Fianna Fáil Senator Thomas Byrne has said the party will be bringing forward legislation to deal with the anomalies surrounding interest rate increases and reductions. It follows today’s interest rate cut from the ECB and the varying announcements from Irish banks as to how the rate cut would be applied to borrowers.

Senator Byrne said: “The European Central Bank is not implementing a policy of cutting interest rates again for the benefit of banks, the burden on borrowers needs to be eased. Obviously mortgages holders on tracker mortgages will immediately benefit from the rate reduction but there has been a mixed from Irish banks as to how they will apply the rate cut to other borrowers. AIB for instance appears to have set its face against passing on the cut in any form while others are pledging to pass on the cut in part.

“There is significant disparity in the interest rates being charged by banks in the Irish market at the moment and this is causing significant differences for borrowers. Fianna Fáil has been working on this issue for some time and will be bringing forward legislation proposing that an ‘average rate band‘ be introduced. We have been examining a number of such models in place in other countries and believe a system can be put in place here that is fairer and more transparent.

“Borrowers need co-operation from banks, certainty from markets and help from the Government to get through the current difficulties. We will be bringing forward this legislation in a non-partisan way and seeking support from TDs and Senators from all parties. Mortgages holders and borrowers in difficulty expect politicians to work together on solutions to the current difficulties and I am urging members of all parties and none to carefully consider our proposals when they are published.”