Dáil Éireann debate -
Thursday, 28 Mar 2013

Vol. 798 No. 2

Topical Issue Debate

VAT Rates Exemptions

Deputy Timmy Dooley

As the Minister of State knows, the private bus and coach industry plays a substantial role in the Irish economy. The industry is made up of over 1,900 small to medium enterprises which operate in every county in Ireland and which between them employ somewhere between 6,500 and 7,000 people. The industry is a major provider of transport services, with 276 scheduled services, 220 student services and approximately 200 tour services. I wish to focus on the 200 tour services in this particular discussion.

Coach tourism services make a significant contribution to the Irish economy, with about 300,000 overseas coach tourists visiting Ireland in 2010, worth an estimated €180 million to the Irish economy and supporting employment in other sectors of the tourism sector. Private bus and coach tour operators account for approximately 80% of the school transport service. Unlike the haulage industry, coach and bus companies cannot reclaim VAT. The issue of VAT exemption for the haulage industry is a historic issue. This competitive disadvantage must also be viewed in the context that Northern Ireland based coach operators are zero rated for VAT and, therefore, can claim VAT back on all inputs. This puts southern operators, or Twenty-six Counties operators, at a distinct disadvantage, because they must include all the VAT they pay on the inputs and are not in a position to reclaim it, unlike their counterparts north of the Border. This places a significant competitive disadvantage on their shoulders.

While we are an all-island economy in some respects, there is no doubt the Border exists in this regard and this creates a great difficulty for those operators south of it to be able to compete effectively. This is why, in the past couple of years, we have seen a greater amount of Northern registered tour buses plying their trade south of the Border. This would be fine if we had a fair and open competitive environment, but we do not. It is incumbent on the Department of Finance to look at this situation and to try to assist those companies south of the Border which must operate within a different VAT regime to see if something can be put in place to resolve their issue.

I appeal to the Minister of State to take on board the concerns that have been raised. As he knows the coach tour part of many of these operators' businesses is important to their survival so they can provide the type of school services they do and other scheduled services. It is part of the mix of services they operate, but now it looks as if the pressure being put on them in this competitive environment will make it very difficult for them to survive long term. It is incumbent on the State to address the issue being brought to its attention.

Minister of State at the Department of Education and Skills (Deputy Ciarán Cannon)

I am pleased to have this opportunity to speak on the issue of the VAT treatment of the coach and bus sector.

The transport of passengers and their accompanying baggage is exempt from VAT in Ireland under paragraph 14(3) of Schedule 1 to the VAT Consolidation Act 2010. In this respect, services provided by the coach and bus sector are exempt from VAT. This means that a person who provides a bus or coach service does not register for VAT and does not charge VAT on the supply of their services. This also includes the hiring of a bus or coach with a driver. In this respect extending the 9% VAT rate to these services does not arise as no VAT is charged on the services. In addition, persons who are exempt from VAT cannot recover VAT incurred on goods and services incurred in relation to their business, such as fuel, tyres and mechanic charges, used for the purposes of the person's coach and bus service.

The Deputy is concerned about the different VAT treatment of passenger transport services between Ireland and the UK. In the UK, passenger transport is zero rated for VAT purposes, which means passenger transport providers do not charge VAT on the services they supply, but unlike in Ireland, they are entitled to recover VAT incurred on the goods and services used as part of that service, including fuel. VAT law in Ireland and the UK must comply with the EU VAT directive. As passenger transport was exempt in Ireland on 1 January 1978, it is possible under the VAT directive to continue to apply that exemption. As passenger transport services were charged at the zero rate in the UK on 1 January 1991, the UK is entitled to continue to apply a zero rate to passenger transport services. It is not possible under EU law for Ireland to apply a zero rate to such services as we did not apply a zero rate to them in 1991.

However, I would point out that UK passenger transport operators who establish their businesses in Ireland are subject to the same VAT rules as Irish operators. They are exempt from VAT and not zero-rated and as such are not entitled to deductibility in respect of VAT incurred on items such as fuel. In addition, UK passenger transport operators who are not established in the State are not entitled to any refund of VAT incurred in this State for the purposes of carrying out passenger transport activities, whether that service takes place wholly or partially in the State or whether it takes place wholly outside the State.

