herald

Saturday 16 December 2017

Labour to push for two-year reduction in bankruptcy term

Joan Burton
Joan Burton

Tanaiste Joan Burton and Public Expenditure Minister Brendan Howlin are to again press the idea of reducing the bankruptcy term from three years to one at a key government meeting.

The pair will raise the proposal at a meeting of the Economic Management Council (EMC) at which they sit with Taoiseach Enda Kenny and Finance Minister Michael Noonan, who are known to be less enthusiastic on the plan.

There is a strong desire within Labour to address the failure of the Government's Insolvency Service to adequately address the mortgage arrears crisis.

Former junior minister Willie Penrose has tabled a bill which would reduce the term of bankruptcy from three years to one.

The move is likely to meet resistance from the Department of Finance. Fine Gael sources have said that Mr Noonan's department are "very cool" on the idea, saying it will not have a substantial effect on the numbers in mortgage arrears.

"There is a strong feeling within finance that reducing bankruptcy wouldn't address the problem as many people would lose their home," said one source.

However, Ms Burton and Mr Howlin are adamant that something be done, with Mr Howlin promising his party colleagues at a private meeting to raise the matter with the Taoiseach and Mr Noonan.

"Brendan told the party he would raise it with Noonan and Kenny, and this will all be thrashed out at the EMC," said a senior Labour figure.

Before the St Patrick's Day break, Taoiseach Enda Kenny and Tanaiste Joan Burton discussed the issue, which is becoming a growing political problem, at their weekly one-on-one meeting before Cabinet.

MEASURES

Mr Kenny has said the Government would unveil a new set of measures to tackle the mortgage arrears crisis next month, in advance of the spring statement, and held out the possibility of introducing new legislation.

Mr Kenny also said the new proposal would be considered in the coming weeks.

"It is something we can consider," the Taoiseach said. "I know Deputy Penrose has tabled a Bill on this.

"Obviously it might spur the banks on to a more expeditious decision. The banks don't get anything, or very little, in the case of bankruptcy," he said.

A review of the current insolvency system and the implementation of the Central Bank's mortgage arrears targets were nearing completion and a new set of measures would be announced in April "to focus in particular on the still unacceptably large numbers of families in long-term mortgage arrears now facing repossession of their homes".

It has also been suggested that the Government's spring statement will take place in the last week of April.

hnews@herald.ie

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