Fianna Fáil has called on the Government and the Central Bank to put pressure on banks to facilitate variable mortgage customers with fairer interest rates.

Tabling a Private Members’ motion in the Dáil, the party's finance spokesperson Michael McGrath said excessive variable mortgages rates are the main financial challenge for thousands of families.

People have watched in frustration as their mortgage rates have risen while rates have fallen elsewhere, he said, and existing customers are paying €992 more than new standard variable rate customers.

Deputy McGrath claimed the banks' arguments are bogus and do not stand up.

He said that those paying standard variable mortgages in Ireland are the forgotten group.

He said that the minister’s early enthusiasm for taking on the banks when the Government came into office seems to have disappeared.

He said the Government needs to publish a white paper on what a competitive banking sector should look like seven years on from the crisis.

Deputy McGrath said that the Central Bank needs to do more protect consumers and acting for existing variable rate customers would be a good place to start. 

Speaking on behalf of the Government, Minister of State Simon Harris said they would continue to apply "downward pressure" on standard variable rates charged by banks by supporting more competition in the banking sector.

He said the Government would do this by working with national and European competition authorities to encourage and support new lenders in the market.

"This Government has achieved a great deal over the past four years but we must not become complacent," he said.

"We must sustain a competitive economy that can pay its own way, serve society and that can survive and thrive in a reformed eurozone and an increasingly globalised international economy."

Mr Harris said he was not an apologist for banks and he had difficulties with some of the decisions they have taken in recent years.

However he pointed out that lenders in Ireland - including those in which the State had a shareholding - were independent commercial entities.

The Dáil has now been adjourned, with the Private Members' debate set to continue tomorrow evening.