Dáil Éireann debate -
Wednesday, 16 Jun 2010

Vol. 712 No. 3

Other Questions

Departmental Agencies

Leo Varadkar

Question:

39 Deputy Leo Varadkar asked the Minister for Enterprise, Trade and Innovation the decision he has made on each of the recommendations of the Special Group on Public Service Numbers and Expenditure Programme report relevant to his Department such as creating a single funding stream for all science, technology and innovation activities across all Departments, the discontinuation of funding for the Irish Council for Bioethics, the reduction of Departmental civil servants serving the science, technology and innovation programme, consolidating all indigenous enterprise support and sector marketing functions in Enterprise Ireland and the rationalisation the organisations losing functions as appropriate, the reduction of Industrial Development Authority capital and administrative costs including rationalisation of regional offices in Ireland and shared services, efficiency saving in administration and programme prioritisation in Enterprise Ireland, the rationalisation of IDA and Enterprise Ireland overseas offices, reorganisation Shannon Development, reorganisation of Forfás, outsourcing the Certification Service of the National Standards Authority of Ireland, the rationalisation of all employment services provided or funded by the State into a single operation, ending the dual entitlement of certain social welfare claimants to both social welfare payments and FÁS training allowances or Community Employment allowances, cutting FÁS services to business, finding efficiencies in the FÁS administration budget, the relocation of all Industrial Relations institutions to a single location, merging the Health and Safety Authority and the National Employment Rights Authority into one Work Place Inspectorate, merging the functions of the Registrar of Friendly Societies and Companies Registration Office, savings in corporate services, a reduction in administrative budget and a transfer of foreign posts to Brussels to reduce travel and subsidence spend, merging the Irish Takeover Panel with the Competition Authority; and if he will make a statement on the matter. [25397/10]

Deputy Batt O’Keeffe

The report of the special group on public service numbers and expenditure programmes made a number of recommendations addressed directly to my Department. The Deputy has outlined most of these recommendations in his question.

In the time available, it is not possible to address all of the recommendations in the special group's report relating to my Department in detail. However, I am circulating, for the benefit of the House, a detailed table which sets out the current position on each of the recommendations in the report that relates directly to my Department. As the Deputy will see from that table, eight recommendations have been accepted in whole or in part and the resulting financial savings have been incorporated into my Department's Estimate for this year.

Some proposals envisaged by the special group, such as the rationalisation of agencies, are quite complex to implement and may require legislative provision if they are to be achieved. There are also a number of recommendations in the report affecting my Department which require cross-departmental consideration and/or consideration at Government level.

As the Deputy will be aware, responsibility for FÁS transferred from my Department to the Department of Education and Skills with effect from 1 May this year. The recommendations made by the special group in respect of FÁS programmes and services are now a matter for consideration by that Department.

Decisions in respect of some recommendations will be a matter for consideration by Government in due course. Any expenditure reductions that may arise will be included in the budget for my Department in future years.

Summary of Recommendations made by the Special Group on Public Service Numbers and Expenditure Programmes in respect of the Department of Enterprise, Trade and Innovation