While persons who are VAT exempt cannot recover VAT incurred on goods and services incurred in relation to their business, there is special provision within the VAT code to allow a refund of VAT incurred on the purchase of touring coaches. Under VAT Refund Order S.I. 266 of 2012 coach operators who are exempt from VAT may, subject to the conditions in the order, be entitled to a refund of the VAT paid on touring coaches that are no more than two years old and are within specified dimensions.

Furthermore, while VAT exempt coach and bus operators are not entitled to claim the VAT incurred on their fuel costs, the Finance Act 2013 provides for relief from excise incurred on auto-diesel used in the course of business by qualifying bus and coach operators. The relief was originally intended to apply to licensed hauliers, but following consideration, the Government decided to extend the relief to tax-compliant licensed passenger transport operators. The relief will operate on a sliding scale dependent on fuel prices, but will not apply when the price of auto-diesel falls below €1.24, including VAT. The maximum amount of the relief will be 7.5 cent per litre and will come into effect from 1 July 2013. It is estimated that the relief will cost in the region of €35 million gross in 2013 and €70 million gross in a full year.

Deputy Timmy Dooley

I welcome the Minister of State setting out the facts as they are. A UK business or operator established in the Six Counties can offer its services south of the Border. It can purchase all of its materials north of the Border, where it has the capacity to recover the VAT it pays. I do not suggest such companies do so on goods purchased south of the Border. This relates to inputs purchased north of the Border. There is nothing to prevent such a company from coming south to compete with operators in this jurisdiction that have a much greater cost base by virtue of their fuel inputs, etc. Such factors make it exceptionally difficult for them to compete with those involved in what I would describe as a predatory practice. We must recognise that the treatment or application of VAT is entirely different on either side of the Border.

The Minister of State has mentioned that this relates to an EU position. The Government has made much of its capacity to renegotiate matters at EU level in recent times. I would have thought it should be possible for it to seek some redress in this instance, given that it is clearly having a significant impact on a particular sector. It should be working at EU level to ensure the same set of circumstances applies south of the Border as north of the Border. This industry should be able to avail of a zero VAT rating or other compensatory measure that would ensure there was a fair and level playing pitch. Those who wish to ply their trade here should be treated equally in the interests of the protection of jobs. The Minister of State does not need a lecture from me about the devastating impact on the domestic economy of the fact that over 14% of people in our society are unemployed. The sector we are discussing would gain if this relatively minor change were made to an EU directive. Perhaps some other methodology might be used to ensure these operators can participate and compete on a level pitch. I ask the Government to consider the impact of what has happened in this sector and try to find a means of rectifying it. That is necessary if we are to retain the level of employment in this sector and enable those involved in it to compete effectively.

Deputy Ciarán Cannon

The Deputy is aware that the rather unusual and varying applications of VAT that applied in member states when they joined the European Union were allowed to remain in place. In essence, that has led to the development of some anomalies. The difficulty is that the VAT directive which applies does not allow for such anomalies to be removed. I wholeheartedly agree with the Deputy that the industry needs any support we can make available to it. The only option available to us in that regard was to extend excise duty support to hauliers and those involved in passenger transport services. We have done this and it was sought by the coach and tourism operators. The Government had given a commitment to support them by using the only taxation facility available to do so. It will cost the State €70 million in a full year. That is a serious commitment on the part of the State and the Government to a sector that deserves our support and will play a part in the country's future recovery.

Water Meters Installation

Deputy Anthony Lawlor

I thank the Leas-Cheann Comhairle for allowing me to raise this topic. I welcome the Minister of State, Deputy Ciarán Cannon.

I appreciate that further legislation relating to Uisce Éireann is on its way down the tracks. The specific problem I am raising relates to Bord Gáis Energy's search for water meter operators which is going through the eTenders process. A number of people have raised the issue with me. According to the tender notice, Bord Gáis Energy is looking to install meters that will be capable of being read by hand-held electronic devices, without stop valves, etc., having to be opened. The meter readers will not have to physically examine each meter; they will be able to read it electronically.

