Vol. 700 No. 1
90 Deputy Simon Coveney asked the Minister for Communications, Energy and Natural Resources the method he plans to adopt to introduce post codes here; the reason he has rejected a global positioning system; and if he will make a statement on the matter. [3892/10]
A smart economy requires that the underlying infrastructure supports enterprises based on knowledge and innovation. For this, an ability to collate and assess data spatially is a prerequisite and postcodes can play a key role and can deliver economic and social benefits across the whole economy.
Ireland is the only country in the EU that does not have such a postal code in place, but as the Deputy is aware, the Government has now approved the implementation of a postcode system as recommended by the National Postcode Project Board.
This board, which comprised representatives from Departments, together with public and private sector organisations, was established to recommend the most technically appropriate postcode system for Ireland, design an implementation plan and assess the costs and benefits of postcodes.
In the course of its deliberations, the board looked at a number of postcode models and technologies including postal sector models and a number of spatial and hybrid postcode models taking into account several factors including memorability, likely uptake by the public and ability to adapt to emerging technologies. The model recommended, and since approved by Government, is an alpha-numeric, publicly available and accessible postal code model.
Each postcode will have a geo-coordinate at its centre and consequently, would be compatible with global positioning or navigation systems, allowing integration with GPS and other global navigation satellite technologies. Applications based on such systems become much more readily accessible to the public through the use of a postcode.
In arriving at this model, the technical and economic consultants who assisted the board engaged in a series of stakeholder consultations. These consultations revealed overwhelming support for the introduction of postcodes across public, private and voluntary sectors and identified that postcodes would not only deliver benefits for the postal sector, but assist in the delivery of public services and contribute to the development of a knowledge economy and the country's overall competitiveness.
My officials and I are currently working to address the next steps in this project. A competition will be launched shortly to select a body that will assist the Department in managing the delivery of a working postcodes system. That delivery will be effected by way of a competitive tender process. It is expected that postcodes will be assigned and in use by the end of 2011.
I thank the Minister for his answer, which is almost identical to the answer he gave in November. The reason I tabled the question is because I believe the Minister is making a big mistake. He is correct to suggest a geo-coordinates based system would allow some compatibility with a GPS, global positioning system, but the problem is the coordinates used would be in the middle of a district relevant to between 20 and 50 houses. This was outlined in the Minister's report. It will cost approximately €15 million to implement a new postal code system in Ireland after all the work is done and the money spent. I strongly support the idea but there are issues for a HSE ambulance, a courier or a postman that does not know the area. Is it not the case that the new post code system the Minister proposes to introduce will not bring the person with a letter or service directly to a person's door or address without having local knowledge of the area? If this is the case, is it not a waste of money to introduce a post code system that merely slightly improves what is in place at present — which requires local knowledge for postal delivery — when there is an alternative available which can pinpoint a person's property accurately through a GPS based model and that is being introduced on a commercial basis anyway by the private sector? Couriers are buying in and the HSE is examining such a system.
I must be careful because within a week we will start a competitive process which should deliver quickly in terms of the exact system we introduce. Given that it will be within a competitive process I must be careful not to skew the result one way or the other. The case is not as set out by Deputy Coveney. I agree with the Deputy that post codes are right for this country and that as well as providing an effective postal code system they should have capability to provide location code facilities for a range of applications that will develop as the smart economy evolves. I agree fully this must be one of the components within the system we develop and deliver. However, the exact mechanism and format will depend on the competitive process. I am not ruling out any one technology but we maintain it should fit within the characteristics set out as a result of the work done over the years in terms of having memorability, accessibility and the ability to evolve into a whole range of other uses which will bring benefits to our economy. The competitive process will determine which technological solution will best provide this. The solution will have to provide both location code services as well as a postal code service and I am committed to delivering this quickly.
