Bankruptcy term to be cut to one year - new legislation
Published 01/12/2015 | 09:46
The term of bankruptcy could be reduced from three years to one if a new bill is passed by cabinet today.
It is widely expected that the bill, which will bring Irish bankruptcy laws in line with the United Kingdom, will be approved when it's put to Cabinet.
It iis being proposed by Justice Minister Frances Fitzgerald but the proposals were spearheaded by Labour TD Willie Penrose.
Other proposals in the bill include increasing penalties for those who try to hide assets and for those already in the process, the timescale for bankruptcy will be 18 months.
In cases of serious non co-operation, the period will be extended to 15 years - the maximum at the moment is eight.
In addition, the window in which income payment orders apply will be cut from from five to three years.
These orders apply when bankrupt individuals are pursued for income surplus that is considered to be in excess of reasonable living costs.
Speaking about the proposed bill this morning minister for Public Expenditure and Reform Minister Brendan Howlin told Newstalk that it would help people recover from previous mistakes.
"Bankruptcy is not an easy option for anybody. It is the last option for somebody. The stigma of bankruptcy will still exist. The problems in relation to the court orders and paying back will continue for years after the bankruptcy," the minister said.
"So it certainly won't be an easy option for anyone. Anybody who is facing into bankruptcy will know how difficult and challenging it is for themselves and their family."
It is currently unclear as to what will happen to those who are already bankrupt should the bill be passed however, it is understood that those who have been so for one year could be cleared after three months.