Alan Shatter (Dublin South, Fine Gael) | Oireachtas source

Deputy Mac Lochlainn is not listening to what I said about that issue. He is trying to equate the debt relief notice provision, which allows for the writing off of €20,000 without a compulsion to repay in circumstances where a person simply has nothing, with a whole range of stuff within that which allows approximately €6,000 worth of assets to be ignored in the context of household assets, the value of a car, educational equipment and the other things we have discussed. That is one issue. The personal insolvency arrangement is not about having all debts wiped off and walking away. It is about having much larger debts and entering into an arrangement which facilitates over a period of time at least a portion of them being discharged without the person sinking - because a person going into bankruptcy sinks - and without one's home being sold unless it is of a particular value that is just unreasonable for it to be retained. They are important and different mechanisms. It is not about providing assistance to wealthy people. Those who are wealthy will not be in this process and do not need the process. It is about people who are in financial trouble.

Deputy Niall Collins made an interesting point. He suggested that instead of this €3 million provision, people should work through their problems or they could go into bankruptcy. Working through their problems is what the personal insolvency arrangement is about. It provides a mechanism that facilitates working through it. What is the failsafe in this? There is a strange bit in this because this debate is based on the assumption that financial institutions are completely evil. They were certainly very wrong in the manner in which they advised people and are guilty of enormous failures of judgment in providing funding for projects that were insane and in not carrying out appropriate due diligence. However, the irony in this is if we take it that in most instances of this level of debt, it will be money owing to financial institutions, if what is on offer in a personal insolvency arrangement by way of debt resolution does not hold out to the financial institution the prospect of doing better by entering into it - in other words, recouping some of the debt - than they would do through bankruptcy, they will not agree to it.

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