The Minister and I agree that we must introduce a post code system. However, the point on which the Minister and I disagree and where I believe he and the Government are making a big mistake is that the tendering process being introduced has only invited tenders according to criteria setting out an area based system. He and others have already stated several times that the post code system would only pinpoint areas of the country on the basis of a code down to the nearest 20 to 50 properties. If such a system were introduced to rural Ireland with the ability to narrow down to between 20 and 50 properties such a service would be no better than that which currently exists with the use of local districts or townlands. This is the problem. The tendering process the Minister intends to launch will not facilitate what is known as a one-to-one solution that will bring accuracy in terms of delivery. The Minister may wish to correct me but my understanding is the reason the Minister decided on the model in question was based on one letter written in 2006 by the Data Protection Commissioner, Mr. Billy Hawkes, that outlines his view that there would be data protection issues with a post code system that pinpoints people's premises. I fundamentally disagree with him on that. There is much evidence to the contrary. Will the Minister outline his reason for rejecting the accurate pinpointing of property in a new post code system based on GPS or some other accurate system for the area based coding which he is introducing?
I am not rejecting any accurate system. It will be up to the competitive tendering process to decide on which system. I have had several good conversations with the Data Protection Commissioner, who has the important job of protecting people from invasion of privacy. That can be done while still delivering a system with the level of accuracy we need for locational code purposes and in the postal code system. It must be done to the satisfaction of the Data Protection Commissioner and I believe it can be done. It must also deliver a range of different services as well as the postal code service. That is what we are seeking in the tendering system, to deliver the best technical solution at the best cost while giving us the services we need.
91 Deputy Liz McManus asked the Minister for Communications, Energy and Natural Resources the budget set for 2010 to fund the Broadcasting Authority of Ireland; the budget for the period of its establishment in 2009; the cost to the authority of outsourcing work in 2010, 2011 and 2012; the way he will address the lack of public scrutiny in view of the scrutiny measures in the Broadcasting Act 2009; and if he will make a statement on the matter. [3896/10]
The Broadcasting Authority of Ireland, BAI, was established on 1 October 2009 under the Broadcasting Act 2009 as the new statutory body to regulate the broadcasting industry in Ireland. The budget set by the authority's predecessor, the Broadcasting Commission of Ireland, BCI, for 2009 amounted to €6.238 million. That budget was prepared on the basis of a full year's operation although it was expected that the BAI would be established at some stage during that year. The BCI was allocated €4.575 million in Exchequer funding in respect of January to 30 September 2009. Following its establishment on 1 October, the BAI continued to operate until 31 December within the limit of the original budget set by the BCI for 2009.
As the BAI had not yet established the industry levy through which it is to be funded and as it had not yet established borrowing facilities which are provided for under the legislation, it relied on a number of existing cash flow sources to ensure that the regulation of the broadcasting industry could be maintained during the last quarter of 2009. As regards 2010 and later years, in accordance with section 37 of the Act, the setting of the budget for the BAI for any particular year is a matter for the authority. While the legislation makes provision in section 37(1) for the Minister to be able to specify the form the estimates should take and any additional information as may be needed, it does not require the estimates to be submitted for specific ministerial approval. The budget for 2010 has been set by the BAI at €7.6 million, which will be fully funded by the industry levy as provided for in the Act. Details of this budget have been submitted to my Department and I will be considering if additional information is required.
In accordance with section 37(7) of the Act, this 2010 estimate of income and expenditure will be published shortly by the BAI on its website, with my consent and that of the Minister for Finance. The BAI has indicated that the increase in the budget for 2010 over that the 2009 budget for the BCI is as a result of the increased role given by the Oireachtas to the BAI. While the BAI has taken over the functions of the BCI and the Broadcasting Complaints Commission, BCC, it has also been given a range of new functions additional to those held by its predecessors, mainly relating to public service broadcasting and the provision of digital broadcasting services. The BAI has also indicated that the extent to which this budget is actually expended will depend on the level of activity of the organisation. It has confirmed that it will discharge its functions in a cost effective manner and is conscious of not imposing an undue burden on the broadcasting sector.
