Fines Act 2010: paying fines or doing time?

Today’s Irish Times editorial says that prison is not always the answer.

ON OCCASION, popular policies are simply wrong. The practice of locking people up for relatively minor offences has been hugely expensive and largely counter-productive.

This is certainly true in the case of minor offences and non-payment of fines.

Do not pass go

The Fines Act 2010 has been signed into law by the President but will not be commenced by the Minister for Justice and Law Reform until the Courts Service is ready to facilitate implementation. The most high-profile aspect of the Act is to provide alternatives to imprisonment for non-payment of fines, but it also increases the maximum fines that can be imposed for many offences.

Alternatives to jail

It may seem bizarre to jail someone for not paying for their TV licence, although imprisonment for non-payment of fines is somewhat more complicated than that. In reality, the jail term is imposed for ignoring a court order (to pay the fine), rather than for the original offence.

Though they were not specifically required to do so in the past, District Court judges generally inquire into the financial position of a defendant before setting the level of fine and the time in which it may be paid. Someone on a low-income with a number of dependents might be given a small fine and a period of months in which to pay it. When setting the penalty, the judge sets a number of days ‘in default’: this is the period of imprisonment that will result for non-payment.

The Fines Act includes a statutory requirement to enquire into the means of a defendant and, importantly, provides for payments by instalment and alternatives to imprisonment for non-payment. This area of the law has been the subject of extensive research, including the Nexus report and the Law Reform Commission’s report on penalties for minor convictions. The main points of the new system are:

  • When convicted, the judge must take into account the defendant’s financial circumstances before setting a fine. This is known as equality of impact: the impact of a fine should not be made more or less severe as a result of the defendant’s financial circumstances.
  • If a requirement to pay the full fine by a particular date would cause financial hardship, the judge can order that it be paid in instalments. However, the full amount will generally have to be paid within 12 months.
  • If a fine remains unpaid, a receiver can be appointed to recover the fine by seizing and selling the defendant’s property. A judge can also order that a fine be recovered as if it were a civil debt.
  • A judge will now be able to order community service instead of imprisonment for non-payment. Previously, community service could only be ordered as an alternative to a prison sentence (ie. not in place of a fine).

[Update] It has been reported that the average cost of keeping inmates in prison has fallen to €77,222, a drop of 17%. However, that still works out at €212 per day in prison. Take again the example of the individual who fails to pay for their TV licence: the State loses €160 in revenue for the licence. It must then bear the cost of prosecution, which could reach a few thousand euros. Say the defendant is punished at the extreme end of the scale, receives the maximum fine of €1,000 and is jailed for 10 days for non-payment.

Not including the cost of prosecution, the State is at a loss of €3,280. With the cost of prosecution included, the full cost will be around €5,000. In 2009, 60 people were jailed for this offence and 3,500 were jailed in total for non-payment of fines. Obviously, there is a financial incentive for using the alternative provisions of the Fines Act in future.

Penalty fines

The Act also contains a more straightforward system for setting the maximum fines for offences. From now on, all new legislation  covering minor offences (ie. on summary conviction) must categorise the fine in accordance with the Act. Until now, each individual penalty fine has been set in the relevant legislation as a punt or euro amount and, if the level of the fine was to be changed, it had to be done individually for each specific offence.

The Fines Act sets out a new system of categorised fine for minor offences:

  • Class A: maximum fine of €5,000
  • Class B: maximum fine of €4,000
  • Class C: maximum fine of €2,500
  • Class D: maximum fine of €1,000
  • Class E: maximum fine of €500

Existing offences are retrospectively classified. This could lead to significant increases in maximum fines for old offences that have not been amended in recent decades. Fines for more serious offences will also be increased by a multiplier: for example, a fine for a serious offence set between 1965 & 1975 will be multiplied by 10.

Here are two examples, albeit by reference to relatively obscure offences:

  • The offence of indecent exposure carries a maximum fine of £500 (€634.87). Under the Fines Act, that will become €1,000.
  • It is an offence to make a false statement when applying for a lottery licence or permit, punishable by a fine of up to £100 (€127). Under the Fines Act, the maximum penalty will be €2,500.

These examples illustrate that the increase might be of a few hundred euro, or a few thousand. If there is a Class A offence out there that has not been updated since 1914, the maximum penalty could go from around €100 to €5,000.  The explanatory memorandum (from when the Act was at bill stage) says that the increases

will not represent a real increase in the amount of the fine, it will simply maintain its value and ensure that the intentions of the Oireachtas when passing the legislation are respected.

The latter part of that sentence may be true but the increase will be very real for someone convicted under an old piece of legislation.

Nevertheless, the new system of fines is practical as the classes of offences can be changed without the necessity of amending every piece of legislation on the books. In addition, lawyers and judges can now refer to penalties by class, rather than having to remember or keep note of a wide variety of maximum penalty for different offences.

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