Government failures on cost of living and cost of doing business driving insolvency – Matt Carthy TD

Sinn Féin spokesperson on Justice, Matt Carthy TD, has said that the government’s failure to tackle the cost of living and cost of doing business are driving insolvency and must be addressed. 

Deputy Carthy was speaking on a motion in relation to the mutual recognition of changing insolvency practices in different European Union member states.

Teachta Carthy said:

“When we discuss insolvency we cannot avoid discussing what is driving insolvency for both businesses and individuals.  That includes the high cost of living, insurance, rent and sky-high utility bills in this state – all of which this government has failed to tackle. 

“We know that these costs are the reason that so many businesses are struggling, and that many unfortunately find themselves facing insolvency.

“The cost of living and cost of doing business must be addressed and there must be a crackdown on vulture funds to ensure that they are forced to provide interest rates at the same level as banks.   

“Government needs to ensure that all mortgage holders that have played by the rules have the right to transfer back to banks regardless of the status of their mortgage.

“Government failure to reform and rebalance our own insolvency framework continues to have real consequences for people today.

“It is a shame that in 2019 government approved changes to legal aid in Personal Insolvency Cases which removed a debtors automatic right to funding for a barrister.  At the time, my party colleague and Sinn Féin spokesperson on Finance, Pearse Doherty TD, described this as an attack on the most vulnerable and a coup for banks and vulture funds. He was right. 

“In effect, it limited ordinary people’s ability to enlist the aid of a barrister in taking the fight to the banks.

“It continues to impact upon that 27% of people who actually managed to work themselves out of arrears and get their mortgage back on track since the financial crash, and who are now facing undue financial hardship because they have been forced back into arrears arising from exorbitantly high interest rates. 

“Over 100,000 struggling mortgage-holders are paying interest rates of more than 6%, 7,000 are paying interest rates of more than 8.5%.

“These are people whose mortgages were sold off during austerity years, and who through sheer grit, playing by every rule managed to get themselves back on solid footing. Today, they once more find themselves in precarious standing arising from the greed of vultures.

“Insolvency procedures must be fit for purpose.  As Ireland and other EU member states update, adjust, or develop different civil mechanisms, it is generally right that we should continue to facilitate mutual recognition of changing insolvency practices in different European Union member states. Where such mutual recognition exists today, ordinary people and businesses should continue to avail of the benefits of mutual recognition.”