Dáil Éireann debate -
Tuesday, 17 May 2005

Vol. 602 No. 4

Adjournment Debate.

Playground Funding.

Cecilia Keaveney

It was officially announced this week that we have a serious problem with obesity. I wish to raise a matter which could be a core tenet of any solution to this problem. In the past eight years, this Government has delivered sporting facilities all over the country and nobody can deny the huge advances that have been made in almost every parish. However, we are competing with a very sedentary lifestyle and the primacy of television, video, DVD, computer, Game Boy and so on. Toddlers know how to insert a video into a player and how to turn on the television with a remote control device. Children observe the behaviour of others and turning on the television or video recorder becomes normal for them. Indeed, we are often amused when very young children can perform such tasks.

We must understand that babies are aware of all that is going on around them. They understand words before they can speak, they attempt to walk before they have developed the physical capacity to do so. They also develop concepts of what is right and acceptable or what is wrong and unacceptable. By the time children reach five years of age, most of their character is formed by what they have observed around them since birth. If one observes young girls, practically from the moment they can walk, they try to put on their mothers' make-up and walk in her high heeled shoes. This underscores the fact that what happens in their environment as an infant will impinge on their attitudes to certain activities. It is almost too late, at five years of age, to introduce children to arts or physical activity like sport if they have not encountered this in those they have been observing up to that point.

I wish to see interdepartmental interaction between the Department of Health and Children, the Department of Arts, Sports and Tourism, the Department of Community, Rural and Gaeltacht Affairs and the Department of the Environment, Heritage and Local Government that will ensure that there are play areas for our young people from the earliest age, not just for teenagers. I am aware that plans are afoot to develop skateboard parks for the teenage cohort.

We do not need to look to other countries for examples of best practice — they exist here. We had a brief scheme that delivered to some children and I congratulate the Minister for that. However, the reality in County Donegal is that there are over 30 communities that wish to be served by a playground facility. The local authority is willing to drive the issue at ground level, but there is a lack of funding.

We must accept the fact that children must get involved in physical activity from the earliest possible age. Parents must be encouraged to play with their children, as was the situation with the 'sugradh le chéile' idea that was once promoted. The facilities must be provided to enable this to happen. Wherever one sees age-graded playgrounds, one sees activity, fun and enjoyment. We should aspire to provide facilities that would allow five to ten year olds to bring along bicycles and cycle around roundabouts, learn signalling to stop and go and so forth. Such facilities are available in many parts of the UK and in Spain. However, age-graded playgrounds are ideal for children under five.

Currently, the provision of playgrounds for young people seems to be falling between Departments and is thus not getting the priority it deserves. I ask the Minister to examine the issue, to ensure that initial cross-departmental action begins, to make an individual responsible for the provision of play facilities and to talk to the local authorities, which are very enthusiastic about this area.

Play facilities are one of the solutions to the obesity problem and much money will be spent on solving that particular problem. However, it does not require much money to put a basic play infrastructure in place that will encourage parents and extended families to play with children.

If young people see physical activity as a normal part of the life of those around them, their sense of play will expand into an acceptance of sports at a later age. This will offer a counter balance to the time that will be spent at a school desk or in front of a screen. We must ensure that the aspiration to achieve points in exams is not the main pursuit of young people. We must aim for balance in life. This is a goal worth pursuing and the funding involved would be money well spent in problem prevention. Providing children with musical stools to play on should be our objective and I do not want to see the issue of play facilities fall between departmental stools any longer.

Minister of State at the Department of Health and Children (Mr. B. Lenihan)

I thank Deputy Keaveney for raising this matter, which is very close to my heart. The funding of playground facilities does not fall between departmental stools, but falls very firmly on the stool of the Minister for the Environment, Heritage and Local Government, Deputy Roche. The fact that Deputy Keaveney raised this matter allows me to outline to this House details of what has been done in this area, which is not inconsiderable, although I agree with the Deputy that more can be done.

I launched Ready, Steady, Play: A National Play Policy in March of last year, a policy for the under 12s which was the first of its kind in Europe. One of the objectives identified in the policy was to maximise the provision of public play opportunities for children. It identified how these could be maximised, not only through financial incentives, but through progressive planning on the part of local authorities.

