Tánaiste is again failing to protect borrowers & SMEs by failing to secure COVID-19 payment breaks from banks – Pearse Doherty TD
Sinn Féin spokesperson on Finance, Pearse Doherty TD, has criticized Tánaiste Leo Varadkar for again refusing to even seek COVID-19 payment breaks for borrowers who have been impacted by public health measures in the past number of months.
Yesterday, the Tánaiste confirmed that he would not be seeking COVID-19 payment breaks from the banks which would protect borrowers from the charging of additional interest and the impairment of their credit ratings.
Instead, borrowers have been told they are on their own, while it will be business as usual for the banks.
Speaking today, Teachta Doherty said:
“The third surge of Coronavirus has resulted in job losses, continued unemployment and financial insecurity for so many borrowers, including mortgage-holders and small businesses.
“When this pandemic began, the European Banking Authority issued guidelines that allowed Government and lenders to provide for payment breaks for borrowers who were impacted by the virus.
“These guidelines allowed for payment breaks without the charging of additional interest or the impairment of borrowers’ credit ratings.
“Due to Government inaction, Irish borrowers were only able to avail of 6-month payment breaks while borrowers in Germany, Italy and Spain were able to avail of breaks of between 9 and 12 months.
“Worse still, borrowers were charged additional interest during their breaks, increasing their outstanding debt by thousands.
“By the end of November, over 9,000 mortgage holders and SMEs whose payment breaks had ended were unable to return to normal repayments.
“We know that banks and lenders have failed to offer many of these borrowers sustainable solutions in these difficult times.
“This round of restrictions will impact them and so many more borrowers throughout the State.
“Once again, the policy of the Government is to sit on their hands, do nothing and let the banks call all the shots.
“In December 2nd the EBA announced that it was reactivating its payment break guidelines.
“Th is was an opportunity to provide real relief for thousands of borrowers.
“Despite calling on the Government and banks to seize this opportunity, they failed to do so.
“Yesterday the Tánaiste made clear that he would be seeking no such protections for borrowers.
“Instead he has made clear that he will be telling the banks that it is business as usual.
“With so many workers, families and businesses unsure as to how they will make their mortgage and loan repayments, this Government is saying ‘You’re on your own’.
“That is just not good enough.
“The correct response has been obvious for months.
“An extension and reactivation of payment breaks for borrowers who need it, without the charging of additional interest.
“The European regulator allows it, now the Government must secure it.”