We come to amendment No. 40 in the name of Deputy Rabbitte. Amendments Nos. 41 and 43 are related. May we have agreement to take amendments Nos. 40, 41 and 43 together? Is that agreed? Agreed.
SECTION 4.
I move amendment No. 40:
In page 13, subsection (1), between lines 29 and 30, to insert the following:
"(b) to encourage and promote the establishment and adoption of codes of practice on matters of credit.".
On a major Bill such as this I do not think I should take up the time of the committee, not because the amendment is not important, but it is, but because the Minister seems to have tabled a fairly identical one. It constitutes a very important insertion in the Bill. I do not know where the slight difference in wording between the Minister's and mine is any more than is necessitated by the fact that she intends to insert it in a slightly different part of the Bill. But transparency and fairness in relation to the terms of credit agreements is imperative. There should be a clear set of procedures laid down for such eventualities as people being brought to court; there should be some kind of early warning system and so on. Perhaps if we heard the Minister's note it might limit debate on this section.
My amendment is essentially on the same lines calling for codes of practice to secure transparency and fairness in relation to the terms of credit agreements and the conduct of agents dealing with the consumer. Like Deputy Rabbitte, the ability of the present Director of Consumer Affairs to issues codes of practice, as far as I know, is confined to advertising. Clearly it would be to our advantage to have it extended to areas like debt enforcement, to the way in which creditors ensure people have the capacity to meet their commitments, to the way in which people bring in third parties on credit checking, a whole lot of issues related to credit, to enure the consumer would be protected by codes of practice. There is merit in this. I commend the Minister for agreeing to this amendment.
I am in agreement with the spirit of the Deputies' amendments and, obviously, with that of mine. Having studied all the amendments and thought about them I think Deputy Richard Bruton's best articulates the full spirit of what we all want here. Therefore, I am prepared to accept this amendment as being in the spirit of Deputy Rabbitte's and mine.
Do I take it that the Minister and Deputy Rabbitte will withdraw their amendments on the understanding that Deputy Richard Bruton's is the most appropriate?
Amendment, by leave, withdrawn.
Amendment No. 41 not moved.
I move amendment No. 42:
In page 13, subsection (1) (d), line 44, to delete "(d)" and substitute "(c)".
This is purely a drafting correction.
Amendment agreed to.
I move amendment No. 43:
In page 14, subsection (1), between lines 4 and 5, to insert the following:
"(f) to publish Codes of Practice setting out conduct regarding credit agreements, in order to secure transparency and fairness in relation to the terms of credit agreements and the conduct of agents dealing with the consumer.".
I thank the Minister for her approach to this matter.
Amendment agreed to.
I move amendment No. 44:
In page 14, subsection (1), between lines 4 and 5, to insert the following:
"(f) to establish a network directly or in co-operation with others, as he sees fit, to inform the public of their rights under this Act, and of the relative costs of alternative sources of loan, and to provide a forum through which the public could seek advice on appropriate redress and to mediate in respect of difficulties in loan repayments.".
Many people will have had practical experience at the coal face dealing with people getting into debt difficulties. There is a huge gap in information on the part of the public; generally speaking it is those on lower incomes, who would not have bank accounts, who are forced to source their credit in areas where credit is most expensive, where they are more liable to get into difficulties. When they get into difficulties very often it is only at the very last moment that they approach groups such as the Coolock Community Law Centre in my constituency. It will have been their experience that there is a need for a much better information network, greater accesss to alternative sources of credit. The whole approach to credit of many of the major financial institutions, the banks, is not conducive to giving access to lower cost credit to people who are proven payers of extraordinarily high interest rates and, in many cases, have proven records of paying; they do not open up their doors sufficiently to deal with such customers.
There is need to build into the Bill a provision that one of the functions of the Director of Consumer Affairs would be to ensure a proper information-imparting network. In many instances the homemaker service being operated on a pilot basis is a great step forward, although some people contend that, in some ways, they are transpiring to be elaborate debt collectors, that their position often boils down to being in the business of debt collection.
The other element of my amendment has to do with people getting into difficulties who should be able to obtain advice on how they can seek redress. There is a strong feeling that recourse to the courts to deal with these difficulties may be a mistake and that very often mediation would be a much better approach, in that it would draw in the debtor at an earlier stage, allowing a creditor to see the real position of the debtor, so that one could mediate for a solution between them, which it must be admitted very often happens in practice.
Cases go through the courts and there are all types of letters and procedures. When you get in touch with some financial institutions and draw their attention to the fact that a person is a pensioner and give details of his income they recognise that you cannot get big settlements and that mediation could be a useful approach to debt collection. My amendment may be all embracing but perhaps the Minister would see merit in accepting part of it or breaking it down. In a consumer credit Bill we should look to low income households who may not have the same access to information and put a network in place from which they can obtain information, seek redress and get some mediation on their difficulties without the intimidating armoury of court appearance.