Recommendation	Position
Create a single funding stream for all science, technology and innovation activities across all Departments.	In the context of Budget 2010, the Minister for Finance announced that the Government was establishing a single funding stream for Science, Technology and Innovation to maximise the efficiency and focus of investment and ensure that Ireland’s effort is strategically targeted on those areas that can achieve greatest impact.
	The transfer of responsibility and associated funding for the Programme for Research in Third Level Institutions (PRTLI) and certain other research functions from the Department of Education and Skills to the Department of Enterprise, Trade and Innovation from 1 May 2010 represents significant progress in relation to implementing this recommendation.
Discontinuation of funding for the Irish Council for Bioethics.	The 2010 Estimates made provision for an orderly wind-down of funding from the Department of Enterprise, Trade and Innovation to the Irish Council for Bioethics (ICB) in the course of the year. The then Minister for Enterprise, Trade and Employment agreed with the Minister for Health and Children and the Minister for Finance that the three staff in the secretariat to the ICB should be seconded to the Department of Health and Children, so that their expertise could be availed of appropriately.
	The funding allocation that had previously been made available to the Department of Enterprise, Trade and Employment for the ICB was accordingly transferred to the Department of Health and Children. Any further decisions in relation to the body are a matter for that Department.
Reduction of Departmental civil servants serving the science, technology and innovation programme.	The Special Group proposed reductions in civil service numbers across all of the Department’s programmes.
	The number of serving civil servants in the Department fell by 80 in 2009 and will fall further this year due to the moratorium on the recruitment of staff.
	The Department is currently in discussion with the Department of Finance on staffing targets for the year. The Department will apply its reduced resources as required to address key priorities which may vary from time to time.
	The Special Group also proposed reductions in the number of staff in the Department’s agencies. Staffing targets for the agencies are also under discussion with the Department of Finance.
Consolidate all indigenous enterprise support and sector marketing functions in Enterprise Ireland and the rationalisation the organisations losing functions as appropriate. EI to deliver consolidated services through 8 offices in line with NSS hubs	The proposal made by the Special Group cuts across a number of Government Departments and agencies. Detailed consideration of those aspects that concern only the Department of Enterprise, Trade and Innovation (regarding, for example, the CEBs) is at an advanced stage.
Reduction in Enterprise Ireland’s Capital spend	The Government considered it appropriate to increase Capital funding to Enterprise Ireland over the last two years to enable the agency to support vulnerable but viable companies, through, for example, the Enterprise Stabilisation Fund.
Reduction of IDA’s capital and administrative costs including rationalisation of regional offices in Ireland and shared services.	IDA’s administrative costs have been reduced by €2.6 million for 2010 compared to the 2009 Estimate provision. This has been achieved through pay and efficiency savings.
	It is not clear what savings would accrue from a rationalisation of regional offices.IDA Ireland’s capital allocation is directly related to its contractual commitments.
	IDA Ireland’s capital allocation is directly related to its contractual commitments.
Efficiency saving in administration and programme prioritisation in Enterprise Ireland.	Enterprise Ireland’s administrative budget has been reduced by €7.9 million for 2010 compared to the 2009 Estimate provision. This has been achieved through pay and efficiency savings.
The rationalisation of IDA and Enterprise Ireland overseas offices.	The agencies already share office space in most common locations.
Reorganisation of Shannon Development.	Consideration of this recommendation is on-going in the context of the special requirements of the Mid West Region in the aftermath of the Dell closure. Any reorganisation of Shannon Development would require approval by the Government.
Reorganisation of Forfás.	The Special Group’s proposal was that Forfas’s existing shared services function (carried out on behalf of a number of agencies) should be relocated to a wider Shared Services operation.
	The implementation of this recommendation would be contingent on the identification of another body which provides shared services functions more efficiently than Forfas.
	In the absence of the identification of such a body, the Department requested Forfás to examine the possibility of achieving savings through an enhancement of their existing shared services arrangements and this process is under way.
Privatise the Certification Service of the National Standards Authority of Ireland.	The Special Group’s proposal was to privatise (rather than outsource) the NSAI’s Certification Services.
	Having considered the recommendation in detail, it was not clear that any benefit would accrue to the taxpayer from such a move, because of the high level of overhead costs that would remain with the NSAI after a sale of the certification business. The more likely result would be increased Exchequer cost. Accordingly, it has been decided not to pursue this proposal at this time.
The relocation of all Industrial Relations institutions to a single location.	The Labour Court, the Labour Relations Commission and the Rights Commissioner services are currently located in Tom Johnson House in Dublin.
	The Office of Public Works and the Department of Communications, Energy and Natural Resources have been requested to facilitate the location of the Employment Appeals Tribunal to the same premises.
Merging the Health and Safety Authority and the National Employment Rights Authority into one Work Place Inspectorate.	Further examination of this proposal suggests that: there are radical differences between the natures of the two inspectorates;
	overlaps between the two Agencies are minimal;
	a merger will not yield appreciable savings;
	substantial legislative change would be required.
	On that basis, it is not propose to proceed with this recommendation. However, both Agencies are, under the aegis of the Department, developing a programme of practical co-operation designed to make most efficient and effective use of their overall resources, whilst having regard to their different remits.
Merging the functions of the Registrar of Friendly Societies (RFS) and Companies Registration Office (CRO).	The two offices and their statutory functions are already the responsibility of the same public official. Proposals relating to the future of the Registry of Friendly Societies and its statutory functions will be submitted to Government shortly.
IAASA should maximise shared services and reduce the Exchequer’s intervention from 40% to 20%	IAASA is endeavouring to maximise the use of shared services, but scope for savings is minimal. The Department currently provides payroll services to the Authority. The level of Exchequer subvention is provided for in legislation and any reduction in this subvention would require detailed policy assessment and legislative change.
Savings in corporate services, a reduction in administrative budget and a transfer of foreign posts to Brussels to reduce travel and subsistence spend	Savings of €1 million in the Administrative Budget were delivered in the 2009. Further savings will be achieved in 2010.
	There are costs associated with the assignment of posts to Brussels (e.g. Rent Allowance). Having analysed the proposal, the Department does not believe that the recommendation would be efficient or achieve economies in an overall context.
Merging the Irish Takeover Panel with the Competition Authority	This merger could lead to unnecessary policy conflict and it would not be in line with best international practice.

Deputy Leo Varadkar

I thank the Minister for his reply and I look forward — assuming it will still be my responsibility to do so after tomorrow — to examining the table to which he refers in great detail. I would not agree with every proposal contained in the an bord snip nua report but I and my party agree with many of them. For some time I have been critical of the fact that the Government commissions reports and appoints task forces but does not then state, within a reasonable timeframe, which recommendations it is accepting, which ones it is refusing — and the reasons for so doing — and which ones it is going to implement. That practice should be normal for Government.

Does the Minister agree that if a report is commissioned or a task force appointed, the Government should, within a reasonable timeframe, indicate the recommendations it intends to accept and those it intends to reject? Does he also agree that reasons should be indicated as to why certain recommendations might be rejected and that information should be provided with regard to when and how those which are being accepted will be implemented.

The Minister indicated that eight of the recommendations in the report have been accepted. Have any been rejected?

Deputy Batt O’Keeffe

The report contains a total of 17 recommendations in respect of my Department. As already stated, eight have been accepted and will be implemented. We believe that four or five of the others are not appropriate and I can list these for the Deputy and provide reasons as to our why we perceive them in this way.

Deputy Leo Varadkar

That was the question which I asked.

