Targeted mortgage relief on cards for Budget 2024, Varadkar says

A targeted form of mortgage relief for homeowners facing financial distress is under consideration as part of the Budget 2024 package.

Following a rapid increase in mortgage interest rates, the Government is considering reintroducing payments linked to need, along the lines of the mortgage interest supplement, a short-term support paid through the welfare system wound down in 2014.

This was linked to the employment status of borrowers, with eligibility limited if one partner in a couple was in full-time employment.

Speaking on Thursday, Taoiseach Leo Varadkar said a targeted form of mortgage relief was under consideration, although no decisions had been made.

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He said “Anything we do would be very targeted to people who are in financial distress, who are struggling to pay their mortgage and may potentially lose their home, because nobody wants that to happen.”

Meanwhile it has emerged that the Coalition is also considering reforms to the bank levy, at a time when surging bank profits have prompted the Opposition to call for a windfall tax on banks.

A spokesman for the Department of Finance said the existing bank levy was expected to raise €87 million in 2023.

“As this year [2023] is the final year for which the levy is chargeable under the legislation as it currently stands, this department is currently engaged in an exercise to review the bank levy, and make recommendations to the Minister for Finance as to its future.

“The department is aware of the range of levies of various types and durations that are in effect across the EU, and these have informed, and will help inform, its continuing work in this area.” The outcome of this work would be “reflected in Budget 2024″, the spokesman said.

Earlier this week, Italy’s right-wing government announced a surprise 40 per cent windfall tax on “surplus profits” of banks generated by the rise in interest rates.

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Mr Varadkar and Minister for Public Expenditure Paschal Donohoe were both tight-lipped on questions about reform of the bank levy on Thursday.

Meanwhile, Minister for Education Norma Foley said the option of extending the free schoolbooks scheme at primary level to second level would be considered ahead of the next budget.

The cost of free schoolbooks for 500,000 pupils at primary level is €53 million. Extending it to 400,000 post-primary students would likely cost a further €70 million or more, according to sources.

Ms Foley said it was her “absolute aspiration” to extend the scheme beyond primary schools.