Dáil Éireann debate -
Wednesday, 17 Oct 2012

Vol. 779 No. 1

Topical Issue Debate

Credit Availability

Deputy Ray Butler

I have previously spoken on the matter of high loan refusal rates and the detrimental effects they were having on the recovery of SMEs which is vital for the country. At the time, it was suggested that banks were putting already pressurised businesses into further decline by withdrawing their overdraft facilities and restructuring these loans into term loans. Banks, on the other hand, were stating that their means of restructuring loans were in fact helping SMEs to continue to operate but yet again, the opposite seems to be the case.

A fuller and far bleaker picture has emerged in the latest numbers presented by the Central Bank. These figures exclude lending for property or to financial firms and are accepted as being a good measure of access to business credit. According to the Central Bank, lending to small businesses dropped by more than €500 million in the second quarter of this year, which is very disappointing. This latest decline represents a fall in lending of €1.9 billion to small and medium-sized enterprises in the 12 months up to the end of June 2012 compared with the same period last year. The financial squeeze applied now has tightened so much that total lending to SMEs now stands at just under €40 billion, with just €459 million of that figure accounting for new loans made in the three months to the end of June.

Furthermore, the independent organisation working in support of the Irish small and medium-sized enterprise sector, ISME, had already indicated that half of all applications for business loans were being turned down by the banks, prior to the release of the figures from the Central Bank. The picture becomes even bleaker. We already know that a high percentage of SMEs have restructured loans on their books with little or no access to loan or overdraft facilities from the banks.

All of this evidence puts a major question mark over the targets set for the AIB and Bank of Ireland to provide €3.5 billion each in new loans to small business this year. Clearly these targets are not being met on the ground. Once again it begs the question, if banks do not lend to small business and offer real support in these economically turbulent times, how can we seriously expect our economy to recover and grow?

For example, the recent report by the Credit Review Office states it has overturned 96 cases in respect of which banks refused credit. According to that office, which reviews lending by Allied Irish Banks and Bank of Ireland to small and medium businesses, 813 full-time jobs and 46 part-time jobs have been secured and an additional €9.6 million has been loaned by the banks. The report also states it will be a challenge for the two pillar banks to reach their lending targets of €3.5 billion each to small and medium firms in 2012. The Credit Review Office report also states that a significant amount of the lending is a restructuring of existing loans rather than new lending. Some of these loans were originally provided by Anglo Irish Bank and Bank of Scotland Ireland, both of which are winding down. Mr. Trethowan has expressed grave concerns about the length of time taken by the banks to process loans and instances banks declining potentially viable loans, with the effect of devastating the owner of a firm or farm.

While current Government initiatives are helping to address some of the problems faced by small business, if the pillar banks continue to minimise credit which SMEs need to remain viable, this sector will diminish to an unprecedented level. The banks must start lending to encourage growth in our economy. Without it, SMEs cannot and will not survive.

Minister of State at the Department of Jobs, Enterprise and Innovation (Deputy Sean Sherlock)

I thank Deputy Butler for raising this issue. As a Government, we have moved decisively to restructure the banking system and ensure that it provides credit to the economy every year. We are also acting to fill gaps where specific market failures exist.

The Deputy will be aware that the Department has introduced two targeted initiatives to support an additional flow of credit for small businesses into the economy. I attended the launch of the credit guarantee scheme this morning, which was presided over by the Taoiseach, Tánaiste and Minister for Jobs, Enterprise and Innovation, Deputy Bruton. The guarantee scheme will go live next Wednesday, 24 October, and is expected to provide an additional €150 million per annum in lending for small businesses over the next three years. Ulster Bank, AIB and Bank of Ireland are participating in the scheme.

The guarantee scheme is intended to address market failure affecting commercially viable micro, small and medium-sized businesses in two specific situations, namely, where businesses have insufficient collateral and where businesses operate in sectors with which the banks are not familiar. It provides a 75% State guarantee to banks against losses on qualifying loans to firms with growth and job creation potential. Each €150 million of additional lending under the scheme is expected to benefit over 1,800 businesses and create over 1,300 jobs.

Another important initiative developed by the Department is the €90 million microfinance loan fund to address access to credit and support lending to the most vulnerable cohort of our SME sector, namely, microenterprises. Microfinance Ireland was launched on 27 September and has been open for business since 1 October. It will provide loans primarily to newly established and growing microenterprises across all industry sectors, with commercially viable proposals that do not meet the conventional risk criteria applied by banks. Loans will be for amounts of less than €25,000 and will be generally provided for business start-up costs, expansion costs and working capital. The thrust of the lending policy will always be focused strongly on the potential sustainability of the business, its ability to repay the loan and the creation and maintenance of jobs. It is intended that the fund will provide loans to some 5,500 microenterprises over time, resulting in the creation of approximately 8,000 jobs at a cost of approximately €2,500 per job, which is extremely good value for the State's investment, when referenced against foreign direct investment.

