Scheme must be fair and effective for personal debt resolution

15 February 2012


The proposed new debt resolution scheme must offer a fair and effective way for those who cannot support their enormous debt burdens to deal realistically with their creditors, said legal rights group FLAC today.

While welcoming the fact that Government is finally taking action on the personal over-indebtedness crisis, FLAC said however there were some important issues not tackled in the draft legislation which the organisation planned to raise with the Joint Oireachtas Committee on Justice, Defence and Women's Rights examining the Bill today.

Speaking ahead of FLAC's presentation to the Committee, FLAC Senior Policy Researcher Paul Joyce said "there must be an independent review mechanism to guard against unfair use of a creditor veto."

He said that among the other issues FLAC will raise with the Committee are:

  • There must be proper and adequate licensing of Personal Insolvency Trustees.
  • There must be very clear and restrictive stipulations around the proposed five-year income payments order suggested at the end of the three-year bankruptcy period.
  • There must be constant monitoring and evaluation of the scheme, including provision of detailed figures on personal debt.
  • There must be proper provision for a minimum protected income.

According to FLAC's Director General Noeline Blackwell, "This scheme is badly needed to allow people swamped with un-payable debt to

Ms Blackwell continued: "In FLAC, we currently have no choice but to tell people seeking our help with their debt problems that there is nothing more that we - or they - can do, simply because they have exhausted all the existing meagre legal remedies. That simply cannot continue. If a sound legal structure which takes consumer needs into account is put in place now, future generations will not have to suffer this unnecessary pain again."


Editors' notes:

  1. FLAC (Free Legal Advice Centres) is an independent human rights organisation dedicated to the realisation of equal access to justice for all. It campaigns through advocacy, strategic litigation and authoritative analysis to contribute to the eradication of social and economic exclusion.
  2. A copy of today's presentation by FLAC to the Joint Oireachtas Committee on Justice (at 2:30pm) is available to download.
  3. FLAC has already worked with other NGOs to develop '9 Principles to overcome personal debt' last October.
  4. You can also download the entire draft heads of bill.