomes with no disposable income, so they cannot avail of insolvency arrangements. What changes will the Government make to ensure these families can stay in their homes?
Deputy Finian McGrath: Hear, hear.
Deputy Ruairí Quinn: Everybody in this House shares the concern which the Deputy has raised on a number of occasions. This Government has put in place a most comprehensive programme of action to assist householders struggling to pay their mortgages—–
Deputy Seamus Healy: That does not cover this category of people.
Deputy Ruairí Quinn: I am trying to reply to the Deputy’s question.
Deputy Billy Kelleher: The Minister is not listening.
Deputy Ruairí Quinn: We have rebalanced the rights of borrowers and lenders under the biggest shake-up of personal insolvency law in the century. We have given those who bought their first homes during the bubble significant increases in mortgage interest relief. That is not the end of what we are trying to do. I accept the concerns which have been expressed and although the figures are hard to calculate, they are of the order mentioned. Under this system, it is inevitable that some people will be faced with the prospect of losing their homes because of their circumstances. As a Government, we are prepared to look at the measures that can be adopted in that set of circumstances, where some kind of rental agreement or other form of intervention can be arrived at with institutions that in many cases have been funded by the taxpayer. This is to ensure that a family does not lose a home.
Deputy Joe Higgins: Write down the mortgages.
Deputy Peter Mathews: Correct.
Deputy Ruairí Quinn: Whatever way it is to be done, nobody in the House wants to see people put out on the street because they cannot repay amounts.
Deputies: Hear, hear.
Deputy Peter Mathews: Well do something about it.
Deputy Ruairí Quinn: Nobody wants that.
Deputy Finian McGrath: Fine Gael and Labour are the Government now. They still think they are the Opposition.
Deputy Seamus Healy: The current arrangements do not protect the people I have described.
An Ceann Comhairle: If Deputies are not prepared to listen, they should not ask the questions.
Deputy Ruairí Quinn: We all share the Deputy’s concern. This is an evolving problem and we have taken steps to resolve it in a number of areas. That does not mean we will not take more steps if necessary. In some cases, it probably will be necessary.
Deputy Peter Mathews: Of course it will.
Deputy Ruairí Quinn: The Government will not be found wanting.
Deputy Finian McGrath: They still think they are the Opposition.
Deputy Healy asks Minister Quinn if he accepts that there is a serious problem with regard to people facing homelessness, and also asks if he accepts that there are thousands of families on low incomes below the minimum living expenses who can not avail of the insolvency process and face the loss of their family homes as a result, and what does he intend to do about this?
Deputy Healy also asks Minister Quinn if he accepts that bankruptcy is a solution to these families, as Deputy Healy does not? and also Deputy Healy asks what changes are his government going to make in the insolvency arrangements to ensure that this category of distressed mortgage holder, who can’t avail of insolvency, can stay in their homes.
Deputy Seamus Healy: Christmas can be a lonely and difficult time of the year for the poor and low-income families, for the elderly, for carers and for long-term social welfare recipients. The Christmas bonus made Christmas for many such families and gave them a little bit of comfort. The official State statistics agency, namely, the Central Statistics Office, has found that almost one quarter of the people do not have the money to afford at least two goods and services that generally are considered the norm for society. This quarter of the population is categorised by the CSO as deprived and that figure has doubled over the past five years. The accepted definition of deprivation means that people cannot afford such basics as heating their homes, buying meat, having a warm coat or buying a gift for a grandchild at Christmas time.
Members know the money is there to pay for a Christmas bonus. Not too long ago, the Minister of State at the Department of Foreign Affairs and Trade, Deputy Costello, told Members in this Chamber that this country is the seventh wealthiest country in the world. In addition, the Central Statistics Office has revealed that gross financial assets of the wealthy are back up to boom levels, at €310 billion. Moreover, the Minister, Deputy Noonan, has informed Members that the top 20,000 earners in this country each earns in excess of €430,000 per annum. A minimal asset or wealth tax or a small increased rate of income tax on such very wealthy individuals would cover the cost of the Christmas bonus many times over. Many civil society organisations, including Age Action, Focus Ireland, OPEN, the Irish National Organisation of the Unemployed, Barnardos, the National Women’s Council, the ICTU president, John Douglas, as well as many more, have called for the restoration of the double social welfare payment at Christmas. In the context of the acknowledged levels of deprivation in Ireland and in the context of such wealth, will the Government show compassion this Christmas and restore the Christmas bonus?
