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

I welcome that the Deputy has raised these three issues. We are considering them in the context of Seanad amendments to the Bill. I share his concerns. We have had an opportunity to work through this and consider it with regard to the BPOs. We are revisiting that in the context of our own considerations and what the Deputy has to say on the issue.

The bank account issue is important. We are considering whether we can incorporate an amendment into the Bill to deal with that issue. If people enter into a debt settlement arrangement or PIA, there is nothing in law to stop him or her having a bank account, but we do not want a situation in which financial institutions decide not to give him or her a bank account. Where individuals who are working through debts have some form of income, a bank account may be essential for that income to come in, for debt payments to be made and for there to be a very efficient and easy mechanism to see what is coming in and going out. The bank account can be the easiest way of doing it. Clearly, if someone in a PIA or debt settlement arrangement is to have a bank account, it must be one in which there is not an overdraft facility.

I am concerned about another issue. One may not have a credit card, but there is no reason one should not have a debit card if it is usable on a bank account with no overdraft facility. The debit card is just a payment facility instead of carrying cash. I want to examine both issues. We have been giving some thought to them and will see whether we can address them.

In terms of bankruptcy, the Deputy is right. Perhaps an individual who is bankrupt can maintain a single bank account, but only in the context of there being no overdraft facility so that another level of indebtedness is not being created in the middle of a bankruptcy, which clearly would not be viable.

The same issue would apply to debt cards as opposed to credit cards. It is my intention to revisit those.

The determination clauses in contracts are interesting. Clearly, one does not want individuals who are very competent in their jobs but who, for a number of reasons, have got themselves into financial trouble to find themselves unemployed. It is not in their interest nor in the interest of creditors. There is an issue of private contracts concluded between individuals and whether one can, in legislation, interfere with an existing contract. That is a particular issue which has a constitutional dimension. One can certainly provide for legislation which ensures that a clause, such as the one the Deputy mentioned, would be void in future contracts. This is an issue on which we have to consult the Attorney General's office. It is not quite as simple as it looks and we need to be careful about how we deal with it.

There are other areas and there are particular professions in which by virtue of becoming bankrupt one is not entitled to practice one's profession, and in circumstances where the bankruptcy has nothing to do with any dishonesty in the manner in which one ran one's profession. For example, someone might have foolishly borrowed money from banks to invest in property or to invest in some business having taken the view that if he or she bought some share in a business, he or she would do well out of it but has lost money on that and is in difficulty, even though he or she is competent in his or her profession and if the bankruptcy does not give rise to any judgments about his or her competency in his or her profession. There is an issue, for example, where professions are self-regulated or if there is a statutory provision. Should a bankruptcy prevent someone continuing to work in that profession? There are other issues.

One of the matters about this legislation is the huge areas it must cover and its complexity. I suspect the day it is enacted, we will all think of something we should have addressed which is why I am saying this is not cast in tablets of stone. If we discover something in the short to medium term, which should have been addressed and which we need to address, a short amendment Bill will be produced, if needs be. However, we are looking at those areas with a view to addressing them in the Seanad which means they will come back to the Dáil in the context of any Seanad amendments made which we have not discussed in the Dáil by way of formal amendment on Report Stage.

I am afraid I will not surprise the Deputy by saying I cannot agree to the two year instead of the three year issue. There is an issue about having a neighbouring jurisdiction which allows people to exit from bankruptcy within a year. As some people have discovered, it is not quite as easy as they think to get into that jurisdiction. One has to have some real connection with it. One cannot simply take a flight over and three weeks later seek bankruptcy. In Northern Ireland and in England, individuals, with their main residence and businesses based in Ireland, have attempted to use that bankruptcy jurisdiction but they have been unsuccessful. Someone can move lock, stock and barrel and relocate and that may affect that aspect but we have to have bankruptcy legislation which we believe is reasonable.

There is a very dramatic change from where we have come in regard to the three year provision. I am afraid I cannot accept the Deputy's amendment for the period of automatic discharge from bankruptcy to be reduced from the three years prescribed here to two years. What we are doing is a significant advance on the current 12-year period. The UK is unique in its one year period. In other European countries, as the Deputy may know, the periods of time are longer. They are based on giving an opportunity for arrangements to be made in regard to a bankruptcy which may result in some value going to creditors.

Our objective here is to provide a reasonable period of time for an individual to be within bankruptcy but for bankruptcy to no longer be perceived as a penal remedy which disables individuals for the rest of their lives, or certainly for 12 years. It was the rest of a person's life when I came into office. We made a temporary change to the law bringing it down to 12 years. I am afraid I cannot accept the Deputy's amendment to reduce the three year period to a two year one.

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