Mary White (Fianna Fail)
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The matter I raise relates to the imprisonment of people because of non-payment of debt. This issue was first brought to my attention by Ms Esther Lynch, the legislation and public affairs officer of the Irish Congress of Trade Unions, and I subsequently received help from Mr. Paul Joyce, one of the drivers of change of this legislation.

Imprisonment for non-payment of debt is governed by the enforcement of the Court Orders Act 1926, as amended in 1940, and is the culmination of a long-drawn-out process in which the debtor often plays little or no part. It begins with the service of legal proceedings which the debtor rarely if ever defends, as the fact of the debt is not contested. As a result, there is no court hearing, and the creditor enters summary judgment by filing the appropriate papers in the relevant court office.

Although the debtor is informed of the judgment, it may take some months before any enforcement action is taken. One of the most common methods of enforcement to recover the debt is the instalment order procedure. This involves the debtor being summoned to send in his or her details of income expenditure in advance of having his or her means examined in open court on a specific date.

Given that debtors are often in poor financial circumstances, with multiple debts, and because the hearing is held in open court, debtors rarely attend. This often results in an instalment order being made for an amount of money which the debtor cannot afford. Failure to meet the terms of that order may lead to a committal summons being served on the debtor, who is then imprisoned.

In this day and age, that is archaic legislation. The procedure is flawed first because it fails at an early stage to establish the financial position of the debtor, taking into account all of the person's debts. A debtor's debt should be examined in totality, not on a case by case basis. The procedure takes place in public, which is guaranteed to ensure that the debtor does not appear. Further, it fails to take into account the stigma associated with debt, and the stress, panic and shame which many people feel in such a situation. To involve a criminal sanction which is totally inappropriate for a civil matter and impacts adversely on the debtor and his or her dependents, is extremely costly, with no return for the State. It also does not benefit the creditor.

Nobody benefits from the imprisonment of an individual for the non-payment of debts. Not only is the debtor temporarily precluded from any chance of repaying, because he or she cannot earn money while incarcerated, but the serving of warrants and imprisonment of individuals for non-payment of debts is a waste of taxpayers' money, prison space and Garda time.

How many people are currently in prison for non-payment of debts? The free legal aid unit within ICTU has requested that the Minister for Justice, Equality and Law Reform set up a high-level committee to look at the reform of this archaic legislation and take into consideration consumer pressures and demands, and the spending and borrowing by consumers in the 21st century.

Dick Roche (Wicklow, Fianna Fail)
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As and from 5 May, there are two prisoners, one male and one female, in Irish prisons for the non-repayment of debt. Senator While will be aware that a person committed to prison as a result of the non-payment of a civil debt is committed for failure, through wilful means or default or culpable neglect, to obey an order of the court. Before the court makes such an order, it would have to go through an extensive procedure involving an instalment order and finally a committal order.

This is a mechanism for enforcing the court's instalment order. The threat of imprisonment can be effective and many debts are paid off when the prospect of imprisonment looms. Persons committed to prison for non-payment of debts do not qualify for remission of sentence under the rules for the government of prisons.

It cannot be presumed that all persons failing to meet their debts do so because of poor financial circumstances. Imprisonment is only used in cases where the courts are satisfied a person has the ability to discharge a debt but has not done so. In many cases, when a person committed for failure to pay a debt or fine is faced with the reality of imprisonment, he or she makes the payment.

A number of issues have been raised in this context. One argument, for example, is that attachment orders might be used as an alternative to imprisonment. However, attachment orders do not always work. An attachment of earnings order has a role in the case of an offender who has a salary and who thinks that it would be cheaper to spend a few days in jail than to pay a civil debt. However, those circumstances do not exist in all cases.

Senator White is correct regarding the pressures of modern society and the extraordinary availability of consumer credit. Consumer credit is a fact of life in our society but, unfortunately, many in our communities experience the down side of over-extending their borrowing arrangements or get into difficulties because there has been a change in personal circumstances, such as illness. The Government has paid attention to dealing with these cases. The Money Advice and Budgeting Service, MABS, provides a crucial service for people who require help and advice in making their way out of serious debt. The Government has made significant financial resources available to the service in 2005 — the figure for this year is in excess of €13.6 million. The seriousness of the problem is highlighted by the fact that MABS sees more than 16,000 new clients annually and has more than 30,000 clients on an ongoing basis.

The approach adopted by MABS offers a better way of achieving a result acceptable to both creditor and debtor. However, while MABS gives practical finance and budgeting advice and practical assistance in helping to engage with creditors, it does not pay debts. It simply helps people through the process. District Court judges recognise the work of MABS and in some instances they recommend that people who are before the courts avail of the service. It is, however, often difficult to persuade persons in debt to engage in the process. Sadly, some people leave their debts until they reach the point, as happened in the two cases I mentioned earlier, where imprisonment looms. The willingness of a debtor to manage his or her case is crucial and seeking expert advice is the best way forward if there is to be a successful resolution to the problem of indebtedness.

The number of persons in custody at any time for non-payment of debt reflects the fact that imprisonment is a sanction of absolute last resort. As I mentioned earlier, there are only two prisoners serving sentences for failure to pay debts, which represents 0.5% of the prison population. The role of the Department of Justice, Equality and Law Reform is that of implementing the order of the court as custodian of the person concerned for the duration of his or her sentence — nothing more and nothing less. It does not have a role in operating a debt management service. However, the Government has given particular attention to this issue and the Minister for Social and Family Affairs, in particular, has had much to say on personal debt recently.

There are procedures in place for people who find themselves in difficulties and people would be well advised to use them. While as much assistance as possible is available through MABS and financial institutions, a small number of people in debt are often reluctant to engage in the process, despite their situation, and that must be recognised. However, the imprisonment option is one of in extremis and it follows a very lengthy process. People are given opportunities but sadly there are vulnerable people who fall through the cracks. Imprisonment is a punishment visited only at the end of a very lengthy process and is the final, rather than the first, solution.