asked the Minister for Communications the total contribution made to the Exchequer by Telecom Éireann since vesting date 1 January 1984; and the agreed arrangement for the repayment of capital up to 1990.
Ceisteanna—Questions. Oral Answers. - Telecom Éireann Exchequer Contribution.
10.
Payments into the Exchequer since vesting day amount to £256,972,782 including special payments of £157,600,000 under arrangements agreed with the company. In the period up to 1990 the company will make further payments totalling £66,211,375, including special payments of £50,527,767.
The company will receive full credit against their liability to the Exchequer for these special payments according as they are made, the payments being fully allowable in the capital balance for the purposes of calculating interest chargeable. In addition after 1 December 1987, these payments will be allowable against interest payable.
Essentially in agreement with the board, the cash receipts from revenue arising from the Exchequer debts, payable over a 15 year period, have been condensed into a four year period with full allowance being given to the company for making the early payments.
Is it appropriate that Telecom Éireann should go into debt to pay off Government loans? Does it not mean that Telecom Éireann are in a sense another tax gathering agency for the Department because the charges and levies imposed on the board over such a short period have created enormous difficulties for that concern? Will the Minister agree that those difficulties have resulted in the board having to increase charges and have led to a poorer service? Is the Minister aware also that the board have to borrow to pay off the Government?
That is not a question; it is a comment.
Does the Minister feel that the charges on Telecom Éireann by the Government are excessive?
No. On the contrary I understand that the agreement works to the advantage of the company. The Deputy should bear in mind the background to this. At the meeting which set up BTÉ on 1 January 1984 a debt of £745 million was due to the Exchequer for telephone capital. A total of £305 million of this was annuitised over 15 years and the balance of £440 million was converted into equity, the equity to be converted by dividend payments. As far as the annuity is concerned I should like to state that in 1985 agreement was reached between the company and the Minister for Finance whereby special payments of £208 million over four years would be paid by the company. The company are receiving full credit for these payments and since they are allowable off the capital balance for the purpose of calculating interest chargeable BTÉ are not being imposed on.