It seems that the main purpose of the proposed reduction is to help people keep the family home. I will update and submit my summary of The Family Home in Bankruptcy as part of my submission.
The family home in bankruptcy
Brendan,
I have had communication with Willie Penrose (bill proposer) since March on this and I feel this area has been deliberately over egged by those who want to stop the move to one year.
It's not that it isn't an issue but we all know in many instances the house has to go and 1 year wont make that stat change drastically.
This fact has been seized upon by elements opposed to the change within Fine Gael and the DOF. The Taoiseach infuriated the bill supporters by saying "changing to one year isn't a panacea"
No one, including the bill's supporters ever remotely inferred this and I hope the Finance Committee isn't so short sighted to see that some elements want the debate to be a narrow one solely focused on whether it helps one keep the family home.
In his replies to me Willie Penrose was much more focused on the human element
* Bankrupts were usually unemployed and bankruptcy was/is a millstone in regaining employment
* Lack of incentive to go back to work even if attainable as your earnings will be garnished
* The toll a prolonged bankruptcy has on the mental health of the bankrupt and his/her family (Separation, loneliness, lack of esteem, depression and even suicide is common)
* The stigma of bankruptcy and the insistence there must be a punishment/purgatorial element to it above and beyond the handover of all remaining assets needs to be largely removed. This undoubtedly still exists here but not in UK and US.
Penrose is also a firm believer that many who are bankrupted are at heart risk taking entrepreneurs who need to get back in the game
Finally Penrose simply believes it is nonsense to have a bankruptcy period of 3 years in Dublin and 1 year 60 miles up the road.
As regards pros and cons
Interestingly Chris Lehane was in with Finance Committee last week and while clearly not allowed indicate what he would prefer (1 or 3) concurred with much of Willie Penrose's sentiments that a shorter period undoubtedly would have a significant positive impact on the debtor's outlook, mental health and ability to take it on the chin and bounce back.