Tom Sheahan (Kerry South, Fine Gael)

I ask the Minister of State to support this Bill and let it go forward, because if the Government does not do so, it would equate to the recent scenario where a drug trafficker was awarded a haulage licence. Some of the people who have got involved in debt collection have awarded themselves fancy names, such as "debt collection services". The idea that they consider themselves service providers is quite scary. Some businesses are using this to get back the money they are owed. This creates a full circle of pressure, whereby the businessman owed the money is under pressure and feels he must exert pressure above and beyond what is needed. This is why he might use people like the "Viper". There are many other individuals who may not be as forward as the "Viper", but who might still use tougher measures.

These debt collectors are taking anything between 15% and 20%. I have had people in my constituency office owing relatively small sums of maybe €1,000 or €2,000, yet the pressure put on them affects their entire family. They are just not in a position to pay. They would do so if they could enter negotiations and pay the debt over an agreed length of time, but things seem to be getting more underhand and more violent. I had a lady in my office recently who borrowed €1,000 for a first holy communion celebration. After a few weeks, a total of €1,500 was due and the debt collectors were calling to her house. First, they kicked in the door and left. They came back a week later, following a few threatening phone calls, and they broke the windows in the house. This woman is a lone parent and she is in a frantic state. She is afraid in her own home. That criminals are describing themselves as "service providers" in order to collect debt is what kills me.

The chairman of the Irish Human Rights Commission, Mr. Maurice Manning, recently warned that imprisonment over debt is likely to increase. We all understand and accept that, because people are under financial pressure and money is owed. The UN called on the Government last year to ensure its laws are not used to imprison a person for the inability to fulfil a contractual obligation. That is quite ironic, because no member of the Cabinet is currently fulfilling his or her contractual obligations, as the Government has cut back 17% on some agricultural schemes and 8% on other schemes. I am sure the Government will ensure the law is not used to imprison people owing to their inability to fulfil a contractual obligation.

Debt collection is a seedy business. I support what my colleague, Deputy Flanagan, is trying to do. Such businesses should come under the auspices of the Financial Regulator and, more important, should be regulated by the Garda Síochána. That is a must and I ask the Minister of State to consider that proposal.

The Bill also deals with the issue of complaints made in good faith. I referred earlier to the woman who visited my constituency office this week and who told me her door had been kicked in and that, following several threatening telephone calls, her windows had been broken. Debt is a serious issue for many people in Ireland. While I am not aware of the up-to-date figure, the Central Bank in 2007 noted that of all countries in the euro region Ireland had the second largest ratio of personal sector debt to gross domestic product and the largest ratio of personal sector credit to gross national product, which is shocking. The biggest issue facing the State and the people of this country during this time of recession is personal debt. It is not necessary for me to speak of the situation in which young couples with mortgages of €300,000 find themselves as that is evident to everyone. That percentage of personal debt is causing great hurt. People are finding it difficult to deal with their debt. The repercussions of the level of debt held by families and households will result in social, personal and health problems in the future.

I believe everyone should honour their debts. In 2008, 276 people were imprisoned for failure to repay debt. On average, they received sentences of 27 days of which they served an average of 20 days. Also, on release from prison, the debt remained to be paid. Imprisonment does not make economic sense. Not alone does the debt remain to be paid when the debtor is released from prison but the cost to the State far outweighs the benefits that result. At a cost of almost €2,000 a week, it is more expensive to imprison a person than to put him or her up in a swanky hotel in Dublin for a week. What benefit is this to our already struggling Exchequer?

There is chronic overcrowding in many of our prisons. In April 2009, just short of 4,000 prisoners were in custody. The bed capacity of our prisons is 3,600. This represents an occupancy level of 106%. Overcrowding in prisons creates tension and makes prisoner violence more likely. Also, it severely hinders the capacity of the prison system to rehabilitate serious offenders. Some 12 of our 15 State prisons are packed beyond capacity. This is not, as some might believe, a matter of prisoner comfort levels but of ensuring we have safe and functioning prisons. The role of prison is partly to rehabilitate inmates. Currently, this is not happening as almost half the number of offenders are returned to prison within four years of release. Is prison, at a cost to the Exchequer of €2,000 per prisoner per week, the correct place to send people who owe money bearing in mind the debt remains to be paid by the offender on release from prison? This does not lie well me.

Often, there are threats of physical violence and damage to personal property. I am aware of a couple of incidents which were reported to me in my constituency office. This type of activity is happening not alone in Dublin or in the cities, it is happening in my constituency. "Enforcers", which is what I would call these debt collectors, are being sent to houses to extract money owed. As the economy worsens and businesses encounter financial difficulties, there are disturbing reports of threats, intimidation, destruction of property and physical assaults not alone on people owing substantial debts but on people who owe as little as €1,000 or €2,000.

Late last year, shots were fired over the house of a developer in County Offaly who owed money to a business associate. Also, a Galway builder had a brick put through the windscreen of his car when he refused to co-operate with a debt collector. Many of these debts relate to the construction industry and to young people with mortgages of up to €300,000 who are unable to pay any of their other bills. I ask the Minister of State to take on board what is happening, not alone in our cities and urban areas but in areas like mine.

I will outline to the House another sad incident reported to me in my constituency office. A person in business for more than 30 years and who has an excellent track record recently fell on tough times. As turnover and cash flow were causing him major problems, he was finding it difficult to pay his suppliers. His primary concern was to pay his staff - the number of which had been greatly reduced - on Fridays and to then give a portion of the profits, of what continues to be a profitable business, to his creditors. While he was having difficulty trying to carve up his reducing profits, he was keeping his debts at bay and the business remained profitable. Eventually, one of his suppliers became heavy handed. Not alone did the supplier send people to his home after several threatening telephone calls but - I could hardly believe this - when his wife was in town with their children the debt collectors approached her and took from her what money she had in her purse under the guise of debt collection services. For these people to say they are providing a service strikes a chord with me.

I applaud Deputy Flanagan for bringing forth this Bill. I have outlined for the Minister of State some of the stories told to me in my constituency office not from people who owe hundreds of thousands or millions of euro but from people who owe as little as €1,000 or €2,000. I hope the Minister of State will support this Bill and let it go forward. It is needed to protect people who, through no fault of their own, find themselves with cash flow problems. Many of these people believe these heave handed criminals and debt collectors are on par with our banks.

See this speech in context