Additional information not given on the floor of the House.
In this context, section 32(4) of the Broadcasting Act requires the authority to ensure that regulation by the authority and the statutory committees does not involve the imposition or maintenance of unnecessary administrative burdens. In addition to including this provision in legislation, I have made clear to the authority the need to be particularly vigilant about keeping costs down in the current economic climate. I understand that the authority has requested the chief executive to continuously review its proposed expenditure throughout 2010 with the aim of reducing it where possible. In accordance with section 33 of the Act, any surplus of levy income over expenditure in 2010 shall be offset against future levies or refunded, as appropriate.
Section 33 of the Act provides for the BAI to meet its expenses by means of a levy on public services broadcasters and broadcasting contractors. The Act requires the BAI to make a levy order for the collection, payment and administration of a levy and for a levy order to be laid before each House of the Oireachtas as soon as may be after it is made. The levy order for 2010 was laid before both Houses on 19 January 2010.
With regard to the outsourcing of work, section 18 of the Broadcasting Act 2009 provides that the authority may engage consultants or advisers as necessary in the performance of its functions. The outsourcing of work is, therefore, an issue for the authority in accordance with the requirements of the Act.
I do not accept that there is a lack of public scrutiny of the BAI. The Broadcasting Act provides a range of measures to ensure appropriate public scrutiny. Section 37(4) of the Act requires that the annual accounts for a particular year are to be submitted to the Comptroller and Auditor General not later than the end of March the following year and, in accordance with section 37(5) of the Act, are to be submitted to the Minister, along with the report of the Comptroller and Auditor General, for laying before the Houses of the Oireachtas by the end of June of that year. Furthermore, the chief executive is accountable to the Committee of Public Accounts, and the chief executive and the chairpersons of the authority and its committees are accountable to the appropriate committees of the House of the Oireachtas.
In addition to the requirements on the provision of estimates of income and expenditure, there are also provisions requiring proper management of books and records relating to income and expenditure and for ministerial oversight and consent as to the form of accounts. The BAI is also subject to the Department of Finance guidelines on corporate governance of State bodies which include a range of obligations in terms of reporting, accountability, risk management, internal audit and departmental oversight.
I hope the Minister gives me the information on the additional cost of outsourcing work by the Broadcasting Authority. This is a central issue. Does the Minister not accept that it is absolutely outrageous for him to tell us now that the budget for 2010 will be €7.6 million, even though throughout the debate on the legislation he tried to dampen our concerns about increased costs? In the past the Exchequer has footed the bill for broadcasting regulation but now that the broadcasters must foot the bill the costs have gone out of control. The figure for last year was €6.2 million, but the figure for this year is €7.6 million. It is a new authority but it is very similar to the old one in many ways in terms of regulating broadcasting. How can the Minister stand over such escalating costs?
Will he also answer the question about the additional costs? Staff have left during the transfer and work will have to be, and perhaps already is, outsourced. How much will that add to the costs? How much is included for it in the €7.6 million? What will the Minister ensure is published that is in line with the legislation passed by the House, in which the Minister agreed to ensure proper scrutiny of what the authority does, by everybody and particularly by broadcasters who have suffered a 25% to 30% reduction in their advertising revenue?
I agree with the Deputy that every organisation must be conscious of costs in these difficult times and keep budgets tight——
They have exploded.
——and live within them. The chairman and chief executive of the Broadcasting Authority of Ireland are aware of that fact. They are committed to examining every aspect of their business, ensuring that they pare the costs down to the bare minimum and that the final outcome in terms of expenditure could be below what has been estimated. They will publish an initial estimate but they are committed to maintaining costs to the minimum at a difficult time, particularly for many broadcasters as advertising revenues fall. The authority has additional functions. It must undertake a body of work this year in particular, as it sets itself up and takes on a range of new roles. That will involve certain outside consultants. There will not be the major increase of staff which was originally sought to take on this work. I believe the work can be done cost effectively. The authority's work benefits the industry in the short, medium and long term in providing a fair and competitive environment in which all operators know they are dealt with effectively and well. That, as well as being cost competitive, is a key requirement of the authority.