While I do not like to be parochial, the best figures I have with regard to this problem are for my local area. Approximately 55,000 of the approximately 70,000 houses in County Kildare are connected to the public water mains. Between 4,000 and 6,000 houses in the county that were built after 2004, when the installation of water meters was first required as part of planning conditions, have water meters in place. A number of the householders in question have contacted me to express concern that their water meters might not be compatible with what Bord Gáis Energy is seeking as part of the eTenders process. Some meters have been installed since before 2004. Some of them may be at the wrong depth, while others may be of the wrong type to be read in this way. Some of the old-style manual meters which are fairly large and have to be read physically are still in use.

As we know, people will be charged for the installation of meters through their water bills. Those who already have water meters are worried that they will be charged for their removal if they are deemed to be incompatible with what Bord Gáis Energy is looking for in the eTenders document, in addition to being charged for the installation of a new meter. Some of them paid for meter installation as part of the purchase of their houses, while others paid for it when they installed their own meters. I would like the Minister of State to give the House a commitment that Bord Gáis Energy will not charge people who have existing water meters in place if these meters need to be replaced to make them compatible with what is being required of the operators in using water reading systems. They should not be charged for the installation of new meters.

Deputy Ciarán Cannon

The introduction of domestic water charges is provided for in the programme for Government and the memorandum of understanding with the European Union, the IMF and the ECB. The Government considers that charging based on usage is the fairest way to charge for water. It has decided that water meters should be installed in households connected to public water supplies. It has also decided that Irish Water, a new State-owned water company to be established as an independent subsidiary within the Bord Gáis Energy group, will be responsible for the metering programme. The procurement process for the metering programme is under way. It is expected that the installation of meter boxes and domestic water meters will begin in the middle of this year and will be rolled out as quickly as possible thereafter. The Water Services Act 2013 assigns the necessary powers to Irish Water to allow it to undertake the metering programme. Census 2011 reported that approximately 1.35 million domestic properties were connected to public water supplies in Ireland. The objective is to install meters in the maximum number of these properties. A national survey has commenced to provide additional information on the suitability of individual properties for metering and on the work involved for the installations.

In recent years many local authorities have required developers to install meter boundary boxes in domestic properties. Local authorities have installed boundary boxes in some areas as part of water mains rehabilitation works. As local authorities have not installed water meters in these boundary boxes, no issues relating to the compatibility of meters will arise. Where a boundary box has been installed, the cost of installing a meter will be significantly lower as no excavation or reinstatement works will be required. The suitability of existing metering boundary boxes for the current metering programme is being examined as part of the national survey I have mentioned. The installation of meters is labour-intensive. Minor excavation and reinstatement works will be involved after the installation of the meter. It is estimated that the metering programme will sustain up to 1,600 jobs over two to three years. This will provide much needed employment in the construction sector. Other skills such as customer care experience will also be required. Irish Water will establish a new call centre to deal with customer inquiries. This will employ up to 375 people from 2014. At least 25% of the estimated 1,600 jobs created directly by Irish Water's domestic water metering programme will be given to people from small local businesses, the unemployment register and school leavers, graduates and apprentices.

Deputy Anthony Lawlor

The Minister of State's answer does not really include the commitment I am looking for on behalf of those with existing water meters. They should be able to inform Bord Gáis Energy or Uisce Éireann that they have a water meter and ask the company to come and read it. That would be better than the water board contacting them to say they have made the board's job of installing a water meter a little easier. It would be much fairer if the water board had to pay for one type of meter to be replaced with another. It is not the fault of consumers who planned ahead and installed water meters that we are now trying to make life easier for meter readers by using a system of reading meters that is not compatible with meters in situ.

In all fairness, Irish Water, or Uisce Éireann, should pay for the installation of the water meter if it is already in existence. This would make it much easier for Irish Water itself to read it.