I have been making every effort to identify funding for playgrounds, together with my colleagues in Government, including the Minister for the Environment, Heritage and Local Government. I am delighted to say I have had considerable success in this regard and a total of €7.9 million funding was provided in 2004 through various schemes since the launch of the policy to increase the level of access to play facilities. However, considerable sums were made available in RAPID areas and pilot projects were sanctioned in each county and the rolling out of this programme has increased the level of demand. Many other authorities and communities are seeking to establish more play facilities. One of the reasons I insisted on a rapid roll out of the original pilot schemes was to create a higher level of demand and increase the level of awareness. As Deputy Keaveney pointed out, a small amount of money in this area can go a long way. Of the total sum of €7.9 million, €7.3 million was spent directly on providing playgrounds in 2004.

In recognition of the fact that Ireland has a very poor playground infrastructure and following consultation with my colleagues, the Minister for the Environment, Heritage and Local Government and the Minister for Community, Rural and Gaeltacht Affairs, two playground grants schemes were established as a direct result of publication of the policy, namely the local authority playground grants scheme and the RAPID playground grants scheme. These schemes have resulted in an additional 77 playgrounds being funded in 2004. Some of those playgrounds are under construction.

I will not go into too much detail on these schemes. In outline, the local authority playground grants scheme involved the Department of the Environment, Heritage and Local Government providing up to 50% funding for the development of new, or the renovation of existing, playgrounds in 2004. Approximately €2 million was allocated by the Department to county and city councils under the scheme. Under the RAPID scheme €3 million was jointly made available by the Department of Community, Rural and Gaeltacht Affairs and the Department of Health and Children. That will result in 45 playgrounds being built in RAPID areas. Both the schemes provided capital funding for playgrounds and it was a condition of the schemes that the local authority meet ongoing maintenance costs, including insurance.

I am happy to say that both of these schemes are continuing in 2005 and the local authorities will be receiving letters about them in the coming weeks. The 77 playgrounds funded by these schemes are now beginning to open to the public throughout the country and will represent a significant increase in our playground infrastructure. The Department of the Environment, Heritage and Local Government is administering the local authority playground grants scheme in 2005 and I will raise the issue of funding for this year with the Minister.

I would like to add that the Minister has also committed funding to the provision of facilities for older children in 2005 under the skateboarding scheme. His officials will be liaising with my officials in the National Children's Office in relation to this proposal and also in the context of developing recreation policies for those aged between 12 and 18.

Tax Code.

Dr. Cowley

I do not condone the dodging of tax. Everyone should pay his or her fair share of tax. However, there is currently an anomaly where older people in their mid-70s and mid-80s are being treated unfairly in a trawl by the Revenue Commissioners where their aggregate investment in insurance company schemes exceeds €20,000.

Is the Minister aware that in many cases the original or initial investment was very small, for example, £2,000 and that this fund has grown due to reinvestment in other insurance companies by the investment manager? Investments grew rapidly in the early years, achieving 30% growth per annum. The accumulation of money from that reinvestment by investment managers has driven many thousands of older people into the tax net now, whereas they would not be liable based on the original amount invested. In many cases the original amount cannot be traced due to the fact that many of those original insurance companies have gone out of business, for example, Norwich Union, Abbey Life, Royal Life, CGNU etc.

While I agree that everyone should pay his or her fair share of tax, is it not unfair to go back 25 years considering the small amount of the original investment in many cases, particularly as no tax may be owed at all in some of these situations? The Minister may say they need not worry, but older people worry and do not eat or sleep. This issue is causing terrible worry and consternation among older people with such insurance policies and who must make a declaration to the Revenue Commissioners by 23 May 2005.

A quarter of a century ago people put a few bob aside for the rainy day. Now they are expected to be able to account for all of the original investment. This seems unfair treatment for older people in their mid 70s and 80s, considering that the Government is using the Statute of Limitations to its liability to nursing home payments to older people to six years. However, it has no trouble going back 25 years to get older people into its net in this situation.

These investment type products were launched in the mid-1970s. The biggest supplier and market leader was Irish Life Assurance Company, which was State owned. Pre 2001, the glossy brochure inducing people to join stated: "Tax — All returns from [this product] are taxed — currently at 24%. We pay this tax for you so then when you cash in your [product], you have no further tax to pay." Post 2001, due to the change to exit tax by former Minister for Finance, Deputy McCreevy, the brochures stated:

Exit tax is calculated as standard rate of tax applicable at the time of encashment plus 3%. Hibernian Life & Pensions Limited deducts this tax and pays it to the Revenue on your behalf.

