Vol. 804 No. 3
6. Deputy Dara Calleary asked the Minister for Public Expenditure and Reform his views on the way that private sector investment including the European Investment Bank can be best used to complement public expenditure to maximise economic growth; and if he will make a statement on the matter. [24644/13]
Public infrastructure is funded primarily by two sources of funding at the moment, namely, Exchequer financing, the vast bulk of funding, and PPP sourced funding. The PPP mechanism allows the State to leverage its resources and access additional investment to supplement the Exchequer capital programme, progressing needed infrastructure investment while generating economic activity and supporting employment.
Last July, the Government announced its plans for an additional €2.25 billion investment in public infrastructure projects in Ireland over and above our existing Exchequer funded capital investment plan. The stimulus package comprises two elements. The first is a €1.4 billion to fund the proposed new PPPs. This will come from the European Investment Bank, the National Pensions Reserve Fund, domestic banks and other potential sources of funding. The National Development Finance Agency and the Department of Finance are leading on sourcing this funding and are liaising with my Department in this regard.
The second element is a package of €850 million coming from the proceeds of the sale of State assets and from the new licensing arrangements for the national lottery, to be used as a project preparation facility for the new PPP programme and to fund additional Exchequer capital projects and other commercial and publicly needed projects.
The European Investment Bank is a strong and valuable support and partner in our PPP programme. In the past it has provided funding for a number of PPP projects, especially under the major motorway roads programme. More recently, it has supported two PPP projects, marking the reopening of the Irish PPP market following several years of international slowdown and difficulties in the market.
In November 2012 the latest bundle of PPP schools was signed off on by all partners. Work commenced immediately on eight sites around the country, supplementing the Exchequer funded schools building programme. We will be monitoring the number of jobs created through the stimulus package on an ongoing basis. This has already started on a pilot basis with the schools bundle 3 project which has an estimated capital value of €100 million. To date, some 924 direct full-time jobs have been created on the eight sites.
Additional information not given on the floor of the House
Work has also begun on the N11-Newlands Cross PPP project which was signed off on on 30 April. This is a bundle of two projects, the first of which involves removing the bottleneck at Newlands Cross on the N7 Limerick-Cork-Waterford road in Dublin. The second will be an upgrade of the N11 between Arklow and Rathnew to a four lane dual carriageway. The National Roads Authority, the National Development Finance Agency, the Department of Transport, Tourism and Sport and the funders - the EIB and Bank of Ireland - have all made significant efforts to deliver these projects in order to underpin market confidence that the PPP market is prepared and ready for the roll-out of the new PPP pipeline.
While the role of opening up additional funding lines for Ireland is primarily a matter for my colleague, the Minister for Finance and the National Treasury Management Agency, we have been working closely together in this regard. I am keen to build on the relationship we have with the EIB in order to ensure its continued support for the PPP programme. I have had several meetings with senior EIB personnel, including the president, Mr. Werner Hoyer, who has confirmed the bank's commitment to working with us to ensure we can maximise the resources available to Ireland and Irish investment. I welcome this valuable commitment and support which clearly demonstrates the confidence the EIB has in Ireland and the robustness of our projects.
Total EIB funding for Ireland in 2012 was €600 million. This was made up by projects in several sectors, including €100 million for Exchequer schools, €200 million for Exchequer water schemes, €50 million for the schools bundle 3 project, €150 million for Bank of Ireland's SME fund and €100 million for Bord Gáis's onshore wind programme. In addition to this EIB financing, my officials are working closely with officials from the Department of Finance and the National Development Finance Agency who are seeking to attract private sector infrastructure financing. Sources of such funding include domestic banks, international banks and institutional investors. The Minister for Finance is also liaising with our partners at European level to make progress in the area of non-bank financing.
The Minister has outlined what is being done generally through the public expenditure programme. My question, however, concerns the funding available in the private sector to complement the work ongoing through the European Investment Bank. Will the Minister tell us which banks are participating and how much each has drawn down or is capable of drawing down for onward lending to business, particularly the small and medium-sized business sector? Will he indicate the interest being charged by the EIB to these banks and what they, in turn, are charging their clients when they lend on the moneys? What is the period of the loans? People involved in the business sector are saying some of these loans are only available for a five year period, whereas the economic life of a project and the pay-back period are longer. If the Minister does not have the information to hand, he might convey it to me later. He has indicated that €850 million of the €2.25 billion investment in public infrastructural projects is coming from the sale of State assets. The difficulty in this regard is that the only revenue we can be sure of collecting this year in that process is the proceeds of the sale of the national lottery licence which, as the Minister indicated, will be received in December. I hope that funding is not being funnelled away from the national children's hospital project.
