The Report and Final Stages of the Gas (Interim) (Regulation) Bill, 2001, are to conclude at 6 p.m. if not previously concluded.
Gas (Interim) (Regulation) Bill, 2001 [ Seanad ] : Order for Report Stage. - Gas (Interim) (Regulation) Bill, 2001 [ Seanad ] : Report Stage.
I move amendment No. 1:
In page 5, between lines 19 and 20, to insert the following:
3.–Notwithstanding any other provision of this Act, the Minister shall not make an order appointing a day to be the appointed day for the purposes of this Act until legislation has been enacted providing for –
(a) comprehensive accountability of the Commission and other public enterprise regulators to the Minister and to Dáil Éireann, and
(b) the transfer of any share (other than one owned or to be owned by or on behalf of employees) in the Board and in other public enterprise utilities to a public sector holding company.”.
We had what could be described as a major debate on this issue on Committee Stage. I thought it would be correct to table the amendment again on Report Stage. The Bill should not proceed beyond this point because we have not thought it through. I am not blaming the Minister in particular in that regard, but the House has not thought through the effect of transferring authority from the House and the Minister, who is accountable, to regulators who are I feel are not accountable. We have not got the capacity to make them accountable.
(Mayo): As Deputy Stagg said, we divested a huge amount of our own powers of scrutiny and the powers of Parliament to agencies that are absolutely unaccountable. While, on the surface, the principle of regulation is good in terms of ensuring a fair, open and competitive marketplace, we have given away all our responsibility in respect of our overview and oversight functions and the absolute necessity for people to be accountable in respect of their actions.
We have three regulators. We have the Office of the Director of Telecommunications Regulation and we had the experience, rather early on in the term of office of Ms Doyle, of her refusing to come before a committee of this House when asked to do so. She did so only after a great deal of persuasive arm twisting. Ultimately, when regulators come here, they come here as a matter of courtesy.
We had the Commission for Electricity Regulation – CER. This Bill will extend the powers, scope and remit of the regulator, Mr. Tom Reeves. Again, when Mr. Reeves comes before the committee of the House to answer, as he is obliged to do, he does so as a matter of courtesy and he is not open to the powers of persuasion or any kind of amendment that we may put forward in respect of policy issues.
Mr. Bill Prasifka is in charge of looking after the management of the whole airline sector. When the Aviation Regulation Bill was passing through this House, we predicted that a major problem would arise in respect of how airport charges would be fixed. Both the Labour Party and Fine Gael tabled amendments and proposed, supported and justified them very doggedly. We said a major problem would arise in regard to airport charges and we were proven right. For some reason, best known to himself, the regulator for the aviation sector has decided to pitch the airport charges for Cork and Shannon airports at ridiculously high levels way above those being charged for Dublin airport. It is manifestly wrong and unjustifiable.
There is a throughput of 14 million passengers per year in Dublin airport. The prediction is that it will blossom by another 5 million to 6 million in the next three to four years, bringing the throughput to 20 million. The figure relating to Shannon airport is 2 million and that relating to Cork airport is 1 million. How anybody can justify pitching the charges for Dublin airport, which has a huge volume of passengers and is barely able to cope with the capacity, at a lower rate than those in Shannon and Cork airports is questionable. Shannon airport was hit hugely by the events of 11 September and the misfortunes of Aer Lingus. To pitch the charges of that airport at a scale much higher than Dublin airport is beyond comprehension.
Hear, hear.
(Mayo): What Deputy Stagg said is correct. There is a need to look at the legislation and the next Government will have to do so. We have given away far too much power to the Environmental Protection Agency, the National Roads Authority and the regulators I have instanced here in the House. Deputy Stagg has a very strong case. The matter will certainly have to be revisited by the next Government, whatever the composition of that Government may be.
I empathise with what Deputies Stagg and Jim Higgins have said, particularly with regard to giving away our powers in this House. I do not think there are many colleagues in the House who would disagree with those sentiments. Deputy Stagg, who tabled this amendment, articulated those points very forcefully and at length on Committee Stage. My problem is that the amendment before us would have the effect of delaying the coming into effect of the provisions of this Bill for a considerable time, perhaps indefinitely. I have already explained the reasons for the urgency in introducing the Bill at this time.
