Aodhán Ó Ríordáin (Dublin North Central, Labour) | Oireachtas source

Amendment No. 2 seeks to delete subsection 21(18) of the Bill, which defines "relevant debt" for the purpose of a court review. The effect of the Senators' amendment is to remove the definition of the type of debt that may be the subject of an application for the new court review. I thank the Senators for their amendment, but I cannot accept it. First, this amendment risks creating legal uncertainty. Subsection 21(1) already provides that the new court review refers to a person with a relevant debt. Removing the definition risks leaving it unclear who can apply for the review. This sort of uncertainty has to be avoided, particularly given the urgency of making the review available to borrowers in long-term arrears who urgently need solutions.

Second, the definition of "relevant debt" in subsection 18 targets the review at those who are most in need - people who are in mortgage arrears on their home or in a restructure of such arrears which has not returned them to solvency. It is the Government's policy to prioritise this group. Removing the definition could open up the review to any person proposing a personal insolvency arrangement, including a person whose difficulties relate, for example, to five buy-to-let properties. This may seem superficially attractive. However, it would carry a risk of legal uncertainty.

I strongly underline that the Government's proposal has been very carefully designed and balanced to take full account of the very difficult legal territory of potentially providing for imposed solutions which could impinge on the property rights of secured lenders. Following extensive deliberation and legal advice, the Government believes the Bill is constitutionally robust. An important element, however, is that the Bill concentrates on risk to the borrower’s home where the social policy justification for Government intervention, both regarding the borrower and the implications for public housing and other public policies, is at its strongest. To make the changes proposed by the Senators would disturb this careful balance and risk opening up the Bill to legal challenges. That would be extremely damaging to the situation of homeowners in serious mortgage arrears who are in urgent need of solutions. For these reasons, the Government cannot accept the proposed amendment.