The Deputy's questions on the European Investment Bank are more appropriate to my colleague, the Minister for Finance. However, I will answer them in so far as I can. I do not know the interest rates that apply. I have met the president of the EIB, Mr. Hoyer, on two occasions, first when he was newly appointed and the second time when he was in Ireland. The entire board of the bank met here, the first occasion on which it had met outside Luxembourg. Last year the bank allocated some €600 million to us and we are expecting an even larger allocation this year. We are also dealing with the Council of Europe Development Bank. The domestic banks involved in the programme are Bank of Ireland and Allied Irish Banks. In regard to SMEs, the EIB has pledged €500 million to each of the two pillar banks to be lent onwards to SMEs. While this is primarily a matter for the Minister for Finance, it is important that we ensure, given that the EIB does not operate high street banks, that the money is channelled through the pillar banks to the people who need it. In regard to the €850 million allocation from the sale of State assets, we are confident that, together with the sale of the national lottery licence, we will also receive the proceeds of the sale of ESB power stations and the Bord Gáis Energy generating capacity in the last quarter of the year.
I will direct several of the questions I asked to the Minister for Finance, as suggested, particularly in regard to the SME sector. In respect of funding for public projects, the Minister referred in a document issued by his Department last year to various education projects that were under way and several road projects. The Newlands Cross project was mentioned and there might have been one or two in his constituency. However, there was also mention of primary care centres in the health sector. What is the position in that regard and how many of these primary care centres will actually go ahead? Are they real or imaginary projects? Will the Minister indicate, in addition, whether any project in the justice area is included in the programme?
Is the Government monitoring public private partnership agreements to ensure rights and conditions for employees are maintained? I ask this question in the context of the official pickets at the Shanganagh wastewater treatment plant yesterday. According to workers, the consortium of a Spanish multinational and an Irish building firm attempted to sack a shop steward who had sought to negotiate on conditions and so on. As a result, the workers have been forced to strike. The partner in this PPP is Dún Laoghaire-Rathdown County Council. Will the Minister give an undertaking that such projects do not function as an opportunity for private firms to trample on workers' rights?
Deputy Sean Fleming asked about primary care centres. I should have mentioned that bundles of such centres will be included in the allocation of funding from the European Investment Bank. It is interesting to discover that different institutions like different projects. The EIB likes road projects, for example. I have been trying to offer different options, but these types of project seem to be what it is used to funding.
Does it like forests?
The Council of Europe Development Bank, on the other hand, prefers justice projects. It is funding the project at Cork Prison, for instance, and the renovation of a number of Garda stations. It is a matter of conjecture as to why these bodies have a predilection for particular types of project. As I said, we are putting together various bundles. I will send Deputy Sean Fleming a note on the status of the primary care centres.
7. Deputy Seamus Kirk asked the Minister for Public Expenditure and Reform the role envisaged for the Public Service Chief Information Officer Council; and if he will make a statement on the matter. [24659/13]
My Department established the Public Service Chief Information Officer Council in November 2011. The council is a representative forum for senior managers with responsibility for information and communications technology, ICT, and-or e-government from across the civil and public services. It provides expert input to decisions and actions to improve the impact of ICT and e-government on public service delivery. My Department, in collaboration with the council, has published e-government and cloud computing strategies to support the public service reform plan.
The council has met on seven occasions to date. Agendas, minutes and other relevant documentation are published on its website, ciocouncil.gov.ie. The council is chaired by my Department. The Government recently appointed Mr. Bill McCluggage as Government chief information officer and he will assume the chair when he takes up his appointment in June.
It was the appointment of Mr. Bill McCluggage that caught my eye some time ago. When one thinks about a chief information office, one might well assume it would in some way be connected with Government information services. What linkage is there between these two organisations? The Minister has talked about cloud computing, social media and so on. Surely they should all be integrated instead of having information technology communications in one corner and the old-fashioned communications methods being routed through Government information services. Is the Minister at liberty to outline the terms and conditions of Mr. McCluggage's appointment, including pay rates?