Deputy Michael Healy-Rae: Wonder Woman might bring it back.
The Taoiseach: The abolition of the Christmas bonus was announced in 2009 and to restore it now would cost €261 million.
The Taoiseach: The rationale for the abolition of the Christmas bonus back in 2009 was that it was preferable to cutting social welfare rates across the board. In 2010 and 2011, however, the Government of the day reduced primary personal welfare rates for all persons under 66 years by more than €16 per week. In budget 2014 the Government was able to protect the State pension, the carer’s allowance, the disability allowance and other core weekly payments in addition to child benefit, while still reducing the overall welfare spend as part of the necessary effort to reduce the deficit. It would be grand to think that one could do these things but it is not possible.
I appreciate the difficulties that many people have had and continue to have as a result of the economic recession of recent years. That said, we have gone from a position where the country lost 250,000 jobs in three years to one where 1,200 net jobs are being created every week and there has been a fall in the numbers on the live register over 18 consecutive months. It is heartening to see the trends of confidence. Interest rates have fallen below 4% and even the construction index is rising. We still face significant challenges and it is not easy to make decisions to reduce public debt, but we have one of the highest deficits in Europe. We have targets and objectives to achieve and the people have made great sacrifices, but I think they see the process leading in the first instance to an exit from the bailout and following through to creating more jobs and achieving our target of having a deficit below 3% by 2015. By growing the economy there will be more opportunity for people to get gainful employment and to benefit from the rise in the economy. The Government has committed to not reducing core welfare rates and not increasing income tax because that is a tax on work. These are always difficult balances.
I am sorry to have to say to Deputy Healy that it is not possible to restore payment of the Christmas bonus as it was previously. The cost would amount to €261 million and we do not have that money. Unfortunately, we cannot return to the situation where there was an assumption that everything was available for nothing. Someone has to pay at the end of the day and balance is required. The budget maintained the State pension, the carer’s allowance, the disability allowances, other core weekly payments and child benefit. Despite all the cynics and all those who said we would destroy all the welfare payments, that did not happen.
Deputy Mattie McGrath: It did happen.
The Taoiseach: Considering everything, it has not been possible to restore this year’s Christmas bonus at a cost of €261 million.
Deputy Seamus Healy: That is a mean and shameful reply. However, those are not my words. Those are the words of Deputy Eamon Gilmore, leader of the Labour Party, when he addressed a question on Leaders’ Questions to a former Taoiseach who had abolished that bonus:
This payment has been made to pensioners every year for 30 years, even in some of the country’s most difficult economic years … for the first time in 30 years pensioners will not get the small bonus which has been paid to them in years past … The Taoiseach’s reply contrasts sharply with his more sympathetic approach to the golden ten yesterday … They get all the comfort from the Government but pensioners, who worked hard to make the country what it was … are told they will not receive the small payment which made Christmas worthwhile for many of them. This is mean and shameful.
An Ceann Comhairle: Deputy Healy, please put your supplementary question.
(Interruptions)
Deputy Seamus Healy: I want to ask Deputy Eamon Gilmore and the Labour Party how they can stand over not restoring the Christmas bonus in these circumstances.
An Ceann Comhairle: The Deputy is not asking Deputy Gilmore at the moment. He must ask the Taoiseach a supplementary question.
Deputy Seamus Healy: I am referring to how wealthy people were comforted by the previous Government. We know that during the course of this Government since Deputy Gilmore and the Taoiseach came to power—–
An Ceann Comhairle: Please put your supplementary question, Deputy Healy.
Deputy Seamus Healy: —–we know from the Sunday Independent 300 rich list that they have increased their wealth by €9 billion since 2011.
An Ceann Comhairle: Please put your supplementary question, Deputy Healy.