Many older people in the west are affected by this measure. The Government is doing well from it. It got tax on the gains over the years and the money was used to build property on the east coast. The Government has already got its pound of flesh. I am not in favour of letting off the hook anybody who has invested large amounts of money in order to avoid tax. However, thousands of people are affected by this Revenue trawl, mainly the small investors who made provision for the rainy day. They are being treated unfairly, like big tax dodgers. They face the same penalties and are liable for possible prosecution and naming and shaming. Many of them were on small farmers dole payments and were not liable for tax. When they got a few bob on the headage, it was put aside for the rainy day or children's education. They paid their tax on the gains.

The people in the Revenue Commission do not seem to know or care that there is inherent unfairness in this measure. People who do not have money to pay fines are worried sick and quite desperate. Perhaps there are cases where tax should have been paid, but the person was not in the tax net at the time. Now, 25 years later, the Government is looking for this money. Whose fault is it these people were not in the tax net? The difficulty with trying to get these people to pay tax 25 years later is that those involved are now in their 70s and 80s. They are scared out of their lives and afraid to talk to anyone. Some may have phoned the Revenue Commission line, but many are afraid to do so. However, by the end of the week they will have to make a declaration to the Revenue Commission as to whether they have paid tax on this insurance investment. Many are unsure about that. Even if they were sure they had paid, many of the companies have gone out of business. If they do not make a declaration to the Revenue Commission, they will be liable for even greater penalties, naming and shaming and possible prosecution as well as persecution.

Will the Minister intervene with the Revenue Commission on this issue? Why should the trawl go back 25 years? Why should the lower limit of the threshold be €20,000? Something must be done. Entire life savings are being wiped out. Can the Minister help?

Minister of State at the Department of Finance (Mr. Parlon)

I am pleased to have the opportunity to address the Dáil on this matter.

I assure the House that the fact that some people have invested in life assurance investment products and have legitimately profited from such investment does not lead the Revenue Commissioners to assume they are engaged in tax evasion. The focus of the Revenue investigation is on the source of the money invested in insurance products and whether it was money that should have been, but was not, disclosed to the Revenue Commissioners. Ordinary taxpayers who invested money from sources such as redundancy payments, accident compensation funds, retirement lump sums or savings from moneys that were subjected to tax have no further obligations and need have no concerns about this investigation.

I am, however, informed by the Revenue Commissioners that following on from information gleaned from previous large scale investigation projects and other research, it was clear that some individuals had used life assurance investment products to hide taxable income, gains or acquisitions. The number of investors combined with the volume of funds invested suggested that the matter was best dealt with on a similar basis to that used for previous large scale projects such as the bogus non-resident account and the offshore account investigations. This involves a voluntary phase with time deadlines, during which individuals can come forward voluntarily and disclose outstanding liabilities, and a follow up investigation phase to identify those who do not come forward voluntarily. Those who come forward voluntarily will benefit from reduced penalties, their names will not be published in the quarterly defaulters lists and they will not be considered for prosecution, or even persecution. As with the previous investigations, this one is aimed at those who have not fully disclosed their income, gains or acquisitions in the past and who owe tax to the Exchequer. Those who have previously declared their incomes and paid their taxes are compliant taxpayers and are not required to do anything in connection with the investigation.

The Revenue Commission contacted all the relevant insurance companies and requested that they write to their investors where the investment was in aggregate greater than €20,000. It is understood that as a result many individuals have received letters from their insurance companies in recent weeks outlining the background to the Revenue investigation. The issuing of mail shots by insurance companies to investors is to be commended.

I welcome the opportunity to clarify a number of issues relating to the current investigation. First, the investigation applies only to those who invested in insurance products using money that should have been but was not disclosed to the Revenue Commissioners — money colloquially known as "hot money". Accordingly, most people do not have a tax problem since they would have funded their investment with redundancy payments, accident compensation, lump sums received from a pension fund on retirement, personal savings from moneys that were subjected to tax etc. These people are not affected by this investigation.

