The seminar, which was hosted by the Department of Social Protection, was attended by a number of stakeholders in the area of mortgage and personal debt.
In her opening remarks to the seminar, Minister Burton said: "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."
Minister Burton also welcomed the recommendation that without effective bankruptcy legislation the mortgage arrears problem will not be solved. She said that Minister for Justice Alan Shatter was currently preparing the outline of legislation on personal insolvency as a matter of urgency.
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"My Department welcomes the proposed introduction of Minister Shatter's Personal Insolvency Bill. We see the early reform of personal insolvency legislation as key to resolving the mortgage arrears and personal debt problems."
The Department of Social Protection is currently spending about €77 million a year on Mortgage Interest Supplement. Minister Burton commented: "In effect, my Department is subsidising the mortgages of more than 18,500 struggling borrowers who have turned to us for help. 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."
Minister Burton also welcomed the report's recommendation to provide an independent mortgage advice service which aims to advise customers (in arrears or pre-arrears) in their dealings with mortgage lenders and that the funding for this service should be provided by mortgage lenders. Minister Burton commented: "I am satisfied that MABS, under the aegis of the Citizens Information Board, currently provides an excellent service to its customers, many of them on low incomes or people living on social welfare payments. While the new service proposed by the report is very different from that provided by MABS, I have no doubt that that there should be strong linkages between this new service and MABS. I would welcome your views on how this might be achieved.’"
(CD)
