Brian Ó Domhnaill (Fianna Fail) | Oireachtas source

This section, on statements of means, also boils down to ability to pay. Questions have been raised by organisations such as FLAC about how the District Court will determine whether a person can afford to pay the debt on enforcement and the various types of enforcement procedure, including deduction from salary through the PAYE or social welfare system. A debtor in employment, for example, will be obliged to provide a statement of means for the court, which will then be used in assessing his or her capacity to pay. Where the debtor is receipt of social welfare payments, the statement of means will have attached to it a verification statement from the Department of Social Protection. Therefore, issues arise regarding employment which we will deal with in other sections and the relationship with the employer.

Judgment debtors are invited to provide a statement of means in regard to instalment order applications, but many do not do so. According to FLAC, although the legislation is in place, many do not do so in some instances due to a fear of the court process and the public nature of the court appearance. Any journalist or individual can obtain information in a public courtroom on the means of an individual. There are no safeguards in place and there is none built into the legislation.

It will be an offence not to comply with this section without a reasonable cause and conviction carries a potential class C fine to a maximum of €2,500, which is another potential debt for the debtor. The debtor will be afforded the opportunity to make representations to the court on his or her own behalf, but many judgment debtors do not avail of this opportunity, given the public nature of the courtroom. The ordinary individual on the street would not have the confidence, means or wherewithal to make a case for himself or herself in court without hiring a solicitor. That costs money, money which he or she does not have in many cases. The Law Reform Commission has raised this issue. The Bill makes no reference to any service or support that might be available to debtors, particularly distressed debtors, who appear in court to support their cases on inability to pay. Opportunities have been missed here. There are two issues. The first is that there is no support for the debtor who may have to appear in court to present a case. That support might be legal or emotional, just having someone with them. Many of these debtors are isolated and living in poverty. While there are people who may default on debts, even though they can pay them, many others default because they cannot afford to pay. Those people need support and help. The issue was raised by the Law Reform Commission but it has not been addressed in this Bill.

The second issue concerns the openness of the courts' procedure and process. As Senator Ó Clochartaigh said, individuals have to give their information in a public setting and then effectively make it available to the world, which I think is wrong. There should be a different process, particularly for small debts. An opportunity has been missed to establish some kind of out of court system that would be private but which would probably yield better results for the lender than going through the public courts system. It would also cut down on legal expenses.

A process is being established here that will ultimately benefit the legal profession, which is unregulated. The EU and IMF raised that as one of the Government's failings, that is, not bringing in regulation to a shielded sector within the Irish economy. This sector will benefit from this legislation because individuals will need legal representation, but that is wrong. Small debts of up to €4,000 should be dealt with privately in a different manner outside the court setting. Both debtors and lenders would obtain better outcomes if that were so.

The Minister of State will probably read the departmental line he has been given in whatever answer is coming from on high. I must accept that but I think an opportunity has been missed in not dealing with the public courts setting. Individuals should not have to wash their linen in public and let the world see what their means are. I think that is wrong. No one should have to justify why he or she was not in a position to pay a small debt. We should not put people in that position and we would not have done so if this legislation had been drafted otherwise, with different thinking and new methods, such as what is done in Britain and other jurisdictions. We could have established a debt office to mitigate for both sides and come up with a compromise. Everyone would have benefited from that but instead we will fill the courts system again, which is already clogged up. We know the courts are working in overdrive with debt cases at the moment but this legislation will only exacerbate that, while supporting the legal profession.