The Minister is still in denial; he has been in denial from the beginning of the debate on this issue. The Minister knows that the way to organise efficiencies is to have one regulator to replace ComReg and the Broadcasting Authority. We now have a broadcasting authority with a budget of €7.6 million. That is the reality. Nothing else matters and nothing the Minister says in honeyed words about every effort being made changes that. The budget is a burden borne by broadcasters who are currently in difficulty. That is the Minister's responsibility.
There was a hidden cost in the last three months of last year. How much is that cost and who will pay it? The Exchequer stopped paying as soon as the new authority was established on 1 October. Who has paid the bills since then? How will they be met if they are based on borrowing?
The budget for last year was €6.238 million for the full year. The BAI was only in operation for the last quarter. The budget from April to September, therefore, was set at approximately €4.550 million and the remaining budget of approximately €1.5 million — the accounts have still to come in — was the estimated cost for that fourth quarter. It was largely met from cash flow resources that the authority had at its disposal. The approach that was always agreed on this——
I do not know what that means. The Minister must explain it because it does not make any sense. Money comes in from the Exchequer. The budget was €6.238 million. There is now a €1.5 million shortfall and the Exchequer is not paying for it. The BAI is in existence and has costs. It is only a new body so how can it have cash flow?
It was legislated that the new body would not be paid by direct Exchequer payment, and provision was made for that in the accounts for last year.
Who is paying for it then?
The interim payment was made through existing cash flow resources the authority had. The levy was always due to be applied. It will be paid quarterly, with the payment being applied to the previous quarter. The first payment in the first quarter this year, therefore, is retrospective.
It is for last year. I see.
That will apply for each quarter. There is also the provision that where there is an underspend, that amount can be refunded to the industry to ensure it gets the benefit from savings that should, and I am sure will, accrue.
The final figure, therefore, is €7.6 million plus €1.5 million.
We must move on to Question No. 92.
92 Deputy Simon Coveney asked the Minister for Communications, Energy and Natural Resources the position regarding the progress made in securing commercial digital television services following ongoing negotiations between a consortium (details supplied), RTE and the Broadcasting Commission of Ireland; and if he will make a statement on the matter. [3893/10]
The Broadcasting Act, 2009 requires the Broadcasting Authority of Ireland, BAI, an independent regulatory authority, to provide for the development of commercial digital terrestrial television services.
On foot of this requirement, the BAI's predecessor, the BCI, launched a competition, which is still ongoing. As the Deputy is aware, the highest placed consortium in the competition withdrew from the process last April. Negotiations then commenced with the next placed bidder and this process is continuing.
As I stated recently in response to a previous question on this issue, I am not prepared to speculate on the outcome of the commercial DTT process, which is a matter for the BAI and one in which I do not have a direct role. Nor am I prepared to surmise on the ongoing negotiations between BAI, RTE and the OneVision consortium. I have, however, made clear my views that I would like to see this process concluded as soon as possible.
The Minister has been saying that for six months.
The conclusion of the process is essential to provide certainty for broadcasters, suppliers and the general public with regard to the development of commercial DTT services in Ireland. More generally, it is my intention that analogue TV services will be switched off in late 2012. This will ensure a valuable digital dividend and it underlines the need to implement a DTT service.
This is the third or fourth time we have discussed this issue. The Minister, Deputy Ryan, will know that I and many others have real concern that we will not be able to make the 2012 deadline for analogue switch off, which will have significant consequences. I understand — the Minister can correct me if I am wrong — that the new BAI met to discuss the DTT issue yesterday. There are ongoing negotiations between RTE and the OneVision consortium, which is now the proposed provider of commercial DTT services on the multiplexes which are there for that.
