Eugene Regan (Fine Gael)

I wonder why we go to so much trouble in this Bill and not remedy this particular defect in existing legislation. The Minister has correctly outlined the number of safeguards that have been introduced in the Bill that deal with the outcome and the implications of the Laffoy judgment. However, he cannot pick and chose the bits that he wants to deal with. The judge has stated in express terms that the legislation fails the proportionality test. Where one does not have a statutory scheme that does not require the creditor to seek redress by attaching those resources, then this is a failure. These are constitutional principles to which the Minister is duty bound to have regard. This judgment was not appealed as it was clearly "slam dunk" on the constitutionality of the legislation, given the serious implications of non-payment and non-compliance, but I do think the Minister is picking and choosing which bits he is going to implement in this Bill. Why run the risk of leaving this Bill open to challenge? Anyone challenging the Bill can simply quote the specific ruling of Ms Justice Laffoy.

The Minister has also made the case for this amendment in his exposé about the painstaking difficulties of getting money and recovering debts in court. The fact is that the attachment procedure is the most efficient procedure because it has immediate effect. It is a procedure which does not leave things hanging in the air, avoids the threat of imprisonment and at the same time provides a mechanism for the creditor to recover some if not all of the debt he is seeking. The ultimate outcome of the Minister's refusal to accept this amendment is that we still have the big stick of imprisonment rather than the more considered approach as outlined in Ms Justice Laffoy's judgment.

I commend amendment No. 6 to the Minister. There is an issue with personal service of the summons for an instalment order, in that it should be served personally and the implications of non-compliance should be spelled out to the person being served. This principle, which again was established in the judgment, applies not only to the committal summons but to the instalment order itself. There is a requirement that the instalment order be served personally and that notification be given of the consequences of failure to comply. This amendment is not to the 1940 Act, but to the principal Act of 1926. The amendment states that all instalment orders made under the aforementioned section must be served personally on the judgment debtor and must contain a notification of the consequences of failure to comply with such an order, including the impossibility of imprisonment, pursuant to Order 6 of the Enforcement of Court Orders Act 1940. The endorsement on the order would inform the debtor that failure to comply could result in the issuing of a committal summons, so it comes before that, as a result of which the instalment order could be varied. The court may order mediation, in accordance with this Bill. The court may order attachment of debt owed to the debtor by a third party. The court may order imprisonment with or without a stay of execution. On page 83 of her judgment, Ms Justice Laffoy highlighted this as a weakness in the system. I appreciate that the Bill seeks to address it at a later stage - the committal stage - of the whole process. The principle is established when this process is initiated at the instalment order stage, however.

An amendment of this type is required to fully implement and take account of the implications of Ms Justice Laffoy's judgment. It is important that instalment orders are served personally. It is also a question of efficiency. When one moves to the committal stage, the full implications of the provisions of the legislation before the House come into play. I refer to the legal aid provisions etc. This amendment will ensure that instalment orders are registered with the individuals on whom they are personally served. It should be immediately brought home to people that an order has implications - it is not something they should put aside or throw in the bin. I am seeking to avoid many problems and hasten the process of recovering debt. I commend it to the Minister of State.

I will explain the logic underpinning amendment No. 4, which is a variation on the proposal to which I have already referred. The proposed new section 6(7) of the 1940 Act, as provided for in the Bill before the House, will ensure that various processes take place. Section 6(7)(a) provides for a process of variation of the instalment order and is followed by section 6(7)(b), which provides for a process of resolution by mediation. The logical next step would be to provide for a process of attachment orders, before moving on to the imposition of a prison sentence, albeit stayed, and finally the more draconian measure of arrest and imprisonment. That is the logic of amendment No. 4.

The Minister is fully aware that it costs approximately €2,000 a week to keep a prisoner in jail. The number of people who are imprisoned for non-payment of debt was mentioned on Committee Stage. They spend an average of 24 days in prison. One can add up the cost of that. We need to avoid such direct costs and minimise the indirect costs and additional problems associated with overcrowding in our prisons. These amendments have been tabled to improve the Bill and ensure it complies fully with Ms Justice Laffoy's judgment in the McCann case. I ask the Minister to reconsider the position in relation to these amendments.