I do not believe the amendment is an appropriate way to address the issues being raised. The removal of any possible conflict between the Minister's role as regulator and shareholder in Bord Gáis Éireann has to be achieved. The establishment of independent regulation achieves this, while at the same time promoting confidence in the market. That latter point is important.
The Deputy's amendment addresses two general issues – accountability of the commission and other regulators and the State's shareholding in Bord Gáis and other State-owned utilities. These issues are far broader than the scope of this Bill. This Bill is not the appropriate forum for dealing with them.
This Bill seeks to deal with matters that need to be addressed urgently and expeditiously. The framework established by this Bill and the Electricity Regulation Act, 1999, ensures adequate and effective accountability on the part of the commission. This accountability is achieved by the obligations on the commission in regard to the publication of its annual report, the audit of its annual accounts by the Comptroller and Auditor General and its ability to answer to the appropriate Oireachtas committee.
The issues raised by Deputy Stagg, supported by Deputy Jim Higgins, ought to be dealt with in a fashion that addresses in a general way and simultaneously the regulatory frameworks for all sectors, as well as other related issues such as the proper resourcing of Oireachtas committees. I am aware of the reservations that exist in regard to certain aspects of the consultation on regulatory reform recently initiated by the Taoiseach. I am of the firm view that this is the correct forum in which to address these matters.
On the question of shareholding, the idea being put forward of having a public holding company that would act as shareholder of all State utilities is interesting. I certainly agree with Deputy Stagg in that regard. However, the effect of the proposed amendment in delaying the transfer of regulatory responsibility for the gas sector to the commission until such time as this holding company is set up is problematic. The delay would only have the effect of continuing in existence the conflict of interest between the Minister's function as regulator of the gas sector and shareholder of Bord Gáis that this Bill is designed to address. For those reasons, I cannot accept the amendment.
In respect of the amendment before the House, during the earlier stages of this Bill I spoke about my disappointment regarding what we are allowing to happen in this House. The Minister of State will agree that the degree to which power is being taken from this House and therefore from the people is alarming. I am taken aback by what we are allowing to happen. No sane government would allow so much power to be removed from the parliament. Ms Etain Doyle is the regulator of telecommunications, Mr. Tom Reeves is the regulator of electricity, Mr. Bill Praviska is the regulator of aviation and Mr. Michael Tobin is chief executive of the National Roads Authority. I have attended a number of meetings on the question of roads where the people asked their public representatives to make sure a fair balance is struck when new roads are built. When a public representative or an election candidate is forced to admit he or she has no power in this regard the people begin to wonder if they are living in a democracy.
Ms Etain Doyle was asked to appear before a committee of this House. She eventually came, but very reluctantly. The power of the House, which comes from the people, is vested in the Department and the Department must continue to have some say.
The Government is proceeding with the new national stadium. The money being spent on Sports Campus Ireland amounts to a monumental mess and is costing the taxpayers a fortune. Today's proceedings of the Committee of Public Accounts is even more laughable. The Tánaiste has said no decision will be made on the so-called Bertie Bowl until after the next general election. If the Tánaiste and Taoiseach return to power—
This matter cannot be discussed during this debate.
If the Taoiseach wants two Bertie Bowls the Tánaiste will willingly agree. Power is being taken away from the representatives of the people. The Minister for Tourism, Sport and Recreation may say corners were cut or that a certain individual lacked caution but a debate on this matter is not allowed in the House.
I agree with what Deputy Stagg said recently with regard to the regulator of electricity. Decisions are already being made by Bord Gáis with regard to the areas to be served but I presume the regulator will make such decisions in the future. For a long time I have campaigned for a gas supply to Birr, Tullamore, Clara, Portlaoise, Portarlington and Edenderry in counties Offaly and Laois. Bord Gáis has announced it will provide gas in Clara and Tullamore, and I welcome this. However, if the Minister retained power I would be able, in the future, to go to his office and to make a case on behalf of a particular town. Public representatives and the people they represent could, after carrying out the necessary research, make such representations but it is unlikely such representations could be made to a regulator. The people and their representatives will be kept at arm's length. Our letters will receive a standard acknowledgement stating their contents have been noted we will await replies in saecula saeculorum.What is happening is wrong. The Minister should retain the power to make decisions. I hope the next Minister and his officials will ensure gas is provided, not alone in Clara and Tullamore but also in Birr, Edenderry and Portarlington. There have been major job losses in Birr and I am particularly interested in the provision of a gas pipeline or spur to that town. I call on the Minister to provide that.