I do not have the terms and conditions of the appointment to hand, but I will have no difficulty in conveying them to the Deputy. Like most of the appointments I have made in my Department, including a new head of procurement and a new director of reform, he has been appointed on a five year contract with fixed wages. That is a good way to do it and the people I have appointed under these terms have been of extraordinary quality. Mr. McCluggage, likewise, is coming with a great pedigree, having been chief information officer in Northern Ireland before moving to the British Cabinet Office to assume the same role. I will send the Deputy a note on the structure of the council and how it operates.
8. Deputy Clare Daly asked the Minister for Public Expenditure and Reform if he will lift the public sector recruitment embargo which is resulting in important public facilities having to close down as vacancies from retirements remain unfilled. [24514/13]
The Government has set out an ambitious public service reform plan that aims to transform the quality and cost effectiveness of public services in Ireland. As part of that plan, we are undertaking a steady and managed reduction in public service numbers. There is, however, no wholesale embargo on recruitment. There is significant recruitment in targeted priority areas such as health and education.
The Government is, sensibly, taking a measured and prudent approach in order to mitigate the potential disadvantages of reduced staffing levels.
To this end, the numbers reduction policy takes account of priority areas, by allowing for replacement of key staff especially in the education sector and in key areas of health; gives sectoral and local management discretion in exactly how staff resources are allocated within an area; provides a framework for redeployment of staff across the public service; and includes introducing new streamlined services such as shared services, which allow functions to be maintained and indeed enhanced with reduced staff levels and at a lower cost.
Reform of the public service is necessary both because we need to reduce costs given our serious fiscal position, and because the quality of public services for the citizen needs to be continually improved and value-for-money for the taxpayer protected. The Government's reform plan is comprehensive and ambitious. It captures a wide range of reform projects, including ICT infrastructure projects to support enhanced automation, better on-line services and shared payroll and HR services; change management projects to support more effective work practices, redeployment, rostering and manpower planning; organisation restructuring, involving mergers of previously separate State bodies and of divisions and work areas within organisations.
These reform projects will allow the public service to function more efficiently and more cost effectively over the medium term. Crucially, they are facilitating the delivery of services while making headcount reduction.
The Minister has given the impression that the system is quite flexible, that there is not an outright ban and that services can be delivered. He said that areas such as education and health are prioritised, does this mean that local authorities are prevented from recruiting people? In my area Fingal County Council has to reduce library hours significantly because on the one hand, it needs to open a new library in Donabate and on the other, several librarians have retired. The net impact is that the local authority has said that it cannot open the new facility unless it cuts hours in all the surrounding ones. This is a vital community service. In Rush, according to the census there are 9,000 people and over 6,500 are members of the library. There were 400 events there last year but now the library hours are being slashed. The Minister's party colleagues on the council took the unusual step of directing the county manager to overturn this decision to reduce library hours. To do that they need 12 extra librarians to keep it open. What can the Minister's Department do in this case? Could those 12 people be recruited or is the council prevented from recruiting them? The Minister's answer would be very helpful to the people in the area and in illuminating the overall situation.
I cannot answer a particular question like that because I cannot micro-manage the 300,000 employees across the State agencies, the local government sector and each Department. There is an employment control framework and there is flexibility within the framework devolved within councils or Departments. I do not want to pretend that there is no pressure. There is pressure as we are reducing numbers because we must reduce the pay bill. There are no compulsory redundancies and we have maintained that policy to date. Some services will be affected. I do not want to pretend that is not a fact because we are in an economic crisis. Unfortunately we cannot afford all the services I would love to be able to provide. I am not in a position to speak about the local library the Deputy mentioned.
I regard the library service as a flagship for the State. When I was a member of Wexford County Council that was the only committee of which I wanted to be a member because I think libraries are very important to the community. On foot of this discussion I will ask my Department to contact Fingal County Council about this but I cannot give any succour or support to the Deputy about what flexibility might be available.
I know the Minister does not know the detail but theoretically is there anything to stop the local authority from taking on 12 people? Is there a ban in place, stopping the authority from recruiting 12 people? The Minister says it must be done within a cost framework but assuming these savings were made elsewhere could the embargo be lifted to provide librarians? Librarians have a particular skill and they are required in order to keep the facility open. Is there anything blocking that if the savings could be found elsewhere? I have lots of problems with the big picture but I would like an answer on that local example for now.
I am at two removes from this, first because it concerns the local authority and second because that is the responsibility of the Department of the Environment, Community and Local Government. There is an employment control framework which sets a headcount local authorities are not allowed to exceed. There is flexibility within that but I do not know the details and what flexibility applies at local level. The Deputy might talk to the Minister for the Environment, Community and Local Government about this matter. I will ask my Department to make contact with Fingal County Council.