To assist medium-sized business, we introduced the €150 million development capital fund scheme earlier this year. This will assist in increasing the availability of risk capital and closing the so-called equity gap experienced by SMEs seeking risk capital in excess of €2 million. The development capital scheme is aimed at addressing a funding gap for mid-sized, high-growth, Irish businesses with significant prospects for growth and job creation. Typical companies expected to benefit are those with in the region of 60-160 employees.

Further work with the banks is continuing to adapt to the needs of the non-traditional sectors, such as the technology and emerging sectors. Enterprise Ireland is working closely with the banks to develop propositions for exporters and technology companies that are suited to different stages of growth, including start-ups, early stage and mature companies and to adopt cash flow lending as opposed to the asset backed approach that has been the norm in recent years. Knowledge sharing is ongoing, including reciprocal secondments from Enterprise Ireland directly into the banks, sector briefings and trade mission involvement. In addition, the Department is working closely with the Department of Finance and the Credit Review Office to evaluate evidence on credit availability and to ensure that the amount of credit flowing to the SME sector is maximised to facilitate sustainable job creation and retention.

I refer the Deputy to pages 68 and 69 of the third progress report, which speaks further to the issue raised by him.

Deputy Ray Butler

I thank the Minister of State for his response. I welcome what is being done by Government, including the roll-out of the new credit guarantee scheme today and the introduction of the microfinance loan fund. However, Ms Fiona Muldoon, director of credit institutions and insurance supervision at the Central Bank, said that she believes a culture of leadership is missing in Irish banks. The secretary general of the Department of Finance also said that banks, in terms of lending decisions, are looking for miracles to happen and are closing shop, waiting for the Central Bank or Government to bail them out or for a national recovery.

I am visited every day at my constituency office by people operating small and medium-sized businesses who have obtained a structuring of their loans by the banks and are repaying these loans. However, because they are outside the original terms of their overdraft or loans, this is viewed as a mark against them in terms of getting further loans. The Irish Credit Bureau dealt with only a minuscule 760 cases because the banks will not even give out application forms for credit. If one cannot get an application form, one cannot be refused. Many of the banks will not even answer telephone queries from small and medium-sized businesses.

I was recently visited by a gentleman from Navan who employs nine people in his factory. Despite that he is paying his way, has restructured all of his loans, has €200,000 on his books and could employ ten extra people tomorrow, he cannot obtain finance. The Irish Credit Bureau served its purpose during the Celtic era. However, it serves no purpose now. It is not fit for purpose in a recession.

Deputy Sean Sherlock

It is hard not to agree with the points made by the Deputy in relation the banking sector. A distinction must be made between businesses seeking to restructure loans in order to survive and retain their viability and loans generated for new business. I refer the Deputy to the Action Plan for Jobs 2012 and the third progress report which states that the Department of Finance published the SME lending demand survey in July. That survey of 1,505 companies shows that during the six month period surveyed demand for credit remained low, with only 38% of SMEs requesting bank credit between October 2011 to March 2012. The full survey and findings are available on the Department of Finance website.

I take on board the points made by the Deputy in relation to the person referenced specifically by him. I believe the Taoiseach addressed that point today during Leaders' Questions. This is about driving new relationships between Enterprise Ireland and the pillar banks.

The Economic Management Council has already indicated it will meet the pillar banks before the end of the year. There is no question that there is a sense the banks are not coming forward with proposals based on a lateral view of how to solve the problems of the person referenced by the Deputy who may have a viable business. The Government is trying to press home this point to the banks. There is a role for the Economic Management Council. The two initiatives, on micro-enterprises and the partial loan credit guarantee scheme, will create a new pillar of lending and will be government backed. This will have a knock-on effect on the SME sector of the economy.

School Accommodation

Deputy Michael Moynihan

I welcome the opportunity to discuss this very important issue on the floor of the Dáil. It is projected that the Presentation Convent national school, Millstreet, County Cork, will experience huge growth by 2014 or 2015. At present the enrolment figure is approximately 240 and it is projected this will rise to 289 in September 2013 and to 340 by September 2016. It has received one extra mainstream classroom teacher, but its immediate problem is a shortfall in accommodation, and a mainstream classroom, a language room and a resource room are required. In 2007 and 2008 the national school received a grant to purchase two prefabricated classrooms. At the time, the board of management thought it would have been very bad value to accept money for prefabricated classrooms, so it applied to the Department to be allowed to raise money locally to be used with the grant to build permanent classrooms. The Department and the then Minister, Batt O'Keeffe, were convinced to go with this scheme. It was a pilot scheme, being the first such scheme in the country. The school went ahead and provided extra classrooms with the money allocated by the Department for prefabricated classrooms. This has been huge value for money.

