There is no doubt but that the cost of mortgages represents an extraordinary burden on thousands of families, many of whom see no light at the end of the tunnel. Some 96,000 households are in mortgage arrears for more than three months. The personal insolvency arrangements, in terms of the resolution of the issue of household debt, give complete control to the banks. To add to all of this misery and people's genuine anxiety, the State owned banks, Allied Irish Bank and the Educational Building Society, have decided to increase their variable mortgage interest rates by 0.4%. This is a devastating blow to many mortgage holders. The cost of this increase on a mortgage of €300,000 will be approximately €800 per annum, which is a savage increase for many and will cripple family budgets. This represents a cynical profiteering ethos within these institutions which, in terms of their particular agenda, are making sacrificial lambs of variable interest rate mortgage holders. This is a sneaky rise in advance of an anticipated European Central Bank cut next week.

Many are asking questions such as, "Is anybody going to do anything about it?" and "Is the Government indifferent to the plight of those mortgage holders who will suffer significantly as a result of this hammer blow announcement yesterday by AIB, the EBS and Haven?" The 2011 Central Bank report on variable interest rate mortgage pricing in Ireland states:

It appears that some lenders are charging higher variable rates to compensate for the losses they are making on their tracker loans. The risk with such a strategy is that it may be counterproductive and continue to exert upward pressure on arrears.

There is no doubt but that this increase will add to the number of families in arrears. When one takes into account the property tax and other charges, the situation is looking impossible for many families. This increase will lead to more families in mortgage arrears.

Will the Government intervene in this matter? Will it meet the banks to ask them to reverse this savage increase in variable interest rate mortgages?

The Government has already intervened to address the issue of mortgage arrears, which is one of the biggest problems facing many householders. In many cases, those in mortgage arrears bought homes at the height of the property bubble. The Deputy will recall that there was a property bubble during the lifetime of the Government in which he served, the result of which is that many are now stuck with high mortgages which they are finding difficult to pay. To address this problem, the Government has put in place the personal insolvency legislation which reduces to three years the period of time for personal insolvency and a range of non-judicial personal insolvency settlement methods. That system came into operation at the beginning of 2013. Some 8,000 cases of arrears have since been addressed by the putting in place of various settlements. However, there is a lot more to be done. The Government continues to encourage the financial institutions to speed up the process and reach settlements with people in mortgage arrears in order that they can get on with their lives and have certainty about where they are in terms of their mortgage difficulties. There is no doubt but that the announcement by AIB and the EBS that they propose to increase their standard variable interest rate mortgage is bad news for mortgage holders. However, the Deputy will be aware that is a commercial decision made by the two institutions.

The State owns AIB and the EBS and I asked the Tánaiste if the Government would intervene to have this rate increase reversed. The Keane report was published two years ago. However, nothing has happened during those two years in terms of the many sensible recommendations made in it. The mortgage interest subsidy was abolished. The bottom line is that families are facing an average increase of €800 per annum. I put it to the Tánaiste that this is unsustainable. I agree with the Central Bank that this will push many people on variable interest rate mortgages into arrears, thereby increasing the overall number in arrears.

It demands Government intervention. It will damage families and cripple the economy.

Everybody has talked about the domestic economy not getting off the floor during the past two years. Everybody accepts that the domestic economy needs some stimulus, some investment. If €800 is taken out of many families' annual household budget, there is not a chance that the domestic economy will go anywhere in the next 12 months. This is a wider issue. It is extraordinarily difficult for the families concerned but it has repercussions and implications for the broader domestic economy. Two years ago when the banks refused to pass on an ECB cut the Government made great play of hauling in the banks-----

A question, please, Deputy.

-----but it seems that was just all optics. The Government is not even saying now that it will talk to them about this savage increase, which represents cynical profiteering and, in my view, is not in the interests of the shareholder ultimately because it will damage the economy. The fundamental question that needs to be asked is whether is it about just getting the banks sorted or the economy sorted. It seems mortgage holders are at the end of the queue and there is complete indifference to their plight given the scale of the increase that will be taken out their weekly, monthly and annual household budgets. There is need to intervene in this case on behalf of the families and the wider economy as well.

As I said, any announcement of an increase in mortgages is bad news for mortgage holders, about that there is no doubt or arguing, but it is important we stick to the factual situation. The Deputy said twice that the average increase is €800 a year but that is not the case. The average standard variable rate mortgage in the AIB is €128,000 which means that the increase will be €24 a month. It is bad news for the householders concerned but that does not amount to €800 a year. The average standard variable rate mortgage in the EBS is €102,000 which will mean an increase of €17 per month. Again is it bad news for the householders concerned but it does not amount to €800 a year. It is important that the Deputy sticks to the factual position.

I am dealing with the facts.

Your arithmetic is every bit as bad as when you were in government.

Deputy Martin was also wrong when he stated that the Government did not act on the Keane report. It did act on that report. That is why we introduced the personal insolvency legislation.

With the banks in control.

Split mortgages.

That is why the personal insolvency service has been established. That is why a range of measures has been advanced to help people who are in mortgage distress. Our objective is to aim to get settlement of the mortgage arrears difficulties people have. We have now put in place the architecture under which that can be done. Since the beginning of this year 8,000 have been settled.

They have not been settled.

That needs to be speeded up.

The Tánaiste should check the facts himself.

We are in constant contact with the banks to encourage them-----

Encourage them?

-----and drive them forward to get the settlements made.

Did the Government know this increase was going to be made if it is in constant contact with the banks? It must have.

The objective here is that we have to get to a point where people can get their mortgage difficulties settled and get on with their lives.

And this is going to help them.