Pat Breen (Clare, Fine Gael)

I welcome the opportunity to speak to the Bill. Like Deputy Eoghan Murphy, I am delighted that it is going through the House before the summer recess, even if we have to sit until midnight, as it is extremely important.

I congratulate the Minister and his colleagues on producing this radical legislation which will overhaul the personal insolvency procedures. I welcome the Bill and thank the Government for delivering on the commitment to help families who are struggling to repay their mortgage. The Bill gives hope to thousands who are in mortgage arrears because it provides light at the end of the tunnel. When we went into government, we made a commitment that we would try to help the people concerned. Like other Deputies, I am well aware of the problems mortgage arrears pose for families. I am assisting a number of families in my constituency who are in such a position. It is not easy for them. I have had lots of tears in my office from people encountering such problems. The current process is cumbersome and provides little solace for those in trouble. Previous speakers have stated negotiations with various interests can be difficult. Some banks offer no leeway in negotiations with householders. That is why a new and innovative approach is required.

In the wake of the property bubble and the resulting recession the number in mortgage arrears has accelerated. According to the Central Bank, at the end of March there were 764,138 private residential mortgage accounts in total, of which 77,630, or 10% of mortgages, were in arrears for more than 90 days. When we look at restructured mortgages, it is interesting to note that of the total stock of such mortgages at the end of March, just over 40,000 were in arrears of varying length. In essence, a sizeable number of people are still in mortgage difficulties, even where restructuring arrangements have been put in place. We have all seen evidence of this.

The scale of the problem is compounded by personal indebtedness. In 2008, for example, the level of personal indebtedness equated to every household borrowing €158 for every €100 earned, which speaks for itself. There is no simple or quick-fix solution because of the complexity of the problem. I welcome the provisions included in the Bill that provide for a number of solutions for people in various circumstances. It is also welcome that the Bill recognises those who ran up a substantial personal debt and whose circumstances have changed since they first took on the debt. That is the case for many householders because at the height of the Celtic tiger people were encouraged to borrow and there were a number of cases in which people had taken out loans had since lost their jobs and were in real difficulty in paying back their debt. The provision of debt relief certificate provides the opportunity for persons who have accumulated unsecured debts of up to €20,000 to wipe the slate clean. That is a welcome move.

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