I visited the school recently and it has enormous problems. It got the best value for money possible from the last tranche of funding it received from the Department. The board of management involved a very good local engineer and much good work was done with the builders. Now it has a short-term problem and difficulties will arise in September 2013. It has been allocated an extra mainstream classroom teacher but there is no room for that teacher. The projected enrolments mean a huge problem will occur in 2016. What does the Department of Education and Skills envisage for the school? This issue requires urgent attention. I understand inspectors from the Department visited the school recently to discuss the problem. Short-term and long-term problems exist with regard to accommodation. We need to take a holistic approach. The Department will throw money at a short-term problem to try to sort it out but the long-term issue needs to be considered. The Department needs to examine the school's space and ground. The board of management is very innovative and this has been proved in the past. In agreement with the Department it can stretch a euro as far as possible. The short-term and long-term problems need to be examined because this rural school will experience a huge growth rate in the coming years.

Deputy Sean Sherlock

I am taking this matter on behalf of my colleague, the Minister for Education and Skills, Deputy Ruairí Quinn. I thank the Deputy for raising it as it provides me with an opportunity to clarify the position on the application for additional accommodation received from Millstreet Convent national school, County Cork. It is a co-educational primary school catering for boys and girls from junior infants to second class and for girls only from third to sixth class. I am aware the school had 218 enrolled pupils in September 2011 and that the current enrolment is 244 pupils, as the Deputy outlined. I understand the school expects enrolments to increase further next September 2013.

On 5 October the Department of Education and Skills received an application from the school for the provision of one additional mainstream classroom and two learning support rooms to meet its current needs. In addition, the Department received a further application from the school on 15 October for major capital funding to provide additional mainstream classrooms to cater for the school's projected longer term enrolments.

In this regard, the Department of Education and Skills will examine the demographics of the area concerned. The analysis will take into account results from census 2011, child benefit data for the area and an examination of current school enrolments with a view to establishing future accommodation requirements for the area. The school's applications will be assessed in the context of the Department's analysis of need in the area and a decision on the applications will be conveyed to the school authority subsequently.

The Deputy will be aware that the five year programme which the Minister, Deputy Quinn, announced on 12 March 2012 will provide more than 100,000 permanent school places, of which 80,000 will be new school places. The remainder will be the replacement of temporary or unsatisfactory accommodation. Where an immediate enrolment need in an area has been identified, such as the appointment of an additional teacher, and where a school's existing accommodation cannot provide for this growth, the Department considers applications by schools for capital funding for additional classrooms, mainly on a devolved basis. The delivery of new schools, together with extension projects to meet future demand, will be the main focus of the Department's budget for the coming years.

Deputy Michael Moynihan

I thank the Minister of State for his reply and for outlining the facts. The board of management has been in discussion with the local community to get a room for the extra classroom. The Department will provide money for a prefab, but the school does not want this because it is a short-term solution and it believes it would be a waste of vital resources. The Minister of State outlined extra school places would be provided in developing areas. This school is classified as a developing school. It is probably one of the few developing schools outside of the greater urban centres. An immediate problem has arisen and an application was received by the Department on 5 October. I am asking for every urgency to be given to this so the board of management is not left in limbo until all of the issues have been gone through. Surely they can be correlated and examined as a matter of urgency. A holistic approach must be taken, not only on the short-term issue but also on the school's status as a developing school because of the projected growth in numbers in the coming years. Will the Minister of State ensure there is no delay in the Department, that the application is processed as quickly as possible and that the school does not just get an answer to the short-term issue but also obtains a solution for the long-term issue coming down the tracks?

Deputy Sean Sherlock

I note the Deputy's concerns in this regard and the points he has made on the school's developing school status. I reiterate that the Department will be in contact with the school when the demographic analysis in the area has been completed.

If, through the good offices of the Deputy, the board of management was to contact me directly, I would be happy to engage with the school, subject to all of the criteria, particularly the budgetary criteria, laid down in that regard. Perhaps we can take a look at this with a view to solving the problem without giving any false hope at this stage. I would be happy to visit the school if such an invitation was extended to me. I am not making any promises but there may be ways around this. It is important that the Department has the opportunity to complete the vital demographic study.

Garda Strength

Deputy Pearse Doherty

Last Saturday evening in the town of Kincasslagh in County Donegal, which is probably best known throughout the country for being the home town of Daniel O'Donnell, over 200 local residents turned up for a public meeting. It was a meeting to voice their concerns about the ongoing and escalating anti-social behaviour and criminal activity occurring in the area. This activity culminated in a recent unprovoked petrol bomb attack on a car outside the home of an elderly lady and her daughter. Unfortunately, due to family commitments, I was unable to attend the meeting. However, I have spoken to many people from that area and I can tell the Minister that there is a real sense of fear, shock and concern in the area, particularly on the part of the elderly community. These are people who are genuinely frightened by the increase in crime and the lack of Garda presence in rural areas.

