The Government was accused of “washing its hands and abandoning” mortgage holders in advance of the latest increase in interest rates by the European Central Bank (ECB).
Sinn Féin finance spokesman Pearse Doherty made the remarks in the Dáil as he criticised the Coalition for not adopting his party’s proposal to bring in temporary mortgage interest relief.
The Sinn Féin proposal is aimed at helping households with tracker and variable mortgages as well as people paying high interest rates after their loans were bought by vulture funds.
Tánaiste Micheál Martin mounted a strong defence of the Government’s record highlighting interventions totalling €12 billion while arguing that Sinn Féin’s proposal is “knee jerk” and one that would discriminate against those on fixed-rate mortgages.
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On Thursday the ECB raised its interest rates by 0.25 per cent as it continues to try to bring euro zone inflation under control.
The rate now stands at 3.75 per cent. It is the seventh increase of recent times.
Mr Doherty raised the issue during Leaders’ Questions saying the expected increase would be a “hammer blow” to hundreds of thousands of families, including 250,000 households with tracker mortgages.
He says it comes at a time of “great financial pressure” with people already “squeezed” by rises in food prices and energy bills.
Mr Doherty told the Dáil that the Central Bank outlined how one in five households are seeing their mortgage repayments increase by €400 per month and some people are seeing increases that would total between €5,000 and €6,000 over a full year.
He said Sinn Féin’s proposal for temporary and targeted mortgage relief would absorb 30 per cent of the rise in mortgage costs for a household up to a maximum of €1,500 and called the Government’s rejection of it a “mistake”.
Mr Doherty said the Coalition claimed it cannot act until October’s Budget but he set out tax changes including those for the hospitality and tourism sector and on solar panels as well as the removal of some levies for developers that took place outside the normal budgetary cycle.
He added: “So the argument that nothing could be done to support these families in the here and now with rising mortgage costs before October is simply a nonsense.”
Mr Martin said there is “no doubt that pressure is increasing on families with mortgages” but the Government “have to be mindful not to rush into the Sinn Féin sort of knee jerk response to issues”.
He highlighted Sinn Féin’s proposals to cap energy bills last year, said a similar scheme was brought in in Britain, and argued that “it was a disaster leading to the demise of a prime minister [Liz Truss]”.
He said Sinn Féin needs to “look at this more broadly” and said its mortgage interest relief plan is “discriminatory against those on fixed mortgage rates”.
Mr Martin said the Government’s cost-of-living interventions have reduced childcare, education, transport and healthcare costs highlighting several specific measures like bringing in free schoolbooks for primary pupils and the series of €200 electricity credits for households.
He said the Government’s cost-of-living programme is comprehensive and a better approach than the “knee jerk response” of the Opposition.
Mr Doherty said the Fianna Fáil leader is not willing to intervene to provide direct supports for mortgage holders and “that’s a crazy situation”.
He said some people are already paying 8 per cent interest rates and it is going up after Thursday “and we have a government that is washing its hands and abandoning these mortgage holders”.
He said the Government is offering free schoolbooks while his party is seeking direct support for mortgage holders and he asked Mr Martin if such support is under consideration.
The Tánaiste responded saying interest rates had been raised twice at the time of last autumn’s Budget and at the time Sinn Féin chose not to provide at all for mortgage holders in its budget submission.
He said: “What I have said earlier represents a very comprehensive, strategic approach by Government to reduce costs generally for households including those with mortgages.”
Mr Martin said Mr Doherty seemed to dismiss the free books scheme but said it is a “very significant intervention for many, many families with mortgages that they won’t face the costs of books next September.”
He concluded saying: “Our measures and interventions have been far more comprehensive, more strategic and sustainable than anything you’ve proposed.”