Deputy Ciarán Cannon

Although I am far from expert in this area, the response I have given would seem to indicate that the vast majority of houses have boundary boxes installed as distinct from water meters, although the Deputy may know otherwise. In that instance, the issue of compatibility does not arise. However, where there are already meters installed, I assume in order to standardise the reading of meters and to do so in the most efficient and effective way, there will need to be a replacement of those meters. While I am not aware of the number of meters to be replaced, if the Deputy was to contact the Department of the Environment, Community and Local Government or Bord Gáis itself, they might be able to enlighten him further as to exactly what process will be in place for those meters to be changed.

Fire Safety Issues

Deputy Seán Crowe

Across the State, people bought houses and apartments during the boom and then discovered to their horror that bad planning, poor regulation and reckless developers had left them with serious problems. Whether it is pyrite ripping homes apart in Dublin city or fire safety issues forcing people from their homes at Coalport Limited's Priory Hall, the hopes and dreams of many of these families have been destroyed. On a weekly basis, I deal with issues of dampness spores and so on. Again, it is always the tenant's or the owner's problem while the local authority steps back.

This week, we learned some of the residents in an affordable development in Lucan, County Dublin, have discovered their homes do not meet fire safety standards. The 52 houses in Foxford Court were sold in 2005, which is part of the problem. In 2005, people complained there was a problem with fire regulation in the area but it is only now, in 2013, that the developer is examining the problem. There is also a problem in that the houses were sold as affordable housing by South Dublin County Council, which has a responsibility. However, the council seems to be stepping back and saying it is a matter for the tenant.

What assurances can the Minister of State give the families in Foxford Court and other developments that their homes will be made safe and compliant with building and safety regulations? This estate is just one example and there could easily be others. What reassurances can the Minister of State give residents that they will not have to foot the bill for the works that are required to make their homes safe? Does he consider it acceptable for a local authority, South Dublin County Council in this instance, to wash its hands of a problem when it was the council that sold the affordable houses in 2005?

I emphasise that the delay from 2005 to 2013 is a serious issue. We are talking about fire safety yet we are eight years down the track. Something is wrong with the system. While the Minister of State might not know the detail, this could happen in any area. I point out this estate is not in my constituency but I am concerned and feel we need to address the problem.

Deputy Clare Daly

I was absolutely fuming when I read what happened to residents in Lucan because the very same developer was responsible for building units in Balbriggan. I spent years, starting about seven years ago, trying to push Fingal County Council to rectify fire safety issues which are in existence in that estate and must now find out the same builder was responsible for the same thing in a different local authority area. Yet, this other local authority has adopted the very same contemptuous attitude that some people in Fingal County Council adopted with regard to residents' concerns.

These are not isolated cases. As remediation works are being done in pyrite-afflicted homes at the moment, when the walls are opened up it is found on a regular basis that fire safety standards are not being adhered to, and this is a particular problem in timber-frame developments. There have been numerous breaches of these regulations yet the local authorities have not acted and have not initiated any enforcement proceedings whatsoever. What is the Minister and his Department going to do about that? In the case of the developer concerned with the estate in Balbriggan, the council there engaged with the developer, agreed some issues to be dealt with and then accepted a few issues and let him off in terms of compliance on the others. No enforcement proceedings were taken.

When people buy dwellings from a local authority, they think they are buying the best and that they are getting the best standards of checking and so on. In this case, not only did that not happen, but the seller of the property, in this case the local authority, has walked away from it. That is not good enough. The people who bought affordable houses were those who needed support as they could not afford to buy on the market. They need greater protection. We know of instances where people are being levied for the cost of the remediation works. Homeowners themselves are being asked to pay for this, and the local authority's response has been that it is a civil matter between the tenant and the builder. It is not a civil matter between them. The local authority has a role to play as the enforcing authority. What is the Minister going to do to make sure the local authority ensures the builders do the work they were supposed to do and adhere to the standards they were supposed to adhere to? If the builder is gone, how will the Minister make sure that is done without it being a cost to the residents, who are the victims in this?

Deputy Ciarán Cannon

I thank Deputy Crowe and Deputy Daly for raising this matter of such acute public concern. On behalf of the Minister, I want to acknowledge the difficult and distressing situation being faced by the residents of Foxford Court who, through no fault of their own, find that the homes they have invested in do not comply with the minimum statutory requirements in regard to fire safety. Contrary to inaccurate media reports, it is important to note that no evacuations have been ordered or have taken place at Foxford Court. The development is being monitored by fire safety officers and the question of evacuation is unlikely to arise.