Nobody expects a garda to stand on every street corner to catch the culprits intent on pursuing a path of crime. Nevertheless, there is a growing fear that the Garda at current resource levels is not in a position to provide effective policing for rural areas. On the night of the petrol bombing, I am informed that it was two hours after the initial call that the Garda patrol car arrived on the scene of the attack. Meanwhile, we know that crime is on the increase. According to the latest CSO crime statistics, there was an 18.3% increase in burglaries in the northern region, which includes Donegal, in the year up to June 2012. Hardly a week goes by without my hearing about another attack on a home, business or community across County Donegal, either directly through my constituency office or through the media. In particular, older people feel increasingly vulnerable in their homes and I am sure this is not unique to Donegal. These people must be reassured that the gardaí are present in the community and that they can help protect them.

Instead of providing the necessary resources to tackle the issues effectively, this and the previous Government have in successive budgets depleted the resources of the Garda. They have stripped the resources bare to a point where the Garda cannot fulfil the demands of the community. This year, the Minister oversaw the closure of 39 Garda stations, three of which were in my county - Culdaff, Doochary and Dunkineely. They were all closed on the Minister's watch. There are reports that another 96 stations may be considered for closure. The Minister has already informed us that the draft policing plan for 2013 is likely to contain further proposals for rationalisation of Garda stations and districts. An example is the threatened removal of the Glenties district headquarters, which could see the redeployment of up to 30 to 40 full-time gardaí from west Donegal, further highlighting the concerns of the people in this area.

If the Minister was to put it into context, we know that crime is on the increase in these areas. One does not need reports; one only needs to live in the area to know it is happening, yet from 2008 to this year, Donegal saw a reduction of 52 Garda personnel. I know it was not done solely on the Minister's watch as Fianna Fáil oversaw most of it. The county has seen a reduction in Garda numbers from 488 in 2008 to 436 today. Unfortunately, that trajectory is continuing and we are at breaking point. It is not good enough that it takes two hours for Garda personnel in a patrol car to arrive in a rural area where a car has been petrol bombed by criminals in that area, putting the lives of the individuals inside the adjoining house in jeopardy. What assessment does the Minister and the Garda Commissioner make of rural areas and their policing needs when making decisions to close down stations and reduce Garda numbers in these areas?

Minister for Justice and Equality (Deputy Alan Shatter)

I thank the Deputy for raising this matter. I heard what he had to say about the petrol bomb incident. I am sure the Deputy will appreciate that I cannot refer to the detail of a matter that is under investigation by An Garda Síochána in the House.

The Deputy will be aware that the allocation of resources by the Commissioner is constantly monitored in the context of crime trends, policing needs and other operational strategies in place on a district, divisional and regional level. On a daily basis, gardaí are involved in preventing and detecting crime and criminal activity. The House will be aware that as recently as this morning a man died from gunshot wounds in Golden in County Tipperary. While it is too early to speculate on the circumstances or motive behind this incident, it is yet another stark reminder of the issues being dealt with by members of the Garda Síochána.

Both the Government and the Garda are responding to the challenges in policing and in dealing with a very difficult economic situation. I will detail some of those responses. The House will be aware that despite budgetary constraints, I announced a substantial additional investment of €3 million this week in Garda transport for the purchase of new vehicles. It is anticipated that 170 vehicles will be delivered to the Commissioner and come on stream in December and January. They will be in addition to the over 200 vehicles which have been brought in to service since the beginning of 2011.

In addition to our 13,500 gardaí, which is a great deal more than we had even at the height of the Troubles in Northern Ireland, we now have over 1,000 Garda reserves who assist the gardaí in their day to day work. Garda reserves are vital links to our communities and I commend them for their service. There are also over 2,000 civilian staff who provide vital technical, administrative and specialist support to front line gardaí. These include scenes of crime specialists such as photographers, analysts, IT specialists, etc. Compared with England and Wales or other smaller countries like Denmark, New Zealand and Finland, we have more police officers per head of population.

In particular, the implementation of the new Garda roster system ensures that resources are optimally deployed when and where they are required to every part of the community, both rural and urban. The same drive for efficiency is also what determined the Commissioner's decisions to close some Garda stations in 2012, as mentioned by the Deputy. I expect a further rationalisation of the Garda station and district network in the forthcoming policing plan. The objective at all times is to ensure that the most effective and efficient service is delivered across the country. While I fully understand the concern that communities may have about possible Garda station closures, I am convinced that in providing a modern, effective police force, our emphasis should not be on bricks and mortar. Up until the station closures which took place earlier this year, this State had a Garda station network that was mostly unchanged since 1922 and which took no account of modern transportation, communication and policing methods. We must focus on making the best possible use of our police resources so that gardaí are out on our streets and in our communities responding to crime and providing visible policing rather than waiting for occasional callers to a Garda station.

