Later today, the Government will put through the House the Second Stage of the National Asset Management Agency Bill. This will be the most expensive piece of legislation ever to pass through Dáil Éireann whereby the State will be expected to put up €54 billion to take bad loans off the banks. Even in a best case scenario it will mean the taxpayer is putting up a premium of about €7 billion for these bad loans. Meanwhile, tens of thousands of householders are facing the prospect of having their homes repossessed by the same banks who will benefit from this arrangement. In a report last week, the ESRI estimated that by the end of next year 35,000 households will not be able to repay their mortgages. It is well known that the banks are just waiting for the NAMA legislation to go through before they open up in a very serious way to seek repossession——

Is there any evidence for that?

——of homes from people who are in serious trouble. One of the biggest problems I hear from Labour Party public representatives all over the country concerns the difficulties of repaying mortgages and the fears people have of losing their homes. The biggest fear people have at the moment——

Is that the Deputy will be in Government.

——is the fear of losing their homes. I want to put a suggestion to the Taoiseach, which I ask him to take up before the NAMA legislation is enacted. Deputy Joan Burton will put down an amendment on Committee Stage proposing that there should be a moratorium on home repossessions for a period of time. This is perfectly reasonable. The people who are having difficulty today in repaying their mortgages are those who had good jobs a year or two ago, and certainly at the time they took out the mortgage. Hopefully, they will have good jobs again when we come through the economic difficulty. However, while the economic recession lasts, while there is an employment downturn and while business is difficult, many of these people will have problems repaying their mortgages. Instead of having their homes repossessed, an arrangement should be made whereby they can retain their homes and continue to live there. All kinds of arrangements could be made through the banks which would allow that to happen. It would make more economic sense because ultimately the State will have to pick up the tab if people's homes are repossessed. It also makes sense from a social and family viewpoint if people are allowed to stay in their homes. I want an assurance from the Taoiseach in this respect. I know he will probably tell me that there are codes of practice, but all these codes are doing is buying time for people. They are just postponing the evil day. There needs to be an assurance given to people who are worried about losing their homes that there will be a moratorium on home repossessions. I ask the Taoiseach to implement that before the NAMA legislation is finally enacted.

It is important to recognise that the level of mortgage arrears which results in house repossessions by the lender is, thankfully, still very low in this country. In previous discussions we have had on this matter, I have stressed the need for people who are not in a position to pay or who have temporary difficulties, to make contact with the lending agencies. There are codes of practice in place which must be respected when people get into such difficulties.

As regards the specific question raised by the Deputy, in the revised Programme for Government we have further strengthened our commitment to assist mortgage holders who are under pressure due to changed economic circumstances. The programme refers to introducing new measures to protect families who are experiencing difficulties with their mortgage repayments. The existing statutory code on mortgage arrears and the recently agreed protocol between the Irish Bankers' Federation and the Money Advice and Budgeting Service on debt default will be further reviewed with a view to expanding the options available for dealing with debt. These include, for example, the use by banks and other lenders of more flexible mechanisms to avoid foreclosure in appropriate circumstances. These could also include reduced rates, longer maturity dates, rolling up of outstanding interest, banks taking equity in the house, and banks taking ownership and leasing back to the resident with payments coming off the loan.

They will not.

With reference to the measures adopted in other jurisdictions, the Government will examine ways of expanding its own mortgage measures. A range of options and efforts will be made to assist in every way possible. As regards a moratorium being put in all cases concerning mortgage repayments, it is a question of being able to distinguish between those who are not in a position to pay and those who are refusing to pay, despite perhaps having an ability to pay or pay an amount of it. That issue would have to be considered in the context of any amendment that is put forward, to ensure that, on the one hand, we seek to protect people in difficulty while, on the other, not compromising funding support for those institutions on an ongoing basis.

There are two requirements that have to met here, but the approach the Taoiseach is taking does not meet either. I have been talking about the necessity for a moratorium on home repossessions for some time. On a number of occasions, the Taoiseach has responded by saying the banks are being spoken to, codes of practice are being introduced, and all kinds of approaches are being recommended to the banks. The first problem with that, however, is that it is being left to the goodwill and generosity of the banks. Whatever disposition the banks may have now to be generous and to respond to the invocations of the Government to deal sympathetically with mortgage holders, as soon as the NAMA legislation is passed and the banks have their money and their bad loans off their books, they will have a free hand to do as they please. The Government must include a requirement in the legislation for a moratorium on repossessions. I do not refer to people who default on their loans through their own fault, who have the wherewithal to repay a mortgage and are negligent in doing so, but to people who are stuck because they have lost their job, their business has gone bad or their circumstances have changed and they need a break. Just as the banks are looking for a break from the Government, householders also need a break. Unless that is done before the NAMA legislation is passed, the Government will tee up a situation where the banks will be able to go after householders with a free hand and the world and its mother knows that is what they are planning to do. The ESRI estimates 35,000 householders are in their sights.

The second thing that needs to be done is the Government needs to take the fear of the loss of one's home out of the psyche of the country. The Taoiseach has invited the trade unions and employers for further discussions. The first item he needs to put on the table before he commences social partnership talks is a guarantee that people will not lose their homes in order that those who have endured jobs losses or the loss of their business will not find themselves in a situation where they have to uproot from their neighbourhoods, leave the homes they have been living in and take their children out of the local school and so on. This would mean they would, at least, have that peace of mind and the issue of the rescheduling the repayment of the mortgage and all the options outlined by the Taoiseach, with which I agree, could be bedded down and made part of a moratorium that could be enforced for the period of time we are going through these difficulties.

The Government parties have in their revised programme indicated that they want to enhance protections for mortgage holders who have a genuine problem. Nobody in the House is at variance on the need to maximise protection in this regard. We need to do so in a way that meets the objectives of what the House is seeking which, at the same time, does not use a mechanism that can have an adverse impact on the funding of the banking institutions.

The Deputy has made certain points about the NAMA legislation. It is not about giving a free hand to anybody. It is about restructuring and having a viable financial system that will be able to continue to provide mortgages to those who seek them, as we seek to revitalise the housing sector and to make sure the funding arrangements for the banks are such that people who get into difficulty are dealt with appropriately, sympathetically and proportionately in view of their circumstances. The question of the best way of achieving that, therefore, can be further discussed in the context of the NAMA legislation and continuing economic debate in the House.

However, in the context of discussions I have in the House or outside the House with other social partners, the purpose of the Government's commitment in the programme for Government is seeking to achieve precisely that. How do we protect those in genuine difficulty temporarily who would have the capacity to reply and who need a period of time to reorganise their commitments? We have set out in some detail how that may be done. That is the Government's intention. We are setting out that objective and further discussion on it can take place in the House.