Ireland is imposing punishing new requirements on people applying for debt write downs, according to the Financial Times:
A single person will be allowed just €247.04 a month for food, €57.31 for heating and €125.97 for “social inclusion and participation”, an expenses category that includes tickets for sporting events and the cinema.
The allowances rise for someone with children, or without access to public transport: according to the Irish Times, each child of primary school age adds another €204.88, while €131 is allowed for a car if there’s no other alternative.
The move is the first attempt to quantify acceptable living standards in the country, following the spate of bankruptcies caused by the financial crisis. The guidelines are also expected to be used by banks as they begin restructuring home loans shortly – in Ireland, unlike the UK, mortgages are included in insolvency laws, in an effort to prevent banks from simply foreclosing on debtors.
English insolvency laws are less restrictive than Ireland’s, requiring only that the bankrupt person be left enough cash for “reasonable” expenses. As the FT reports, past cases have found that holidays, mobile phones and video rentals are covered by that, but gym memberships, private healthcare, gambling, cigarettes and alcohol aren’t.
The imposition of cash limits could be a step up for welfare, if recipients are free to ignore the categories which they’re calculated for. One of the worst things about the sort of moralistic reasoning which the British laws embody – and which are mirrored in the arguments for food stamps – is that it prevents people from making their own decisions about what “necessities” are for them. If I’d rather spend £500 on gym memberships than £1000 on a mobile phone bill, then I’m better off if I’m allowed to do that, and so’s the state.
Of course, the Irish limits aren’t that flexible – and nor are they that high. So for the time being, you’re probably better off bankrupt in Britain. Put that on the tourist posters…
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