Deputy Batt O’Keeffe

Some of the recommendations will not provide the savings envisaged. The special group was interested in bringing about savings. One of its recommendations related to merging the Irish Takeover Panel with the Competition Authority. I am informed that such a merger could lead to an unnecessary policy conflict and would not be in line with best international practice. As a result, the recommendation relating to the merger must be disregarded.

There is a further recommendation relating to the Irish Auditing and Accounting Supervisory Authority, IAASA, which——

An Leas-Cheann Comhairle

I do not believe it necessary for the Minister to read out the entire list.

Deputy Leo Varadkar

I would like to hear what is happening in respect of the recommendations that have been refused.

Deputy Batt O’Keeffe

I will supply the list to the Deputy.

An Leas-Cheann Comhairle

I would like to allow some flexibility in respect of this matter and invite supplementary questions from other Deputies.

Deputy Batt O’Keeffe

I will also outline for Deputy Varadkar the reasons we believe we cannot approve four of five of them.

Deputy Willie Penrose

I was about to suggest that some of the recommendations are inherently contradictory. That is why the Labour Party looked askance at some of the proposals contained in the McCarthy report. A number of those proposals, particularly that relating to the merger to which the Minister refers and which I also identified, could have serious implications. As we have discussed on previous occasions, the Competition Authority has serious work to carry out in respect of cartels, etc., and is obliged to consider what is best in that context. Does the Minister intend to deal with such matters in the context of the new legislation he intends to introduce?

Deputy Batt O’Keeffe

I did give consideration to the recommendation that the Health and Safety Authority, HSA, and National Employment Rights Authority, NERA, be merged into a single workplace inspectorate. Again, however, radical differences arise in the context of the nature of these agencies and there are overlaps in their work. In the circumstances, we cannot see a merger becoming a reality or the savings that were envisaged eventually being made.

The McCarthy report sought a reduction of 594 in the number of staff across the Department and the various agencies. There are 5,150 whole-time equivalent posts across the Department and its agencies. The number of posts across both fell by 322 in 2009. Some 80 of these posts related to departmental civil servants. We are currently examining the annual staffing targets required by the Department of Finance for 2012. As the Deputy will appreciate, the transfer of FÁS had a significant impact on numbers within the Department. This is a matter which will now have to be taken into account by the Department of Education and Skills.

Deputy Deirdre Clune

In the budget introduced in April 2009, it was stated that Competition Authority and the Consumer Agency were to be amalgamated. However, nothing has happened in the intervening 15 months. This merger was on the Government's agenda prior to any special reports being commissioned. We have been looking forward to the introduction of the relevant legislation for a long time but nothing has happened.

Deputy Batt O’Keeffe

As Deputies Varadkar and Penrose will testify, the legislation to which the Deputy refers was before the House quite recently. We are moving forward with this matter. Emergency legislation was introduced and another major Bill is being finalised at present. I hope to be in a position to publish the latter in September or October.

Deputy Leo Varadkar

I am confused by the Minister's answer. If memory serves, the legislation to which he refers is the Competition (Amendment) Act 2010, which was recently passed by the Houses and which allows the Minister to appoint, on a temporary basis, some members of the authority. The consumer and competition Bill, the purpose of which will be to merge the Consumer Agency and the Competition Authority and to extend the powers of the resultant new body, has yet to appear. My question is similar to that posed by Deputy Clune. Some 15 months have passed since the introduction of the relevant budget in April 2009. I accept that a week is a long time in politics. At present, a day is a long time in politics. However, why has it taken 15 months to draft the relevant legislation?

Deputy Batt O’Keeffe

The process relating to drafting the relevant legislation is extremely complex and a great deal of interaction took place between the Department and the Office of the Attorney General. I have increased the staffing complement dealing with this matter in my Department by bringing on board an official from the Office of the Attorney General.

It is hoped we will now be in a better position to transpose directives and to process legislation with far greater co-ordination of activity between my Department and the Office of the Attorney General.

Michael Noonan

Question:

40 Deputy Michael Noonan asked the Minister for Enterprise; Trade and Innovation if he has given any consideration to privatising any agencies or companies within the aegis of his Department; and if he will make a statement on the matter. [24511/10]

Deputy Billy Kelleher

The following agencies operate under the aegis of my Department: Enterprise Ireland, Forfás, IDA Ireland, the National Standards Authority of Ireland, Shannon Development Company, county and city enterprise boards, InterTrade Ireland, Science Foundation Ireland, the Competition Authority, the National Consumer Agency, the Irish Auditing and Accounting Supervisory Authority, the Health and Safety Authority and the Personal Injuries Assessment Board.

In general, these are statutory, non–commercial, State agencies and are for the most part reliant on Exchequer moneys to fund their activities. In some instances, the agencies generate own-resource income but this is used to defray operating expenses and so limit the requirement for Exchequer funds. The Personal Injuries Assessment Board, which is entirely self-funding, is not engaged in commercial activity designed to make profit.

The Special Report on Public Service Numbers and Expenditure Programmes, the McCarthy report, recommended the privatisation of the certification services of the NSAI. Having considered the recommendation in detail, it was not clear that any benefit would accrue to the taxpayer from such a move because of the high level of overhead costs that would remain with the NSAI following a sale of the certification business. The more likely result would be increased Exchequer cost. Accordingly, my Department has decided not to pursue this proposal at this time.

I do not believe that any of the agencies under the Department's remit are engaged in the provision of services that would be a suitable or attractive proposition for privatisation.