I asked the Minister, Deputy Ryan, a question several months ago and wish to ask it again. Will he set a deadline for those negotiations to be finalised so we all know the status of DTT regarding RTE, which has responsibility for and is required to provide free-to-air DTT services which, I understand, will be called Saorview? There are significant financial consequences for RTE because of the commitments which have to be made to put the infrastructure in place. Should OneVision go the route of Boxer we will be left holding the baby. The Minister will be responsible even though he seems to refuse to be part of the process at this stage.
As the person responsible from a policy perspective, will the Minister set a deadline for RTE and OneVision to conclude their negotiations so we and the Minister, who is the policy maker in this area, know where the country stands, in terms of the provision of commercial DTT which is a requirement for the provision of a viable free-to-air DTT service?
I have already set deadlines. There is a deadline within the legislation we recently enacted for the switch on of a free-to-air digital service in December 2011. There is a deadline for us of 2012, which is when we will switch off our analogue system because the valuable spectrum we can then accrue for broadband and other purposes is of real importance to us. That is a certain deadline——
We are not on course for that.
——and I said to each of the parties directly and clearly that, come what may, that deadline will be met. We will switch off our analogue services. In terms of the ongoing commercial negotiations between OneVision and RTE, it is the Broadcasting Authority of Ireland which will ultimately set the deadlines on that process. That, under the legislation, is what its authority is and it would be wrong for a Minister to step into the middle of a commercial negotiation process and start subverting the BAI's role in that regard. I have given clear indications here and elsewhere to everyone involved that there is time urgency with this issue and that it is in everyone's interest, if we are in such negotiations, to conclude them quickly. I will not step into the middle of commercial negotiations because that would be counterproductive and improper.
I am not asking the Minister to step into the middle of the negotiations. Will he accept that RTE has already spent some €70 million putting DTT infrastructure in place, on the basis of having a commercial operator in place which would help to finance that infrastructure? Would he also accept that he changed the broadcasting legislation, through an amendment, to change the deadline which was set for the provision of DTT services, the deadline for which was the end of last year because of the ongoing problems resulting from Boxer pulling out?
This time last year Boxer pulled out and we now potentially have a crisis on our hands, should it turn out that RTE and OneVision cannot do the necessary deal. If that should happen we are starting all over again. The Minister has responsibility to ensure that we are on course and that there is a clear road map in place to deliver analogue switch off by the end of 2012. Yet, all the Minister is willing to say at the moment is that at the end of 2012 analogue switch off will happen. Is he now saying that he will put no deadline in place for the conclusion of negotiations between RTE and OneVision?
The 2012 deadline is real and absolute. It also gives any party involved a clear deadline to be able to effectively set up whatever alternative service comes out of this process. We are clearly coming very close to the time lines where we have to act immediately. A deadline is set for 2012 which would require all parties involved to make their minds up and make their commercial decisions quickly. Come what may, that deadline will be met. We will switch off our analogue services and, despite the difficulties and the slowness of the process, I am still confident we will have an alternative digital service to offer the Irish public.
93 Deputy Simon Coveney asked the Minister for Communications, Energy and Natural Resources his views on introducing an emergency alert system, using mobile phone mast infrastructure, to allow for direct contact to be made with the public on a targeted regional basis in response to emergencies in order to improve direct communication between the national emergency centre and the public; and if he will make a statement on the matter. [3894/10]
The possibility of using the mobile phone infrastructure to broadcast messages to the public in the event of an emergency has been considered by my Department. Initial discussions with the industry indicate that this is not a simple task and that the infrastructure is not designed to broadcast short message service messages simultaneously to all users of the mobile phone network. It is proposed to have further engagement with industry to explore these technical limitations and to examine the feasibility of how messages can be delivered to the public during emergencies using mobile phone infrastructure.