9. Deputy Timmy Dooley asked the Minister for Public Expenditure and Reform his plans for regulation of lobbying; and if he will make a statement on the matter. [24653/13]
I recently secured Government approval for the drafting, by the Office of the Parliamentary Counsel, of the Lobbying Regulation Bill. The general scheme of the Bill has been published on my Department's website.
The main aim of the proposed regulatory scheme is to strengthen public confidence in politics and in the business of government, as well as to increase the accountability of decision-makers by subjecting public policy-making, and those who seek to influence it, to greater openness and transparency.
The proposed Bill provides for a statutory web-based register of lobbying activity. The key features of the proposed regulatory system include the following: communication with designated public officials or office holders on specific policy, legislative matters or prospective decisions will be subject to registration. The focus of the lobbying register will be on the subject matter of the communication, the purpose of the lobbying, the organisations and person lobbied and the type and intensity of lobbying. It is intended that the Standards in Public Office Commission, SIPO, will be responsible for managing the implementation of the register and for monitoring compliance. An important part of this function will be to provide guidance to registrants. The proposed Bill will also allow for the regulation of a "cooling-off" period for up to a year for former public officials seeking to lobby former colleagues they worked with in a public body. A more extended blanket prohibition on post-public employment is likely to conflict with a person's right to earn a livelihood. Normal citizen interaction with their local political representatives is a fundamental democratic right and will not be subject to registration other than when it relates to land rezoning and development issues in light of the recommendations of the Mahon tribunal.
Lobbying activity forms an important element of the democratic process. It contributes to greater openness and transparency on public policy formulation and provides valuable input to the decision-making process. The intention of this Bill is to continue to encourage such participation and engagement but to ensure that it occurs in an open and transparent manner.
I understand that is generally the scheme about which the Minister has spoken and he wrote to the Oireachtas Joint Committee on Finance, Public Expenditure and Reform during the month saying that he hopes to have the legislation enacted by the end of the year. What is his plan for the commencement and implementation date of that legislation? Many Bills have been enacted but never commenced.
Today we heard that the Taoiseach held formal talks with the tobacco industry. Some of the big asset sell-offs such as the part sale of Bord Gáis, the national lottery licence and the ESB stations about which we will talk for the next decade will happen or be under way before this legislation comes in. It looks as if the legislation is being delayed or not proceeding in advance of the sale of State assets. The legislation could have been brought in last year. It looks as if we will wait till the assets are sold off before bringing in the legislation so that people cannot influence major Government decisions after the fact.
I will commence the legislation as soon as I can but I do not want to pre-empt the legislative process. I hope to bring it to Government very shortly and I will publish it immediately thereafter but there is a growing queue to get into the Oireachtas Joint Committee on Finance, Public Expenditure and Reform now and it will be very busy for the next while.
There are clear, published protocols about the handling of the sale of State assets. I have made it clear that in respect of any information from a bidder or potential bidder my immediate staff has had no contact at all with such persons. There is a portal, an access point, through NewEra and a designated officer to handle that and the protocols surrounding that are published.
What was the Deputy's last point? I have written "lobbying".
It was about the tobacco industry.
Everyone is entitled to lobby. The issue about the lobbyist register is that everyone is entitled to know who is lobbying. It is also important lobbying is done in an open and transparent way.
Will the Minister put the Standards in Public Office Commission, SIPO, on notice to put arrangements in this regard in place? Before, when we have passed legislation, it has taken six to 12 months to have new systems put in place so the legislation’s provisions could become operational. SIPO should be put on notice on the general scheme of this proposed legislation to ensure it does not commence putting the systems in place after the legislation is enacted but beforehand.
With another budget coming up in several months’ time, the motor industry could be lobbying on motor tax, the pharmaceutical industry on the costs of medicine or the drinks industry on the sponsorship of sports. Will the Minister put a voluntary registration in place so the public can see who is lobbying which Minister about what in the months ahead?
Yesterday, at a Dáil committee hearing on the IFSC Clearing House Group, I had the most educational day since I was elected-----
Good man, but do not tell us about it. Just ask a question.
I realised where the centre of the power is.
Deputy, we have three minutes left and there is another Deputy with a question coming up.
Will the Minister include the IFSC Clearing House Group in the lobbying legislation?
