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

On occasions I am sure the odd thing I say is not necessarily always greeted from behind me with enthusiasm. By and large, the background notes I get are very helpful but I would frequently add additional information as I am going through them. I see them as an important roadmap to what I am saying but we will see if we can do something in that regard for tomorrow.

I come back to these amendments. They provide a more succinct terminology for the different types of debts that were already addressed in a particular way within the legislation. On the issue Senator Norris raised, as Members will see in regard to amendment No. 1, the excludable debts of a debtor referred to means: liabilities of debtors arising out of any tax, duty, levy or other charge of a similar nature owed or payable to the State; amounts payable by debtor under the Local Government (Charges) Act 2009; amounts payable by debtor under the Local Government (Household Charge) Act 2011; the liability of a debtor arising out of any rates due to a local authority; debt or liability of a debtor in respect of moneys advanced to the debtor by the Health Service Executive, HSE, under the Nursing Homes Support Scheme 2009; debt due by the debtor to any owner's management company in respect of annual service charges; and a debt or liability of the debtor arising under the Social Welfare Consolidation Act 2005.

What is the purpose of that? If people owe taxes or money to a local authority, the HSE or a property management company it is of great importance they meet their obligations. If those debts exist they are debts that are part and parcel of the overall financial profile of an individual whether they are trying to receive the assistance of a debt relief notice or trying to enter into a debt settlement arrangement or a personal insolvency arrangement. They are very specific debts. Most of them in the list I mentioned, and I will come to one that is an exception, are debts owing to the State. The State has a duty in the interests of other citizens to recover moneys due but there are circumstances in which the reality may be that money is not recoverable and it may be to the benefit of the State and therefore to taxpayers generally and the citizens of this State that if a full sum is not recoverable a portion be recovered that may not otherwise be recovered, even if that portion is paid over a period of years. It envisages a process that these debts cannot automatically be included in any arrangement or under a debt relief notice, DRN, they cannot be automatically written off but it creates a possibility that the State or a State agency may decide to engage in the matter and participate. It also gives them an entitlement to simply say:

No. This is a debt. It must be paid. If there is to be an arrangement make an arrangement with all other creditors but remember in the background that our debt has some degree of priority and will not be included in that.

Members will see that included within the list is a debt due by the debtor to any owner of a management company in a multi-unit development. That is the only one referred to as an excludable debt that is not owed to the State or a State agency. At one stage we were excluding that debt in its entirety. I am interested in what Members of the House may say on that issue. We excluded it from being a settleable debt because if someone is an owner-investor in a multi-unit development it is not that he or she owes the money to one person. If it is going towards the management of that unit the money such people owe is to facilitate the management and upkeep of the unit in which they maintain their apartment and if they do not pay up, it impacts not on the State but on every other apartment owner.

Often there are management companies administering these matters on behalf of the apartment owners within a multi-unit development. In some instances a committee is set up by two or three of the apartment owners who take that job onto themselves and do not involve a management company. The concern was that if we included that debt within it, it could unfairly impact on others in the multi-unit development who might, as a consequence of some individual's failure to make payments, find themselves having to make a higher payment which might impact on their own financial circumstances. It also could be difficult, where there are many owners within a multi-unit development, to get their agreement that a debt can be settled in this way but it would be open to them, where there is an appointed committee or an agent, to authorise them to engage in this way.

There is a case for making that an excludable debt which may, in cases where ¤3,000 or ¤4,000 is owing because someone has not paid their management charges for two or three years, give rise to a greater possibility that some of the arrears due will be paid over a period of time or it may not. It is debatable whether that should be in the excludable or the excluded category but on balance we thought we should put it in the excludable category.

Senator Norris is right in saying that the Bill is providing a new mechanism for debt settlement by the State or State agencies should they choose to opt into it in circumstances where there is money due. In effect, that is what it is doing and it is a new mechanism that falls short of taking an individual into bankruptcy, for example, should there be assets there and money due and an individual's failing to make payment.

The excluded debts are of a particular category. Liability of the debtor arising out of a domestic support order effectively envisages where a court order is made in family law proceedings for the support of a spouse, a child, a cohabitee or a civil partner in circumstances under the 2010 Act. Once the court has made an order that order cannot be compromised.

There are usually court mechanisms if people are in financial difficulty or their financial circumstances have changed and they are unable to meet their obligations. There are usually provisions within legislation, such as the Family Law (Maintenance of Spouses and Children) Act, 1996, the Family Law Act, the Family Law (Divorce) Act of 1996 or what I call the civil partnership and cohabitees Act. I would have had a row with the person who added the long spiel at the end of the title if I had been the Minister. Within those Acts, where financial orders can be made there are mechanisms for variations in changing circumstances. There is also the constitutional matter that when courts make an order it cannot be compromised externally.

On Report Stage, I want to give consideration to the need to define more exactly what is meant by domestic support order. We tend to call them maintenance orders, periodical payment orders or financial relief orders. There is a range of terminology in the family law area and we do not use the term domestic support order. We may need a definition of domestic support order.

Amendment No. 1 refers to "the liability of the debtor arising out of damages awarded by a court". That is a court order and people are bound by it. The courts are independent and we cannot interfere with individuals' obligations pursuant to a court order. The amendment refers to "debt or liability of the debtor arising from a loan (or forbearance of a loan) obtained through fraud, misappropriation, embezzlement or fraudulent breach of trust;". I do not think that anyone would suggest that type of debt should not be met if assets or funds are available to meet it. It should not be compromised. If a court order is made under the Proceeds of Crime Acts, pursuant to proceedings taken by the Criminal Assets Bureau, it should not feature in the debt relief notice or debt settlement arrangement or a personal insolvency arrangement. Every criminal in the country who has had an order for the seizure of assets made would suddenly announce they were insolvent and wanted the benefit of a debt relief notice and personal insolvency arrangement.