Second, I refer to a matter specifically mentioned in the matter raised by the Deputy, namely the growth in funds invested in the life assurance companies. While the moneys were with the insurance companies the funds in which they were invested were taxed and therefore the individual investor has no further liability to pay on those profits. The Revenue Commission is satisfied that the life assurance companies have correctly accounted for all tax due on the growth of the investment and accordingly it is only interested in any undisclosed funds invested.

Third, this investigation does not apply to anybody who fully rectified their tax affairs previously, for example under the 1993 amnesty or the recent Revenue investigations. In the current phase of this investigation, the Revenue Commission is concentrating on cases where the individual investment or the aggregate investments exceeded €20,000. Based on experience this is where it perceives the greatest risk to be and setting such a threshold enables it to manage this project effectively. Therefore, the deadlines set for making a qualifying disclosure, namely 23 May and 22 July, will not apply to investors whose investments in aggregate are €20,000 or below.

It is not the Revenue Commission's intention currently to initiate an investigation into cases below the €20,000 threshold. However, should new data emerge from the current phase which makes it necessary for it to rethink this approach, there would be a further opportunity for such cases to avail of the qualifying disclosure scheme outlined in the code of practice for revenue auditors and disclosure dates would be announced as appropriate.

Authorised Revenue officers will shortly carry out a sampling process in the insurance companies as provided for in this year's Finance Act. Preparatory work has already taken place and I am advised that full co-operation in this process is being received from all the insurance companies. Takeovers, mergers etc. are not posing any particular difficulty and records are generally available for the period covered by the investigation — 1980 and subsequent years. At a later stage the Revenue Commission will ask the High Court to make orders under which the insurance companies will be required to furnish particulars relating to investments and investors.

Any people in doubt as to whether the current scheme applies to them should consult their tax adviser or the Revenue help line at 01- 6474818. Notice of intention to make a disclosure must be sent to The Revenue Commissiom, 1 Clanwilliam Court, Mount Street, Dublin by 23 May. As always, any person whose tax affairs are not correct should take steps to rectify them at the earliest opportunity.

Industrial Relations.

Mr. Sherlock

Management at the Dairygold plant in Mitchelstown is seeking to implement a draconian regime in an attempt to cap direct labour costs at €3.8 million per annum. Such a regime would undermine Irish jobs and result in an influx of cheaper eastern European labour. Management is threatening to close down Dairygold's meats division if workers do not agree to a rate of pay of €9 per hour, or gross pay of €351 per week, for all sections of the plant. Such a rate of pay would mean a loss of up to €150 per week for some of the plant's workforce of approximately 150 people.

I raise this matter because I feel that Dairygold is trying to introduce sweatshop tactics. It is embarking on a systematic campaign to force Irish workers who earn the average industrial wage out of jobs, thereby making way for migrant workers who will be paid at a rate marginally above the minimum wage. We are witnessing the systematic dissolution of the social partners' hard-fought gains, to be replaced by "yellow pack" jobs. The Government must intervene to protect Irish jobs against an influx of cheaper labour from eastern Europe. It is an insult to the people of this country and the workforce of Dairygold in Mitchelstown, who have always been loyal to the company, to expect Irish workers to survive on €351 per week.

I have mentioned that management at the Mitchelstown plant is trying to cap its labour costs at €3.8 million per annum. Such a draconian regime would undermine Irish jobs and lead to an influx of cheaper labour from eastern Europe. The company is threatening to shut its meats division if workers do not agree to a rate of pay of €9 per hour, but that rate has been rejected by 95% of the workforce. If agreement is not reached with SIPTU, the company may try to sell Galtee Meats. It has been suggested that the managing director of the company, who used to work for Kerrygold, is preparing for a possible take-over of Dairygold by Kerrygold.

The Minister for Enterprise, Trade and Employment should intervene under the Companies Acts to investigate the Dairygold operation at Mitchelstown before it is too late. I remind him that 1,200 jobs at Dairygold have already been lost in the Mitchelstown area.

Minister of State at the Department of Enterprise, Trade and Employment (Mr. Killeen)

I thank Deputy Sherlock for raising this matter on Adjournment. I understand his concerns about the proposed cost-saving proposals at Galtee Meats, which is the pig division of Dairygold Co-operative Society Limited.

