Monday/Tuesday 16th & 17th December 2013
Less than 1% of Irish have used advice service on mortgage arrears
Burton set up a panel of accountants to offer borrowers independent financial advice
Less than half of 1 per cent of those in mortgage arrears have used an independent financial advice service set up by the Government last year to tackle the crisis, a new report has revealed.
Minister for Social Protection Joan Burton set up a panel of 2,000 accountants to offer borrowers independent financial advice on the long-term resolution proposals by lenders, such as a split mortgage, mortgage-to-rent or long-term interest only.
Under the system lenders have to pay €250 to a professional of a borrower’s choice from the panel. However, a review of the Independent Financial Advice Service (IFAS) of the Mortgage Arrears Information and Advice Service published yesterday shows that just 200 invoices have been sent to lenders since the service began in June.
More than 100,000 people are now in mortgage arrears in the Republic.
The review says there will be time delays between the issue of the long-term forbearance offer, the meeting with the accountant, and the receipt by the lender of an invoice.
Ms Burton accused the banks of failing to make all borrowers aware of the service.
“I’m particularly concerned at submissions stating that the Independent Financial Advice Service is not being offered to all eligible borrowers, which suggests the banks have not done all they can to make borrowers aware of the service. I will be taking that issue up with the banks.”
Ahead of any discussions between the Minister and the banks, arrangements have now been made with the Irish Banking Federation for a comprehensive information leaflet on all elements of the Mortgage Arrears Information and Advice Service to be sent out with annual mortgage statements to all mortgage holders.
“I want to see this service deliver for those in mortgage difficulty, and as an interim but important step to drive awareness we have ensured that mortgage holders will get a comprehensive leaflet on the service when they receive their annual mortgage statement,” the Minister said.
The review, conducted by a working group chaired by Ms Burton’s department, highlighted a number of issues, including a lack of awareness and low take-up of the service.
It recommends that information to borrowers about the service should be standardised and stand-alone, and should specify that the service is confidential and independent, that no additional fee will be charged, and that the lender recommends that the borrower avail of the service.
It says the scope of the advice should be broadened to include advice on other mortgage-debt resolution options and, in that context, consideration be given to increasing the funding for financial advice from €250 to €500.
Mario Draghi expresses concern about health of Irish banks
European Central Bank president says banks must take ‘decisive’ action before stress tests next year
European Central Bank president Mario Draghi: said while the balance-sheet assessments of the Irish banks had identified no capital shortfall, there were needs for adjustments for provisions and risk-weighted assets. Photograph: Reuters
European Central Bank president Mario Draghi has raised concerns about the health of
Irish banks, urging “decisive” action on issues revealed by a recent balance-sheet assessments before European stress tests next year.
Addressing the European Parliament, Mr Draghi said while the balance-sheet assessments of the Irish banks had identified no capital shortfall, there were needs for adjustments for provisions and risk-weighted assets.
“This should be addressed before the SSM assessment,” he said in a response to a question from Irish MEP Gay Mitchell.
Under the original terms of Ireland’s EU-IMF rescue, Ireland was obliged to undergo a full health check of its banks before the end of the programme.
However, this was downgraded to a “balance-sheet assessment” after Dublin argued it should not be treated differently from other countries in next year’s Europe-wide stress tests.
Mr Draghi emphasised yesterday that the balance-sheet assessments by the Irish Central Bank were “not forward-looking” and fall short of the “stringent” stress tests that would be required next year.
Ireland’s three main banks – Bank of Ireland, AIB andPermanent TSB – informed the market last month the Central Bank tests had been completed and that no capital requirements had been required.
However, the full results of the tests were not published.
Bank of Ireland revealed that the Central Bank had concluded that it should take an additional €1.3 billion in provisioning against its mortgage and commercial loans, while Permanent TSB chief executive Jeremy Masding toldThe Irish Times that the bank would be taking extra provisions for bad loans following the reviews. AIB has yet to comment on whether provisions are needed.
