After days of confusion over whether parents would have to surrender jobs if their childcare costs were greater than their take- home pay, Mr Varadkar said such a situation could not be ignored.
“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.
“Nobody is asking anybody to give up their jobs. What is going to happen is that people are going to come forward, they are going to say ‘I can’t pay my debts, I can’t pay my mortgage’, and in that case, the insolvency practitioner will go through with them why they can’t pay their bills, and obviously a creditor is not going to agree to a writedown unless that has been gone through and they can work out what is the most they can pay.”
However, Taoiseach Enda Kenny directly contradicted Mr Varadkar — and the debt reduction guidelines — by telling the Dáil the rules would “in no way determine that a person would have to give up work”.
Mr Varadkar said he did not know how many women would be forced to choose between careers and an insolvency deal, but insisted that families would not be left on “bread and water”: “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.
What now...— Frances Byrne (@FraffieB) March 26, 2013
RT @MikeHogan4FM: Irish Examiner front page tomorrow pic.twitter.com/acmA5RE7na
“What it doesn’t mean is that people who are given a haircut as part of insolvency are somehow going to have to live on bread and water. That is not what is intended. People will still be able to have a normal life, a decent life, and maybe even a few luxuries, but it is going to be worked out on an individual basis.”
Mr Varadkar said people struggling to keep up with mortgage payments needed to be treated with respect.
Fianna Fáil leader Micheál Martin said the guidelines represented “an unacceptable degree of nanny-stateism” and highlighted the need for independent oversight of insolvency deals.
The guidelines state that: “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.”