Niall Collins (Limerick, Fianna Fail)
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64. To ask the Minister for Justice and Equality the anticipated number of cases to be completed by the personal insolvency regime by the end of 2013; the total number of personal insolvency practitioners appointed to date; and if he will make a statement on the matter. [46616/13]

Niall Collins (Limerick, Fianna Fail)
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For the benefit of those watching, I will outline my question which relates to the work to date of the Insolvency Service of Ireland. My concern arises because we missed a number of deadlines in getting the service up and running. There is a question mark over the appointment of personal insolvency practitioners who numbered so few at the outset of the service.

Alan Shatter (Dublin South, Fine Gael)
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I can advise the Deputy that as of 1 November 2013, a total of 72 personal insolvency practitioners are currently authorised by the Insolvency Service of Ireland, ISI. In addition, as of the same date, 18 Money Advice and Budgeting Service, MABS, companies, representing 47 individuals, are authorised to act as approved intermediaries. The location and contact details of approved intermediaries and personal insolvency practitioners are publicly available on the relevant registers on the ISI's website, www.isi.gov.ie. It is expected that the number of authorised approved intermediaries and personal insolvency practitioners will increase further over the coming months.

It might be noted that the ISI has added a statistics page to its website which provides key information such as the number of approved practitioners, the number of information requests to the ISI and associated pertinent information. I am advised that the statistics page will be updated on a monthly basis and I would encourage Deputies to consult that page in order to get the latest information.

The ISI began accepting applications for the three new debt relief solutions introduced by the Personal Insolvency Act 2012, as amended, on 9 September 2013. The ISI is currently processing a number of applications. As I have previously advised the Deputy, the ISI has stated that, in the interest of confidentiality, it will not be providing details or breakdowns of the numbers of applications for the various debt relief solutions received or being processed at this time. The ISI fully intends to provide quarterly statistics once a statistically meaningful number of applications have been processed.

During the course of the Personal Insolvency Bill's passage through the Oireachtas, I originally indicated provisional estimates of applications in one full year of operation of the three new debt relief solutions to be 15,000 for debt settlement arrangements and personal insolvency arrangements and 3,000 to 4,000 for debt relief notices.

It is a welcome development that the Circuit Court recently issued the first protective certificate for a debt settlement arrangement. As the Deputy will be aware, debt settlement arrangements and personal insolvency arrangements are conducted in a two-stage process. The protective certificate at stage one offers a 70-day window for practitioners to develop a proposal to the satisfaction of the debtor and creditors. This means that the first debt settlement arrangements and personal insolvency arrangements will issue in the near future, that is, approximately 70 days after a protective certificate has issued.

Additional information not given on the floor of the House

The Deputy refers to completed cases in his question. However, given the nature of the processes involved, cases will not actually be completed by the end of the year as the arrangements in question are processes that can range in duration from three years up to seven years. It is important to note that as soon as the protective certificate issues, debtors are protected from any action that creditors, subject to the protective certificate, may be inclined to take.

The ISI continues to engage with key stakeholders on a number of issues and is working on standardising a personal insolvency arrangement template, establishing a complaints panel for complaints of improper conduct by personal insolvency practitioners, establishing a personal insolvency practitioner education oversight committee and personal insolvency forum facilitation, the integration of the Office of the Official Assignee and is preparing for the anticipated increase in bankruptcy cases.

Niall Collins (Limerick, Fianna Fail)
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I am sure the Minister will agree that with only 72 personal insolvency practitioners operating, the service is wholly inadequate. If one averages that out across the counties of Ireland, that amounts to only three personal insolvency practitioners per county. There are approximately 120,000 mortgages in arrears of more than 90 days and there is another large cohort of people who are struggling with personal debt. Red C published some interesting statistics in StubbsGazette recently, which estimated that up to 25,000 people will seek to avail of the service. It is wholly inadequate.