Compliance with the building regulations is a matter, in the first instance, for the owner-developer. Enforcement is a matter for the building control authority, in this case South Dublin County Council, or, in regard to fire safety, the fire authority, in this case Dublin City Council. Where difficulties arise, remediation is ultimately a matter between the parties - that is, the developer, the developer's agents and insurers, on one hand, and the buyers, their agents and the owner's management company on the other hand - subject to the terms of any contracts entered into by the parties.

Foxford Court consists of 52 housing units developed as an affordable housing scheme. Eligible applicants purchased the properties by private sale, having fulfilled the criteria for eligibility under the affordable housing scheme. It is understood that "opinions of compliance" were provided by the developer and their agents in regard to the sale of the dwellings at Foxford Court.

In response to concerns raised by residents, South Dublin County Council has advised the residents of its obligations under the planning, fire safety and building control codes. It has advised that the management company contact the developer in regard to the remediation of defects and deal with the chief fire officer to agree a strategy to address the issue. The chief fire officer may also advise on risk assessment and mitigation measures. It is understood that the problems include inadequate fire-stopping provision between dwelling units and failure to fire-seal around service pipes.

South Dublin County Council is in possession of three units at Foxford Court. These have recently been inspected by council staff and will require remedial work to achieve compliance with the approved fire safety certificate. As owner of these properties, South Dublin County Council will remediate these units and it has indicated its willingness to share relevant information with the management company.

The Minister for the Environment, Community and Local Government is committed to ensuring that local authorities use the powers available to them under the various planning, fire safety, housing and building control Acts to assist residents who, through no fault of their own, find themselves in the stressful and distressing situation of coping with a home that is not compliant with the fire safety requirements and building standards. Local authorities across the country have been proactive in addressing such problems to date and, on behalf of the Minister, I urge South Dublin City Council to engage proactively with all stakeholders to work towards a resolution in the case of Foxford Court.

The Minister agrees with Deputy Crowe on the need for new building control legislation to ensure compliance with fire safety standards. In this regard, following extensive public consultation, he will shortly announce stringent new building control regulations which will require in regard to building works commencing on and after 1 March 2014: the submission of compliance drawings and documentation with local building control authorities; an inspection plan to be drawn up and executed during construction by a registered professional, who will be known as the assigned certifier; and mandatory certificates of compliance to be signed by the designer prior to construction and by the assigned certifier and builder when a building is complete. The introduction of statutory certification, backed up by the lodgment of compliance drawings and inspections during construction by registered professions, is a key consumer protection measure, and an important element in the pursuit of an improved culture of building control.

Deputy Seán Crowe

I welcome the fact the Minister of State is urging South Dublin County Council to engage proactively with all stakeholders to work towards a resolution in the case of Foxford Court.

Again, it is not a matter of urging it. This local authority and other local authorities in similar situations have a responsibility and must step up to the plate and support those residents. The fact that the local authority will share relevant information is a positive step but it is understandable why residents would feel it has a larger role in this because they bought their homes through this local authority.

Does the Minister of State agree that Newlands Development Limited must also rectify any fire safety problems in other homes in Foxford Court? The Minister needs to contact Newlands Development Limited as a matter of urgency and urge it to right the wrong done to these tenants. We need to do more to help the families in this situation. I welcome the legislation coming down the track but we have a responsibility for the people stuck in this situation.

Deputy Clare Daly

The Minister of State's response understates the scale of this problem. It is a fact that there are thousands of dwellings that are not compliant with fire safety standards and it is a miracle that multiple fatalities in this regard have not occurred. According to the Minister of State's response, it is understood that opinions of compliance were provided by the developer and its agents for the selling of the dwellings. That is it in a nutshell. Documents were signed that said these dwellings were in compliance with standards but they are not. There are thousands more dwellings that are not compliant. As a minimum, the State must accept responsibility because these problems arose due to a system of self-certification. They must be rectified now at no cost to the residents before lives are lost.

