Cantillon: Holding on to a higher standard

It was about as inauspicious a first day as you could fear. Barely had the Insolvency Service of Ireland opened for business than one of the 37 qualified PIPs (professional insolvency practitioners) went on radio and proceeded to undermine the process. Jim Stafford told the nation on RTÉ's Drivetime, "In practice, the PIP will also have to assess the type of house that might be needed for a professional person, such as a solicitor, accountant or a hospital consultant as opposed to a house that's needed by someone who is in the PAYE sector for example, so that, as a PIP, I would be making a very strong case, for example, that a solicitor should have a bigger house that accords with his professional status in society so that his neighbours and clients can see that, yes, this person is a good solicitor who is living in a good house."

Pressed later, he said that in a 10-minute radio interview, it was “inevitable that misunderstandings can arise and that statements can be taken out of context, which is exactly what happened here”.

Nothing was taken out of context in the extensive interview. Mr Stafford, one of the State’s most experienced insolvency practitioners, made a deeply offensive suggestion that some professionals need different standards of accommodation regardless of their financial standing. It was a significant error of judgment; that he might believe it is of greater concern.

The Insolvency Service of Ireland subsequently issued a statement saying, inter alia, “the professional standing of a borrower is not expected to be a factor in this assessment” and, later, Mr Stafford issued an unreserved apology.

The problem is that Mr Stafford is one of the most senior insolvency practitioners in the State. His own company biography notes that he “drafted the complete syllabus for the diploma in insolvency course run by Chartered Accountants Ireland” and is the sole representative of Irish insolvency practitioners on that group’s ethics committee.

Mr Stafford is correct that the insolvency system aims to keep people in their family homes where possible. Whether that person is a professional or a pauper should have no bearing on the issue. If anything positive is to come from this unfortunate episode, it is that the behaviour of PIPs will be more closely watched.