Insolvency guidelines prove a PR disaster

Even for such a clumsy Coalition it has been a desperate spectacle to watch as Enda Kenny and Co lost control of the political narrative surrounding new insolvency rules — and then blamed everyone else for their own incompetence.

Despite it being belated and leaving the banks with the whip hand, bringing some much needed debt relief for families struggling in mortgage misery should have been a boost for the Government — but, instead, it managed to turn it into a PR disaster.

Confusion reigned in government circles from Sunday when a newspaper leaked draft guidelines on how people seeking help with debt distress are to be treated, especially the incendiary clause: “Where a person is working and paying for childcare as a consequence of his or her employment, the cost of childcare should not exceed the income from the employment.”

Mr Kenny appeared to be in denial when questioned on the guidelines while out on the stump in the Meath East by-election campaign on Monday, insisting it would be “quite incredible” if banks forced people to give up their jobs in order to qualify for mortgage restructuring — as if the draft rules his Government created had nothing to do with him or his ministers.

Mr Kenny stuck to this political disassociation in the Dáil on Tuesday, telling TDs the guidelines “in no way determine that a person would have to give up work”.

Unfortunately for the Taoiseach that claim flatly contradicted the guidelines, and what his Transport Minister Leo Varadkar was saying at the same time.

With a reputation for political bluffness, Mr Varadkar is that rarest of cabinet ministers in that he will usually endeavour to answer a question rather than revert to the Coalition default position of evasion.

Pressed on what the insolvency rules would mean in practice for women (as they are usually the lowest earners in a family unit despite equal pay legislation) who take home less than their child care costs, the minister made it clear such financial realities could not be ignored when assessing bids for debt writedowns.

While stating nobody would be made to give up their job, Mr Varadkar said if career women wanted mortgage help, childcare costs must come into play: “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 to be taken into account in any insolvency arrangement.”

His remarks were summed up in the Irish Examiner headline: “Varadkar: Women to choose career or mortgage” — and the story then exploded across late-night TV and morning radio.

At this point the Government finally realised how calamitously it had allowed the controversy to escalate and decided to do what all incompetent administrations do when they lose control — attack the messenger.

A weasely statement was issued in Mr Varadkar’s name which played a game of pedantic distraction that some broadcast media organisations initially fell for, as it stated: “The headline in the Irish Examiner today is not what I said. That is a headline, not a quote, and it doesn’t reflect my views.”

Everyone agrees the headline in question is indeed a headline, and as it contains no quotation marks, it is not a quote. The point of contention is whether it reflects the minister’s comments. Most reasonable people would, surely, agree that it did — the Government’s dysfunctional spin machine insisted it did not.

The statement went on to remark: “The quotes in the body of the article are accurate, however.” So, the story was right, but the headline accurately reflecting that story was wrong.

It would seem a certain minister must have got an early morning rocket up him from Spin Central for going off message and actually telling the truth, and so needed to be dragged back into the Axis of Evasion.

The fact that voters, some of them working mothers, were going to the polls in a photo-finish by-election at that very moment might have had a lot to do with the Government rage.

In a carefully-worded Dáil statement Mr Kenny then made it look as if the guidelines were being withdrawn — when they are not — and insisted that nobody would be “forced” to give up their jobs. And as the insolvency regime is not the judiciary that is true — but women can still be effectively blackmailed into such an action by being told they will not get help unless they do give up work, as the Government created rules insist.

Failure to find a credible line and stick to it has seen the Government’s flagship insolvency policy descend into chaos over an issue that will effect a small minority of working mothers — but has now made Mr Kenny and Co look like the anti-women administration.

What it says

*What the guidelines say:

“Where a person is working and paying for childcare as a consequence of his or her employment, the cost of childcare should not exceed the income from the employment.”

*What Leo Varadkar says:

“As I understand it this would only pertain to cases where somebody’s childcare bills exceed what they are making at work, I don’t know how many cases of that there are. But I think where somebody is in that position whereby they are losing money, it is costing them money to work, and as a result they can’t pay their mortgage, then that is something that needs to be taken into account in any insolvency regime.

“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.”

*What Enda Kenny says:

“The guidelines have not yet been published. I want to make it clear to every man and woman in the county, but particularly women, that no guideline laid down by the personal insolvency agency will be mandatory or conditional for any person in having to give up his or her job in determining his or her position.”

More on this topic

Numbers seeking insolvency solutions fallsNumbers seeking insolvency solutions falls


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