The operations of Galtee Meats in Mitchelstown, Roscrea and Tallaght employed approximately 500 people until the end of September 2004. On 10 August 2004, the Dairygold Group announced that it intended to terminate its slaughtering operation at Mitchelstown and to close its facility at Roscrea, and that has since happened. The activities at Roscrea were transferred to the vacated space at Mitchelstown, where the company operates a substantial added value and small goods operation. The company continues to operate the facility in Tallaght. Such actions were taken by the company on foot of a comprehensive review of its pigmeat divisional cost competitiveness and its performance as a profit centre, based on an independent Danish meat research benchmarking study. Galtee Meats intends to focus on growing the added value branded category, which has been profitable.

I understand that Galtee Meats is seeking to adjust its wage costs. It has introduced improved practices as part of its attempt to achieve improved profitability in its operation. Such measures are being introduced so that the company can plan its growth prospects on a competitive basis. Galtee Meats recently informed workers at its pigmeat processing plant in Mitchelstown of its planned cost-saving proposals, which are aimed at achieving international competitiveness. I understand that the proposals involve an increase in the hourly rate of pay from €8.25 to €9 and changes to the existing bonus and overtime systems. The trade union has calculated that such changes would result in significant reductions in the workers' net incomes. The proposals also involve changes to the working week, increased productivity and the buy-out of certain work practices. The members of the union voted last Thursday not to accept the proposals.

This country's system of industrial relations is essentially voluntary in nature. If the parties have failed to find a solution to the issues in dispute, the State can make available the Labour Relations Commission and the Labour Court to act to settle disputes. The experience and expertise of the commission and the court are available free of charge. Management and unions at Dairygold availed of the services of the State's dispute settling machinery during the rationalisation of other divisions within Dairygold last year. However, neither the trade union nor the company has referred this matter to the Labour Relations Commission to date. Therefore, the matter is still at the local discussion stage. Ultimate responsibility for the resolution of the issues in dispute rests with the parties in question. The Deputy is aware that I have no function in individual disputes.

Collective agreements are the primary method of determining conditions of employment, in keeping with this country's voluntarist industrial relations tradition. The role of statute law has traditionally been limited to setting minimum levels of protection or entitlement. Ireland has been to the fore in ensuring that reasonable conditions of employment exist. The approach of consensus, which involves employers, employees and the Government, has been supported by a well-balanced suite of employment rights legislation and a range of measures designed to stimulate employment. That approach constitutes an appropriate framework for the purpose of achieving an efficient and competitive business environment. The primary objective of employment rights legislation is to protect the safety and health of workers and to foster labour market harmony by promoting policies which minimise conflict and maximise fairness.

Food processing is an internationalised industry. One of its features is its easy mobility, which depends on factors such as its cost base, labour supply and proximity to cheap raw materials or the intended marketplace. The maintenance of competitiveness in our economy, specifically in the pig production industry in which margins are tight, will continue to be a serious challenge for the Irish food processing sector. The meat processing industry, which is an important part of our agrifood economy, is engaged in the processing of meat, most of which is Irish. The resultant products make a valuable contribution to export earnings and are sold on the home market. The maintenance of employment levels and wealth creation is particularly vital for the local economies in which processing operations are located. I would be concerned if the level of food processing activity were to decrease.

I thank the Deputy for raising this matter on the Adjournment. The State's industrial relations machinery remains available to the parties, as I have said, and I urge the parties to avail of such facilities if they require third-party assistance.

School Accommodation.

Mr. Ring

It does not give me great pleasure to raise this issue in the House again. I refer to the problems faced by Gaelscoil na Cruaiche in Westport, County Mayo, which has more than 200 pupils. The school's principal, seven mainstream teachers, full-time resource teacher and shared learning support teacher have to work in appalling facilities. The lease on the school's current accommodation will expire later this year.

Some former Ministers, including the former Minister for Education and Science, Deputy Woods, made promises when they visited Westport during the election campaigns of 1997 and 2002. I recall that Deputy Woods said on local radio in 2002 that the school would be able to leave its current premises at that time. Everybody in the county, including Fianna Fáil's election candidates, was convinced that an announcement would be made the following week that a new building would be built on a new site. The only problem was that the money was not made available for the acquisition of a new site. I am reminded of the Abba song, Money, Money, Money.