I am, of course, very conscious of the deep distress which burglaries and thefts can cause to the unfortunate victims of such crimes. The most recent comparative figures published by the CSO indicate that the incidence of burglary and theft in Donegal has, in fact, been less than in many other areas of the country. However, that is not to minimise the impact of such crimes on those affected by them, particularly the elderly and more vulnerable members of society, or the impact of a petrol bomb attack on any individual or family.

I welcome the fact that the Garda Commissioner has announced the introduction of a wide range of measures aimed at tackling gangs involved in burglaries. In May of this year, the Garda Commissioner launched the national "Garda Supporting Safer Communities Campaign". This important campaign highlights a range of key issues, in particular, burglary prevention by engaging with communities.

Operation Fiacla, which commenced in February last, is focused on identifying and targeting mobile gangs involved in burglaries around the country so as to disrupt their activities and bring them before the courts. Operation Fiacla is intelligence-driven and specific burglary initiatives have been implemented in each Garda region in support of this operation to target suspect offenders, disrupt their activities and secure their attendance before the courts. I am confident that Operation Fiacla is making an impact. Since its commencement in February up to 22 August last, over 1,700 persons have been arrested and almost 1,000 persons have been charged as part of the operation.

This clearly reflects the substantial efforts being made by the Garda to tackle the prolific offenders who are behind the growth in burglaries.

The Garda national model of community policing plays a key part in responding to crime by taking into account and responding to local conditions and needs. In this regard, the Garda continues to work closely with communities to enhance community safety in a wide range of local fora, including through partnership programmes such as Community Alert and Neighbourhood Watch, in addition to more formal structures such as joint policing committees.

I pay tribute to everyone in the Garda Síocháná for the commitment and professionalism they display in carrying out their duties. I assure all communities, including the one in Donegal referred to by the Deputy, that the Garda is efficiently carrying out its functions and that it will do everything possible to bring criminality to an end. However, the reality is that no matter how many members of the force there are, there will always be individuals within communities intent on criminality and targeting individuals for a variety of reasons. We cannot have a member of An Garda standing outside every house in every rural or urban community.

In the context of making reference to rural Garda stations, I draw to the Deputy's attention the fact that the main station closures occurred not in rural areas, but in Dublin. Whitehall and Harcourt Terrace Garda stations were both closed in the context of the consolidation and rationalisation of stations with a view to using resources as efficiently as possible. The next largest station to close was Dalkey Garda station, which is in the Tánaiste's constituency. It is a question of smart policing, using resources efficiently and ensuring the members of the force are not sitting unnecessarily at desks in Garda stations rather than being engaged in front line duties.

Deputy Pearse Doherty

I have a couple of points to make to the Minister. His last comments show that he fails to understand rural areas. It is not about the size of the station but about the presence and service it provides. Culdaff, Dunkineely and Doochary are wee villages and do not need a massive Garda station, but they need the service. The service was taken away from them by the Government.

The Minister said it is a question of smart policing. If people could see that the closures of the stations in question led to the presence of more gardaí on the street or a better service, they might be able to accept them. They do not see more, however. Therefore, let us look at the facts.

I have a very simple question for the Minister. I understand that this matter is not entirely under the Minister's watch but he should note that 52 gardaí were taken away from Donegal over the past four years, and three stations have been closed down. Some 200 people turned up at a public meeting in this regard on Saturday evening. The Minister knows as well as I do that it is very difficult to get people to attend public meetings on different issues, yet 200 people in a small rural community decided this issue was important enough to warrant their turning up. The people affected are respected, upstanding members of the community whose car, which was parked outside their house, was petrol-bombed. They did not provoke anybody and the community has rallied around them. The community is asking a simple question, perhaps through me. What does the Minister have to say to the community in Kincasslagh to reassure it that it will be in a better position tomorrow than it was yesterday or the day before? What decisions can the Minister make to ensure the Garda is resourced as much as possible so it can respond to the needs of that community?

I said in my opening statement that we do not expect a garda at every street corner. I appreciate the work of the Garda, be it in rural or urban areas, but I understand from it and others that it is under-resourced and working against tremendous odds because it is not getting the support of the Minister for Justice and Equality, Deputy Shatter.

Deputy Alan Shatter

As the Deputy well knows, it is nonsense for the purpose of rhetoric to suggest the Garda is not getting support. It has my full support and that of the Government. However, we must live in a world of reality, from which the Deputy is semi-detached. This year, the State requires to borrow €16 billion simply to maintain services. We entered into government under the shadow of an EU-IMF-ECB agreement that requires us to reduce public expenditure. We entered government under the shadow of an agreement that required us to reduce the number of members in the Garda force, in addition to a broad range of other reductions.

When we came into government, we had the largest number of members in the force in the history of the State. It was even greater than the number in the force during the Troubles. The number has been reduced from approximately 14,500 to 13,500 by retirements. The force is still substantially greater in number than it was during the course of the Troubles. There are substantially more policemen and policewomen in Ireland per head than in most other European countries. Therefore, it is not a question of bricks and mortar; it is about smart policing and doing what is necessary without delimiting the manner in which the Garda operates and its effectiveness.