The public information section of Deputy Bruton's amendment is important. I am less clear on how the forum and mediation service, to which he refers, would work in practice. It is important that people are informed of the new situation following the enactment of this legislation. The truth is that the people who need it most are least likely to be well informed of the protection the new legislation affords them. I do not know what contacts, if any, there are between the Director of Consumer Affairs and such citizens' advice bureau as we have. It would make a great contribution to the quality of legislation if we had a citizens' advice bureau network on a more extensive basis as it would take some of the burden of work of Members in that area. Presumably it has something to do with our clientelist political culture that we do not have such a bureau. It may be possible to have a link between the Director of Consumer Affairs and such citizens' advice bureau in terms of bringing to the notice of people their rights and entitlements under the Act. That part of Deputy Bruton's amendment would strengthen the legislation.
It is envisaged, if and when resources are allocated that there would be devolved offices of the Director of Consumer Affairs in major urban centres. Your own city, Chairman, is the first in which the Director hopes to set up his devolved office.
Is this devolution distinct from decentralisation?
Devolution and decentralisation. It is the intention to have devolved offices of the Office of Consumer Affairs in Cork, Limerick, Galway, Sligo and possibly Athlone. That would certainly help in terms of access to redress and give the Director an opportunity to inform the public, through his agents, in those offices. I agree that Bills such as this come to the notice of those who do not need the help and those who need it do not hear about them. I had a preliminary discussion with the Director on how this information will be disseminated following the enactment of the Bill, how we will inform people of the existence of the Bill, their rights under it, where they can seek redress and so on. The Director is well imbued — Deputy McDowell paid a generous tribute to him which was well merited — with the public spirit and the public good. I know he wants to let the public know about his services. We hope to establish a network directly with the Director to inform the public of their rights under this Bill and of the relative costs of alternative sources of loan. When the devolved offices are in operation there will be a right redress, advice and exchange of information and proper mechanisms will be put in place. I would find it very difficult to encompass the second part of the Deputy's amendment which seeks "to provide a forum through which the public could seek advice on appropriate redress and to mediate in respect of difficulties in loan repayments". We may be able to consider the first part of the Deputy's amendment down to the words "alternative sources of loan".
I accept that. The amendment breaks down into three parts: the first part down to the word "loan" and the second seeks to provide a forum through which the public could seek advice on appropriate redress. Under the provisions of sections 45 and 46 the Director of Consumer Affairs alone can challenge on behalf of the consumer.
That is correct.
If the Director, or someone through whom he has access, is not directly interfacing with the consumer when he is seeking advice on redress there is a real imbalance. As the Minister will be aware I will be seeking to amend that section later so that others can act on behalf of the consumer to challenge in the court unreasonable charges or unreasonable terms of credit. The public should have some type of access to the Director whereby if they consider they have an excessive charge case or an unreasonable terms case they can get advice on appropriate redress. Ultimately that would be by the Director of Consumer Affairs.
I accept that the mediation idea is outside the remit of the Director but it is an issue we should examine. When we debate the enforcement provisions of the Bill, perhaps the Minister would think about mediation but it is probably opening up a bigger field than she wishes to take on. This is probably the last time we will examine consumer credit for a decade. The Minister should give us her considered view and that of her officials on whether mediation, established in some way or other, would play a worthwhile role in relation to consumer credit. If the Minister is willing to accept the amendment down to the word "loan" I will accept that but I had hoped she would accept it down to the word "redress".
What the Deputy is seeking is already enshrined in the Director's activities but the Deputy is seeking to give it a more focused emphasis. He has the right and the duty to bring forward cases reported to him by the consumer. The drift of what the Deputy is saying is that it should also work the other way round.
He is the one who takes the enforcement action.
Yes, he is empowered to do that.
People should be able to go to him to seek advice on whether they have an enforceable case.
Anybody can go directly to the Director of Consumer Affairs. Many of his officers answered telephone queries from morning until night from consumers. The devolved system, to which I referred, throughout the country will make that process more coherent and accessible.
This is unique, in that for the first time it is giving him the right——
The Bill gives him the right to go to the various groups, societies or institutions and to give a decision on whether their claim is justifiable. I agree with the thrust of the Deputy's amendment and I am prepared to accept it down to the word "loan". The amendment would then read:
to establish a network directly or in co-operation with others, as he sees fit, to inform the public of their rights under this Act, and of the relative costs of alternative sources of loan.
We have the choice of putting the amendment or resubmitting it for consideration on Report Stage.
It would be better to move a well drafted amendment on Report Stage.
Amendment, by leave, withdrawn.
I move amendment No. 45:
In page 14, subsection (2), lines 6 and 7, after "agreements" to insert "and consumer hire agreements".
Amendment agreed to.
Section 4, as amended, agreed to.