Mr Draghi also said the ECB had “a more cautious assessment” of Ireland’s budget for 2014 even if targets were likely to be met. However, he noted that the deficit-to-GDP ratio, which has been credibly set at 4.8 per cent, overperforms relative to the requirement of 5.1 per cent set out in the European Commission’s excessive deficit procedure.
Just 23% of Irish people think ‘now is good time to save’
Just 23% of Irish people believe that now is a good time to save money, the lowest level ever recorded by the Nation
Managing Director of Nationwide UK (Ireland), Brendan Synnott. said that the impending rise in DIRT tax and falling interest rates are pushing consumers away from saving.
“There are two main reasons for the decline in the proportion of people who say now is a good time to save.
“The rate of deposit interest retention tax (DIRT) will increase to 41% in Jan 2014, from 33% at present.
“Overall, the savings interest rates have been in decline for the past 18 months in response to market conditions. Both these measures are combining to reduce the return that savers are getting,” he said.
Another factor that was pushing people away from saving, according to Mr Synott, is government policy which 66% of respondents believe actively discourages people from saving.
The combination of factors seems to not only be affecting attitudes to savings but also people’s habits with the proportion of those saving regularly falling for the second month, down to 32% from 39% in September.
Mr Synnott said that people wanted to save but that the Government is pushing them not to.
“Consumers are now responding negatively to government policy and the general savings environment.
“However their fundamental attitude to saving and preference to save any spare money available remains strong,” he said.
Nearly 40% of people surveyed said that they would save their spare cash, a two percentage point increase from last month.
Coincidentally, preference to spend has also increased to 13% compared to 8% last month, while preference to pay down existing debts has fallen to 43% from 47% last month.
Irish firms lead the way in social media usage
Most European enterprises employing 10 or more people now have their own website, with Irish businesses leading the way in how they use social media.
In the EU, 30% of enterprises used at least one type of social media in 2013, though only 8% had a formal policy for social media use.
Ireland was the exception, with 20% of enterprises having a formal policy for using social media for their business.
The next highest was the Netherlands (18%), Cyprus (17%), and Denmark (16%). In 19 of the EU states, the share was below 10%.
These data come from a report published by Eurostat, which is the statistical office of the EU.
They form part of the results of a survey conducted at the beginning of 2013 on information and communication technologies usage and e-commerce in enterprises in the 28 member states along with Iceland, Norway, and the former Yugoslav Republic of Macedonia.
The proportion of enterprises with a website differed among member states, with the largest shares recorded in Finland (94% of enterprises with at least 10 persons employed), Denmark (92%), Sweden (89%), Austria (86%), Germany and the Netherlands (both 84%).
Countries with the smallest shares included Romania (42%), Bulgaria (47%), Latvia (56%), Portugal (59%), Greece and Hungary (both 61%).
The use of social media ranged from 15% of enterprises in Latvia to 55% in Malta.
The share of enterprises using at least one type of social media ranged from 15% in Latvia, 16% in the Czech Republic and 19% in France, Poland and Romania, to 55% in Malta, 50% in the Netherlands, 48% in Ireland, 45% in Sweden and 42% in the United Kingdom.
The largest shares of enterprises using blogs are in the Netherlands, the UK, and Ireland.
Cat domestication traced to China some 5,300 years ago
The earliest evidence for cat domestication comes from Chinese farms dating to 5300 years ago, a new study confirms.
While ancient Egyptians loved their felines, it looks like China beat Egypt as being the first to discover the merits of cats.
The findings, published in the Proceedings of the National Academy of Sciences, pinpoint the early Chinese village of Quanhucun as being the likely ground zero for cat domestication.
“At least three different lines of scientific inquiry allow us to tell a story about cat domestication that is reminiscent of the old ‘house that Jack built’ nursery rhyme,” says study co-author Fiona Marshall, a professor of archaeology in Arts & Sciences at Washington University in St. Louis.
“Our data suggest that cats were attracted to ancient farming villages by small animals, such as rodents that were living on the grain that the farmers grew, ate and stored.”
