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Insolvency quango backsliding already

THINGS are not looking too good at the new Insolvency Service of Ireland (ISI) and the organisation has yet to open its doors.

On Tuesday, the ISI was backtracking on an interview with Bloomberg (where things are also not looking too good for other reasons) which quoted new boss Lorcan O'Connor promising to pursue and prosecute borrowers fraudulently seeking debt forgiveness.

In a normal country with an honest debate on debt forgiveness, the promise by the head of a quango to implement the law would not make headlines.

Back in Ireland where we must all pretend that omelettes can be made without breaking eggs, Mr O'Connor's comments caused something of a storm.

The most disturbing part of the interview was Mr O'Connor's assertion that "it's incumbent on the service to ensure we are strict and protect the integrity of the 99pc of cases that are genuine".

Can anybody really believe that only 1pc of those not paying their mortgages are strategic defaulters? Should Mr O'Connor (right) allow himself to jump to that sort of conclusion?

Clearly he has a completely different view of things to Bank of Ireland which appointed 1,100 rent receivers to stop landlords stealing money from tenants which should go to the banks. While it is impossible to say whether Professor Gregory Connor's figure of 35pc is accurate, it is surely closer to the mark than Mr O'Connor's.

This is only the latest back-sliding from the ISI since it was finally created a few weeks ago. Mr O'Connor has already let it be known that, in some cases, he will allow those looking for debt relief to continue paying for private health insurance.

This means that the two million people who choose not to jump the queue when it comes to access to doctors and equipment will be forced (once again) to subsidise not just the other two million queue jumpers but the small minority of those queue jumpers who claim they are unable to put a roof over their heads.

The ISI is a grand experiment without parallel. It may yet come good. It is certainly easy to carp from the sidelines rather than come up with solutions to the debt crisis.

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But the grandeur of an experiment should not blind us to the reality that it is also a very risky gamble. Every time the provisions in the legislation are watered down by politicians, or officials like Mr O'Connor, the gamble gets even riskier.


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