The Deputy is peddling an untruth. Despite the closure of 39 Garda stations, there has been, according to the statistics up to the end of June 2012, a reduction in crime across every category in the State in the past 12 months, except in the area of burglary and in the area of theft, in respect of which there was a very small increase. In the area of burglary, Operation Fiacla is having a profound impact. Many of those who are responsible for the increase in burglaries over the past 18 months will find themselves, in the coming weeks and months, before the courts as a result of charges brought as a consequence of that operation.

I assure all rural communities that the Garda has the Government's full support. It will be resourced as best we can properly resource it in the difficult financial circumstances that exist in the State. I urge all rural communities to participate in Community Alert schemes and I ask citizens to provide their own security in their homes by way of burglar alarms and to be careful to ensure they do not do anything that sets them out as possible victims of some of the lawless individuals who are still intent on crime. Let the Deputy not peddle the myth that the Garda has anything but my absolute support and that of the Government in the work it is doing.

Child Detention Centres

Deputy Niall Collins

I thank the Ceann Comhairle for selecting this issue, which is very topical given the publication yesterday in the public domain of the prison inspector's report and the facts that there is to be a referendum on children's rights, that we are to amend adoption legislation and that we are waiting to process the Children First legislation. I join the Minister in complimenting the Inspector of Prisons and Places of Detention, Judge Michael Reilly, on his work on the report. It is fair to say he went about that work in a dedicated and fearless manner, turning up unannounced continually to get to the bottom of many of the matters referred to in the report. It is noteworthy that he spoke not only to prisoners and prison officers, but also to service providers and management. He informed himself quite widely on the issues outlined.

We all agree the report is fairly damning. It outlines some very serious issues and their consequences. It is noteworthy that what is contained in the report is at complete variance with the mission statement of the Irish Prison Service, which was to provide safe, secure and humane custody for people who are sent to prison. The mission statement of the Irish Prison Service has now been amended to include the dignity of care for the people entrusted to the service.

For the sake of completeness, let me quote some brief extracts from the report. The inspector states:

[T]he detention of children in St. Patricks should end as a matter of urgency. It is my view that the timeline for ending the detention of children (May 2014) should be revisited.

In essence, the report states children's human rights were violated and that children were maltreated, degraded and abused.

We all agree this is not a political issue. It concerns the management of the Prison Service as well as the staff members who perpetrated these acts.

An Ceann Comhairle

I call Deputy Ó Ríordáin.

Deputy Niall Collins

I wish to ask a question. What is the status of the investigation to which the Minister referred in his public comments in recent days? Is the Garda Síochána involved in that investigation?

An Ceann Comhairle

The Deputy has gone way over time.

Deputy Niall Collins

Have the complaints mentioned by the inspector in his report been referred to the Garda? Does the current management-----

An Ceann Comhairle

I must ask the Deputy to resume his seat, please.

Deputy Niall Collins

-----have the capacity to deal with the issues raised in the report?

Deputy Aodhán Ó Ríordáin

I thank the Ceann Comhairle for allowing me the opportunity to contribute. When I was elected to the House, I realised that positive announcements would be few and far between during our time in government. However, when the Minister announced last April that the practice of incarcerating children in St. Patrick's Institution was to end, I was proud of what we were achieving and I believed we were moving towards a new republic.

I visited the unit and met its residents and staff, but the report's findings are disgusting. Although Judge Michael Reilly is to be commended, why were the concerns of the Ombudsman for Children, Ms Emily Logan, regarding St. Patrick's Institution not heeded? Judge Reilly's report states:

I met a child on B Wing who was on 23 hour lock up. This child was quite fragile. He explained to me that he was now talking to himself.

It also states: "This was the first time that any prisoner, in any prison, had displayed such fear in my presence." Another part of the report states: "The bed clothes were dirty, the toilet was blocked and he had no running water."

By what date exactly will the practice of incarcerating children in St. Patrick's Institution come to an end? How will those who oversaw the maltreatment of children there be held to account for their actions?

Deputy Alan Shatter

I will commence by thanking Deputies Niall Collins and Ó Ríordáin for raising this important matter and for the opportunity to speak on the issues arising from the Inspector of Prisons and Places of Detention's report on St. Patrick's Institution, which I published yesterday.

I would like to begin by thanking the inspector, Judge Michael Reilly, for his report. He has a tremendous record of providing independent oversight of our prison system and brings a forensic eye, persistence and dedication to the process, for which the Government and I are very grateful. With regard to St. Patrick's Institution, as he remarks in his report, he made a number of unannounced visits on a variety of occasions to facilitate his getting the best insight possible into the running of the institution. His reports, however critical they may be, make a real difference and I can assure the House no stone will be left unturned in addressing the issues raised in this particular report.

