Ivana Bacik

Second Stage (7th July 2009)

Senator Ivana Bacik: I thank Senator Quinn for sharing time with me. While I welcome the debate on this legislation, I concur with the criticisms expressed by Senators Regan, Quinn and O’Donovan regarding the brief time provided to debate this important Bill. It is a terrible shame that the House is rushing through all Stages in one day, given the significant impact the Bill will have on many people.

I have called many times for a debate on prison policy and noted also that far too many

people are being locked up in prison for minor offences. This legislation relates to persons who are being locked up despite not being convicted of offences under the criminal justice system. As Senator Quinn pointed out, 272 people were imprisoned last year for civil debts, that is, non-payment of debt. He also helpfully added that Ireland’s approach to this issue has been criticised at international level.

I am concerned that the Minister of State’s figures show that in the first six months of this year alone, 186 people were imprisoned for an average period of 20 days for non-payment of debts. Three weeks is sufficient time for a person to lose his or her job. Further, the person’s children could be sent into care and mortgage and other debts will mount up during the incarceration period. As other speakers noted, matters can only get worse in the current circumstances as more and more people find themselves unable to pay their debts and ultimately face the threat of imprisonment, even with the undoubted improvements offered by the Bill.

I am grateful to the free legal advice centres for their briefing and the report, To No One’s Credit, published this week on recommendations for change. As FLAC pointed out, while the Bill contains welcome changes necessitated by the McCann judgment, it does not go far enough in that it still contemplates imprisonment as a sanction for debtors. Although it will improve the current position, it is akin to placing a sticking plaster to an open wound, namely, our shameful policy of continuing to imprison people because they cannot or do not pay their debts.

FLAC, in its comprehensive report, suggests that we move towards the removal of imprisonment as an option in debt cases and instead employ effective non-penal remedies to enforce compliance with civil debt judgments. Senator Regan and FLAC proposed that attachment of earnings legislation be considered as an alternative solution. Other methods, including sanctions available on the criminal side, such as community service orders, could also be employed. There is no reason imprisonment must be used as a sanction in these cases.

Many of us are uncomfortable about moving those who owe civil debts into the criminal system. While we all accept that sanctions must be available, it is the nature of the sanctions that must be examined. The sanction of imprisonment is, as I have outlined, counterproductive because people who are imprisoned can no longer earn money to repay debts they may owe and their position is likely to worsen while they are in prison. They may, for instance, lose whatever employment they have or their children may be taken into care.

It is extraordinary that the comprehensive reform of the debt repayments system promised by the Minister has not been undertaken in the 69 years since the passing of the Enforcement of Court Orders Act in 1940. This was at the start of the Second World War. It is also extraordinary that the House will rush through criminal justice legislation in a matter of hours when it has taken us nearly seven decades to come to some overall reform of the system.

I welcome the fact that the Law Reform Commission is working on this issue and will

produce a consultation paper on debt enforcement. We know much of what will be in that paper and, from the work done by FLAC, we know much of what is happening. As I indicated, more than 200 people were imprisoned last year, a figure that appears likely to double this year given that 186 people have already been imprisoned for an average of three weeks in the first six months of 2009. We are aware of the problems that exist and that the system is not working. We should, therefore, seek to improve the system and move away from criminalisation.

The Bill includes many welcome measures. Unfortunately, while it appears it will at least reduce the likelihood of imprisonment of a debtor in his or her absence, figures on the problem are lacking. The Courts Service estimates that only one in five debtors takes part in debt enforcement proceedings. I have been present in District Courts where committal orders were made in the absence of the debtor. While this may not occur as a matter of routine, under current circumstances judges regard this course of action as the only option available to them. The figure I provided is an estimate from the Courts Service. FLAC has pointed out the need for statistics to be gathered on the number of committal orders granted, and on the percentage of debtors who attend, fail to attend or have legal representation. We simply do not have those data, but we can certainly estimate that a small number of debtors are currently involved in the courts process. To have debtors criminalised in their absence is, as the High Court has found, a serious flaw in the current system. It is welcome that measures will now be put in place to ensure it is more likely that debtors will appear in court.