Deputy Seamus Healy: That is €9,000 million. A very small tax, wealth assets or income tax, on these very wealthy individuals would cover—–
An Ceann Comhairle: The Deputy is not listening to me. Please put your supplementary question.
Deputy Seamus Healy: I have a question.
An Ceann Comhairle: You are way over time.
(Interruptions)
Deputy Seamus Healy: With all respect, the first question took 15 minutes.
An Ceann Comhairle: With all respect, please put your supplementary question.
Deputy Seamus Healy: As I said, a very small tax—–
Deputy Paul Kehoe: Did the Deputy vote for it? Does he remember that?
Deputy Seamus Healy: —–on these very wealthy individuals would cover this Christmas bonus—–
Deputy Mattie McGrath: The same as Deputy Brian Hayes, the Minister of State.
An Ceann Comhairle: Stay quiet, please.
Deputy Seamus Healy: —–numerous times over.
(Interruptions)
Deputy Seamus Healy: In the context of the obscene wealth—–
Deputy Mattie McGrath: The Ceann Comhairle is not protecting the Members.
Deputy Seamus Healy: —–of those 300 richest people in this country—–
An Ceann Comhairle: Please, Deputy Healy. Put your supplementary question.
Deputy Seamus Healy: —–will the Taoiseach reconsider his decision not to pay the Christmas bonus and at least give some little comfort to people who are deprived this Christmas?
Deputy Finian McGrath: Do not be a Scrooge.
An Ceann Comhairle: I call the Taoiseach to reply and I ask if he would please stick to one minute. I am getting totally frustrated here. We are now about 12 or 13 minutes over the allocated time. Members either want me to chair this or they do not want me to chair it but do not give me time limits which nobody is prepared to stick to. I do not like interrupting speakers consistently but Members will have to change these time limits if they are not prepared to stick to them, and it is not on.
Deputy Mattie McGrath: The Ceann Comhairle should talk to the Government Whip.
An Ceann Comhairle: I am not referring to you, Taoiseach.
The Taoiseach: It is not possible to restore the Christmas bonus as Deputy Healy suggests because it would cost €261 million. The entire social welfare system is being reformed.
Deputy Seamus Healy: It is being destroyed every day of the week.
The Taoiseach: Instead of passive payments, the change will demonstrate that work will pay and activation measures are being put in place. When the Christmas bonus was abolished in 2009 it was followed in 2010 by reductions in all those areas of social welfare. This Government is committed to not reducing core rates, and in budget 2014 it was possible to protect those.
Deputy Patrick Nulty: The budget cut core rates.
The Taoiseach: It would be lovely from a political point of view to say we can pay for this.
Deputy Seamus Healy: There are buckets of money. This is a very wealthy country.
The Taoiseach: The money is not there.
(Interruptions)
The Taoiseach: The system is that those who earn most pay the most. The Government restored the minimum wage, removed 330,000 people from liability to the universal social charge, and maintained core rates in all the areas I mentioned, including carer’s allowance, the State pension, disability allowance and child benefit, which is very beneficial for families with children.
Deputy Seamus Healy: Child benefit was cut in the last two budgets. Another promise broken by the Labour Party.
Deputy Healy highlights to the Tánaiste the case of 30,000 families who do not qualify for insolvency under the new arrangements and who are facing eviction, and he asked the Tánaiste: “Will the Government exercise sovereignty by preventing reckless bailed-out banks, some owned by international vulture capitalists, from evicting 30,000 families in this country”.
Séamus Healy (Tipperary South, Independenkt)
Up to 30,000 families face eviction due to the failure of the Government to protect them. They are distressed mortgage holders who have fully engaged with the banks. They are not strategic defaulters. Their only property is their family home. They do not have buy-to-let properties. In most cases they have modest mortgages. In all cases their incomes have collapsed due to the recession. The Insolvency Service of Ireland has set out living expenses for personal insolvency arrangements. Under those guidelines a family of two adults and two children must have minimum living expenses of €24,780 per year to qualify for insolvency arrangements. Such a family on jobseeker’s benefit or allowance has an annual income of €19,364, which is significantly less than the minimum living expenses under the guidelines. A similar family with one person in employment at a wage of €9 per hour – in excess of the minimum wage – and including FIS, has an income of €23,193 per year. Again, that is less than the minimum living expenses set out under the insolvency service.
