'They can't have it both ways' — Harris blasts banks for failing to pass rate rises on to savers

Higher Education Minister Simon Harris said Ireland does need a competitive banking sector 'but we also need a reality check here from the banks. They can't have it both ways'. Picture: Brian Lawless

The Further Education Minister has slammed Irish banks for failing to pass on interest rate increases to saving deposit accounts.

Simon Harris described the situation as "offensive", with mortgage holders being hit by increased rates due to European Central Bank (ECB) rate hikes, but savers not reaping any benefits.

He was speaking as it was reported that the bank levy will be extended beyond the end of this year. 

Mr Harris said that it would have been "ludicrous" to allow the bank levy expire because "quite frankly people feel they're getting fleeced by certain financial institutions". He said that while a banking sector was necessary, a "reality check" was needed.

"We need a banking sector," he said. "We need one that works and we need one that is competitive and really we need to see competition grow in the banking sector. 

But we also need a reality check here from the banks. They can't have it both ways 

"We can't have a situation where they say 'oh, we're sorry, we have to increase your mortgage interest rates because the interest rates increased'.

But the poor saver — and maybe the pensioner or maybe the parent who has been squirreling away small amounts of money week in week out to try and prepare for their own family's rainy day, for their future, for their healthcare needs — find themselves not benefiting in terms of the interest rates increase on their savings.

"So the banks in some cases in my view, are trying to have it both ways. That's not acceptable."

Mr Harris added that it's "utterly offensive for Irish banks to be complete and utter laggards when it comes to passing on the benefits to those who have money on deposit".

Asked about his own priorities for Budget 2024, Mr Harris indicated that third-level students can expect a repeat of last year's once-off €1,000 cut to college fees as well as the €679 payment.

"I'm a great believer when once off measure works it should certainly be considered again.

"Obviously, it's a matter for Budget Day and the budget will take place on the 10th of October but I'm very clear about this. We're living through a cost-of-living crisis. Students, families parents are certainly not immune from this. 

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"The cost of going to college, particularly if you have more than one child in college, can be a very significant burden for people."

He said that the Government has shown "good form" in terms of lowering the cost of education.