Arthur Spring (Kerry North-West Limerick, Labour)

We should consider how this legislation will play out overall and the consequences of negligent lending. Three Deputies have just emerged from the Joint Committee on Finance, Public Expenditure and Reform. If we learned anything today it was that banks were finally starting to acknowledge that the form of lending pursued over a long period, especially mortgages, was negligent and that negligence must have consequences. We have also learned that the ESM will come to the rescue of the country at some level. The way this plays out will be down to the ability of Ministers, the Government and the ECB to listen to how we want them to solve the banking crisis.

The cost of funds to the banks remains too high. If we can change this in such a manner that the ESM can shore up the cost of funds and bring it down low enough, variable rate loans and tracker mortgages will not cost the taxpayer money in the future.

Before anyone tries to find out how he or she can avail of the Personal Insolvency Bill, I encourage him or her to watch and see how it plays out in the banks, whether any of the mortgage debt will be parked, whether there will be further reductions in variable rates and how the Government will pursue the Bill with a view to keeping people in their homes. The last thing I want to see in the case of personal insolvency brokers or trustees is for expenses to be incurred by a person who is technically bankrupt for the purposes of negotiating with banks or people whom he or she does not trust.

My friend and colleague, Deputy Kevin Humphreys, has rightly pointed out that the MABS has played a great role in many towns and I have expressed this view to the Minister. Much depends on the capacity of the MABS to negotiate with the banks, solicitors and creditors. There may be a deficiency in some places when it comes to dealing with the legalities, but in such cases expertise can be hired in the private market and this could bump up the expertise of the MABS. I would prefer to see the MABS dealing with the issue of insolvency and creditors and the proposed limit raised from €20,000. I worked in several financial institutions. Many of my constituents know this and have come to me seeking financial advice and for me to negotiate on their behalf. I welcome the development of the Personal Insolvency Bill, but I cannot underestimate what the MABS has done for people to date.

If the sole purpose of personal insolvency trustees is to try to provide a job for themselves, I remain fearful. I fear this will cost the State money and that there will be an unacceptable lack of transparency for taxpayers and the general citizen. The comparability of a personal insolvency trustee is unbeknownst and will be determined behind closed doors. People will be resting on their laurels in the belief others will negotiate on their behalf. They will not get the same deal as the person next to them. Of the people who have approached me with financial troubles, no two have the same problem. I am keen to see the details of the Bill established as soon as possible, especially the costs of the PIPs, who will pay for them and what the terms of engagement will be. There must be arm's length engagement. I have no wish to see the first cousin of someone else dealing with someone in a bank in a small town, as that could lead to problems further down the line.

The credit unions must be protected. They have many loans under the amount proposed and we should not encourage people to seek the assistance of the Bill for the purposes of damaging the credit unions. It is encouraging, if somewhat ironic, that Moody's believes this will affect the banks. Standard & Poor's also believes this legislation raises concerns for the banks also. Still, the banks have been capitalised and I hope this legislation will be to the benefit of the people.

As I know we are breaking up shortly, I wish everyone a nice recess. I hope I will not bump into anyone here for at least one month.

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