When the service went live the number of personal insolvency practitioners was extremely low. There are now 72 practitioners registered. What does the Minister intend to do to incentivise more people to become personal insolvency practitioners? As with the old adage, 'justice delayed is justice denied', if people cannot get this service, their problems will not be resolved. It was reported on news bulletins this morning that AIB has come to an arrangement with the Irish Mortgage Holders Association whereby a parallel type debt solution system will operate, outside of the personal insolvency legislation. It will be an independent arbitration process. Will the Minister indicate what he intends to do - assuming he can do something - to increase the number of personal insolvency practitioners in the country?

Alan Shatter (Dublin South, Fine Gael)
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I welcome the arrangements that AIB have put in place. One of the great difficulties that all Members on both sides of the House have referenced in recent times has been the slowness of the banks in entering into permanent debt settlement arrangements with their customers. There have been tens of thousands of temporary or interim arrangements entered into but very few permanent arrangements. I always said when the legislation was going through the House that a sign of its success would be if it forced the banks and other financial institutions into finally addressing, on a permanent basis, the indebtedness of individuals who have no possibility of addressing their debt issues unless appropriate arrangements are put in place. The intention always was that the personal insolvency legislation would be used as a last resort, not a first resort. In that context, I welcome the fact that this step has been taken. I hope there are many individuals whose debt issues will be resolved through that process, without having to resort to the personal insolvency legislation.

As far as I am aware, there are hundreds of cases in the pipeline in the context of work that is being done by personal insolvency practitioners. As my initial reply indicated, more personal insolvency practitioners are expected to be licensed in the coming weeks.

Niall Collins (Limerick, Fianna Fail)
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One could also view this morning's news of AIB’s arrangement with the Irish Mortgage Holders' Association, an arrangement set outside of the parameters of the insolvency legislation, as pointing to a perceived failure of the legislation. The point is that the banks still have a veto in the whole process, while all the cards are stacked against those who find themselves in mortgage arrears and who are being strangled by personal debt. How will the Minister get more personal insolvency practitioners? He said he understands there are more in the licensing and application process. What is he doing to incentivise people to become practitioners? There are 120,000 mortgages in arrears of more than 90 days. These people will need to be able to avail of the insolvency service.

If the marketplace for personal insolvency practitioners is being controlled by a small number of people, the Minister knows there will be less competition and they will charge more. There is an obligation on the Minister to address this concern. What will he do to address it?

Alan Shatter (Dublin South, Fine Gael)
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The Deputy always has this pessimistic and depressing view of life.

Finian McGrath (Dublin North Central, Independent)
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He is not like that at all.

Alan Shatter (Dublin South, Fine Gael)
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This legislation started operating from 9 September and we now have more than 70 personal insolvency practitioners. We have been advised by the Insolvency Service of Ireland that it will be licensing additional numbers.

Niall Collins (Limerick, Fianna Fail)
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How many?

Alan Shatter (Dublin South, Fine Gael)
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I will wait to see how many are licensed in that context.

The Deputy has been bleating around the House for the past several years, ignoring the fact that his party, when in government, created the disaster that is now affecting the lives of tens of thousands of people. While making his presentation, he was anxious that the banks would engage and resolve mortgage issues. The banks have been engaging for some time with more than 75,000 people who have temporary arrangements in place to facilitate their dealing with financial difficulties with mortgages. The banks, however, have been unnecessarily slow - I have been critical of them in this regard - in putting in place permanent arrangements to address people’s indebtedness in circumstances in which practical outcomes could be brought about.

I welcome the fact that the existence of the insolvency legislation has resulted in the development of a mechanism by AIB with the Irish Mortgage Holders' Organisation. I note the individual who heads up the organisation was extremely critical of everything to do with the insolvency legislation. The Deputy can be sure that AIB, or any other financial institution, would not be making a financial contribution of €150,000 to any organisation to independently represent those in financial difficulty whose difficulties need to be addressed by the bank unless they felt they would be put under pressure by the insolvency legislation. I welcome the fact that this has happened, and Deputy Niall Collins should see that as a positive outcome of the enactment of the insolvency legislation.