Those two families have no net disposable income, as calculated by the Insolvency Service of Ireland. They have no money to give to the banks. They do not and cannot qualify for the insolvency arrangements. There are up to 30,000 such families. Paul Joyce of the Free Legal Aid Centres told us this morning that thousands of such families have had their proposals vetoed by the banks. I have letters from constituents who have been given the option of having a voluntary sale, making a voluntary surrender or being evicted. They are banks which the public has bailed out.
Last week the Taoiseach refused to answer my question on the issue but he repeatedly stated that there is a solution for everyone. Does the Tánaiste regard bankruptcy and repossession of the family home as a solution for those blameless families? Is that the reason the Government removed the legal ban on repossessions? One could ask whether that is the reason the indefensible situation has arisen whereby the Government has allowed the Central Bank to reduce the moratorium on repossessions from 12 months to two months. Will the Government ensure that the families which have fully engaged—–
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
The Deputy is well over time.
Séamus Healy (Tipperary South, Independent)
—–and have modest mortgages that are not buy-to-let properties, who are not strategic defaulters—–
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
The Deputy should put his question please. He is way over time.
Séamus Healy (Tipperary South, Independent)
Will the Tánaiste ensure that these families will be allowed to remain in their homes?
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
I do not agree that 30,000 families face eviction. However, 30,000 families would face eviction if the Government had not taken the steps it is taking to deal with the mortgage arrears problem. That is why today, for example, the new personal insolvency legislation will come into effect that will reduce from 12 years to three years the period of time for bankruptcy. I also agree that the solution to the mortgage arrears problems experienced by many families is neither bankruptcy nor losing their home. The cornerstone of the Government’s approach to mortgage arrears is to ensure that families are able to continue living in their home. That means solutions must be found where families and households are in mortgage difficulty. The solution will vary from case to case. We have now put in place a range of measures to help families in mortgage distress. The personal insolvency legislation strengthens their hand in their discussions with the banks. The Insolvency Service of Ireland has been put in place. A range of non-judicial debt settlement arrangements have been built into the legislation. A range of measures is also in existence which will allow for engagement between mortgage holders and their lenders. To date, more than 45,000 permanent mortgage restructures have been completed. There is still more to be done. Far too many families are in mortgage difficultly and work must continue on a case-by-case basis with them to resolve their mortgage difficulties in a way that ensures they can continue to live in their homes.
The whole point is that we do not want to see people losing their homes. The very approach of Government policy is to avoid that. Probably the biggest fear people have had during the recession, which has been even greater than the fear of losing their jobs, has been the fear of losing a home. That is why we have taken the approach we have taken. We have put in place legislation and the personal insolvency service and we have set targets for the banks to engage with borrowers and to reduce the number in mortgage distress. That work must continue. There are still many families whose mortgage arrears have not yet been resolved, and work must continue to ensure this is addressed.
Séamus Healy (Tipperary South, Independent)
The Tánaiste has refused to answer the question. I have asked about a specific group, comprising families, that will not qualify for the insolvency arrangements about which the Tánaiste has spoken. He may not accept it but it is accepted widely, both within this House and outside it, that thousands of families do not qualify for the insolvency arrangements. New research by Grant Thornton Debt Solutions has found that many people seeking insolvency arrangements do not have enough income to qualify. Mr. Michael McAteer of Grant Thornton said recently on Newstalk that the only solution for these families is bankruptcy.
The Icelandic Government announced today that it will defy the banks by writing off up to €24,000 of household mortgages. Iceland obviously has real sovereignty.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
I ask the Deputy to put his question.
Séamus Healy (Tipperary South, Independent)
Will the Government exercise sovereignty by preventing reckless bailed-out banks, some owned by international vulture capitalists, from evicting 30,000 families in this country?
