Michael Healy-Rae (Kerry South, Independent)

I appreciate the opportunity to speak on this very important Bill and I thank the Technical Group for allowing me some of their speaking time to talk on the matter.

The reform of our insolvency laws is long overdue. When we look back on the way we have dealt with debt and people who are in a state of crisis we can see that it was very much a requirement for new legislation to be brought before the House.

Broadly speaking, I welcome the efforts of the Government, and I thank and compliment the Minister and the people working in the Department for the work they have done. I would not say that the Bill goes far enough. I can see inadequacies in the Bill and problems that may arise with it but at least a serious effort is being made at reform and change. This legislation should have been brought before the House by the previous Government and it should have been brought here earlier in the term of this Government but I welcome it.

The change in the bankruptcy period from 12 years to three years is most welcome. Unfortunately, many good business people run into financial difficulties and must declare bankruptcy. They always say it is a very good man or woman who goes down and comes back up again, and everybody in business realises only too well, especially those with a small business or those struggling to keep people in employment, that they can run into difficulties. It is welcome that such people will be given a second chance but we must ensure that the people who are owed money are offered every protection possible as many small businesses are going under because they are unable to collect money that is properly owed to them.

The extent of the crisis in Ireland is frightening. In terms of people's personal finances, I have always stated that the most important financial institution in Ireland is Mom's purse because everything depends on what is in Mom's purse on a Monday, Wednesday, Friday or Sunday. If Mom's purse was okay, everything in Ireland was okay but, unfortunately, in recent years the amount of money going into Mom's purse every week has been growing smaller and smaller, and that is the most important financial institution in the country.

What young people are going through at present is frightening and it is affecting their physical and mental health. In that regard I want to thank and compliment the different agencies, including MABS and the Citizens' Information offices, which do untold good work in helping people with their finances. There are MABS offices throughout the country. In my role as a member of the Citizens' Information Board I was glad to be one of the first people to suggest that we should have a new MABS office in the town of Killarney because its growing population and those of the surrounding villages and parishes more than entitled it to have an office of its own. I welcome the work that has been done to bring that to reality.

I take this opportunity to compliment charitable associations such as the Society of St. Vincent de Paul, which is doing untold work in the background in providing vital assistance. When families are in debt and have difficulty getting social welfare there is an interim period in which they do not have money to put food on the kitchen table. Those are the cases that I see first-hand. I do not want to mention the different towns but I compliment the Society of St. Vincent de Paul and other such organisations for the excellent work they do every day in the towns in my constituency in both south Kerry and north Kerry. Their volunteers give freely of their time either by fund-raising or by distributing fuel, helping people with groceries or helping them to pay for ESB bills on which they have fallen behind. Their work is to be appreciated by every one of us.

I said at the outset that I have problems with the Bill. I am worried that some people may be left behind. Will our banking and other financial institutions deal fairly with the people who, to be honest, in many cases they led up the garden path, so to speak? We must be clear about that. Young people went into their banks looking for, say, €150,000 and were persuaded to leave with €200,000 or €250,000. They were told it was okay to bundle other loans, be they car loans, loans to carry out renovation works or anything else. They were even told they could include money to be used to go on holiday in their bundled loan. That was ridiculous, irresponsible and out-of-control banking, yet these are the people dealing with the customers who are put to the pin of their collar and facing desperate circumstances every day of the week in trying to repay these massive debts. That is the reason I am fearful that the banking institutions will have a veto when dealing with people. Will they be as fair and lenient in dealing with their customers now as they were when they were over-generous in giving out the money in the first instance?

We all have our own horror stories of individual cases of people being led up a merry path by those working in the banking institutions. I do not want to tar everybody with the same brush because very fine people work behind the counters of banks every day but, unfortunately, they are facing the brunt of it in terms of actions taken not by them but by their bosses and people higher up along the chain. In some cases the clerks and other people dealing with the customers on a daily basis are being wrongly blamed for the reckless banking by some of our banks and some of the people working in them.

I was not happy with comments made last week by the Minister, who told people they would have to sell their bits and pieces of jewellery and so on. It was not helpful to tell people that they should sell off items such as their wedding rings. That was not a sensible or prudent thing for a Minister to state. I say that having already complimented him on the work involved in preparing the Bill and going as far as he has. However, that was not a prudent thing for a Minister to say. People are in such dire straits that they want sensible talk from Government and helpful suggestions, not to hear such nonsense.

To return to the bones of the Bill, I again compliment those who ensured the Dáil would sit later than usual to process the Bill before the recess. If the Bill is to be helpful there must not be undue delay with it. I thank and compliment FLAC, the free legal advice centres, and Chartered Accountants Ireland who have raised concerns about the fact that there is no outline of a code of conduct audit or disciplinary processes. They have stated that the Oireachtas must address each of those concerns during the legislative process with the Select Committee on Justice and Equality in the vanguard.