Deputy Leo Varadkar

I welcome the Minister of State's reply. It is reasonable to say that given the profile of the State-sponsored bodies and agencies under the aegis of the Department of Enterprise, Trade and Innovation none of them are appropriate for privatisation as they are not commercial entities in any real sense. I was curious to ask this question for many reasons.

It is not that long ago that the Minister, Deputy O'Keeffe, issued a statement which was critical of Fine Gael's NewEra policy on the basis that we were proposing privatisations — that is not what we were doing — and did not know how much this would raise. The Government has since then announced its intention to privatise the VHI. Will the Minister of State agree that the same applies? Is not now an inappropriate time to privatise the VHI and how much does the Minister believe will be raised from this sale? Does the Minister stand over his remarks in regard to Fine Gael's privatisation policies?

An Leas-Cheann Comhairle

The Minister is not answerable to the House for the VHI.

Deputy Leo Varadkar

I would like him to respond to my question.

Deputy Billy Kelleher

The NewEra document was condemned by the Minister, Deputy O'Keeffe, and many others, including Members in Opposition parties. It counted jobs a number of times.

Deputy Batt O’Keeffe

Deputy Bruton was not happy with it.

An Leas-Cheann Comhairle

Please allow the Minister of State finish his reply.

Deputy Billy Kelleher

It seeks to sell off the family silverware. The purpose of the sale of VHI is to deal with risk equalisation and to ensure there is competition.

Deputy Leo Varadkar

No, it is not. That is rubbish.

Deputy Billy Kelleher

Yes it is and this has been confirmed. The Deputy should read the statements in this regard from the Department of Health and Children.

The Government is committed to ensuring we reduce expenditure where possible. The State agencies under the remit of the Department of Enterprise, Trade and Innovation are not involved in profit making. They are non-commercial State agencies that give support to many activities throughout Ireland. The agencies involved include Enterprise Ireland, the Irish Auditing and Accounting Supervisory Authority and others which are critically important in the area of supervision and supports.

Deputy Leo Varadkar

I again ask the Minister of State the question the Minister asked of Fine Gael in regard to NewEra. Is it not inappropriate to privatise VHI at this time given the current state of the capital markets and how much does the Minister hope to raise from this sale? That is the question posed to Fine Gael in respect of NewEra. I would like now to hear the Minister's answer in regard to the Government's proposal to privatise VHI.

An Leas-Cheann Comhairle

Again, the Minister is not accountable to the House for the Department of Health and Children.

Deputy Leo Varadkar

I would like to hear a response from the Minister, Deputy O'Keeffe, rather than from the Minister of State, Deputy Kelleher.

Deputy Billy Kelleher

The best way for this issue to be addressed is by way of parliamentary question from the Deputy as spokesperson on enterprise, trade and innovation. We can then supply the necessary answers. We cannot be held responsible for the matters relating to the VHI and Department of Health and Children posed in the questions tabled today.

Printing Contracts

Catherine Byrne

Question:

41 Deputy Catherine Byrne asked the Minister for Enterprise; Trade and Innovation if he will provide a list of all printing and package contracts awarded in 2009; the value of each contract and the company to which it was given; and if he will make a statement on the matter. [25406/10]

Deputy Billy Kelleher

Neither my Department nor the Offices of my Department, which manage their own procurement requirements, awarded any significant printing contracts in 2009. For the purposes of procurement of printing services in 2009 the Department and the Offices of the Department relied mainly on the Government Supplies Agency and National Procurement Service for the tendering and procurement of printing services. This service is provided principally by means of drawdown contracts, which sets out prices, terms and conditions under which supplies are delivered. The Department and the Offices of the Department purchased, as required, from the appointed contractors in 2009. I am circulating in the official record as part of this reply a tabular statement which sets out the details of all such purchases in 2009.

Printing Costs in 2009 of the Department including the Patents Office and the Employment Appeals Tribunal

Printing Works	Cost	Company
	€
Parliamentary Printing	25,355	Cahill Printers
Business Cards/Letterheads/Complimentary Slips & Envelopes	16,468	Print Stations
Booklets/Reports	16,095	Brunswick Press
Report Printing	12,648	Dara Creative
Report Printing	12,228	EGM
Business Cards/Letterheads/Complimentary Slips & Envelopes	10,718	New Oceans
Business Cards/Letterheads/Complimentary Slips & Record Books	8,954	Fine Print
File Covers	7,206	Enterprise Stationery
Cheques/Licences	6,300	Aluset
Business Cards	1,208	Fine Print
Business Cards/Letterheads/Complimentary Slips	258	Print Stations

Printing Costs in 2009 for the Companies Registration Office and Registry of Friendly Societies

Printing Works	Cost	Company
	€
Letters and Notices	105,349	DC Kavanagh/ Ebrook

Printing Costs in 2009 for the Office of the Director of Corporate Enforcement

Printing Works	Cost	Company
	€
Information Booklets, Headed Stationery, Business Cards	13,785	New Oceans
Information Booklets, Headed Stationery, Business Cards	8,619	Fine Print

Printing Costs in 2009 for the Labour Court

Printing Works	Cost	Company
	€
Printing of the annual report for the Labour Court	7,175	Design Lab Ltd
Printing of Statutory Instruments	629	Cahill Printers Ltd

Printing Costs in 2009 for the National Rights Authority

Printing Works	Cost	Company
	€
Printing of information booklets, quarterly bulletins	38,687	Brunswick Press
Printing of headed paper, business cards, prepaid envelopes, complimentary slips	10,347	Walsh Graphic Design
Inspectors warrant (passport size)	48	Print Services

Deputy Leo Varadkar

This is the second time this session I have been promised a tabular statement. I am sure the relevant tabular statement has been already prepared. Would it not have been reasonable to provide Members with a copy of it for Question Time? Perhaps the Minister of State will do so now. I do not understand how I might ask follow-up questions based on the promise of a tabular statement.

