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Bruton: No 'global strategy' for telling homes how to make deals with banks

Not everyone will be told to quit premium TV or private health insurance – but families will need to make sacrifices.

Image: Mark Stedman/Photocall Ireland

A CABINET MINISTER has said there is no “global strategy” that will be used by banks when seeking to make deals with customers in restructuring their mortgages – but acknowledged that households struggling to make repayments will have to make some sacrifices to reach a deal.

Jobs minister Richard Bruton said reports that homes would be asked to give up private health insurance, or lose a Sky TV subscription, would not be true in all cases – but that each household hoping to make deals with banks would need to make changes to cut spending.

“The truth is, there are many people who are meeting their obligations,” Bruton told RTÉ Radio 1′s This Week programme.

“It is those who simply cannot do that, who are unable to meet them, and there’s no way that they can meet them… those are the category you have to deal with,” he said, adding:

Obviously, that’s going to require a sacrifice – both from the banks, in dealing with the overhang, but also with the individuals and families concerned.

While the provisions of the Personal Insolvency Act would apply as a final option to people in severe mortgage distress, Bruton said banks and individuals would have to negotiate on individual arrangements outside of that structure.

“These are not easy situations,” Bruton said, suggesting a desire that banks would neither micromanage an individual’s finances, nor pursue across-the-board tactics  ”Government cannot announce a global strategy for every house.

“This is a negotiation where the people have to come to the banks and work out a resolution so they can continue to stay in their hous, [and] meet their obligations.

The bank gives something, the people give something, and you work out a sustainable solution.

Earlier, Bruton’s junior minister Seán Sherlock had told The Week in Politics that he did not anticipate that families with two working parents might be told to give up one of their salaries and stay at home.

Sherlock was responding to reports in the Sunday Business Post that the deal could force mothers to stay at home if their earnings are less than the amount the family otherwise spends on childcare.

Read: Nearly twice as many Irish travelled to UK for bankruptcy proceedings in 2012

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Gavan Reilly

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