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
We want every family and householder in mortgage difficulty to have that difficulty resolved and to avoid up losing their home. There is no family that we want to see excluded from the arrangements we have put in place to resolve mortgage arrears difficulties.
There is not a single solution that fits every case.
Séamus Healy (Tipperary South, Independent)
There is a particular group.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
If the Deputy has a particular case in mind, he should let me know.
Séamus Healy (Tipperary South, Independent)
There is a group of 30,000.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
There is not. At the beginning, the Deputy said there were 30,000 families facing eviction. There are not.
Séamus Healy (Tipperary South, Independent)
There are.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
There are not.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
Deputy Healy has had his say. I ask the Tánaiste to speak through the Chair.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
There are not 30,000 families facing eviction, nor will there be. However, there are 30,000 families who would be facing that prospect if we had not put in place the measures we have put in place to deal with the issue of mortgage arrears.
Séamus Healy (Tipperary South, Independent)
The group does not qualify for the arrangements, as the Tánaiste knows.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
We have exceeded the time allowed.
Eamon Gilmore (Tánaiste; Minister, Department of Foreign Affairs and Trade; Dún Laoghaire, Labour)
There is no question of their not qualifying. Every single case of mortgage arrears difficulty must be resolved, and issues must be resolved on a case-by-case basis.
Séamus Healy (Tipperary South, Independent)
Up to 30,000 families face eviction due to the Government’s failure to protect them. Mortgage holders will not qualify for the insolvency procedures because they have no disposable incomes or disposable assets. They have fully engaged with their lenders. They are not strategic defaulters. Their only assets are their family homes. They hold modest mortgages, many of less than €100,000 and almost all of less than €200,000. They are all low-income families, many headed by unemployed people.
They are in this position through no fault of their own. They took out mortgages when employed to put roofs over their heads and to provide for their families. Now, they are unemployed because of the reckless activity of the entire Irish establishment, including the Central Bank, the banks, the Government, their cheerleaders in the media and the State research bodies that predicted a soft landing.
The same banks that destroyed society and that we bailed out are threatening these genuine mortgage holders with eviction. I have a letter from one of the pillar banks to such a mortgage holder. It outlines the options available to the person, including voluntary sale and voluntary surrender. In the event of a shortfall, the person would remain liable under all of the options for the outstanding debt, including accrued interest, charges and legal, selling and related costs. The bank would always seek the gross sale proceeds.
The letter threatened eviction. The bank noted that—–
Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
The Deputy is limited to two minutes.
Séamus Healy (Tipperary South, Independent)
—–forbearance was not appropriate, given the fact that the person’s financial position was unsustainable, and that, if the repayments due were not met and arrears accumulated on the mortgage, the matter would, regrettably, be referred to solicitors.
Such conduct from banks that we have bailed out is outrageous, unjust and unfair.
Tommy Broughan (Dublin North East, Labour)
Hear, hear.
Séamus Healy (Tipperary South, Independent)
Will the Government legislate urgently to enable these unfortunate and blameless families to stay in their homes or will it continue to allow the banks to deploy the modern equivalent of the battering ram?
Deputies:
Hear, hear.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
The position is that I would say all parties in this House elected by the people do not want to see anybody thrown out of their home. The sad fact is, however, that, in a number of cases, it is going to be very difficult for some people to hold on to their homes – some.
Séamus Healy (Tipperary South, Independent)
Up to 30,000.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
The Government has put in place all of the mechanisms to help every person who is a mortgage holder who has got a problem. There are 47,000 restructured permanently already. The numbers are being assessed by the Central Bank. Despite the fact that the party opposite decried the personal insolvency agency, claiming that banks had a veto and that this would result in thousands of people being evicted, the first evidence of cases going through the personal insolvency agency do not seem to indicate that.
Robert Troy (Longford-Westmeath, Fianna Fail)
Does one case tell the story?
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
As these cases are worked through, we will have evidence of the actual situation. If those hard-working people who, through no fault of their own, find themselves in this position of having a problem with their mortgage, the first thing they must do is engage with the lender.