The Minister may see this as a slightly unusual question because it is quite general in terms of what it requests, but the Minister, Deputy Ryan, has responsibility for communications. He will agree that the technical infrastructure now exists for the Government to provide a communications channel in the case of emergencies directly from Government and the emergency infrastructure which it controls to the public. I come from a city which has been devastated by flooding in the past three or four months. Elderly people woke up with floodwaters lapping against their mattresses in their houses and had to be pulled out of windows by relatives or rescued by the emergency services. We can no longer allow a situation to occur whereby, when we have warning that floods are on the way, we do not use the technology which is available to warn people of what will happen.
I ask the Minister to work with me, if necessary, or the industry to ensure the emergency services directly linked to Government have the capacity to use the mobile phone infrastructure currently in place in the country to contact people via their mobile phones in the case of emergency. It should also require the private sector which owns the infrastructure to provide it to Government for use in the case of an emergency such as flooding or some other type of emergency so we can contact people. For every 100 people in Ireland there are 117 mobile phones. Practically every person or household has a mobile phone. It is the obvious way to contact and alert people to warn them about emergencies. Will the Minister put that type of system in place? It is directly connected to his area of responsibility.
The emergency task force which was convened recently did exactly that. It was related to the water issue, where there was a real crisis in terms of the loss of water due to people leaving taps running and so on. It was on that basis the emergency task force went to the mobile phone companies and asked if it was possible for it to use the communications technology in that way. There were difficulties, as is the case when 4.5 million or 5 million messages need to be sent, which have to be considered. In that instance it was not used. It was felt that radio and television broadcasting communications systems could deliver the message. There may be other circumstances. The one to which the Deputy referred is a good example of where it may be possible for us on an emergency service basis to provide instant messaging in such a way. The Department is engaged and will liaise with the Deputy in that regard to see what specific measures will work.
I am trying to be helpful because this is not an issue on which we should be political. I have two proposals, both of which are highly credible, on how we can use the existing mobile phone mast infrastructure to alert people in regional specific areas. Nobody is suggesting that if there is going to be significant flooding in Cork that 4 million people get a text message to say that a mini tsumani is coming down the River Lee from Inniscarra into Cork city. What we are suggesting is that we should be sophisticated enough, because the technology exists, to be able to use the mobile telephone masts in the Cork city area to contact people who will be directly affected by, for example, floods. If Bandon is going to be flooded on Tuesday, given that we have the data from the rivers that flow into that town and from the weather forecast expertise, we should use the mobile telephone mast infrastructure in that area in west Cork to send a message to that specific region to let those concerned know what is going to happen and when it is likely to happen in order that businesses and homes can prepare for it. It is inexcusable that we would not use the technology that is available to ensure that the kind of ill-prepared response to flood crises that happened in places such as Cork and elsewhere would not happen again and it certainly should not happen without warning.
I agree with the Deputy. As I have said those engagements have already started with the mobile telephone companies. They will continue and will take into account the suggestion he has made. It is more applicable in areas where there are short timelines in terms of a flood warning or other such emergency. We will continue to progress the issue with the mobile telephone companies.
94 Deputy Noel J. Coonan asked the Minister for Communications, Energy and Natural Resources if the Commission for Energy Regulation is considering removing the regulated tariff formula pricing structure which allowed for competition in the gas market; his views on whether this will halt competition, choice and service in this sector for consumers and small medium enterprises; his further views on whether that regulated tariff formula is of more importance due to the current economic climate; and if he will make a statement on the matter. [3895/10]
The regulation of charges in the natural gas market, including tariffs to final customers, is the statutory responsibility of the Commission for Energy Regulation, CER, under the Gas (Interim) Regulation Act 2002.
The gas market has been fully opened up to competition since July 2007. Experience in other markets has shown that there is a time lag between full market opening and the emergence of fully viable competition. The small size of the Irish retail gas market adds to the challenge.
