On Tuesday, we heard from the special liquidator of IBRC that it had secured the agreement of the bidders for the Irish Nationwide Building Society mortgages that they would voluntarily adhere to the code of conduct on mortgage arrears, CCMA. Yesterday, the special liquidator appeared before the finance committee. We heard of this voluntary agreement and that there would be no Central Bank oversight, sanctions or recourse to the Financial Services Ombudsman. We found out that the voluntary agreement was not even written down. From the perspective of the families affected it is fair to say that the voluntary agreement is not worth the paper it is not even written on.

The Irish Nationwide Building Society mortgage holders want to bid on their own mortgages but they have been refused. The rationale supplied by the liquidator and the Minister for Finance, Deputy Noonan, for this was that allowing the mortgage holders to bid for their own mortgages could drive down the total sales price, exposing the State to legal challenge from creditors. The sales process is based on a report by PricewaterhouseCoopers which the Minister has refused to release and which the special liquidator has not yet released. However, we found out some useful information about the report from the special liquidator yesterday.

The report recommended a single course of action, which is the one being followed. It did not evaluate different options in terms of the sales price. The liquidator agreed with the finance committee or, rather, told us that sales prices in various scenarios were not provided. In other words, the liquidator has not been provided with advice on what the sales prices would be if mortgage holders were allowed to bid and if they were not. It is still entirely possible that allowing the families to bid for their own mortgages would garner the same sales prices, or even more, than the current process does.

The media has highlighted one example today, that of Mr. Duncan Bannantyne. He offered the special liquidator 97 cent on the euro for his loans, but they were sold yesterday as part of a tranche to Lone Star for 60 cent on the euro, thereby getting €55 million less.

There is still an opportunity but time is ticking. Based on the information that the liquidator provided to us yesterday, he is acting on incomplete advice. In response to a parliamentary question yesterday, the Minister confirmed to me that neither he nor any of his officials had seen the report on which this sales process is based. Does the Tánaiste agree that there is an opportunity to pause the process and for the Minister, his officials or the finance committee to conduct a thorough investigation into whether another process can be designed that would allow the families to bid while making the same returns to the liquidator? We have a small window of opportunity to do considerable good for the many thousands of families that own these mortgages.

Hear, hear.

As I understand it, the special liquidator has reached agreement with the phase 2 bidders for the IBRC mortgage book. The agreement provides that, if successful in acquiring the portfolio, the phase 2 bidders will ensure that the relevant acquired mortgage loans are serviced in accordance with the Central Bank's CCMA. The special liquidator appeared before the finance committee yesterday and explained its decision. I understand that it was aware of the anxieties of mortgage holders and had noted the concerns expressed in recent weeks by the Minister for Finance and other Members of the Oireachtas.

I welcome this positive announcement and remind the House that the Government has always been clear, in that we will ensure mortgage holders retain the protection of the CCMA. As previously stated, however, if it becomes evident that the voluntary application of the code is not delivering the requisite protection for mortgage holders in arrears, the Government will introduce the required legislation.

Looking beyond the IBRC loan book sale and as discussed by the finance committee, the Department of Finance, the Central Bank and the Attorney General's office are examining the applicability of the CCMA to unregulated firms and the need for legislation in that regard. We have continually stated that we expect any purchaser of the IBRC mortgage portfolio to service it in accordance with the CCMA. This remains the position.

As the Deputy is aware, the sales process is being undertaken by the special liquidator as part of the liquidation process. It operates independently on its own legal basis, but the Government is clear in its desire to protect the interests of the mortgage holders. There have been two previous sales of loan books. In both cases, the purchasers agreed to the continued operation of the CCMA. In the current case, the two bidders have given an undertaking to follow suit. If they do not deliver on that undertaking, the Government will introduce whatever legislation is required.

I can only assume that the Tánaiste picked up the wrong piece of paper to read. I did not ask him about legislation on the CCMA. I asked him whether we could pause the sales process to figure out whether another could be devised in which families would be allowed to bid on their own mortgages while returning the same or greater value to the liquidator.

I will provide a quick example from the protest outside Leinster House. A gentleman with whom I spoke who lives in a home with his wife and their children owes €220,000 and will not be in a position to repay it. The liquidator will sell the gentleman's mortgage for a conservative estimate of €100,000, although it could be as little as €50,000. The man and his wife could refinance at €150,000, but they are not being given that opportunity.

When I put my next comment to the liquidator yesterday, he did not disagree. What is likely to happen is that one of the two final bidders, both of which are funds from the US that specialise in distressed assets, will buy the family's €220,000 mortgage for approximately €100,000, quickly ascertain that the man and his wife cannot pay the former amount and, after ascertaining that there is equity in the house, initiate repossession proceedings and evict him, his wife and his children. On the basis that the liquidator is acting on imperfect information and the Minister has not even seen the advice, it is clear that a process could be devised that would allow this man, his wife and children and thousands of other families to stay in their homes through buying back their mortgages at the same prices or even more. However, those mortgages are about to be sold to international funds that invest in distressed assets.

On the basis that what is about to happen is going to cause enormous and unnecessary distress to tens of thousands of men, women and children------

You are way over time.

-----can the Tánaiste please examine whether the sales process can be paused so we can at least try to figure out a process that allows these people to stay in their homes while still returning the same amount, or more, to the liquidator?

Deputy Donnelly is very knowledgeable and he knows how the liquidation process works. He also knows the risks to the taxpayer of an interference by the State in the liquidation process. It is easy to say "let us pause the sale". There are consequences to that which might arise from actions taken by other creditors, and other people involved in the IBRC liquidation process. One would have to be very careful and be very sure that there would not be an exposure to the taxpayer of any such intervention of that kind.

This process is not concluded. The special liquidator told the committee that there are two bidders. Arising from the concerns about the position of the mortgage holders, those bidders have given an undertaking that they will comply with the CCMA, as was the case in the sale of two previous loan books that occurred. The sales process is not complete, and I do not think it is wise to begin speculating about where the sales process will end up. We do not know. That is a matter for the special liquidator. As far as the Government is concerned, we want to see the mortgage holders protected here. If the purchaser does not meet the commitments and standards that we expect, then the Government is prepared to legislate and such legislation would apply not just in the case of the IBRC mortgage holders, but in the case of all mortgage holders. In any event, repossession cases would have to go before the courts and we know the approach the courts are taking, which is to expect that the terms of the CCMA are applied.