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

It is very important that individuals in these circumstances are incentivised to work. In practical terms, this means that if they work harder or work overtime or their business is successful that they retain some additional portion of the moneys they earn. The proposal put forward by Senators Crown and Barrett seeks to have any variation of repayments in a debt settlement arrangement or personal insolvency arrangement arising from an increase in the debtors means limited to 65% of that increase. I have no particular difficulty with the sentiments behind these proposals, but I must remain consistent in my overall approach.

These new debt resolution arrangements are, essentially, a matter of negotiation between debtors and creditors mediated by a personal insolvency practitioner. The participants are free to come to whatever repayment options best suit all that can be agreed and fulfilled over the period of the arrangement. I am not sure that such a specific intervention as proposed would be wise in the context of negotiations between debtors and creditors. The setting of a definitive figure could become an upward target in the context of some arrangements. I understand the point the Senator is making, but in the context of both debt settlement and personal insolvency arrangements, it is about an agreement being concluded, based on the individual circumstances of the parties, the debtor and the creditors. If in the context of that arrangement it is anticipated that over the period the arrangements will apply the income of an individual in employment or a self-employed individual will increase, that is clearly to everyone's advantage.

Creditors want people to be incentivised to continue to earn funds that will facilitate debt being discharged. If they can be incentivised to earn additional money, the creditors have the incentive of being paid a little sooner or of getting a greater share of the cake. Clearly, nobody will bother to do that if he will not benefit from it. Therefore, there is an advantage in this being something that is factored into a debt settlement or personal insolvency arrangement, without imposing some sort of structured provision which might or might not work, depending on individual circumstances and which could, in some circumstances, be a disincentive to an arrangement. On a practical basis, this amendment would not necessarily be a benefit. In the circumstances, I ask the Senator to consider withdrawing it.