I have tabled an amendment suggesting that the court summons should include information in ordinary language for debtors explaining that they may a seek a variation of an existing instalment order at the hearing they are required to attend. It should also provide information, in ordinary language, of the consequences of not appearing at any future committal hearing and the possibility of variations being granted at those hearings. The amendment is based on a wording that FLAC has proposed and deals with the serious problem where debtors are not appearing in court. It is to ensure relevant information is provided to them at the earliest stage. I am conscious that in subsection (5) the Bill provides that the information will be given by the judge where the debtor is arrested and brought before the District Court, but that is too late. According to FLAC, that information should be provided then, but should also have been provided at an earlier stage. I urge the Minister of State to consider accepting something like the amendment I have proposed. Its wording may not be the most elegant, but something to the same effect should be accepted to ensure the debtor is provided at an early stage with information as to the consequences of a failure to appear at that early stage, and the possibility of seeking variations. It appears to FLAC, and it is clear from the evidence we have, that people are simply not clear as to what procedure is being instituted when a committal summons is made. I would like the Minister of State to deal with that amendment in his response.

We need to move away from criminalisation. I am slightly concerned at the altering of the onus of proof. It is certainly welcome to see that the creditor must now establish the reason for the debtor’s failure to pay instalments — that it must not have been due to wilful refusal or culpable neglect. That is welcome but I am slightly concerned about the insertion of a criminal standard of proof. We should instead be moving away from the criminalisation of this area rather than towards it. On Committee Stage I will also address the amendment we have just seen concerning a new section 9, which provides that a Minister may consult a judge. I have some concern about the appropriateness — indeed, the constitutionality — of that procedure given that the judicial function is spent, in a criminal sense, once sentence is passed. I accept that is not quite the case here, however. FLAC has suggested that if we are to criminalise in this way, at the very least debtors should have some possibility of remission on a sentence. There are a number of issues that need to be dealt with, but the better approach would be to move away from the criminalisation that essentially is still at the heart of this Bill. That is why I will be opposing the Bill.

 Report and Final Stages (8th July 2009)

Senator Ivana Bacik: I second the amendment. We debated this issue at length on Second Stage, and I spoke in support of it. Having read Ms Justice Laffoy’s judgment several times, especially the relevant passage at pages 81 to 82, it is clear she is of the opinion that the proportionality test in Heaney v. Ireland can only be fulfilled where there is provision for some type of attachment of earnings procedure. She points out that to be proportionate, any legislative scheme allowing for a person’s imprisonment must impair his or her constitutional right to liberty to the least possible extent. She further states that where a debtor has some resources, some means of paying the debt, but there is no provision in legislation for a scheme of attachment of earnings, the system proceeding directly to imprisonment, then the debt enforcement system is disproportionate because it does not ensure the constitutional right to liberty is impaired as little as possible.

Senator Regan has expressed this well in amendment No. 1. It is a complex and detailed provision which refers to the need to ensure there are protected earnings rates and protected welfare rates for attachment of earnings and welfare orders. This is something to which Ms Justice Laffoy referred, namely, the need to safeguard a minimum standard of living for the debtor. All these safeguards are included, but the key principle the amendment seeks to address is that without some type of attachment of earnings scheme, the legislation will be regarded as disproportionate and may, therefore, be found unconstitutional in the way the regime provided for in the 1940 Act was found constitutional in the Caroline McCann case.

The Minister of State, Deputy Curran, indicated yesterday that in the first six months of this year, 186 people have already been imprisoned for non-payment of debts. We should also be mindful of the human stories of those imprisoned. I related some of the pertinent background information about Caroline McCann yesterday who owed money to the credit union, as referred to in the Laffoy judgment. As I said, she is a single, unemployed mother of two who left school at age 14, lives in social housing and has a history of alcohol abuse and psychiatric illness. That is the reality for many debtors who face court proceedings. It may not have benefited Caroline McCann but some type of attachment of earnings regime should be inserted in the legislation to ensure there is a halfway house safeguard so that a judge does not proceed straight to imprisonment when confronted with a debtor who has not made repayment.