Deputy Arthur Morgan

That is the idea.

Deputy Leo Varadkar

It is disrespectful.

An Leas-Cheann Comhairle

The Deputy has made a valid point. I will raise with the Office of the Ceann Comhairle the matter of circulating tabular statements at the time a question is being answered.

Deputy Leo Varadkar

I appreciate that. This is an important issue. There is concern among the industry that small print contractors in particular are not being given a fair opportunity to tender for Government work. I would like to know how the Department of Enterprise, Trade and Innovation, which is supposed to support Irish industry within European rules, behaves but I cannot ask a follow-up question because I have not received the relevant tabular statement.

An Leas-Cheann Comhairle

If the Minister of State has no objection, I could circulate a copy of the tabular statement to Deputy Varadkar in order to allow him to ask a supplementary question.

Deputy Billy Kelleher

Yes, there is nothing in it that is not available on the record. I apologise for the Deputy not receiving the tabular statement with his reply. If the Deputy wishes I will supply him with a copy of it now.

An Leas-Cheann Comhairle

I will take a question from Deputy Morgan and then come back to Deputy Varadkar.

Deputy Arthur Morgan

Is the Minister of State aware of the perception that exists that a very large number of contracts, not alone in respect of printing, are being awarded abroad? Is he considering ways of improving awareness among businesses who deal in that capacity to tender for such contracts? The same is happening in respect of school building and other contracts. Often when contracts are big, operators here are not in a position to tender for them. Can contracts be segmented? Has the Minister of State considered the possibility of his Department segmenting some of the procurement contracts? We need to as creative and realistic as possible given the current environment.

Deputy Billy Kelleher

Deputies will note from the now circulated tabular statement that some of the contracts awarded are small. One contract awarded to Print Stations was for business cards, letterheads and complimentary slips at a cost of €258. Another contract awarded to New Oceans was for information booklets, headed stationery and business cards at a cost of €13,785. The Department of Enterprise, Trade and Innovation does not award large contracts and relies in the main on the Government Supplies Agency and National Procurement Service in this regard.

A review of tendering and procurement in regard to State contracts is ongoing. We are all aware of the difficulties people are experiencing in terms of accessing contracts owing to the change in environment or in their individual circumstances. It may be that a particular person does not have recognised skill capabilities having been laid off and set up his or her own business as a result of which he or she may not have a track record in his or her own right. This matter is being examined.

Deputy Arthur Morgan

What time-frame is involved?

Deputy Billy Kelleher

As I stated, the matter is under review. The Minister of State, Deputy Mansergh, is reviewing that process.

Deputy Willie Penrose

This is an important issue, one discussed by the Joint Committee on Enterprise, Trade and Employment. Deputy Varadkar may have been inspired to table this question having been present for the discussion on this issue by that committee.

There is a perception that printing contractors are losing out hand over fist and that other European competitors are able to devise methods of ensuring they are awarded contracts. Irish contractors believe other European countries are running a coach and four through the rules in this area and that Ireland is being a goody-two-shoes from a European perspective. Not alone are we obeying the rules but we are making them more difficult for our native industry, in particular the printing industry, which is under threat and trying to survive. We are making business extremely difficult for it.

As far as I am aware — I may be wrong on this — the contract for printing of material in respect of the first referendum on the Lisbon treaty was awarded to a company outside Ireland. How can this be justified?

Would the Minister agree that there is a weighting system in awarding contracts? The OPW is deeply involved in this. Could we not ensure that greater weight is given to people who are tried, trusted and reliable and have done jobs in the past? Our native industry, particularly in the printing trade, has tried to secure important and skilled jobs and they are all under threat.

Deputy Billy Kelleher

We understand that many businesses are vulnerable, as was referred to by the Minister. I have met and received correspondence from many representatives of the printing industry. However, we must be conscious of another aspect. Many Irish companies are also exporting. Irish companies have contracts connected to the 2012 Olympics in London and several Irish software companies are providing services to councils in the United Kingdom and across the European Union. If we are to be open in one area we must accept the quid pro quo. We must restore competitiveness to our economy and ensure that our companies are competitive.

Deputy Leo Varadkar

No one on this side of the House would oppose the rules of the internal market. I will examine the tabular statement provided by the Minister. It gives the names of companies but does not say if they are based in Ireland. In fairness, I did not ask the Minister for that information. I will have to review them.

Does the Department have an internal printing procedure? The Government might save money if it had a Government printing press. Some time ago, Fine Gael began to use its own printing facility in Ballymount, as well as the facilities provided in Leinster House. Has the Government considered having its own printing facilities? Money could be saved in that way without the need to outsource contracts.

Deputy Billy Kelleher

A high level group is examining all areas of procurement by the Department to see where efficiencies and savings can be generated. Printing is a specialised business. Some of the contracts are for printing booklets rather than simple letterheads and complimentary slips.