What Deputy Stagg said is common sense. I fully agree with him and I support his amendment.
May I respond?
The Deputy may use the two minutes reserved for his response.
Thank you. I will use them now.
I sense empathy, sympathy and almost support for my proposal to hold off from doing any more until we have thought through matters. We are rushing like lemmings over a cliff and it will be too late to reverse if we do not call a halt now. I am satisfied the Minister is accountable within the democratic system and I am not satisfied the regulator, to whom we have transferred the Minister's power, will be so accountable until we have given this matter more consideration.
The Minister of State says he is taken with the idea of a holding company holding the shares of State companies. This is very interesting and I am delighted to hear it. If that were done the Minister could remain as regulator because there would be no conflict and this Bill, which transfers the power given to us by the people out of this House, would not be necessary.
Amendment put and declared lost.
(Mayo): I move amendment No. 2:
In page 5, between lines 39 and 40, to insert the following:
"6.–The Act of 1999 is amended, on the appointed day, in the Schedule thereto–
(a) by the insertion of the following paragraph after paragraph 14–
‘14A. The Commission shall, following consultations with the Minister, draw up a code of conduct in respect of controls on staff interests and ethical behaviour to apply to each member of its staff and shall publish any such code of conduct.',
(b) by the insertion of the following paragraphs after paragraph 42–
‘42A. (1) On his or her offer of appointment, each member of the Commission and each consultant and adviser shall make a declaration in writing of his or her interests to the Minister in such form as the Minister, following consultation with the Minister for Finance, may specify.
(2) A person to whom subparagraph (1) applies shall, throughout the tenure of his or her appointment, amend and update his or her declarations of interests as required by the Minister or the Commission, as the case may be, in respect of any changes in the interests held by the person.
(3) (a) A statement of the interests declared under subparagraph (1) shall be made public following the making of the declaration and any subsequent change in a declaration shall also be made public.
(b) The form and content of the statement to be publicised shall be agreed between the Commission, the Minister and the Minister for Finance.
(c) Notwithstanding subparagraph (3)(b), it shall not be necessary to specify in a statement in such report the amount or monetary value of any interest.
(4) Where a person to whom subparagraph (1) applies, fails to make a declaration in accordance with that subparagraph, the Minister shall decide the appropriate action (including removal from office or termination of contract) to be taken.
(5) In this paragraph "interests" includes–
(a)shares in, bonds or debentures of, or other like investments in any undertaking related to the gas or electricity industries where the aggregate of such holdings exceeds €10,000,
(b) a directorship or shadow directorship (within the meaning of the Companies Acts, 1963 to 1999) in such an undertaking held currently or during the previous two years, or
(c)gifts of travel, holidays, transport, money (in excess of €500) or other benefits, including benefits from any beneficial interest in or connected with such an undertaking, during the previous two years which were received by the person being appointed or by his or her spouse.
42B. (1) Where a member of the staff of the Commission or a consultant, adviser or other person engaged by the Commission, has a pecuniary interest or other beneficial interest in, or material to, any matter which falls to be considered by the Commission he or she shall–
(a) disclose to the Commission, or where there is only one member of the Commission, that member shall disclose to the Minister, the nature of his or her interest in advance of any consideration of the matter,
(b) neither influence nor seek to influence a decision in relation to the matter,
(c) take no part in any consideration of the matter,
(d) if he or she is a member of the staff of the Commission, withdraw from the meeting for so long as the matter is being discussed or considered by the Commission and shall not vote or otherwise act as such member in relation to the matter.