(Further Debate in the Chamber)

Senator Ivana Bacik: I am very grateful to the Minister for accepting my amendment from yesterday and acknowledging that in his speech. I put the amendment on Committee Stage last night and we voted on it. The Minister of State, Deputy Curran, indicated he could not accept it but I am delighted there has been a change of mind overnight and that it has been accepted. This is an important principle and I am very grateful to the free legal advice centres for advising us all in a briefing paper of the need to ensure information is provided at an early stage to a debtor of the consequences of a failure to appear and of the possibility that a variation could be made to an instalment order. We had a lengthy debate on that last night.

I am delighted the Government has accepted the amendment I proposed and the principle behind it. Its wording is more elegant than mine was, given that mine was rather rushed, however the basis of it is the same. At paragraphs (c) and (d) the new provisions ensure the summons served on the debtor at the first stage in the process will provide information to the debtor in ordinary language of the options available to the judge of the District Court under subsection (7) at the hearing of the summons.

The policy behind this legislation, with which we all agree, is to ensure a higher number of debtors appear before the court and that they are encouraged to appear before the court with a view to escaping imprisonment and ensuring there is some payment of the debts owing to the creditors. I did not see there was an issue of balance and it seemed entirely appropriate that debtors would be given all the information at the earliest stage in ordinary language about the nature of the District Court hearing and that this would encourage them to attend.

Fewer than one in five debtors engage with the court process, according to Courts Service statistics, so it is in the interests of debtors and creditors and the public good that they are encouraged. The summons should also state that the debtor may be arrested if he or she fails to appear before the District Court. That was already in the legislation and it is very important. The amendment put forward by Senator Alex White, that there should be provision for the judge of the District Court to direct otherwise and by personal service, was also accepted.

I very much welcome the Minister’s acceptance of my amendment. I am delighted the carrot will be incorporated into the summons as well as the stick. It is important we have it in the legislation. The Minister of State, Deputy Curran, indicated yesterday that an information leaflet might be provided but it is far more important that the information is there in the summons for a debtor to see very clearly at the earliest stage possible. Hopefully we will see more debtors appearing before the court and engaging with the process.

The FLAC report that came out this week points out that the sanction of imprisonment should be removed immediately for those who are unable to pay their debts, and this Bill addresses that in a very welcome way. To nobody’s credit, FLAC also recommends the State should move towards the removal of imprisonment as an option in debt cases and should look instead at effective non-penal remedies to be employed for non-payment of debts, not just where people are unable to pay. That is the broader reform I would like to see, and this Bill, unfortunately, does not address that. While it is very welcome in that it ensures, as far as possible, that people are not imprisoned for inability to pay, it still allows for people to be imprisoned for non-payment of debt.

Having said that, I am delighted to have my amendment accepted. I am delighted debtors will henceforth be given information in ordinary language in the summons about the options available to the District Court judge at the hearing of the summons. That is a very important and welcome improvement to the Bill.

Ms Justice Laffoy describes it as disproportionate and in breach of the constitutional right to liberty to lock up a person for non-payment without first checking whether there is some mechanism for attaching their earnings and income. That halfway house measure must be possible to satisfy the constitutional test of proportionality. This is the only possible interpretation in reading the Laffoy judgment. I do not see how else one can fulfil the Heaney test of proportionality. As we all acknowledged yesterday, the Bill provides for very welcome improvements in the current regime for enforcement of debts and will certainly make it less likely that debtors will be imprisoned. However, a careful reading of the judgment in the McCann case points to the requirement that as well as providing safeguards to ensure people are imprisoned less easily for non-payment of debts, a halfway house scheme must also be introduced whereby some attachment of earnings mechanism may be used by a judge before proceeding to the last resort of imprisonment. If the system does not allow for that halfway house, it allows for the imprisonment of people in a way that is disproportionate and which impairs the constitutional right to liberty.

In my amendment I had said the information that should be provided in ordinary language was that the debtor could seek a variation of an existing instalment order. This is fuller, and it emerged during the debate last night that all the options available to a judge at the hearing of the summons should be outlined to the debtor in ordinary language. The Minister had expressed the view that it might be unbalanced to tell the debtor about the possibility of a variation application. I contested that and said I did not see why the debtor would be told of the sticks, the possibility of arrest and imprisonment, but not the carrots, the possibility of variation and mediation.