There is a tendering process which is open and transparent. Some of the contracts awarded by the Department are very small. In general, we depend on the National Procurement Service for larger contracts and general provisions to the Department itself. We are conscious of cost savings in the present climate. We can look at all aspects of this matter.

Loan Guarantees

Michael D'Arcy

Question:

42 Deputy Michael D’Arcy asked the Minister for Enterprise; Trade and Innovation when he will make a decision on the introduction of a small and medium enterprise loan guarantee; and if he will make a statement on the matter. [25419/10]

Deputy Batt O’Keeffe

The Deputy will be aware that work is under way in my Department on the examination of a possible scheme of loan guarantees for the SME sector which could augment lending by banks by addressing particular market failures. This is in line with one of the recommendations in the Mazars review on bank lending to SMEs.

Enterprise Ireland and Forfás carried out examinations of loan guarantee schemes in the UK and in some other countries. Following more detailed examination, Forfás recently submitted a report to my Department, which is being considered. A key issue to be addressed is the role such a scheme might play in improving access to finance, particularly in current circumstances, for viable companies, such as start-ups and technology companies, that do not have bankable substantial assets.

Studies that have been consulted attach considerable importance to the design of such schemes to ensure that they benefit companies and to minimise the cost to the Exchequer. From the company perspective, the key issue concerns additionality, the extent to which a scheme increases the amount of lending to SMEs. To the extent that substitution occurs — companies that would be funded in any event being covered by the scheme — such schemes merely increase the cost of borrowing to the companies concerned. From a cost perspective, the premium charged to the borrower is intended to offset the cost of defaults but in most schemes some level of public subsidy is involved. The design of any scheme is obviously critical. The scheme must have clear objectives and be carefully targeted. The issues are being examined in detail in my Department and on completion of this work I will bring the results before Government.

In addition, the Deputy will be aware that the Government has taken decisive action to get bank credit flowing to viable businesses, which include specific SME funding initiatives by AIB and Bank of Ireland.

Deputy Deirdre Clune

I am confused. Is the guarantee happening? There has been much soul searching, examination and reports while small businesses are crying out for immediate finance to pay a lease, buy stock or invest in the business. That is the real issue. Business people do not have time for the lengthy process in which the Minister's Department is engaged. Is the Minister intent on introducing the scheme or will yet another report be given to someone to examine to see if its recommendations can be implemented?

Deputy Batt O’Keeffe

Generally speaking, I implement the recommendations in reports. However, we must be careful in this instance. We have looked at the UK and other countries. The design of a loan guarantee proposal is of vital importance. If the design is not right the guarantee might supplement credit that is already available, which could cost the country much more in the long run.

We asked Forfás to do a detailed analysis to see what benefits there would be for companies, over and above the increase in credit now available through the banks and through recapitalisation. If we do not get it right there will be exposure and further losses to the taxpayer. I know what Members on the other side of the House would say in those circumstances. I have had the Forfás report for three weeks and it is being examined in the Department. I will bring proposals to Government before the summer recess.

Deputy Arthur Morgan

I accept the need to examine models and that it is right to protect the taxpayer. When the Minister has brought proposals to Government when will the guarantee hit the streets? There is a high risk to the taxpayer. However, companies need funding and we need to ensure they are viable. The big question remains. When will the guarantee get to the end user?

The Minister of State referred to a high level working group. Sometimes what is needed is a low level working group, to get at the real savings. It is often the people on the shop floor who can tell us how to be more cost effective.

Deputy Batt O’Keeffe

There are two issues here. First, we have increased the amount of credit available to SMEs through both banks. We hope that process will lead to greater availability of credit to small and medium sized businesses. Second, we do not want a loan guarantee to supplement that.

Some of the medium sized businesses find it easier to get credit than smaller businesses. Approximately 30% of the medium sized businesses avail of credit compared with 19% of small businesses. Many small companies do not have collateral. Many research and development and start-up companies do not have collateral and are not seen as credit worthy by banks. We must find a way to help, nurture and grow those companies.

We will bring the loan guarantee recommendations to Government and the Government will have to look at them and approve them. We must make sure they are tailor made and will not be a burden on the taxpayer.

Deputy Leo Varadkar

I have some sympathy with what Deputy Morgan said. It seems that high level groups are the latest fashion in Government. I wonder if there is a hierarchy of groups. Are there medium and low level groups or are they all high level? I would be interested to hear the Minister's comments on that.

Deputy Conor Lenihan

The low level stuff is all in Deputy Varadkar's party.

Deputy Leo Varadkar

Has the Minister looked at the Chilean loan guarantee system, which is the preferred option of the Governor of the Central Bank? I think he is right about that, having read his lectures on the subject.

The question everyone else has asked and which the Minister has not answered is, will he introduce an SME loan guarantee?

Deputy Batt O’Keeffe

I will answer the last question first. I will put the proposals in the Forfás report to Government before the summer recess. It will be a matter for Government to take the decision. I was also asked whether we have examined the Chilean system. Yes, we have. That has been taken into account in the FÁS and Enterprise Ireland reports.