The Minister claims the legislation will prevent former members of a Government from lobbying for a year. Transparency Ireland has pointed out this is too short a time. Does the Minister believe five years would make more sense?
I will have to think about putting the IFSC in the lobbying legislation. I will come back to Deputy Stanley on the matter.
On the cooling-off period, people are entitled to make a living, as Deputy Wallace knows full well, and people have constitutional rights in this regard. On the notion that one could be disbarred, for example, say the Minister for Justice and Equality wants to become a solicitor again----
I wish he would.
Should he be debarred? Maybe I am asking the wrong person that question. Let me make it easier - should the Minister for Health be allowed to be a doctor again? The embargo on lobbying will not only apply to officeholders, but also to senior public servants. What grates with people is that senior public servants dealing with an industry or an issue can seamlessly move within a month of leaving office to the other side of the fence, well-armed with information. A year is a reasonable time for cooling off because matters move on without unnecessarily impacting on a citizen’s right to earn a living. Otherwise, we may have to pay people for that period given.
10. Deputy Joe Higgins asked the Minister for Public Expenditure and Reform the position regarding the negotiations between the Labour Relations Commission and the public service unions that have taken place since the rejection of the Croke Park II proposals. [24670/13]
The Government is committed to finding the necessary pay bill savings of €300 million for 2013 and €1 billion by end 2015. We have always maintained that the preferred option was to deliver the necessary savings by agreement.
As the Deputy will now be aware, on foot of the rejection by the public services committee of the Irish Congress of Trade Unions, ICTU, of the Labour Relations Commission, LRC, proposals negotiated in February of this year, the Government had asked the commission's chief executive, Mr. Kieran Mulvey, to initiate discussions with various public sector unions and representative associations on whether there was a basis for a negotiated agreement for achieving the necessary savings.
We have always indicated we were prepared to show the necessary flexibility around how savings could be achieved. That flexibility was availed of by some unions during the first set of discussions which took place earlier this year and again during the most recent LRC process.
Mr. Mulvey and his team have been engaged in intensive discussions with the parties over recent weeks and he has kept me fully informed of developments. Those discussions concluded on Monday last and unions now have draft proposals for agreement for consideration under their own rules and procedures.
The Government is pleased with the outcome of the LRC process. I thank all those involved in the talks, particularly the LRC which facilitated the discussions. It provides us with an opportunity to achieve the necessary savings, to afford the protection of a collective agreement to public servants and to provide industrial peace in the public service at a crucial time for our economy.
As I have stated, if these proposals are accepted, it will be possible to achieve the required savings and achieve major increases in public service productivity to secure the necessary reduction in the public service pay and pension bill. The essential elements and protections of the existing public service agreement will also remain in place and industrial peace in the public service can be secured at a critical time on our path to economic recovery.
Also today, I published legislation to give effect to the pay reduction for those earning over €65,000, the parallel reduction in public service pensions and other contingent measures to enable the Government achieve its savings requirements in the event of non-ratification of collective agreements. Obviously, unions can opt out of the collective agreement if they so wish.
The financial emergency measures in the public interest will enshrine these pay cut proposals from the Government. Can I put it to the Minister that it is misnamed legislation? The public interest suggests the majority interest of ordinary people but this is in the interest of continuing the bailout of bankers and bondholders at the expense of public sector workers and continuing the flow of money to the former. Has the Minister reflected on the bullying and the badgering he has engaged in over the past two months? He has threatened public sector workers that, unless they swallow these cuts, they would be savagely implemented anyway. Following the clear rejection of these proposals, he continued with this, suffering from what I call the Lisbon treaty syndrome where the Government does not accept a democratic outcome but threatens awful repercussions.
Will the Minister agree there is an alternative of putting a progressive tax on the 5% of top earners, introducing a financial transaction tax and a wealth tax? From these, he could get far more than the €1 billion he is now trying to rob from low and middle-income workers in various ways.
Setting aside the politics of it and focusing on the process, will the Minister not pre-empt and subvert the ballot of workers which is likely to take place in the next week by demanding that amendments for this Bill are submitted by tomorrow at 11 a.m? The workers have not looked at it and neither have Members.
Sorry, Deputy, but that is not for the Minister to decide but for the House.
The process of legislation is a matter for the House, not for me.
Deputy Higgins is in a poor position to demand people accept a democratic decision since there are various charges, taxes and levies decided by the elected representatives of the people against which he himself campaigns.
