Michael Noonan (Limerick City, Fine Gael)

The recent IMF World Economic Outlook report, and its chapter on household debt, is a useful contribution to the range of measures being considered to address the global economic situation. However, it should be noted that the examples examined in the report in the chapter dealing with household debt related to particular countries and times, and that some of the debt restructuring examples investigated were more successful than others. Therefore, the particular circumstances of each individual case was a relevant factor in the outcome of the action. While one should seek to learn from previous examples, it is also important to exercise caution in drawing general conclusions from the report and applying them to the current Irish economic position. Indeed, in their public comments on the report, the IMF staff indicated that they were not stating that such a blanket approach should be taken in the case of Ireland and, indeed, indicated that, in cases of constrained fiscal space, which unfortunately is the position Ireland currently faces, a targeted case-by-case debt restructuring approach may be the most appropriate approach. This case-by-case approach is consistent with the recommendations of the Keane report on which the Government approach to address this problem is broadly based. The current funding situation of the Irish fiscal and banking sectors are also relevant factors to be borne in mind.

On the issue of bankruptcy reform, as the Deputy will be aware, the Minister for Justice and Equality, and Defence, has developed a detailed general scheme of a personal insolvency Bill, which was published for public consultation earlier this year. A significant number of submissions were received in response and these, along with the detailed report by the Oireachtas Joint Committee on Justice, Defence and Equality on its hearings on the scheme, will be taken into account by the relevant Departments and the Office of the Attorney General in the finalisation of the Bill. Ireland is maintaining close contact with the IMF and the other troika authorities in the development of its personal insolvency reform proposals and also on the wider approach to tackle mortgage arrears problems and will take full account of their views in the further development and implementation of these proposals.

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