On the high level groups, it is fair to say we are trying to have joined-up thinking and joined-up action across departmental boundaries. I will give an example of something I was involved in when I was Minister for Education and Science. We got the universities in Dublin to tender for their energy costs and they saved more than €1 million. We got the universities and institutes of technology in Limerick, Athlone and Cork to tender for their energy costs and they saved €1.5 million. Great savings can be made by crossing boundaries and having joined-up action and joined-up thinking. I have asked the various agencies in the Department of Enterprise, Trade and Innovation to consider tendering for their energy costs and to see what they can do. We want to transpose that kind of thinking across departmental boundaries. That is why the high level groups are so important. They allow for synergies in what we want and need to do. The savings that result from that are important for the taxpayer.

Consumer Rights

Michael D. Higgins

Question:

43 Deputy Michael D. Higgins asked the Minister for Enterprise, Trade and Innovation the position regarding the draft consumer rights directive; if he is satisfied that the existing rights consumers here, such as the right to reject, will be retained; and if he will make a statement on the matter. [24343/10]

Deputy Billy Kelleher

The proposal for a consumer rights directive was published in October 2008. The directive has been drafted on a full harmonisation basis. If that is retained, it will preclude member states from going beyond its protection in national legislation. Although some provisions of the proposed directive would strengthen consumer rights in Ireland, others would have a less positive effect. Concerns about the proposal's impact on Irish consumer rights centre mainly on its provisions on consumer remedies for faulty goods. As the Deputy's question suggests, it would have particular implications for what is known as the right to reject — the right to return faulty goods, obtain a refund of the price and terminate the contract. A fully harmonised provision along the lines proposed in the draft directive would, if adopted, mean that the right to reject would be a remedy of second rather than first resort for faulty goods.

I assure the Deputy that my officials have expressed reservations about relevant aspects of the proposed directive in clear and forthright terms. Such concerns were restated at political level at meetings of the Competitiveness Council in December 2009 and May 2010. I raised our concerns directly with Vice-President Reding, who has responsibility for this proposal, when I met her at the most recent meeting of the Competitiveness Council. It is important to recognise that discussions on the proposed directive have a considerable way to go at official and ministerial levels and in the European Parliament. The European Parliament committee on the internal market and consumer protection is considering the proposal which is expected to have a first reading in the Parliament before the end of the year. I remind the House that this is a draft proposal, as opposed to an EU directive.

Deputy Willie Penrose

I would object to the implementation of such an EU directive on a full harmonisation basis. It would impinge negatively on existing consumer rights. I accept that it is proposed to extend the withdrawal or cooling-off period for distance or off-premises contracts from seven to 14 days. That would be welcome. The proposal that risk would pass upon the delivery of a consumer sales contract would also enhance the rights of the consumer. We have to ensure it is balanced, however. As far as I can tell, the unfair contract terms set out in the directive are similar to our own. As the Minister of State suggested, the provisions of the consumer rights directive with regard to consumer remedies for faulty goods would impinge negatively on the right to reject or return faulty goods, get a refund and terminate the contract. That would be serious.

The sales law review group was established in November 2008. Has the Minister of State made a submission to the group to ensure important rights are retained? Has he made a recommendation to the observation group on the proposal to reduce the liability period from six years to two years? That would be an absolute disaster. What is the feeling at EU level? Are many other member states that have similar legislative protection in place for consumers showing sympathy with our position? Such protection will be eroded if this directive is implemented in full.

Deputy Billy Kelleher

We have raised our concerns at official level in the strongest and most forthright terms. We relayed them at meetings of the Competitiveness Council in December 2009 and May 2010. I have spoken to Vice-President Reding about our concerns with regard to consumer protection. I emphasise that this is just a proposal — a draft directive as opposed to a directive that would have to be implemented by national parliaments across the EU. We are conscious of the need to ensure there is strong protection for consumers. That is something we are advocating at all levels. Mr. Andreas Schwab, who is the rapporteur of the European Parliament committee on the internal market and consumer protection is conscious that the proposal is not in line with the observations of some member states. It would dilute consumer rights, such as the right to return being the first recourse, as opposed to a secondary recourse. We will raise these issues again in due course.

Deputy Willie Penrose

I thank the Minister of State.

Deputy Arthur Morgan

This is a very good question.

Deputy Billy Kelleher

It was a very good answer as well.

Deputy Willie Penrose

One will not get a good answer unless one asks a good question.

Deputy Arthur Morgan

I would like to ask whether a defective government can give grounds for rejection by consumers. Specifically, when are the people of this State likely to get an opportunity to reject this Government?

Deputy Billy Kelleher

I missed the Deputy's question.

An Leas-Cheann Comhairle

I think it was a rhetorical question

Deputy Billy Kelleher

Was it not relevant to my answers?

Deputy Arthur Morgan

I would love to hear an answer.

An Leas-Cheann Comhairle

If the Minister of State wishes to respond, the Chair will not prevent him from doing so. However, I do not think the matter raised is appropriate to his line responsibilities.

Deputy Willie Penrose

Has any work been done to examine the legislative protection in the Sale of Goods Act 1893, as amended by the Sale of Goods and Supply of Services Act 1980, in the context of the new directive? Did Mr. Bob Clark and his colleagues on the sales law review group examine anything of that nature? We have heard much today about charts — has a chart been compiled to compare and contrast what is available under the 1980 Act with what is now proposed? Perhaps we could be furnished with such a document in due course.

Deputy Billy Kelleher

The common law in the Sale of Goods Act 1893 was amended in the Sale of Goods and Supply of Services Act 1980.

Deputy Willie Penrose

The 1980 Act is the real one.