I also want to say that I greatly valued the report prepared by the Ombudsman for Children, Ms Logan, last year following her discussions with young people detained in St. Patrick's Institution. Her work is much appreciated and she can be assured of my full support, as evidenced by the decision to extend her remit to St. Patrick's Institution.

As I said yesterday, neither I nor the Government will tolerate the type of abuse outlined by the inspector in his report. It is unacceptable in any civilised society. This must change and it will change. Let there be no doubt about that.

The report raises serious issues and major concerns, including weak management, the behaviour of some prison staff, the culture in the prison, the inattention to human rights norms, prisoners on protection and the prevalence of drugs. The inspector concluded that there was a culture in St. Patrick's Institution that resulted in the human rights of some prisoners - children and young adults - being either ignored or violated. However, from the outset I would assure the Deputies that concrete measures have been taken to address the recommendations made by the inspector, with over 80% of the recommendations being implemented to date.

This report is shocking, and I am grateful to the inspector for bringing these matters to light. For many years I personally had concerns about St. Patrick's Institution and believed it was an inappropriate facility for children. I was instrumental in ensuring the Government was committed to change in the programme for Government, which included a specific commitment in that regard: "We will end the practice of sending children to St. Patrick's Institution."

Simply put, the Government will not tolerate this type of abuse. It is completely unacceptable. I visited St. Patrick's Institution on 22 March 2011, within two weeks of my appointment. Indeed, it was a private visit with no media in attendance. Unfortunately, on a ministerial visit the difficulties observed and detailed by Judge Reilly were not readily apparent. The value of his unannounced visits and inspections cannot be overestimated. I met the Inspector of Prisons and Places of Detention in early May last, as he had asked to discuss the situation in St. Patrick's Institution with me, and there has been regular contact with him since then. It is also important not to lose sight of the fact that the inspector acknowledges in his report that the majority of staff in St. Patrick's Institution carry out their duties in a professional manner and the problem lies with a very small minority of staff.

Having had this engagement with the inspector, both the director general of the Irish Prison Service and I were in a position to ensure action was taken immediately. An action plan addressing all the inspector's recommendations was put into place without delay. This included the appointment of a new senior management team, which has been tasked with providing clear and decisive leadership to the staff in order that the problems outlined by the inspector are dealt with quickly and effectively. This team, led by the new governor, is liaising closely with the director general of the Irish Prison Service and the Inspector of Prisons and Places of Detention to ensure each and every one of the inspector's recommendations is implemented.

Indeed, in this context, the Irish Prison Service has also undertaken to ensure enhanced prison health care procedures are put in place and records are maintained on the removal and relocation of prisoners. A new dedicated committal unit is in operation and a new vulnerable persons unit is being established. Additional security arrangements have been introduced to minimise drugs and contraband entering the prison. Educational facilities will be improved along with the provision of an incentivised regimes programme and an improvement in physical conditions and facilities generally. The type of control and restraint mechanism of some prison officers as detailed by the inspector in his report has been brought to an end.

One of the Government's priorities in the programme for Government was to remove 16 and 17 year old offenders completely from the adult prison system. In this context, the practice of sending 16 year old boys to St. Patrick's Institution ceased on 1 May 2012. From that date, all newly remanded or sentenced 16 year olds have been detained in the children detention facilities in Oberstown. There are no 16 year old prisoners today in St. Patrick's Institution.

The Government has also sanctioned the provision of the necessary funding for a new detention facility at Oberstown. This is due for completion in mid-2014. These matters were all dealt with by me in co-operation with my colleague, the Minister for Children and Youth Affairs, Ms Frances Fitzgerald. In the interim, the Minister has agreed to examine the feasibility of accommodating some categories of 17 year old boys in Oberstown on a phased basis earlier than mid-2014, if possible. Arrangements are being made for a number of care staff from the children detention schools to work on placement in St. Patrick's Institution alongside prison staff. It is intended that this will take place within the next two months. In addition, the remit of the Ombudsman for Children was extended on 1 July 2012 to include St. Patrick's Institution, something she has sought for a number of years and a request with which previous Governments failed to agree or implement.

Very soon after I took office as the Minister for Justice and Equality, I initiated a consultation process with the Inspector of Prisons and Places of Detention regarding the introduction of a new complaints procedure for the prison system. This process has been completed recently with the appointment of a panel of 22 external investigators, and the new complaints system will go live on 1 November next. I have instructed the director general of the Prison Service to direct the new investigators to commence an examination of previous complaints in St. Patrick's Institution, such as those referred to by the inspector in his report.

I am conscious and only too well aware that a series of reports going back many years were produced on St. Patrick's Institution, in particular on the need to remove 16 and 17 year olds from there. These reports were not acted upon by previous Ministers for Justice or Governments. I will not be going the same route. This report will not be and has not been ignored. The Irish Prison Service and I, in consultation with the inspector, the Minister for Children and Youth Affairs and the Irish Youth Justice Service, have acted with great speed to address the issues raised in this report. It is my objective to bring to an end as rapidly as possible the situation of accommodating 17 year olds in St. Patrick's Institution.