(2) For the purposes of this section, but without prejudice to the generality of subparagraph (1), a person shall be regarded as having a beneficial interest if–
(a) he or she or any member of his or her household, or any nominee of his or her or any member of his or her household, is a member of a company or any other body which has a beneficial interest in, or material to, a matter referred to in that subsection, or
(b) he or she or any member of his or her household is in partnership with or is in the employment of a person who has a beneficial interest in, or material to, such a matter, or
(c) he or she or any member of his or her household is in the process of acquiring land or property to which such a matter relates.
(3) For the purposes of this section, a person shall not be regarded as having a beneficial interest in, or material to, any matter by reason only of an interest of his or hers or of any company or of any other body or person mentioned in subparagraph (2) which is so remote or insig nificant that it cannot reasonably be regarded as likely to influence a person in considering, discussing or voting on any question with respect to the matter or in performing any function in relation to that matter.
(4) Where a question arises as to whether or not a course of conduct, if pursued by a person, would be a failure by him or her to comply with the requirements of subparagraph (1) the question shall be determined by the Commission or, where there is only one member of the Commission, in the case of that member, by the Minister.
(5) Where a disclosure is made to the Commission particulars of the disclosure shall be recorded in the minutes of any meeting concerned.
(6) Where a person, other than a member of the Commission, referred to in this section fails to make a disclosure in accordance with this section the Commission shall decide the appropriate action (including removal from office or termination of contract) to be taken.
(7) Where a member of the Commission fails to make a disclosure in accordance with this section the Minister shall decide the appropriate action (including removal from office) to be taken.'.".
I tabled this amendment on Committee Stage to put in place a code of ethics for anyone connected with decision making in the gas sector. Where people are in decision making positions it is important that a standard of ethics be set down and accepted by such people, whether advisers, consultants, members of the commission or its staff.
The amendment proposes that the commission, following consultation with the Minister for Public Enterprise, shall draw up a code of conduct in respect of the control of the interests of staff members to ensure a proper ethical standard is applied by the people concerned. This would apply to staff, members, advisers and consultants of the commission. They would be required to make a statement giving a full declaration of their interests. If there were a change in their interests, they would amend the statement. The statement and any amendments should be made public. The form should be agreed between the commission, the Minister for Public Enterprise and the Minister for Finance. Where a person to whom subparagraph (1) applies failed to make a declaration in accordance with that subparagraph, specific penalties would be put in place.
The amendment also sets out what would be regarded as declaratory interest. Such a declaration must be made where the person holds shares in, bonds or debentures of, or other like investments, where such holdings are in excess of €10,000, in any undertaking related to the gas or electricity industries because the regulator will have charge of both. If a directorship or a shadow directorship was held even within the previous two years, a declaration should be made to that effect. Where there were benefits in kind, for example, holidays, gift vouchers, transport provided etc., to a value in excess of €500 a declaration should be made. If there was a pecuniary interest or other beneficial interest, which would be material to a decision by the commission, again a declaration should be made. Attempting to have an influence on a decision would be addressed by the fact that a person would have to make a declaration of interest to the commission and would have to give a guarantee not to seek to influence a decision. If a decision was being made the person involved who had a possible beneficial interest should withdraw from the meeting.
It would not only apply to the staff members, members of the commission, consultants or advisers, but also to members of their households who would have any possible beneficial interest. That is why I tabled this amendment. I thank the Minister of State for accepting the spirit of my amendment on Committee Stage. The Bill as amended on Committee Stage contains section 9 covering declaration of interest. That gives effect to the spirit of what I proposed. As I said on Committee Stage, I was at a loss to know why this matter was not addressed in the original text of the Bill. It seems glaringly obvious that disclosure of interest has to be of fundamental importance to ensure everything is transparent and above board. I rest my case.
We have already discussed these issues. The matters covered by this amendment are fully dealt with in sections 8, 9 and 10 of the Bill, which deal with a code of conduct, declaration of interest and disclosure of interest. Having examined in detail the text proposed by Deputy Higgins and his colleague, Deputy Stanton, I put forward my proposal on Committee Stage, which met the spirit of what he proposed. This is now incorporated into the body of the Bill.
