Until Congress provides a road map for the dissolution of Fannie Mae and Freddie Mac, the Federal Housing Finance Agency has a duty to hire and compensate skilled executives to ensure the government-sponsered enterprises are functioning  in conservatorship, FHFA leader Ed DeMarco told a Senate Banking Committee Tuesday. DeMarco defended the distribution of $13 million in bonuses to 10 employees of Fannie and Freddie, telling the panel that “the executives most responsible for the poor decisions that led to conservatorship and the current losses (at the GSEs) are long gone.” During the hearing, DeMarco said no one at the FHFA expected the conservatorship to last more than two years, which means the agency is still swamped with demands to conserve taxpayers funds, stabilize housing and oversee trillions of dollars worth of home loans. In a letter to lawmakers earlier this month, DeMarco said current pay levels at the GSEs are already down 40% from previous levels, and he believes executive pay is consistent with parameters set forth by the Treasury Department. When questioned by lawmakers Tuesday, DeMarco said the “best action is to move forward and dissolve the conservatorship.” However, until Congress provides a clear plan that describes where the housing giants and the mortgage finance market is heading post-crisis, the FHFA as conservator of the GSEs “needs to ensure the enterprises have people with the skills to manage” $5 trillion of mortgage assets. Sen. Bob Corker, R-Tenn., sympathized with DeMarco’s plight, suggesting Congress has left the FHFA in a state of limbo when it comes to overseeing the mortgage firms. “We have given you no clarity as to the future of these organizations?” Sen. Corker asked. DeMarco answered, “Not a whole lot of clarity, Senator.” “So Congress hasn’t done it’s job telling you what it would like these agencies to be?” Corker said. DeMarco answered, “That is the case. It is difficult for the CEOs and boards.” Corker, who recently proposed a plan to reduce the percentage of newly issued mortgage-backed securities by Fannie Mae and Freddie Mac every year for a decade, asked DeMarco if a 10-year plan to move away from a government-backed mortgage finance market is reasonable. “It depends on how much legal certainty is in place (and) what private capital engagement in the mortgage marketplace would look like,” DeMarco said. “We would have to make meaningful progress to succeed without a major disruption in the mortgage marketplace.” However, DeMarco said a decade seems like a gradual enough time to accommodate a transition away from a GSE-dominated mortgage finance system. Write to Kerri Panchuk.