The current regime of regulation in the upper end segment of the Industrial and Commercial sector is known as the Regulated Tariff Formula regime. The Regulated Tariff Formula took effect in 2003 for gas customers consuming from 188,000 to 9 million therms per annum. Prior to its introduction in April 2003, Regulated Tariff Formula eligible customers could choose from a range of Bord Gáis Energy published tariffs. The Regulated Tariff Formula regime introduced a price regulation formula reflective of monthly wholesale prices and the cost of delivering gas to the customer's premises.
This regime was introduced as an interim measure in 2003 to encourage competition in this sector at a time when Bord Gáis Energy Supply, BGES, had 100% of the market of this sector. BGES now has approximately 41% of this sector.
I am advised by the CER that it launched a review of the Regulated Tariff Formula last October. This review is in line with the commitment by the CER that it would keep the case for retaining or removing the Regulated Tariff Formula regime under regular review. The CER has indicated that it considers the time may now be right to remove the RTF regime. The decision process involves a consultation process on the potential of the regime. The consultation is ongoing.
The continued entry of new suppliers into the gas market, with Phoenix and ESBIE being the most recent entrants, demonstrates that regulatory policy to underpin the growth of competition in gas supply has paid dividends for consumers. The decision now to be made by CER following the consultation process is whether competition has now taken sufficient hold for the Regulated Tariff Formula to be removed in the interests of business customers. I have no doubt that in reaching a balanced and evidence based decision CER will take due account of all the perspectives on the matter including the views of all suppliers and of the business customers themselves.
I thank the Minister for his reply. I asked whether it was his opinion that this is the wrong time to remove the Regulated Tariff Formula in view of the fact that competition is so vital in the economy. I do not accept his claim that it is the responsibility of CER. I can recall the Minister coming into this House during the past 12 months when he used considerable influence to reduce the price of natural gas which had declined on the wholesale market. Also by his appointment of the new regulator, the Minister is, in effect, in charge of CER. It is important to know what is his policy. Does the Minister agree that the removal of RTF at that stage would not be beneficial for the consumer and small industries as there would no longer be a transparent pricing system for gas which could lead to a dominant position for Bord Gáis which could stifle competition?
My direction is that we achieve a competitive clean and secure energy supply and keep money in this country rather than have it go abroad as much as possible. In the gas area, the RTF applies for about 246 customers. These are some of the larger industrial customers, companies that are in a competitive challenge, exporting companies to the UK and others. For them it is important that the regulator gets the price right. There are real benefits from introducing competition from having it deregulated in that one can have a downward price pressure for such customers. However, it is not certain. One has to ensure there is not a dominant position that one does not end up giving short-term gains and seeing a long-term loss. It is the regulator's job to assess, to listen to different views and come to a conclusion. I am confident in its ability to take on that task and to make the necessary change. The RTF has been in place for a number of years. It was always seen as being a temporary measure and was not meant to be a permanent mechanism. It is a temporary measure until there is a sufficient level of competition to open it up. That would bring prices down. The policy is working and I believe the CER will continue to make it work.
Will the Minister agree that the Regulated Tariff Formula has been very effective when compared to the light touch regulatory system in the banks and in Eircom which has virtually brought this area to its knees and that it is important at this stage in our development, in view of the pressure being experienced by the economy and competitiveness and reducing prices? His initial intervention nine months ago had the effect of reducing gas prices significantly but they are still 13% above the European norm. We do not want the energy sector to become like the banks because of what happened through the regulatory regime. Will the Minister acknowledge that the RTF is worth is holding on to for that reason alone? It provides security and competition in the industry.
I do not know about Fine Gael's position but I believe competition helps to drive down prices and I have seen it work. Therefore, my general instinct, where possible, is to let competition work in the public interest. Ultimately, it is for the CER to decide when to turn to such a competitive unregulated market. We are moving on that. We need also to move in the area of electricity, in the last band that is competitive. We are doing it on a steady basis in the gas market and that is appropriate but it is up to the CER to make the final call as to exactly when. The general policy of using competition to bring prices down is something of which I am proud and support.
