John Crown (Independent) | Oireachtas source

I welcome the Minister who has the zeal of a reformer, which is always welcome, and I commend him on his attempt to improve the unsatisfactory regime in place for people with difficulties in their personal finances. With goodwill, good legislation will emerge, which will generally improve the climate. There is a cultural backdrop to what is going on. Our society historically did not like to see itself incurring large debts. We frown on this culturally and deep in their core people did not like going heavily into debt. We generally took out one large loan in our lifetimes to buy a house in accordance with prudent guidelines, which had been passed on to us and articulated to us by the debt professionals with whom we dealt. Thankfully we have somebody who has the will and the parliamentary muscle to effect reform but he is faced with a colossal problem, which is that we are witnessing insolvency on a scale that ten or 15 years ago people would have not dreamt remotely possible in our country. Some people become insolvent because of personal irresponsibility in making bad decisions but they are a minority. Some people become insolvent because they were unwise. Wisdom is easy to define in retrospect and people whom we would not necessarily thought of as particularly foolish made decisions in the context of the advice they received at the time that did not seem foolish but they now seem catastrophically bad.

We can never let this get off the radar screen when we consider legislation such as this, which tries to strike a delicate balance between the needs and responsibilities of those who took out loans they cannot service and those who gave them, that there is a specific reason for the high insolvency rate in Ireland, which is that highly self-interested banks, brokers and debt sellers of all strips pushed debt onto people in varying degrees of knowledge that they would be unable to sustain it. These professionals, who historically had been characterised by prudence, responsibility, conservatism and wisdom - they were often stereotyped as dullards who said "No" on every occasion - replaced these traits with highly bonus-incentivised, irresponsible actions.

Instead what we have are people who were routinely told that those old rules had changed. They were not financial experts; they may have been teachers, nurses, lawyers, skilled workers or taxi drivers. People who were not particularly attuned to macro-economics and the world of finance were told, "No, don't worry about that. It's important to get on the property ladder at all costs." At the time, rather few of them understood when they were stepping onto that ladder, that the advice they were taking was being provided by people who had a dog in the fight - people who were deliberately giving them unwise advice because they were making money from that advice being acted upon.

For that reason, it is critically important in looking at this that the default position should be to acknowledge the fact that on one side of this equation were people who generally acted perhaps naively. On the other side of the equation, the other people who we are seeking to protect - and I understand they need their protections - in many cases acted deliberately irresponsibly and did it for profit. This needs to be borne in mind in assessing the matter.

I have just noticed, on a constitutional crisis point, that the Acting Chairman nodded when I said something. She is supposed to be tremendously impartial. I may well have to report her to the Supreme Court for that.