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Personal Insolvency Bil 2012: From the Seanad (Resumed) (Continued)

Wednesday, 19 December 2012

Dáil Éireann Debate
Vol. 787 No. 4

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Deputy Alan Shatter: Information on Alan Shatter Zoom on Alan Shatter The legislation envisages it as an annual review of what are reasonable expenses. The reality is it will be open to the insolvency service to consult as it deems appropriate and to consider a range of reports and publications that address this issue, as well as consulting with particular Departments. I do not expect it will be appropriate that on an annual basis the insolvency service will engage in some major public consultative process. It must have regard to all the expertise and statistical and financial information available.

When it comes to reasonable living expenses, guidelines will ultimately be published. In dealing with the individual circumstances of a seriously indebted person, the arrangement put in place will depend on particular issues relevant to the individual that must be taken into account. There will not be a set formula resulting in a set sum as applicable to every individual. There will be much variance in that regard.

I have no doubt the service will have regard to the expertise of the Money Advice and Budgeting Service and the manner in which it approaches this issue. I do not envisage an annual public consultative process but the director of the insolvency service would have sufficient expertise to engage in this process. When the guidelines are published, the service will be the body to which each non-judicial debt settlement will be furnished for oversight essentially to sign off on to ensure issues are being dealt with appropriately. When it comes to experience, I am sure the service will have insight into what arrangements are put in place with regard to the expenditure of different people. I expect that would feed into any annual review of reasonable living expenses. It will deal with real people in real debt in the context of a real debt settlement arrangement. Over a period, the service will develop its internal expertise in the area and may well identify issues that repeatedly arise that may not be covered with the first set of published guidelines. There is adequate discretion invested in the insolvency service to ensure that in putting these guidelines on reasonable living expenses in place, it will have available the maximum information.

For the reasons I previously outlined, I cannot accept Deputy Mac Lochlainn's amendments. We have added substantially to the provisions of the Bill as originally published. I am of the view that these additions cover everything about which Deputy Mac Lochlainn is anxious as it is open to the agency to access any source material that is of assistance in addressing the issues. In the circumstances I cannot accept the amendments being tabled.

  Amendment No. 1 to Seanad amendment No. 23 put and declared lost.

Deputy Pádraig Mac Lochlainn: Information on Pádraig MacLochlainn Zoom on Pádraig MacLochlainn I move amendment No. 2 to Seanad amendment No. 23:

In subsection (3)(e), after “households,” to insert “their geographic locations, ability to access services”.

  Amendment No. 2 to Seanad amendment No. 23 put and declared lost.

  Seanad amendment agreed to.

Seanad amendment No. 24:
Section 23: In page 24, before section 23, but in Part 2, to insert the following new section:

24.—Nothing in this Act shall be construed as preventing the Insolvency Service, in the performance of its functions under this Act, from sending or receiving documents or other information, or otherwise communicating, by electronic means.”.

  Seanad amendment agreed to.

Acting Chairman (Deputy Bernard J. Durkan): Information on Bernard Durkan Zoom on Bernard Durkan Seanad amendments Nos. 25, 28, 31, amendment No. 1 to 31, 32, amendment No. 1 to 32, 35, 39, 43 and 45 to 52, inclusive, are related and will be discussed together by agreement. Is that agreed? Agreed.

Seanad amendment No. 25:
Section 23: In page 24, to delete lines 27 to 31 and substitute the following:
“ “Debt Relief Notice process” in relation to a debtor, means the process that commences with the submission of a written statement by the debtor under section 25(1) and which concludes, as the case may be, when—
(a) the debtor’s application for a Debt Relief Notice is withdrawn, deemed to be withdrawn or refused, in accordance with this Chapter, or

(b) the Debt Relief Notice issued in relation to that debtor ceases to have effect in accordance with this Chapter;”.

  Seanad amendment agreed to.

Seanad amendment No. 26:
Section 23: In page 24, to delete lines 32 to 41 and in page 25, to delete lines 1 to 16.

  Seanad amendment agreed to.

Seanad amendment No. 27:
Section 23: In page 25, to delete lines 31 to 33 and substitute the following:
“(b) subject to sections 32(9) and 43, may include a secured debt, and

(c) does not include an excludable debt, unless it is a permitted debt;”.

  Seanad amendment agreed to.

Seanad amendment No. 28:
Section 24: In page 26, subsection (2), line 24, to delete paragraph (f).