Deputy Niall Collins

I thank the Minister and agree with all of his comments. What is the exact timeline for closing St. Patrick's Institution? His reply did not include that information. I asked about the investigation under the stewardship of the director general, which the Minister also referred to in his reply.

Will there be outside input into that investigation from An Garda Síochána?

Judge Michael Reilly indicated in his report that the visiting committees appeared to be carrying out their function under the 1925 Act, which is a little vague. Is there a deficiency in the role or remit of the visiting committee? Why did it not pick up what the Inspector of Prisons did through his dedicated work? There is a value for money report from 2009 in the Minister's Department dealing with community service and probation. The argument is that the capacity could be increased threefold, so rather than having a policy of detaining those aged 16 and 17, we should consider seriously the rehabilitation of these people through more community service. The extra capacity has been outlined in that report.

Deputy Aodhán Ó Ríordáin

I thank the Minister for his response. I agree that this issue is down to a minority of staff but how can we expect any child to be rehabilitated when the behaviour outlined in this report is ongoing? The individuals who were victims of this malpractice will have no faith in the justice system at any time in future until the people responsible for these actions are seen to be held accountable. Will the Minister expand on the issue? Will the Minister provide an assurance on direct provision centres, which are also causing much concern for those with child welfare on their minds? Will they be subject to the same type of investigation as is evident in this case?

Deputy Alan Shatter

As far as I am concerned, this sort of behaviour is not and will not in future be ongoing. A new managerial team has been put in place in St. Patrick's Institution, and there is an important remit to ensure there is no repetition of any nature of any of the events depicted in this report. I have the assurance of the oversight of the inspector, Judge Reilly, who has done a fantastic job. He has indicated that he will make further reports to me when required and will continue to visit St. Patrick's Institution. It is my hope that the new management team will be effective in ensuring we do not see these types of events again. Some 60% of staff have been retrained and specific training has been provided for those at a management level. The remaining 40% will complete retraining in November. The old culture represented the borstals in Ireland but because of the immediate action we have taken and will take, it will be ended for all time. That is of the greatest importance.

I am conscious that I have not responded to some of the questions raised by Deputy Niall Collins because of time limits. From the entire population of 200 in St. Patrick's Institution, there are 25 youths aged 17. With the construction of the new facility in Oberstown, it is envisaged that we will end the practice of having 17 year olds in St. Patrick's Institution. In or around the time this occurs, the intention is to effectively end using this facility for 18 year olds and 21 year olds. There will be better available facilities on completion of the extension to the Midlands Prison, with particularly good educational facilities there. There will also be good educational facilities in Wheatfield Prison. Ultimately, they will be the primary locations for that age group in the prison system, which is currently within St. Patrick's Institution. We are considering alternative uses for the institution.

I agree entirely with Deputy Niall Collins with regard to community service. I have been encouraging the use of community service as an alternative where it is appropriate. We must be realistic with some of the people in St. Patrick's Institution. Tragically, some of the young people are very violent, and one of the great difficulties in the prison is that some of those sentenced and serving time in the prison are members of gangs. Prison officers, who have been working well, have a very difficult job in ensuring there is no violence within the prison, and some prisoners must have protection because they are under threat from other prisoners. It is not an easy environment and we should not pretend that it is.

There are difficulties in dealing with some young people and, as Judge Reilly notes, some are damaged young people. The fact that they are damaged does not mean the violence of which they are capable is not recognised. Some of them are in prison as a consequence of very violent crimes.

With regard to accountability for those who have misbehaved, I must be careful as Minister to say nothing that may prejudice any steps being taken. I have already referred to the fact that the new people appointed to provide an independent team addressing complaints or alleged misconduct, who will be in place from 1 November, will have a remit to examine complaints made to ensure they are properly investigated. I am advised that some officers within the institution are under investigation and I hope Deputies will forgive me if I say no more than that. I must not prejudice any possible outcomes, either in the disciplinary context within the Prison Service or in any other context.

I am not aware of any current Garda investigation into any of these matters. I do not wish to mislead Deputies in that context. If a complaint was made to An Garda Síochána, I am sure it will be investigated. Currently, it is a matter for a prison disciplinary process and the particular focus is to ensure a changed culture, a different environment and to see that people's human rights and dignity are properly respected.

There is a final matter.

An Ceann Comhairle

We are seven minutes over time.

Deputy Alan Shatter

Judge Reilly indicated that as part of the disciplinary processes, young people aged 17 were being denied family visits. A stop was put to that practice on 1 May last, as soon as we learned that was a difficulty. No matter what disciplinary issues are evident, when children are in prison, it is important - no matter the background - that some contact is maintained with family members. That practice is no longer a part of the disciplinary process.