Saturday 27 December 2014

Mums could be asked to give up jobs for debt deal - Varadkar

Published 27/03/2013 | 05:00

Leo Varadkar

Working mums may have to leave their jobs if the cost of childcare exceeds their earnings, Minister Leo Varadkar has said.

Minister Varadkar’s comments are at odds with the Taoiseach on the issue which arose as a result of debt reduction guidelines.

The Transport, Tourism and Sport Minister said the income of people had to be balanced against their outgoing bills before any insolvency arrangement would be agreed by creditors.

He was speaking after the Irish Independent revealed last week that second cars, Sky Sports, holidays and medical insurance could be deemed as non-essential spending under a new insolvency regime.

Guidelines from the Insolvency Service of Ireland, due to be published after Easter, might also add pressure on parents to give up their jobs where childcare costs exceeded their income.

“I know one or two women who probably don’t make very much money at all from working, but they do it to keep their position on the career ladder, if you like, and that is a legitimate thing to do.

“But if you can’t pay your mortgage as a result, or buy your groceries as a result, then that is something that needs to be taken into account in any insolvency arrangement”.

He made the comments at the launch of the 2013 National Ports Policy.

"The situation with the insolvency regime is we have to be as fair as we can with everyone," Mr Varadkar said.

"That means being fair to the 88pc or 90pc of people who are paying their mortgages and are paying their debts and they, like a lot of people, are making very big sacrifices.

"As I understand, this (asking people to give up their jobs) would only pertain to a case where childcare bills exceed what they're making but I don't know how many are in that position.

"If somebody is in that position, where it is costing them money to work and they can't pay their mortgage, that it something that needs to be taken into account in any insolvency regime."

Anyone applying for personal insolvency would go through their personal finances with an insolvency practitioner who would help plan how to meet their obligations including household bills and mortgages.

But no one would be expected to live on bread and water, Mr Varadkar added.

"It may mean a family with two cars who have access to public transport maybe don't need two cars any more," he said.

Taoiseach Enda Kenny said in the Dail the rules would “in no way determine that a person would have to give up work”.

Irish Independent

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