In the words of the Governor of the Central Bank, Professor Honohan, household debt and financial distress is at an unprecedented level. We now have more than 180,000 residential mortgages in some form of distress or difficulty. Some 20,000 mortgages are in arrears for over two years and some 86,000 mortgages are in arrears for over 90 days. The situation is serious at a personal, social, financial and societal level. It is a national emergency which demands a significant response.

It was caused by Fianna Fáil.

The Governor says the situation is getting worse. On Sunday he said there are many people who cannot pay and that distressed mortgages are not being dealt with in significant numbers. He said this was the reason he and others in the Central Bank were tearing their hair out. I suggest many people across the country are tearing their hair out at the lack of any progress on this issue. The Central Bank is not happy at all with the progress the banks are making in this regard. Many Members of this House meet on a daily basis families in deep distress who are making reasonable efforts to cope with their situation but who are not getting a sufficient response from the banks. There is a strong correlation between mortgage arrears and mental health issues and there is a genuine crisis at this time.

The Governor of the Central Bank spoke about the need to be more directive with the banks, notwithstanding the risks associated with that. The Keane report was published 18 months ago, but very little has happened since in the context of practical, innovative responses from the banks. Only 12 split mortgages have been effected since then and only one mortgage-to-rent arrangement. Therefore, the response to the Keane recommendations by the banks has been appalling. Given that the banks got €9 billion in the context of their recapitalisation to deal with mortgage modification and losses and were supposed to use that funding intelligently, what plans has the Government to direct the banks to engage once and for all with customers and to deal with this issue? As Fiona Muldoon, the deputy Governor of the Central Bank, has said, the banks have been in complete denial on this issue for far too long.

Last weekend, I listened to the words of the Governor of the Central Bank as he spoke of his frustration and that of the Central Bank with regard to mortgage arrears. Professor Honohan has played his part for the country in the negotiations, along with the Minister for Finance, in respect of the promissory notes. He expressed his frustration last weekend about the extent of engagement and decisiveness by the banks with regard to the mortgage arrears situation.

As we all know, some 100,000 people are not being allowed to play their full part in the development of our economy. The reason that cannot happen is the failure to bring about resolutions to their mortgage problems. In so far as our relationship with the Central Bank and the banks is concerned, Deputy Martin is aware that in an effort to deal with the issues we have set up a Cabinet sub-committee dealing with mortgage arrears and mortgages, and that we have now extended that to deal with banking and access to credit.

I am not happy at all with the level of resolution that has been achieved. Reports have come from the banks, particularly the two pillar banks, of decisions arrived at in respect of mortgage holders who are in distress. Many of these decisions have been to make the mortgages interest-only for a period, which is not a long-term solution to the problem. The regulator attended a recent meeting at which he outlined the proposals of the Central Bank, and inspectors from the Central Bank are now beginning to call to banks in regard to the mortgage code.

In so far as the Oireachtas is concerned, we have enacted the Personal Insolvency Bill, and all Members are aware of its complexities. The personal insolvency agency will open its doors early in the summer and I hope that between now and then the banks will realise that this offers an incentive to them to get on with the business of dealing with mortgage holders who are in distress and arrears and to work out resolutions. They must also deal with the fact that they received sufficient moneys in the recapitalisation to deal with write-downs in some cases.

The issues that were raised in the House following the Keane report have been followed through and implemented, but not to the extent one would wish, in terms of the different resolution strategies. The advice and guidelines and the websites providing information on how to keep families in their homes are important for everybody here. The mortgage-to-rent scheme was expected to deal with more than 500 cases. It is currently involved with 100 cases and a further 100 are at an early stage of the process. This scheme and other such interventions cannot be rushed for any of the parties. For example, the process involves a 60-day decision period and a 20-day cooling-off period.

I would like to believe that the focus put on this issue by the Governor of the Central Bank and the extension of the remit of public service directors by the Minister for Finance to report to the Cabinet sub-committee on what is happening will provide a new emphasis on the need to get as many of these people as possible back to being able to contribute to the general economy as quickly as possible, not only for their psychological good, but also to enable them make a real contribution to the economy.