She continues, “Results of this study show that the village of Quanhucun was a source of food for the cats 5300 years ago, and the relationship between humans and cats was commensal, or advantageous for the cats. Even if these cats were not yet domesticated, our evidence confirms that they lived in close proximity to farmers, and that the relationship had mutual benefits.”
Marshall, study leader Yaowu Hu, and their colleagues analysed eight bones from at least two cats excavated from the site. The researchers found that the cats were eating grain millet grown by the farmers. One of the cats was aged, revealing that it survived well in the village. Yet another ate so much human-grown grain that the researchers suspect it was fed.
The researchers also determined that farmers then were battling rodents, since they found an ancient rodent burrow into a grain storage pit and grain storage pots designed to be rodent proof. It probably didn’t take long for the farmers to figure out that the cats went after the rats and mice, so they were good animals to keep around.
Analysis of dog and pig remains found that these animals were also eating millet, but deer at the site were not.
Cats must have carved a successful niche for themselves in a society that thrived on the widespread cultivation of the grain millet.
The felines at this time descended from the Near Eastern wildcat, which might have been the primary ancestor of all domesticated cats alive today.
“We do not yet know whether these cats came to China from the Near East, whether they interbred with Chinese wild-cat species, or even whether cats from China played a previously unsuspected role in domestication,” says Marshall.
Chimpanzees show fruits of learning
Chimpanzees may learn to prepare food by watching their companions in the same way that humans develop their cooking skills from their family members, according to new research.
University of Portsmouth psychologists, Bruce Rawlings and Dr Marina Davila-Ross, say their study shows that our closest living relative may be capable of rudimentary human-like traditions within food preparation and they claim it gives an insight into how humans have developed culture.
Their research, published in the journal Animal Cognition, looked at whether chimpanzees socially acquire their natural food preparation skills, known as “extractive foraging” (such as opening hard-shelled fruit) from within their communities. Extractive foraging is an essential skill for both chimpanzees and ancient humans, requiring a combination of intelligence and dexterity.
Mr Rawlings said: “Culture is a hallmark of the human species; we far exceed all other animals in the way we learn skills from within our social communities, particularly within the context of food and cuisine. There is still a huge debate about whether humans are the only species capable of cultural traditions, and indeed how and when this capacity evolved.
“But the clear differences in the natural way the three chimpanzee groups opened the fruits is most likely the result of social learning, which helps form certain behaviour in chimpanzees in a similar way to early human cultures.
“As humans we might learn the best way to crack a nut or how to stone a peach from watching someone else and it appears chimpanzees learn how to handle food in similar ways.”
The study also reported that the chimpanzees occasionally cracked open the hard-shelled fruits and then put the fruits aside to open a few other fruits in a similar way. This indicates that fruits are prepared in advance to eat them one after another at a later stage. Planning in advance indicates a form of intelligence, and these findings link with evidence from the wild where chimpanzees prepare their tools for ant fishing well before using them.
The scientists studied distinct social groups of chimpanzees at the Chimfunshi Wildlife Orphanage in Zambia, Africa. The groups were living in close proximity and in the same kind of environment but the scientists found that the three groups differed in the way they opened the same hard-shelled fruit.
The chimpanzee groups also differed in the number of techniques they combined to open the fruits, with one group averaging almost double the number of techniques for each fruit than the other groups.
Dr Davila-Ross said: “The fruits we studied are also eaten by wild chimpanzees all across Africa and they can be opened without the use of any sticks or stones, unlike the nut-cracking techniques that are also be found in wild chimpanzee populations. Since the fruit preparations did not require any additional tools, we find ecological explanations for the differences unlikely. Furthermore, their social and ecological surroundings showed no notable differences.
“Our analysis on a subspecies level indicated that the differences in foraging techniques are unlikely to result from genetic reasons and they were not influenced by humans.
“Much of the previous research has focussed on captive primate groups, especially with tool use or unnatural feeding behaviours. Half of the chimpanzees in the groups were orphans from throughout Africa and were housed based on their arrival date. Our findings provide important insights to how primordial forms of culture may have emerged.”