The teachers and pupils of Gaelscoil na Cruaiche have to work in atrocious conditions. I am tired of being told by Ministers that negotiations with the Office of Public Works about the acquisition of sites in Westport are ongoing. As a former auctioneer, I know that it is not impossible to get a site in Westport. I can choose a site if the relevant authorities would like me to do so — the only thing that is needed is money. The parents, the board of management, the principal and the teachers will organise a public meeting this week and they intend to march to the Dáil. The school, which has 200 pupils, is a success story because families are prepared to send their children there. It has excellent teachers and an excellent principal, and many other people are also involved in the school. I was proud to see the school pupils taking part in the St. Patrick's parade in Westport.

What is the updated position? Has the OPW acquired a site? Has it had discussions with the town council? Is the problem related to funding or the site? I hope the Minister will be able to tell the principal, the parents and the board of management when the school will get its new site. Will the pupils and teachers be in a new school by September of next year? They must leave their present location because the school's lease is up and the owners of the property want them out. It is time we knew what will happen to the school.

I hope the Minister has good news. I hope the site has been purchased and that the negotiations with the town council are complete. I also hope that the necessary funding has been put in place by the Department of Education and Science.

The people of Westport and the surrounding areas have long memories. They remember the former Minister, Deputy Woods, visiting Westport and giving assurances that this school would be looked after. We are nearly at the end of the term of this Government and it will not be long until the election. The people of Westport will respond and they will have something to say to the Fianna Fáil candidate who visited the school with the former Minister, Deputy Woods.

As Minister, Deputy Woods visited Newport to promise a third level school there, but that never happened. He also visited the Westport Quay school. He brought an accordion on that occasion and sang the lights out. I told the local radio presenter that the song would be a best-seller but it would not be a No. 1 because the Government would not deliver on any of the schools. It did not deliver.

I hope the Minister has good news for this school. I hope he can tell me that the site is bought and the project is progressing to the next stage.

Mr. Killeen

I thank Deputy Ring for giving me the opportunity to outline the proposals of the Department of Education and Science in regard to the provision of a new facility for Gaelscoil na Cruaiche in Westport, County Mayo. Since the beginning of the year the Minister for Education and Science has made a number of announcements relating to the schools building and modernisation programme. This year alone, €270 million will be allocated to primary schools and €223 million to post-primary schools for building works. This represents an increase of 14% on the 2004 allocation.

The programmes supported will include 141 major building projects already on site and more due to go on site in the near future; 122 major school building projects countrywide, which will go to tender and construction during 2005 or early 2006; 192 primary schools which have been invited to take part in the small and rural schools initiative and the devolved scheme for providing additional accommodation; up to 120 schools which have been given approval to rent temporary premises pending delivery of a permanent solution to their long-term accommodation needs; 43 schools which have been authorised to start architectural planning of their major projects; 590 schools which were recently given approval to complete essential small scale projects under the summer works scheme; and 124 schools to progress through architectural planning.

The new schools building and modernisation programme 2005-09 will be underpinned not just by a significant increase in overall funding but also by major improvements in the administration of the funding. Devolving more funding to local level through the summer works scheme and the small and rural schools initiative will allow schools to move ahead more quickly with smaller projects.

Gaelscoil na Cruaiche opened in September 1996 with provisional recognition and was granted permanent recognition in 2000. The school is currently accommodated in prefabricated classrooms on a 0.75 acre site in the town. The cost of site and classroom rental is grant-aided by the Department of Education and Science at the rate of 95%.

The property management section of the Office of Public Works, which purchases sites for new schools on behalf of the Department of Education and Science, was requested to explore the possibility of acquiring a site for the school in question. Following the most recent advertisement placed by the OPW seeking proposals of possible sites, a number of responses were received. Seven sites have been visited and their technical suitability as a location for the Gaelscoil is being considered at present. Due to commercial sensitivities the Deputy will appreciate the Department is unable to comment further on specific site acquisitions, including a site for Gaelscoil na Cruaiche. I thank the Deputy for raising the matter in the House.

Mr. Ring

We need to know the location of the site and the availability of the funding.

The Dáil adjourned at 9.05 p.m. until 10.30 a.m. on Wednesday, 18 May 2005.