Deirdre Clune (Cork South Central, Fine Gael)

I am grateful for the opportunity to speak to this Bill. It is a pity so many varied items are contained in this omnibus style legislation. This miscellaneous provisions Bill covers some important issues and areas which probably should have been dealt with individually. Nonetheless, I wish to speak to three areas. One section deals with changes to the Intoxicating Liquor Acts. The Bill proposes that a code of conduct should be prepared for practices with regard to licensing matters surrounding alcohol, setting standards for the display, sale, supply, advertising, promotion and marketing of the intoxicating liquor.

The issue of the price of alcohol has been brought to my attention a good deal in the past year. I realise this may be more related to the Groceries Order but I call on the Minister to consider the introduction of a floor below which alcohol cannot be sold. Let us consider the advertising in the newspapers every day and especially on Sundays. All the supermarkets take out pages of advertising especially for alcohol at prices with which off-licences cannot compete. However, that is not the issue. The fact is this is contributing to a good deal of excessive drinking at home. I acknowledge there is an issue with the cost of alcohol in licensed premises, which is a deterrent. However, the price at which alcohol is made available by the crate is a problem. Let us consider some of the details. Bottles of beer cost 75 cent and cans of beer cost 50 cent. I would like the Minister to take that on board. It may not be related to the Minister's Department and alcohol was not specifically referred to in the groceries order but it is a growing problem.

I welcome the amendments to the Family Law (Maintenance of Spouses and Children) Act. Many constituents have brought this to my attention. Emergency legislation was passed in July 2009, which allowed those responsible for maintenance orders and who should have been paying them by direction of the court could avoid this. From speaking to the clerk of the District Court, I understand this is because the threat of jail was removed. Those obliged to pay maintenance ignored their obligations and the court orders. This proposal will decouple maintenance debt from civil debt. I know the history surrounding the McCann judgment. Hopefully this proposal will work. Many people, particularly women, find maintenance payments due to them are being ignored by those who should be paying them. District courts are trying to help but I understand there is no means of getting back the money if one ignores one's obligations for over 26 weeks. The cases I am dealing with date to July 2009, which is some 17 months ago and considerably in excess of the 26 weeks. Where do they stand in respect of the money owed to them?

The previous two speakers have addressed the bankruptcy and the reforms needed in this area. The provisions in this Bill are a token nod in the direction of reducing the period for which a person is declared bankrupt from 12 years to six years. That does not go far enough and I am supported in that view by the Forfás report published in September entitled Making it Happen - Growing Enterprise for Ireland. The report is critical of this proposal and suggests our laws are more severe than elsewhere, particularly the UK, and contribute to a fear of failure. In some cases, a bankrupt can be discharged in the UK within 12 months. We should have a debate on this because we do not want people declaring themselves bankrupt and returning into the community while creditors cannot get the money that can and should be paid to them. We need reform, particularly if we are to develop an enterprise culture in this country. The laws are a disincentive to starting up a business.

We have seen great turmoil in our country in the past number of years. The recession has been longer and more severe than in many of our European neighbours. The increase in unemployment, the slashing of Government capital investment and the near collapse of our banking system has resulted in many companies going out of business. Research recently published shows 42% of companies applying for funding from banks were refused credit. We have had a debate in this House on numerous occasions. These factors are having a devastating effect on business, particularly small and medium-sized firms. This year was the toughest yet for Irish business, with a total of 1,132 businesses closing their doors permanently from January to the end of September. This compares to 1,000 businesses in the same period the year before and 488 in 2008. The recession has created an unprecedented economic climate, where viable businesses are being squeezed out of existence. These failures are not necessarily related to recklessness on the part of the entrepreneur or business person, but are a reflection of the tough economic times brought about by decades of economic mismanagement.