While this provision largely mirrors that tabled by the Deputies, there are a number of improvements. These relate to the reporting relationship between members of the commission and the Minister on the one hand and members of the commission and staff of the commission on the other. They also relate to the publication of declarations of interest. Sections 8, 9 and 10 of the Bill have been written so that they are more in line with existing provisions contained in legislation already in force, for instance those contained in the Aviation Regulation Act, 2001. Sections 9(5), 9(6), 10(6) and 10(7) make it clear that where there is a breach of rules regarding the declaration or disclosure of interest by a member of the commission staff, or a consultant or adviser employed by the commission, it is the duty of the commission, not of the Minister, to take appropriate action. In the case of a breach of the rules by a member of the commission it is up to the Minister to decide what action to take.
Section 9(4)(a) ensures that the declarations of interest of members of the commission are published in the proper forum, that is, in the annual report submitted by the commission to the Minister, which is laid before the Houses of the Oireachtas. I again thank Deputy Higgins and his colleague Deputy Stanton for making their very useful proposal. While I cannot accept the text they proposed, I am sure Deputy Higgins will agree that all the issues he has sought to have addressed are now being dealt with in the Bill.
Amendment, by leave, withdrawn.
(Mayo): I move amendment No. 3:
In page 6, between lines 39 and 40, to insert the following:
"(d) by the substitution for subsection (5) of the following subsections:
‘(5) In the exercise of its functions under this Act and without prejudice to subsections (3) and (4), the Commission shall encourage and secure adequate energy supply in the interests of all users in a manner that promotes economic efficiency and gives the maximum benefit to users and in doing so shall have regard to–
(a)the need to ensure a satisfactory supply of gas and electricity for users and in particular the need to take account of the needs of rural customers, the disadvantaged and the elderly,
(b) the need to stimulate a competitive market in the provision of gas and electricity,
(c) the need to take account of the protection of the environment,
(d) the need to encourage the efficient use and production of energy,
(e) the need to encourage research and development into–
(i) methods of generating electricity energy using renewable, sustainable and alternative forms of energy and combined heat and power; and
(ii) methods of increasing efficiency in the use and production of energy;
(f) the need to require that the system operator gives priority to generating stations using renewable, sustainable or alternative energy sources when selecting generating stations,
(g) the need to co-operate with regulatory authorities in other Member States,
(h) the principles of non-discrimination (including equal access) and proportionality, and
(i) the need to impose, maintain and develop public service obligations in accord ance with section 20 of the Gas (Interim) (Regulation) Act, 2002.'.”.
Section 6 essentially deals with the functions of the commission, which are to advise the Minister on the development of the electricity and gas industries, as appropriate, and on the exercise of the functions of the Minister under this Act. The Minister and the commission will ensure that they exercise their powers in a manner which, in relation to electricity, does not discriminate unfairly between holders of licences, authorisations and the board or between applicants for authorisations or licences.
In relation to gas the same principles apply that there should be no discrimination unfairly between holders of licences, consents and Bord Gáis or between other applicants for consents or licences, and the Minister or the commission, as the case may be, protects the interests of final customers of electricity or gas or both, as the case may be.
The functions are listed as follows: to promote safety and efficiency on the part of electricity and natural gas undertakings; to promote the continuity, security and quality of supplies of electricity; to promote the use of renewable, sustainable or alternative forms of energy; to secure that there is sufficient capacity in the natural gas system to enable reasonable expectations of demand to be met; and to secure the continuity, security and quality of supplies of natural gas. That list of requirements seems to be rather threadbare and my amendment seeks to add considerably to it. There is need to ensure satisfactory supply of gas and electricity for users and in particular to take account of the needs of rural customers, the disadvantaged and the elderly. That should be inserted even though it is in the Electricity Regulation Act, 1999.
I point to the need to stimulate a competitive market in the provision of gas and electricity. This should be clearly stated in the Bill because the whole basis for regulation is to ensure there is competition, the marketplace is opened up and everything is seen to be fair, above board, transparent and equitable.
Debate adjourned.
Sitting suspended at 1.30 p.m. and resumed at 2.30 p.m.