  Seanad amendment agreed to.

Seanad amendment No. 29:
Section 24: In page 26, lines 25 to 29, to delete paragraph (g) and substitute the following:
“(g) has not, during the period of 2 years ending on the application date—
(i) entered into a transaction with a person at an undervalue that has materially contributed to the debtor’s inability to pay his or her debts (other than any debts due to the person with whom the debtor entered the transaction at an undervalue), or

(ii) given a preference to a person that has had the effect of substantially reducing the amount available to the debtor for the payment of his or her debts (other than a debt due to the person who received the preference);”.

  Seanad amendment agreed to.

Seanad amendment No. 30:
Section 24: In page 26, line 41 and in page 27, lines 1 to 11, to delete subsection (5) and substitute the following:
“(5) For the purposes of subsection (2)(b)
(a) “net disposable income” means the income available to a debtor, calculated in accordance with paragraph (b), less the deductions referred to in paragraph (c),

(b) the following, in relation to a debtor, shall be taken into account in calculating his or her income—
(i) his or her salary or wages,

(ii) the welfare benefits (other than child benefit) of which he or she is in receipt,

(iii) his or her income from a pension,

(iv) contributions from other household members, and

(v) any other income available to him or her,

and
(c) the following (where applicable), in relation to a debtor, shall be deducted from the sum calculated under paragraph (b):
(i) his or her reasonable living expenses;

(ii) income tax payable by him or her;

(iii) social insurance contributions payable by him or her;

(iv) payments made by him or her in respect of excluded debts;

(v) payments made by him or her in respect of excludable debts that are not permitted debts;

(vi) such other levies and charges on the specified debtor’s income as may be prescribed.”.

  Seanad amendment agreed to.

Seanad amendment No. 31:
Section 24: In page 27, subsection (6), between lines 31 and 32, to insert the following:
“(ii) one item of personal jewellery to a value not exceeding €750 or such other value as the Minister may prescribe, where the cost of purchase of that item is not included in the qualifying debts of the debtor for the purposes of subsection (2)(a);”.

Deputy Pádraig Mac Lochlainn: Information on Pádraig MacLochlainn Zoom on Pádraig MacLochlainn I move amendment No. 1 to Seanad amendment No. 31:

In line 1, to delete “€750” and substitute “€1,500”.

I am sure Deputy Michael McGrath would like to speak to this as well as he has pressed the issue throughout the debate. This deals with the item of ceremonial importance. There was mention of "bazookas" when we debated what would be an appropriate amount for a valuation in this regard. In fairness, I appreciate that the Minister has come some way, although there may be many women out there very aggrieved at the valuation of €750. The amendment would increase this to €1,500, which is a more realistic valuation for the average engagement or wedding ring over the past decade. I have determined this from consultation with people about the matter. Will the Minister consider the matter further, although I appreciate that he has come some distance? Nevertheless, €750 is not a realistic valuation for the typical item of jewellery of ceremonial importance.

  It is an important matter, although there has been a bit of fun with this in the media. We must complete a Bill that strikes a balance between satisfying those who are owed money and not humiliating those who are unfortunate enough not to be able to repay debts. To leave a provision for a person's wedding ring to be taken from that person as part of the process would lead to humiliation. We must get to a valuation that is more realistic in reflecting the average value out there and I argue that €1,500 is much closer to that than €750.

Deputy Alan Shatter: Information on Alan Shatter Zoom on Alan Shatter I will deal with all this group of amendments, beginning with Seanad amendment No. 25. They provide for miscellaneous amendments to Chapter 1 of Part 3, which deals with the debt relief notice process. Seanad amendment No. 25 makes clear the debt relief notice process concludes when the debtor's application for debt relief notice is withdrawn, deemed to be withdrawn or refused or when the debt relief notice issued with regard to the debtor ceases to have effect. The text as currently presented in the Bill is not sufficiently clear and requires further refinement for the avoidance of doubt.

  Seanad amendment No. 28 proposes the deletion of paragraph (f) of section 24(2). This deletion arises as a consequence of Seanad amendment No. 35, which proposes the deletion of section 24(8), regarding the treatment of goods on hire purchase in the context of the debt relief notice process. Having considered the comments made in the Seanad on the matter, as well as comments from relevant organisations, and having consulted with the Parliamentary Counsel, I have decided to remove the provision from the Bill to offer greater flexibility to debtors.


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