MINISTER for Social Protection Joan Burton has insisted that the government is moving as fast as it can to implement proposals contained in the Keane Report.
However, she admitted that no decisions on the proposals made in the report on mortgage arrears have been made since it was published a month ago.
Instead the Labour Party minister said the adoption of many of the proposed reforms would have to wait until next year when legislative changes to the personal insolvency laws come into force.
Speaking at a seminar on aspects of the Interdepartmental Mortgage Arrears Working Group on Monday, Minister Burton said that the taxpayer was currently subsidising the mortgages of 18,500 struggling borrowers, spending €77m a year on the Mortgage Interest Supplement in the process.
Amongst the proposals in the Keane Report was to curtail the Mortgage Interest Supplement and replace it with a more sustainable solution and the provision of an independent mortgage advice function to advise and support mortgage holders in assessing their options and to build trust in the debt resolution process.
Also recommended was the introduction of two “mortgage to rent” social housing schemes which would see approved housing agencies taking ownership of homes in specific circumstances or the leasing of houses by banks to local authorities, which would in turn rent them to former owners.
Minister Burton said she endorsed the proposals of the report and added that the government were moving as quickly as possible to implement it.
She said: “We are picking up the tab for a share of those borrowers’ debt burden, and the money we pay goes directly to the banks. We also spend more than €500 million a year on rent supplements for 100,000 people who cannot afford to house themselves,” she said.
The Minister said the personal insolvency issue was central and would be “the most challenging piece of legislation” to come before the Dáil. She could not give a time frame when the legislation would be ready other than to say that Minister for Justice Alan Shatter was “working flat out on it” and it would be done “as soon as possible.”
She said the reform of personal insolvency legislation was “key to resolving the mortgage arrears and personal debt problems” and that it “would force banks to the negotiating table, allowing both sides to reach a settlement.”
She said the personal debt mountain that many people faced, both from unsustainable mortgages and unsecured credit union and credit card debt, was a problem that needed to be tackled urgently.
“The thing that is different about this recession is that it is not just about high unemployment but also about the high personal debt burden that many citizens are shouldering. This is preventing people becoming economically active,” she said.