SENIOR GOVERNMENT Ministers will meet shortly to consider changes in the law on debt enforcement, Minister for Justice Dermot Ahern said yesterday.
Opening a conference on the subject organised by the Law Reform Commission, Mr Ahern said prison should be used as a last resort in cases involving non-payment of debt.
The Ministers for Finance, Justice, Enterprise and Social Affairs will be among those meeting to consider the issue, he said.
Mr Ahern said the Cabinet had agreed to move on some of the provisional recommendations in the commission’s consultation paper on debt enforcement, published last September, and which also featured in the programme for government.
The conference was part of the consultation process that will lead to the publication of the commissions final report next year.
“I hope the commission will bring forward some of their proposals sooner rather than later,” Mr Ahern said, appealing for its key proposals to be fast-tracked. He stressed that the Government supported the commission’s position that those who could not pay their debts should be assisted, using recovery orders and instalment orders.
He also said he was bringing forward legislation to allow individuals unable to pay fines imposed by the courts carry out work in the community, through community service orders.
The Minister also said he was considering what would be the appropriate level of fine below which imprisonment would not be an option. “I have taken measures to minimise the use of imprisonment for non-payment of both fines and civil debts. But I want to dispel the impression sometimes given that our prisons have ever been clogged up with fine or debt defaulters. This is simply not the case,” he said.
The commission’s consultation paper recommended that the law recognise the distinction between debtors who cannot pay and those who refuse to pay. And that those who cannot pay have a range of options open to them to help them deal with their debts.
It also recommended a new system of debt enforcement based on the introduction of a central debt enforcement office and the removal of most debt enforcement proceedings from the courts.
Mary O’Dea, acting chief executive of the office of the Financial Regulator, told the conference that banks needed to win back the confidence of their customers. Their boards should ask serious questions about governance, risk management, capital allocation, compensation incentives and long term strategic direction. “With the benefit of hindsight we can say we should have done things differently and could have taken earlier and stronger action to dampen credit growth,” she said.
However, she added that in the context of high levels of competition among financial institutions and the focus of the EU on opening up the internal market, it was questionable whether the Financial Regulator alone could have materially prevented the growth of the property bubble.