With regard to Newlands Development Limited, we have concrete proof that fire safety standards were ignored in Balbriggan and Lucan. Will all of its developments be examined and a team sent in at Newlands' expense to remediate all those developments? There are other timber frame developments around the city and I assume that Dublin is no different from the rest of the country that is similarly vulnerable. It is not good enough for the local authority to sit back and tell residents that it is their fault and that the matter must be sorted out between them and the developer. Will the Minister order all local authorities, particularly those in areas with timber frame housing, to open up their books and initiate enforcement proceedings where it is known that a developer has been responsible for ignoring fire safety standards? When the local authority was the seller of these units, can we at least assume that it will respect the people to whom it sold the properties and engage with and undertake to assist them in getting remediation works completed?

Deputy Ciarán Cannon

The Department of the Environment, Community and Local Government will continue to liaise with South Dublin County Council in respect of its response to this situation at Foxford Court. I urge everybody concerned to allow the council to continue to deal with the situation in line with the standard arrangements in place for the discharge of its statutory functions, which are quite substantial in this area. Since the Government took office, the Minister for the Environment, Community and Local Government has clearly signalled that consumer protection in the area of quality construction of new dwellings is a priority. As I indicated earlier, he will shortly announce new reforms relating to mandatory certification and improved inspection arrangements which will have the capacity to improve the quality of buildings while ensuring that problems like those that have arisen at Foxford Court are not visited upon home owners again.

Deputy Seán Crowe

Eight years.

Schools Building Projects

Deputy Joe Higgins

I am sorry the Minister for Education and Skills is not here because I want to call him to account for a gross breach of promise and remind him of his responsibility to the people of Castleknock. It came as a body blow to the parents, staff and students of Castleknock community college when they saw an answer to a parliamentary question from the Minister towards the end of last year saying that desperately needed extra classrooms and a sports hall were not included in the five-year construction programme announced by the Department of Education and Skills last year.

These extra classrooms are long overdue and critical at this stage. Castleknock community college was built in 1995 after it must be said much lobbying and pain from the local community. It was built initially for 400 students but inevitably, as those of us who supported the community and parents at the time predicted, the burgeoning population of young people meant that there was significant pressure for expansion and there are now 1,135 students. Unfortunately and incredibly in this day and age, many of these students are in prefabricated buildings that have gone from being a temporary solution to a long-term fixture. This is a deplorable state of affairs. A mother of a current student wrote to me emphasising the critical need for the new classrooms and pointing out that students are learning in cold and damp prefabs which have outgrown the age they were supposed to last. She also pointed out the necessity for building a sports hall because with the confined space in the area, children are denied the full scope of physical activities.

Castleknock community college has wonderful and dedicated staff and a wonderful complement of students with very committed parents behind them. They are generally low and middle-income earners and many of them have been badly hit by the economic crisis and the disastrous austerity policies of this Government and the previous one. If this Government did not proceed with the much needed facility students and parents were promised, it would be a very low blow.

Two Government Ministers represent this area along with myself. While in opposition, the Minister for Social Protection frequently raised the decibel level quite high when there were intolerable delays in educational investment. The Minister is very quiet on this issue. In 2011, the Minister for Transport, Tourism and Sport welcomed the granting of planning permission for the new addition to Castleknock community college and then said in a communiqué to his constituents that he hoped work would begin in 2012. He indicated that he would be contacting the Minister for Education and Skills to highlight the importance of advancing a project as important as this.

I want an answer from the Minister of State and the Department, namely, a date in the near future when the building of the extra classrooms and sports hall will commence as was solemnly promised to the people and students of Castleknock community college. Nothing less than that is acceptable.

Deputy Ciarán Cannon

I thank the Deputy for raising this matter as it provides me with the opportunity to outline to the Dáil the Government's strategy for capital investment in school building projects over the next four years and to clarify the current position in respect of the proposed building project for Castleknock community college. The five-year construction programme announced in March 2012 identifies the school building projects which are to progress to tender and construction over that time period. There were some school building projects already in architectural planning which were not included in the five-year programme and which may require major refurbishment or the replacement of temporary accommodation. The project for Castleknock community college is one such project. These projects will continue to be progressed to the point where they will be tender-ready but may then need to be deferred for progression to tender and construction at a future date.

