New 9 point plan to deal with arrears

[broken link removed]

• Free Legal Advice Centres
• Threshold
• Focus Ireland
• New Beginning
• Society of Saint Vincent de Paul
• Northside Community Law Centre
• Ballymun Community Law Centre
• Respond! Housing Association
• Dr Stuart Stamp (NUI Maynooth)
• Ciara Murray (Public Information Consultant)
• Simon Brooke (Housing and Social Policy Consultant)
• Dr Michelle Norris (University College Dublin)
• Dr Padraic Kenna (NUI Galway).

A summary of principles to address

A summary of principles to address the debt crisis
1. Over-indebtedness – It is inability to pay rather than a lack of willingness to do so and economic problem that requires a multi-dimensional strategic response from government.

2. The need for data - Comprehensive information is urgently needed to quantify the extent of the debt problem. Policy initiatives undertaken must be constantly evaluated in light of such data.

3. Multiple debt - Proposed solutions must take all debt liabilities into account to be effective and workable.

4. Personal insolvency legislation -There is an immediate need for the introduction of personal insolvency legislation. A Debt Resolution Agency should be established to oversee the legislative scheme to ensure transparency and consistency.

5. Debt write-off - Insolvent debtors should pay to the best of their ability for a limited time period and remaining debt should then be written off.

6. Access to representation - Debtors must be entitled to have an advocate represent their interests in negotiations to agree or processes to contest debt repayments.

7. Minimum income - Debtors must be entitled to a minimum income to meet their basic needs while repaying debts.

8. Unsustainable mortgages - The fact that some mortgages are unsustainable must be recognised and where repossession results, appropriate social housing
and social welfare rights must be provided to such households.

9. Retention of dwelling - State supports should aim to keep people in their homes where possible, whether in an ongoing mortgage or as a tenant where appropriate.

And some people thought that the Keane Report was vague.

Unfortunately, there is no magic bullet and this statement really confirms it.

The second point is "the need for data". But they don't quote any data e.g. the facts that the banks have reschedule 70,000 loans while only 1,000 homes have been repossessed.

On the contrary, as a set of principles they are not vague but quite precise.

The data refers to the full picture of consumer debt which would of course what limited information has been made available on home owner mortgage arrears.

I noted from today's proceedings that Keane spoke of possible debt settlements and write downs being necessary where mortgages are unsustainable.

The data issue is explained as an evidence deficit:

AN EVIDENCE DEFICIT
We also believe that a lack of data and ‘hard’ evidence is hindering reform. The recent publishing of data on mortgage arrears by the Central Bank is welcome, although more depth in the figures would be beneficial. However, there is a critical lack of corresponding statistics on consumer credit arrears
as well as rent and utility debt. Hence, we do not know the full extent of over-indebtedness in Ireland and crucially, we do not know who is most affected and why, and what is coming down the tracks. The Central Bank should require “arrears data” from all lenders (and the government from all state and semi-state creditors) in order to present a picture of where we really stand. Together with the lack of an independent evaluation of current policy initiatives – for example, a
rolling assessment of the results and effectiveness of the Mortgage Arrears Resolution Process
(MARP) set out in the Code of Conduct on Mortgage Arrears - the consequence is an evidencedeficit, which hampers informed and responsible policymaking.