I compliment FLAC on its helpful comments and on the initial submission it made that was very well put together and most helpful and informative. I wish to pay particular attention to one aspect of its submission, namely, that it expects MABS to continue to be very busy in terms of the core work it carries out, being the first point of repair for indebted people. It stated that MABS must be properly resourced to carry out the vitally important work of income maximisation and negotiation of affordable repayment of creditors. I welcome the fact that it made this important point. FLAC also went on to say that the extent to which MABS will be involved in proposing plans under the legislation remains to be seen but, regardless, MABS and other groups working for and on behalf of indebted people will play a critical role in helping people to understand and evaluate their options. In the context of the latter point I am concerned at how the banks and other lending institutions will deal with the cases of individual customers and will direct them to the appropriate services. Given the complexity of the legislation, FLAC states that it is also evident that comprehensive legal advice will be necessary before debtors commit themselves to availing of their potential options.

The Bill states that a period of three years will be required before a person can be released from a state of bankruptcy rather than the previous 12 years. Since the downturn in the economy we saw the ridiculous situation where we exported the problem in that some of the big players in terms of financial indebtedness who went to England were able to come back and operate again in a matter of 12 months. Exporting such problems to England or Scotland is not the way to proceed. Time will tell, but the Government did the correct thing in setting a duration of three years. A year might have been too short and anything more than three years would have been too long because while those concerned had financial problems, if they are going back into business we want them to do their business in this country rather than setting up in England which would mean we would lose out on the jobs they might help to create. Not everyone has the wherewithal to create jobs. Such people are few and far between. That is why we want to create a situation where those people can come back, start up their businesses again and begin to create sustainable jobs. If they did it before, I hope they will be able to do it again. We do not want to lose the work ethic of some of those people to other parts of the world.

I have problems with the Bill and we will see which way the vote will go later tonight. Overall, it would be helpful for the Bill to go through, which it will, but I will have problems voting for it because it does not go far enough. I compliment those who work so hard every day on a voluntary basis to help people to try to overcome the difficulties in which they find themselves. We must ensure that people's mental health is protected. I am aware from my clinics of the pressure debt imposes on young families in particular. They were never under such pressure. Our forebears were reared with no money. They had no money but at the same time they did not have the bills or the indebtedness. That is the big difference between the past and the present. In the 1950s we had mass emigration from this country. The people who left did so because there was no work and no money but they were not up to their eyes in debt in the way people are today. There is a mental pressure on people today that did not exist previously. This is unprecedented. We are in uncharted waters. Young couples are starting out in life with young families that are literally buried underneath an avalanche of debt. We must ensure that the State does everything to protect those people.

I have always stated that just because people are heavily in debt does not mean they are lesser people. It does not mean that they do not have to be treated with respect. I am adamant that the banks and lending institutions must treat their customers properly. Just because they are in debt does not mean they can treat them in a disrespectful way. I have seen high-handed actions by repossession companies. Famous cases were highlighted in the Chamber by Deputy Mattie McGrath of people going out in the dark of night repossessing machinery at the orders of banking institutions. In some instances they even got so carried away they repossessed and took machinery on which not a penny was owed; they took the wrong machines. That is what happens when ones goes out in the middle of the night. Such behaviour must not be allowed. If people are in trouble with debt, it must be dealt with in a proper, respectful fashion. The people who incurred those debts were enticed to do so. In many cases they were only trying to better themselves, create employment, improve family farms or in the case of contractors they were trying to buy machinery to get more work. If things went wrong it does not give people the right to go out in the middle of the night under the cover of darkness to act in a totally improper manner. I hope, particularly because of the cases highlighted in this Chamber, that such a scenario will not happen again. It should not be allowed to recur because were such carry-on to be condoned or allowed, it would give rise to a bad situation. Moreover, horrible things could happen because of it, as tempers would be high and one would not know what might happen. As no one wishes to see such situations develop, it is better for the banks, the lending institutions and so on to be calm and thoughtful when dealing with their customers, that is, the people who they enticed in the first instance to bury themselves in this sea of debt. It is to be hoped such occurrences will never happen again.

I spoke about what I called the biggest and most important financial institution in the country, namely, Mom's purse. Over time, it is to be hoped these young struggling families will find themselves in a position in which the weight and worry bearing down on them at present will be lifted and the level of indebtedness in which they find themselves will be reduced. Members have seen the bailouts for the banks and all the big people. Where is the bailout for the young couples who are buried in debt? Where is the assistance for them? Hopefully, such assistance will start in this Bill but it must go further. In addition, the Government must go further to ensure that all possible assistance will be made available to the people concerned.

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