The project for Castleknock community college entails construction of a two-storey extension with a total floor area of 2005 sq. m. and will include a new sports hall with a balcony and changing rooms, ten new classrooms to replace existing temporary accommodation, some ancillary accommodation and a covered link to the existing school building. The new development includes the demolition and removal of two temporary accommodation blocks and the provision of 26 new car spaces and associated external works including landscaping. The project, once complete, will not significantly affect the overall student intake capacity of the school, which has remained stable at just over 1,100 students per annum for the past ten years.

Following consideration of a number of stage 2(b) submissions, the building unit of my Department convened a meeting with the VEC and its design team on 29 May 2012 in order to deal with outstanding design and cost issues. A third revised stage 2(b) submission was received in my Department in December 2012. Further clarification has been sought from the VEC on this stage 2(b) submission and the Department is currently awaiting a response. Following the liquidation of the civil and structural engineering company on the design team, a tender for a replacement consultant is required. The VEC has been authorised to commence this process. Due to competing demands on my Department's capital budget imposed by the need to prioritise the limited funding available for the provision of additional school accommodation to meet increasing demographic requirements, it was not possible to include this project in the five-year construction programme announced in March 2012.

Deputy Joe Higgins

Unfortunately, there is cold comfort here for the students of Castleknock community college and their parents, with "cold" being the appropriate word. Many students will continue to be forced to be educated in substandard prefab accommodation. This is not acceptable. The Minister of State's reply outlines what the project entails: ten new classrooms to replace the existing temporary accommodation, which is cold and damp, and a new sports hall with balcony and changing rooms. This underlines how essential and urgent this facility is. Therefore, this is not the end of the story. I will urge the parents and students of Castleknock community college to mobilise themselves to demand that the promises made to them be carried out. There is a moral imperative on the Government to put in the necessary investment for these essential improvements rather than paying off gamblers and speculators. The people of Castleknock and everywhere else have no responsibility for the bad debts they raised. There is a moral imperative because of the educational needs of the school students and their right to be educated in satisfactory accommodation.

I point out to both the Labour Party and Fine Gael the political pitfall that lies ahead for them if they do not carry out the promise that these Ministers, representing those two parties, made to the people. The Labour Party is today reaping a bitter reward for broken promises in its pathetic result in the Meath East by-election. In the case of Dublin West and Castleknock, the people will feel similarly betrayed in regard to this. Fine Gael need not think it would be exempt from the anger of our people.

I advise the people to get mobilised. I will advise them to bring the community together to demand the presence of Ministers, to demand explanations as to why their promises have been broken, and to demand that the promises be reinstated and that this very necessary investment in the classrooms and sports hall at Castleknock community college be expedited and delivered within a very short period of time.

Deputy Ciarán Cannon

The Deputy is more than aware of the very significant demographic challenge arising, which my Department has to meet with limited resources. Overall national enrolment figures are expected to grow by 70,000 between 2012 and 2018, with an increase of more than 25,000 students at post-primary level and 45,000 at primary level. Post-primary enrolment is expected to continue to rise until at least 2024. In order to meet the needs of that growing population of school-going children, the Department has to establish new schools as well as extending or replacing a number of existing schools where demographic growth has been identified. Delivery of these new schools, together with extension projects to meet future demand, must be the main focus of the Department's capital budget for the coming years.

The five-year programme announced in March 2012 will provide more than 100,000 permanent school places, of which more than 80,000 will be new school places. The remainder will involve the replacement of temporary or unsatisfactory accommodation. Due to competing demands on my Department's capital budget imposed by the need to prioritise the limited funding available for the provision of additional school accommodation to meet increasing demographic requirements, it was not possible to include Castleknock community college in the five-year programme announced in March 2012. School building projects, including the project for Castleknock, which have not been scheduled for construction in that five-year programme but which had previously been announced for initial inclusion in the building programme will continue to be progressed to final planning stages in anticipation of the possibility of further funds being available to my Department in future years. The project for Castleknock community college remains available to be considered for progression in that context.