Séamus Healy (Tipperary South, Independent)
They are fully engaged. They have done everything.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
There are requirements and codes and targets set out and—–
Peter Mathews (Dublin South, Independent)
The lenders should engage with the customers.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
—–being implemented by the Central Bank to work out a solution in each and every case. The Governor of the Central Bank has been very clear about the targets set by the Central Bank for banks and lending institutions to work out solutions in each and every case. It is perfectly obvious that the people who are applying for mortgages and who are in a position to purchase houses are not going to get caught in the same trap as those who have gone before them.
Despite much cynicism, the Government has acted responsibly to put in place codes of practice, targets and legislation to help the very people Deputy Healy spoke about. If they took out a mortgage and found that because of unemployment or other changed circumstances they are unable to pay, there is now a solution for every case. It means, however, that in every case those concerned must work out what solution is in their best interests. We do not want to see anybody lose their homes.
Séamus Healy (Tipperary South, Independent)
What is the Taoiseach doing for this specific group of people?
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
Some cases I have come across are very difficult.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
Now the Deputy can speak properly. He does not need to interrupt.
Séamus Healy (Tipperary South, Independent)
If the Taoiseach would answer the question we would have some basis for discussion.
Seán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
Please proceed, anyway.
Séamus Healy (Tipperary South, Independent)
While the Taoiseach continues to put his head in the sand and washes his hands like a Pontius Pilate act, many of the people I am talking about will end up on the streets, as Focus Ireland said this morning. It is certain that families evicted from their homes will end up on the huge local authority housing waiting lists. Some 110,000 families are already on those lists and more will join the end of that queue. It is also certain that they will be entitled to rent supplement at a significant cost to the State.
The mortgage to rent scheme would allow these families to stay in their homes on a rental basis and also give them an option of repurchasing in future if their financial circumstances improve. Surely that scheme would be both socially and financially beneficial to families, the State and even to the banks. However, even though we bailed out the banks they are resisting this scheme. The Government seems to have abandoned the scheme. There have only been 60 approvals in that scheme since it was introduced.
Will the Taoiseach personally intervene with the banks to ensure that they fully operate the mortgage to rent scheme? That would give some hope to the 30,000 families involved who are facing eviction. This is a huge problem.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
Some 70,000 mortgages have been restructured.
Séamus Healy (Tipperary South, Independent)
I am not talking about those.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
There were 45,177 permanent mortgage restructurings up to the end of September, which is an increase of 3,500 on the August figure. The Minister of State, Deputy Jan O’Sullivan, is working on a number of those smaller, more precise areas, including mortgage to rent and split mortgages. She is following through on that.
Séamus Healy (Tipperary South, Independent)
Will the Taoiseach intervene with the banks?
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
There is a solution in each case for every person who has a mortgage difficulty, and the figures are well known. However, they must engage with the lenders.
Séamus Healy (Tipperary South, Independent)
They cannot do so because the lenders are not engaging with them.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
There is no point in leaving the matter aside because it will not sort itself out. A deal has to be cut in all these cases. That is why 70,000 mortgages have been restructured and over 45,000 have been permanently restructured. That did not happen of its own accord. It is because of the legislation, the targets, the code of practice and the assistance for people to engage directly with lenders.
Séamus Healy (Tipperary South, Independent)
It will not happen in these cases unless the Taoiseach intervenes.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
The housing supplement is being changed to give a different incentive so that people will have an opportunity to get back to work. The letter that Deputy Healy has is not a solution.
Séamus Healy (Tipperary South, Independent)
Absolutely. It is not a solution.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
Thousands of those letters went out from banks. Neither the Deputy nor I are responsible for the tone of that letter.
Séamus Healy (Tipperary South, Independent)
It is going out to those 40,000 people.
Enda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
This matter has been discussed with the Central Bank whose Governor has set down targets for every bank to sit down with every mortgage holder and work out a solution in each case. Evidence of the much decried personal insolvency legislation is now becoming clear from the initial cases going through, that the banks do not have a veto. If the banks decide not to deal through the personal insolvency agency, they may get nothing at all if the person follows a bankruptcy route. That has been changed from 12 years to three.
