FIANNA FÁIL has said it is in favour of mortgage debt forgiveness but only in individual cases and where a full evaluation has been carried out.
Party leader Micheál Martin and finance spokesman Michael McGrath yesterday gave details of the party’s support for a debt settlement office operated on a non-judicial basis.
The establishment of such an office was a key recommendation of a Law Reform Commission report last year. The report dealt with non-mortgage debt but Mr McGrath said the party would like to see the remit of the office extended to home loans as well.
Mr Martin and Mr McGrath were speaking at a press conference at the end of the first day of the two-day special parliamentary meeting in Tallaght, Dublin, which was attended by all the party’s 33 TDs and Senators.
Mr McGrath said the agency could be allowed to extend its powers into the area of mortgage debt. “We envisage that it would operate through personal insolvency trustees who would fully examine the financial situation and liabilities and have power to strike a negotiation with creditors to revise payments of debts over a period of five year,” he said.
The approach of banks at the moment was inconsistent and opaque, he added. He said Fianna Fáil would bring forward a “groundbreaking piece of legislation” to establish the service.
“What it can achieve is a consistency of treatment for all borrowers. It can recommend a debt solution in each case, which could involve parking the interest payments, or debt deferral or interest deferral.”
Asked did the party favour blanket forgiveness, Mr McGrath said: “Our view is that each individual loan has to be considered individually.”
The first day of the conference had contributions on the economy with Prof Tony Foley of DCU and Joe Durkan of the ESRI addressing the TDs and Senators. The theme of the afternoon sessions was “coping with recession”.
Other speakers included Sr Consilio Fitzgerald of Cuan Mhuire addiction services who said addiction cost the economy €4 billion each year; John Mark McCafferty of St Vincent de Paul who said there had been a 45 per cent increase in contact with its services over the past year; and Lorcan Roche whom Mr Martin said was “an Irish Times columnist who is unemployed”.
Asked did he agree with the views expressed in The Irish Times by Jürgen Stark that the Government should strive for a more austere target in the budget than that currently envisaged of reducing the debt ratio to 8.6 per cent of GDP, Mr Martin said Fianna Fáil’s view was that the target should remain at 8.6 per cent.
However, he said greater clarity was needed from the Coalition on whether or not more than a €3.6 billion adjustment was required.
Mr Martin was scathing of the role of the ECB and accused the Government of sitting on its hands. He later criticised European leaders for a lack of urgency and clarity in following through on decisions taken at the July meeting to deal with the crisis.
“The enormous failings of the ECB have again been exposed, with borrowers enduring wholly unnecessary interest rate rises . . . “The Taoiseach’s approach to Europe has been to step back and in the Dáil he has refused to engage on points of substance.”
Mr Martin denied he was leading the party to a Eurosceptic position.
He also referred to the report of the Mahon tribunal, which is expected this autumn and is expected to criticise Bertie Ahern.Without naming him, Mr Martin said the report “will address the behaviour of a number of parties. It will have wide implications. As far as Fianna Fáil is concerned we will respond quickly and comprehensively to all matters no matter how difficult they are.”
