FLAC statement: Insolvency Service of Ireland now accepting insolvency applications

9 September 2013

FLAC (Free Legal Advice Centres) has welcomed the commencement of potential debt rescheduling arrangements provided for under the personal insolvency legislation, signed into law by the President last December. The legal rights organisation was reacting as the Insolvency Service of Ireland (ISI) began accepting applications from insolvent individuals under the Personal Insolvency Act 2012 from this morning.

FLAC's Senior Policy Analyst, Paul Joyce, expressed the organisation's relief that the ISI is now accepting applications. "FLAC has been campaigning for reform of Ireland's antiquated debt and bankruptcy laws for well over a decade. These new debt settlement mechanisms are long overdue and it is hoped that they will provide a route out of debt for many insolvent people" said Mr Joyce.

"While the various insolvency provisions offered through the ISI will not be suitable for every debtor's situation, the out-of-court options of Debt Relief Notice, Debt Settlement Arrangement and Personal Insolvency Arrangement together with reforms to the bankruptcy legislation should bring about fundamental change to the way over-indebtedness is to be resolved in Ireland."

There still remains however a number of concerns about how the new system will work in practice, according to FLAC. Prominent amongst these is the potential for upfront fees to be charged by Personal Insolvency Practitioners and the lack of access to a system of publicly funded practitioners for those debtors who cannot afford such fees. The lack of any appeals mechanism for debtors whose proposals are rejected and the length of repayment arrangements are also worrying.

"FLAC has consistently stressed that all insolvent debtors need independent support in dealing with their debts right through the process and it is still unclear that this will be available" commented FLAC's Director General Noeline Blackwell. Ms Blackwell concluded by wishing the Director of the ISI and his staff every good wish with their challenging work.




Editors' notes:

  1. FLAC (Free Legal Advice Centres) is a human rights organisation which exists to promote equal access to justice for all. As an NGO, FLAC relies on a combination of statutory funding, contributions from the legal professions and donations from individuals and grant-making foundations to support its work. We offer basic legal information through our telephone information line and free legal advice through a network of 80 volunteer evening advice centres. FLAC also campaigns on a range of issues including personal debt, fairness in social welfare law, public interest law and civil legal aid.
  2. More information on the work of the Insolvency Service of Ireland is available from the ISI website.
  3. FLAC's recent releases on personal debt law reform are available in the news section of FLAC's website.