STATE-RUN SPLIT MORTGAGES URGED BY HOME LOAN BODY - The Irish Mortgage Holders’ Organisation wants the Government to introduce a State-sponsored split mortgage that would allow local authorities to supplement the payments made by home owners in loan arrears and in danger of having their properties repossessed.
It also wants a mortgage-to-lease scheme to replace the mortgage-to-rent one that has failed to gain traction and it has proposed changes to the insolvency regime. These reforms were proposed by the IMHO to Government in a six-page submission dated April 3rd, which has been seen by The Irish Times. They are designed to prevent up to 25,000 repossessions by Irish banks in coming years. On the State-sponsored split mortgage, the IMHO cited the case of a couple with two children, living in Kildare, with a €200,000 mortgage on a property now valued at €120,000. Their mortgage payments are €1,000 a month. The IMHO suggests an affordability test be carried out by the lender, an independent third party or a personal insolvency practitioner, with a certificate of affordability produced, valid for 24 months. The mortgage would be split into two tranches: €140,000 attracting capital and interest repayments of €750 a month, and the balance parked at zero interest. The €750 would be funded through a payment by the couple of €300 and €450 from Kildare County Council, which would receive a second charge on the property for the value of the €60,000 tranche of the loan that has been parked.
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IRELAND HIT BY 'UNEXPLAINED INVESTMENT WEAKNESS' FOR YEARS: IMF - Investment in Ireland was well below potential from 2011 to 2014, and the reason why is not fully clear, according to the International Monetary Fund. That's despite the weak performance largely coinciding with the 2010/2013 period of the EU/IMF bailout when the fund had unprecedented oversight of the economy here, says the Irish Independent. Lack of access to finance and uncertainty about the economic outlook are two likely reasons why businesses invested less after the crisis, even where on paper it looked attractive, the report said. Ireland is one of a number of highly indebted countries in Europe where investment came in well below the IMF's forecast levels over the period, the global rescue fund said in its latest World Economic Outlook. Globally, the IMF, under Christine Lagarde, pictured, said growth potential took a big hit after the 2007-2009 financial crisis and is likely to lag for years, implying that interest rates should likely stay low for quite a while. Potential growth is a measure of how fast economies could grow over time without hitting inflationary speed bumps such as lack of workers or other resources. That potential was slowing in richer economies before the financial crisis due to ageing populations and a drop in technological innovation, but has worsened since. In Ireland and some other countries, investment has lagged well behind potential.
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DIASPORA CENTRE PROJECT AXED AS CASH NOT AVAILABLE - Transport and Tourism Minister Paschal Donohoe axed the planned iconic €26m National Diaspora Centre only after being told there was no capital funding for the project, says the Irish Examiner. In February, Mr Donohoe announced the Government would not proceed with the initiative. However, documents released in response to a Freedom of Information request, show he axed the planned centre after finding out, post-Budget 2015, there was no State money for it. The documents also revealed eight companies were short-listed for the centre, with seven not having funding in place. All, however, stated they had the financial capacity to deliver, but would be relying on a mix of Government funding, public and private sector borrowing, philanthropic, corporate donations, along with local authority funding. In March last year, Cabinet gave its approval to the venture, which the Government believed would become a major tourism attraction. The announcement came on foot of a Fáilte Ireland report, which concluded such a centre would be viable and self-financing and would enhance Ireland’s tourism offering. However, in a memo prepared for Mr Donohoe by his department’s tourism division, it stated it had been anticipated that there would be capital funding for the project by the end of 2014. The memo later adds, however, that “it is now clear post-Budget 2015 that there is no Government funding available in the foreseeable future”.
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EARLY NIGHT FOR JAPAN'S SALARYMEN IN CLAMPDOWN ON CULTURE OF OVERWORK - Japan’s salarymen are saying sayonara to the country’s culture of overwork - with the backing of Prime Minister Shinzo Abe. Long days in the office followed by long nights drinking with colleagues are as much a symbol of Japan as sushi or manga comics. But the culture has been blamed for several of the country’s ills, from its dearth of babies to lacklustre productivity, while a tight labour market is shifting the balance of power from companies to workers. So, in a break with the past, Japan Inc is making a virtue of what is normal practice elsewhere in the world, writes the Financial Times. Trading house Itochu hopes to lure recent graduates with earlier starting and finishing times, while printer maker Ricoh is banning work after 8pm. Fast Retailing, operator of the Uniqlo clothing chain, is looking to introduce a four-hour day for employees who want a better work-life balance. “Even if working hours are short, we will pay more to the employee who produces a higher result. Long hours of work do not necessarily lead to higher performance,” said Tadashi Yanai, chief executive of Fast Retailing. Robot maker Fanuc, meanwhile, plans to woo recruits to its “inconvenient” headquarters at the foot of Mount Fuji by doubling the size of its gym, and building a new tennis court and a baseball field.
