MICHAEL O’REGAN Independent Senator Gerard Craughwell has called for a debate on private rental accommodation. He said that unless the rental market was controlled, as the mortgage market became tighter, rents would only go up.

“We have heard calls from the Department of Social Protection to increase rent allowance, which I fully support, but I do not support the rent allowance being increased merely to give more profit to landlords,’’ he added. “We are trying to strike a very difficult balance and we should take great care with that.’’

Catherine Noone (FG) suggested that private insurance could offer mortgage protection policies to first-time buyers that would cover 10 per cent of the loan to value amount, allowing banks to lend up to 90 per cent of the mortgage.

She said that similar mortgage insurance methods had been used in the US for almost a century to enable borrowers to obtain finance for housing. “Of course, we need to ensure we need we do not create any sort of bubble, as commentators have suggested, but we also need to ensure ownership remains an attainable ambition for young, creditworthy families,’’ she added.

Seanad leader Maurice Cummins (FG) said a number of Senators had raised the Central Bank’s mortgage proposals and he was arranging for a debate on the matter.

Jim Walsh (FF) said the House should debate the plight of hard-pressed working class people. “I am talking about people on lower to middle incomes who are really finding it very difficult,’’ he added. “More than 300,000 people have had to leave private health insurance, which relay needs to be addressed.’’

Mr Walsh said people were now being “assaulted by the banks’’, which hard-pressed taxpayers’ money was used to bail out, in order to extract excessive and exorbitant interest rates.