Deputy Billy Kelleher

Yes. Some of the provisions of the 1893 Act are still used.

Deputy Willie Penrose

They are.

Deputy Billy Kelleher

Does the Deputy suggest that a comparison should be made between the Irish legislation and the draft EU directive?

Deputy Willie Penrose

Yes.

Deputy Billy Kelleher

That observation has been made. We believe the directive, as presently proposed, would undermine the statutory provisions we have made in the interests of consumers in the Sale of Goods Acts and in our broader consumer protection measures.

Deputy Willie Penrose

Can the Minister of State bring a copy of the 1980 Act to Brussels and everywhere else to show them how good our law in this area is?

Deputy Billy Kelleher

I certainly can. I could even bring the 1893 Act with me, just to be sure. Our officials have raised these issues regularly. We do not want our solid consumer protection laws to be undermined by a proposal like this.

Deputy Willie Penrose

Very well.

EU Services Directive

Ciaran Lynch

Question:

44 Deputy Ciarán Lynch asked the Minister for Enterprise; Trade and Innovation the position and timeframe for the transposition of the Services Directive; and if he will make a statement on the matter. [24345/10]

Deputy Batt O’Keeffe

The regulations to bring the services directive — directive 2006/123/EC — into law under the European Communities Acts have almost been finalised. I hope to sign the regulations into law by the end of this month. Ireland is open for business as far as the directive is concerned, as we have been applying it administratively since January 2010. The purpose of the services directive is to remove any remaining barriers to trade in services across the EU and to open all 27 EU markets to service providers and consumers. It will make it easier for an Irish service provider to set up business in any member state by enabling him or her to complete the necessary formalities through a point of single contact. For a consumer, it means access to services from across the EU. The directive contains many consumer protection provisions, as well as provisions requiring member states to share in the policing of their service providers operating throughout the EU. The services directive does not affect labour law and does not diminish workers' rights.

The overall effect of the creation of a single market for services will be to enhance Ireland's competitiveness. It will enhance the EU's competitiveness by creating the necessary economies of scale for European service providers, who are facing an increasingly globalised world economy, to challenge service providers in world markets. Forfás estimated in 2008 that gross value added in services to the Irish economy could increase by €540 million per annum as a result of the services directive, and net employment in the sector could increase by more than 4,000. The value of services exports was expected to increase by between €10 billion and €14 billion per annum. Those projections are being re-examined and revised figures will be included in the regulatory impact analysis which will be published when the regulations are signed. The negotiation and transposition of the directive has been a lengthy process involving all Departments and stakeholders as far back as 2004. In addition, the Oireachtas debated the then draft directive in 2006 before final decisions were made on Ireland's position on the proposal. We have been in ongoing contact with the European Commission at all stages during the transposition process. Officials of my Department met representatives of the Commission as recently as yesterday, 14 June, at which time the Commission was assured of Ireland's commitment to completing the transposition of the directive in the next few weeks.

Deputy Willie Penrose

I thank the Minister sincerely for that. The directive is important in the context of the legal framework for any service provided for economic return, with the exception of specified services in health and various other areas, and takes into account the specific nature of the activity or profession. Is it true that we are in the slow-coach lane? Along with Slovenia and Greece, Ireland is one of the three tardiest countries in transposing the directive. The former Minister for Finance, Mr. Charlie McCreevy, was the person who originated this, so perhaps the Minister is right, in hindsight, to take it easy. That is the way I would look at it at this stage.

There will be many benefits associated with the transposition of the directive. Has the Department identified any specific area, within the broader services area, in which the directive will be of major benefit to us or in which we can take a leading role? It does not apply to insurance or anything similar; nor should it, because of the importance of where contracts are made and so on. Are there certain legislative areas in which we are already advanced and which are complemented by this directive, allowing us to gain an upper hand in securing business?

Deputy Batt O’Keeffe

From Ireland's point of view, it is important to have the Services Directive in place. The directive was supposed to be transposed into law——

Deputy Willie Penrose

In 2007.

Deputy Batt O’Keeffe

——in December 2009, so we have been tardy in that respect. This is why I spoke to the Attorney General about the transposition of directives. I am delighted that a specialist has now been seconded to the Department from the Office of the Attorney General to assist with the transposition of directives, helping us to achieve this more efficiently and effectively than has been the case up to now.

Why would we delay this process? We certainly would not. The directive has been applied administratively since January 2010 so, in effect, it is in operation. The legal entity will be transposed, I hope, by the end of June. That is the target we have set ourselves and we want to meet it.

The major employment growth area envisaged by IDA Ireland and Enterprise Ireland is in the services sector. Our exports of services will grow exponentially over the next ten years. In that respect the directive is important for Ireland, and we welcome it with open arms. We did everything in our power to ensure it was effected administratively because it provides wonderful opportunities for our export business.

Deputy Willie Penrose

The Horizon 2020 report from IDA Ireland, which sets out a road map for future developments, focused on services as an area in which significant benefits could be gained. The directive should be an important complementary tool for the IDA in achieving those objectives.

Deputy Batt O’Keeffe

This is why we in the Department are anxious to transpose the directive legally, although it is operating administratively. Along with IDA Ireland, Enterprise Ireland and so on, we are anxious that indigenous companies in the services sector be given the opportunity to export these services, which should result in the creation of jobs at home.

Written Answers follow Adjournment Debate.