I thank the Taoiseach for his response, but I remain unconvinced of the impact of what the Taoiseach has said is happening. Up to now, the standard response has been the interest-only payment approach, comprising 99% of restructures to date. I put it to the Taoiseach that as the Minister of State, Deputy Brian Hayes, said last week, the banks have been given the money to write down, write off or restructure debts in accordance with the original capital assessments completed more than 18 months ago. That simply has not happened.

It seems to me that the standard orthodoxies in terms of the relationship between the Government and the banks have simply not worked for the person on the street, the family in mortgage arrears and the family in genuine distress and crisis. A different approach is required. It is alarming to hear the Governor of the Central Bank say that officials in that institution are "tearing their hair out" in frustration at their inability to get a sense of how the banks are dealing with this issue and engaging with families and customers. Given that they received €9 billion of taxpayers' money, it seems to me that it is time for the message to get through to the banks - in my view, the message must come from the shareholder, in respect of one of the major banks, and from the Government - that it is time for them to look after citizens in a reasonable and effective way. Many of those who are in significant distress are willing to co-operate and want to fulfil their debts.

Yes.

They want to pay their debts, but they need the space and capacity to do so. We need innovative and radical solutions. Some economists have suggested a permanent interest rate reduction, which would enable the banks to get all of their capital back at a more affordable monthly rate. The question of split mortgages should have been followed through on long before now. It is unclear whether the Personal Insolvency Act 2012 will deal with many of these areas. Unfortunately, it seems that one must almost be at the most insolvent end of the spectrum before one can avail of that legislation. I hope it will bring some relief. I put it to the Taoiseach that the Government should get involved in what the Governor of the Central Bank has described as a "directive" approach to the banks on specific policies for dealing with this issue.

I like the Deputy's new-found focus on dealing with the complex problems we have now. One would swear that the Governor of the Central Bank did not have to make a telephone call from a street corner in Frankfurt a few years ago to say the IMF was in here.

The Taoiseach should answer the question.

Deputy Martin's conversion is most welcome.

The Taoiseach needs to get into the present.

I appreciate the number of constructive suggestions he has made.

The election is over long ago.

We do not forget the reasons all of this happened. On behalf of the Government, I wrote to the regulator 18 months ago to ask him if he required further powers as regulator.

Write to Santa.

I said that if he did, the Government would consider them and respond to him. The regulator made it clear that he did not need any further powers at that time.

Everything is grand.

The Central Bank required the lenders to submit their proposals for addressing the problem of distressed mortgages. As the Deputy is aware, those options included split mortgages, trade-down mortgages, restructuring of mortgage payments and forbearance.

There have been just 12 split mortgages to date.

The Deputy will appreciate that the scale of the devastation his Government left behind meant that teams from the Central Bank and the Department of Finance had to spend the last 15 months dealing with the European Central Bank before last week's very welcome agreement could be reached. Having heard the banks state their case, I understand they have trained their personnel to-----

To collect what they can.

-----deal with distressed mortgage holders.

The Taoiseach has been telling us that for the last two years.

They have been trained to send out the bailiffs.

Can we please have a reply without interruption?

This is an old record.

I remind Deputy Cowen that AIB is now saying it will be able to deal with 1,500 cases a month.

The Taoiseach needs to change the script.

I welcome that if that is the case. I hope they are not all put on interest-only payments because resolutions are needed.

The Taoiseach must be joking.

There is enormous relief for distressed mortgage holders and their families when it becomes clear that they are not in danger of losing their houses.

More and more people are getting into trouble every week.

When a solution is arrived at in these cases, the people in question can contribute fully to the growth and development of the economy. Approximately 100,000 people are being prevented from so doing because of a lack of resolution in their cases. The personal insolvency agency is to be established before the summer. Quite rightly, the focus and concentration of the Central Bank and the Government, through the Cabinet committee, is on the opportunity to focus on distressed mortgage holders, bring about resolutions and clean up the mess the previous Government left behind it.

The banks were given €9 billion for these purposes.

It is getting worse by the day.