Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)

They have always been interested in protecting their profits. There is no change in that regard. This legislation will give the banks a veto. The pressure will always be on them to get as much as they can, even if it does not leave the borrower with a reasonable standard of living, or with his or her home. Any proposal that is made by the borrower or the personal insolvency practitioner can be vetoed by the bank. The bank has the whip hand. This Bill will not enshrine in law the supreme right of the householder or borrower to a roof over his or her head in his or her own locality, and to a reasonable standard of living that is properly defined. In Norway, the independent assessment agency, which is called the "personal insolvency practitioner" in our legislation, has the whip hand. That body can impose a resolution on the bank. The bank does not have a veto in Norway. An independent body decides what is a reasonable arrangement for the repayment of a loan and what is reasonable standard of living. It has as an imperative the requirement to try to keep a roof over the person's head. It can impose a settlement on the bank. That is the critical difference.

Under our proposed legislation, if borrowers or householders are not happy with what banks are proposing to impose on them, the only choice they will have will be bankruptcy, which will involve losing their homes. They will be able to walk away after three years, but they will have lost their homes. We should not say that losing one's home and enduring three years of bankruptcy is a cakewalk. It is better than 12 years, but it is not a cakewalk. It is not an option that people will take up easily. In light of the chief culpability of the banks in creating this crisis in the first place, why does this Bill give the banks the whip hand? It is even more extraordinary given that we are recapitalising the banks. We really need to tease this out. I hope it happens during this debate.

When representatives of Permanent TSB were at the Joint Committee on Finance, Public Expenditure and Reform just now, I asked them about their relationship with the Government. We have recapitalised Permanent TSB. We are the main shareholder - the only shareholder - in Permanent TSB and the main shareholder in AIB, etc. When we debate what the banks are doing, having been recapitalised, we are told the Government is not very happy with the way they are doing things - how they are treating customers and what they are doing with standard variable mortgages, etc. There is an implication that there is nothing we can really do about these matters because the banks decide the policies. Perhaps we can say things to them, but we cannot determine their policies. That is how things are presented to the public. We are told about the terrible and nasty banks. I asked the chief executive of Permanent TSB about his relationship with the owner of the bank, which is the Government. He said he meets the chief stakeholder - the Minister for Finance - every month. Who is telling who what to do in this relationship? If the Minister for Finance is meeting the heads of Permanent TSB on a monthly basis or very regularly - I presume the same thing is happening in the cases of AIB and Bank of Ireland - why are we as the major shareholders not telling the banks what to do? Are we telling the banks what to do? If we are not happy with how the banks are dealing with distressed mortgage holders - we should not be happy - why are we not telling them to change their policies? If we are not happy with how they are dealing with standard variable mortgages, why are we not telling them to do it differently? The Government should answer these questions. This legislation essentially puts responsibility for dealing with this - the biggest problem - at one remove from the Government, on personal insolvency practitioners, PIPs, and insolvency agencies with no teeth. Ultimately, it gives the banks the whip hand and says they can veto anything.

I am not at all happy with the details of this legislation. People only qualify for debt relief if they have a disposable monthly income of more or less €60. That is very restrictive and is essentially saying that, unless one is absolutely poverty stricken, we will not provide relief on personal indebtedness.

In conclusion, major and radical amendment of the Bill is necessary. The only good thing is the recognition by the Government that we need a system to deal with insolvency but we need to radically amend the Bill to take the whip from the hand of the banks and to put, as the central imperative of the legislation, the need to keep a roof over the heads of ordinary householders who borrowed under extraordinary circumstances created by the greed of banks and to ensure people who enter those arrangements are left with a reasonable standard of living that will allow them to re-engage with, and contribute to, society and not be smothered in debt for years or decades.

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