Stephen Donnelly (Wicklow, Independent) | Oireachtas source

I move amendment No. 192:

In page 118, line 18, after "discharged." to insert the following:

"In the first three years post enactment of the Personal Insolvency Act 2012, all bankruptcies shall be discharged after two years. Thereafter, and on return to normality, the period of bankruptcy shall be increased again to three years.".

A few issues arise, but I will not go over one of them again, namely, clearing the debt as quickly as possible. As the Minister will see, I am in favour of temporary periods of shortening. There is an incentive to move to the UK for one year. Ireland having a term that is three times as long as is available in the next jurisdiction makes going to the UK, which we would prefer not to happen, considerably more attractive for many people. As such, three years may be too much.

Instead of discussing economic growth and so on again, I will use this opportunity to raise one or two bankruptcy issues. First, the question of bankruptcy payment orders, BPOs, has been raised urgently by the Free Legal Advice Centres, FLAC, the Money Advice & Budgeting Service, MABS, and others. As the legislation stands, the bank will be able to apply for a five-year BPO at the end of the three-year period, making it a de facto eight-year period. This is far too long and is not a credible option. It will allow the banks to trap people again and I urge the Minister strongly to examine the issue. I have no problem with attaching a BPO to a bankruptcy if there is income that can be used, but it should ideally be constrained to the period of the bankruptcy. This is an urgent issue.

Second, a technical issue was brought to my attention last week. Many employment contracts, particularly with multinationals, contain a clause to the effect that, if an employee enters an agreement with his or her creditors, that employee is instantly fired. One such contract will be terminated if an employee is declared bankrupt or makes any arrangement or composition with his or her creditors generally. That provision would preclude many people from using this legislation. I urge the Minister to examine this issue.

I do not believe that we have covered a third issue, namely, the conditions of the bankruptcy. One or two elements are old worldly and unhelpful, particularly that of not having a bank account. This matter should be considered in terms of the mechanics of paying.

I would prefer three years to two, but we will not go over the issue again, as I do not imagine that the Minister will accept my amendment. There is an interesting comparative issue with the UK's one-year period. It is incredibly important that the BPOs be constrained, as they restore all of the banks' power to squeeze borrowers.

See this speech in context