Fine Gael wants to create an enterprise economy and a vision characterised by many elements to develop a new culture of innovation and enterprise, whereby entrepreneurs will be supported and encouraged rather than having economists and accountants dictate how we operate. Perhaps we should use the terms "job creators" or "self-starters" instead of entrepreneurs. We need to foster a culture of responsible risk-taking and we need to overhaul our bankruptcy laws. If people are declared bankrupt, they should not be pariahs. If they fail at their first venture, they should be given the opportunity to work with their creditors to work through the debts so that their energy, commitment and can-do attitude is available to society.

We know why many businesses go out of business. When making contributions to this debate, we should make a distinction between those who cannot pay and those who will not pay, those who have been reckless and those who have been responsible. We must be big enough to stand up for this distinction and not to back away from the debate because of the headlines about those declaring themselves bankrupt in other jurisdictions. Those people may have a case to answer under corporate law but my contribution focuses on the debt difficulties of an entrepreneur.

Personal insolvency laws can act as a form of limited liability but not in this country. Individuals who are aware that their business failure may not result in a life sentence of indebtedness are more likely to take risks and start new business ventures, which is essential for the growth of this economy and the generation of employment. The safety net of insolvency procedures is shown to encourage entrepreneurial activity. This view is supported by the Law Reform Commission, which identifies research showing that bankruptcy law has a significant impact on the level of self-employment in the economy. Bankruptcy laws are a more important contributory factor to high levels of self-employment or start-ups than other factors such as GDP growth. We do not want to encourage investment in inefficient business ventures. The important thing is that people are encouraged to take risks and develop indigenous business while being offered reasonable protection from the State when things go wrong. Starting a company, whether a shop or a tech company, involves taking risks such as committing to a lease, refurbishing premises or committing to employing staff. People are willing to do it and have done it before but small and medium-sized enterprises have little protection from the State when things go wrong.

We must consider small and medium-sized enterprises. For larger companies, there is the examinership process or they can go to the High Court and seek protection under the examinership system. However, examinership can be lengthy and expensive from a legal point of view. The legislation is intricate. The courts are not an option available to many small and medium enterprises. Examinership is the only realistic option for companies. It was introduced in the Companies (Amendment) Act 1990. The process could cost anywhere from €20,000 to €50,000. Practitioners with insolvency practices who are dealing with companies in trouble are finding that the examinership process is not available to everyone.

We should look to other jurisdictions, especially the United Kingdom which has a system whereby a company can enter into a commercial voluntary arrangement. A legally binding agreement can be drawn up between the directors of a company and their creditors which is certified by an insolvency professional. The benefit of such an arrangement is that it protects the debtor from interest charges and the threat of enforcement during the period but it is also an opportunity for creditors to get money due to them in a speedier fashion. In some cases creditors may never get their money.

A voluntary arrangement for companies or individuals should be considered. The system in the United Kingdom seems to work well. Under the model, the function of a court is limited to a supervisory role. The experience in the United Kingdom is that the voluntary arrangements are implemented for a fraction of the cost of the examinership application.

We are in a changed environment. We speak a great deal in the House about encouraging the indigenous economy and small and medium enterprises but we seem to do little to support them to survive in the real world. Bankruptcy and insolvency have a stigma attached. We need to get away from that mentality. I was interested to see the founders of Bebo and Facebook on "The Late Late Show" on Friday last. The person who set up the successful website Bebo had three failures before he achieved success with a business operation. One learns not from one's mistakes but from one's failures. In the United States one always has a second-chance opportunity. It is disappointing that the proposals in the Bill are so limited.

Let us recognise that people are willing to take chances. The State needs people to do so because the start-ups and opportunities in which they are involved will create employment and reignite the economy. If we continue with the same old negative, archaic bankruptcy laws we are not creating the type of environment in which enterprises can survive. We must look to other jurisdictions. We do not need to reinvent the wheel. We should look at what our neighbours and those further afield are doing and what works. We need to walk the walk in terms of creating an entrepreneurial and enterprise economy that supports start-ups and individuals who are willing to take risks.

See this speech in context