Micheál Martin
Question:1. Deputy Micheál Martin asked the Taoiseach the number of part-time workers employed in his Department. [14640/13]
Ceisteanna - Questions (Resumed)
Departmental Staff Data
Currently, 29 members of staff in my Department are work-sharing. This represents 14% of my Department's total staff. In considering requests to participate in the Civil Service work-sharing scheme, my Department considers its operating requirements and endeavours to tailor workloads to allow for flexible attendance patterns that accommodate the business needs of my Department and the personal responsibilities or choices of those who wish to participate in it.
I thank the Taoiseach for his response. He indicated that a total of 29 members of staff in his Department are working part-time, but how many of them are female? In raising this matter, I am particularly conscious of the need to continue as far as possible to maintain family-friendly work practices. How will the Haddington Road agreement impact, if at all, on people who are working part-time within the Department of the Taoiseach? Will those who are working part-time work even less, or will the options for flexitime or short-time working be eliminated altogether? It seems that in some quarters of the public service, management is saying that it is unable to manage the challenges of work-sharing patterns. We would all be loath to see the pattern of work-sharing being withdrawn. How does the Government view the issue of work-sharing and how family-friendly policies are reflected at the very top of the public service, including the Department of the Taoiseach?
The Government welcomes the Haddington Road proposals. Obviously, I am very grateful to the Labour Relations Commission for the work its staff have put into this, particularly the chief executive officer. Each union now has draft regulations for its own rules and procedures. The Government has published legislation which we must enact in any case to implement pay reductions and other changes. The Minister for Public Expenditure and Reform has estimated that €300 million can be saved by the end of this year and €1 billion by the end of 2015.
As regards the 29 departmental staff I mentioned, all of those work-sharing are female. They range from principal officer level down to clerical officers. The areas where people are work-sharing include the economic, international and Northern Ireland sections, as well as European affairs and co-ordination, protocol, corporate affairs, internal audit and the Office of the Tánaiste.
If a person wishes to work-share, we try to facilitate them if at all possible. The procedure to apply for work-sharing is set out in the Department of Public Expenditure and Reform's circular on work-sharing.
All applications are considered on a case-by-case basis, in light of the pressure on work in those Departments and the overall budgetary situation. If a staff member wishes to change the existing work sharing pattern it can be considered in the overall context of the business needs of the Department and budgetary considerations.
Staff avail of a variety of work-sharing patterns and they range from 40% to 80%. Examples of such patterns include a two-day week where there is a 40% whole-time equivalent, a three-day week where there it is 60%, a four-day week where it is 80% or a split week, two or three days each calendar week or 9 a.m. to 3 p.m. every day, and 73% get involved in that. A broad range of family-friendly and work-life balance schemes are available to staff across the Civil Service, but they are also available in the Department of the Taoiseach. They include work-sharing, flexitime, career breaks, a shorter working year scheme and special leave for domestic circumstances. Staff also have entitlements to a variety of statutory schemes such as maternity leave, paternal leave and force majeure leave. Requests for access to work-life balance schemes are facilitated in so far as we can. Flexitime is available to clerical staff, executive, higher executive and administrative officers and third secretaries in the Department.
Notwithstanding what the Taoiseach has said, we all realise the difficulties the public service is facing in terms of reduced numbers across the board. We do not have, as yet, a number of women, particularly in senior posts, in the public service. We all accept that women are adversely affected by anything that may be seen to be not family friendly or favouring the area of work-life balance. Can the Taoiseach give us a serious undertaking that irrespective of the Haddington Road agreement and the pressures his Department is under, he will take the lead and ensure he has in his Department at least the same number of women availing of the opportunities for various part-time working arrangements into the future that he currently has? The Government is frequently accused of not having the sort of flexibility required to take on board such measures but maybe as we look to the future such measures are even more important than they were in the past. Again, I appeal to the Taoiseach to give us his personal assurance that these matters will be prioritised.
As I said to Deputy Ó Fearghaíl, when somebody seeks one of these arrangements, every effort is made to accommodate that person irrespective of the sector in which they work or their level, in accordance with what I have said here. While Haddington Road sets out the collective agreement for the Civil Service and the non-commercial State sponsored bodies, NCSSBs, some of the individual responses I have given may differ from the broader public service. But because the Deputy has asked a very direct question here, let me give him the following assurance. The Secretary General of the Department of the Taoiseach would be more than anxious that where people have made a request for any one of the flexitime or shared-time working arrangements, the Department tries to accommodate them where that is possible. I can give the Deputy an update where that is concerned with both women and men in the Department where it applies.
An Teachta Ó Fearghaíl asked and the Taoiseach answered most of the questions I had in mind. Because all these work-sharing positions are held by female staff, how many other staff members of the Department of the Taoiseach are women? He might not know off the top of his head.
I will have to give Deputy Adams that figure. I am not sure of the breakdown between male and female but I will send it on to him.
Appointments to State Boards
Micheál Martin
Question:2. Deputy Micheál Martin asked the Taoiseach the number of appointments to State boards he has made in the past two years; and if he will make a statement on the matter. [22130/13]
The National Economic and Social Council, NESC, is the only State agency under the aegis of my Department. The NESC provides guidance to Government on strategic issues for Ireland's economic and social development. Since coming into office on 9 March 2011, I have made appointments to the NESC. The appointments were made in accordance with the National Economic and Social Development Office Act 2006 and SI No. 603 of 2010, the National Economic and Social Council (Alteration of Composition) Order 2010.
I appoint members specifically on the basis of nominations from business and employer interests, the Irish Congress of Trade Unions, ICTU, farming and agricultural interests, the community and voluntary sector and the environmental sector. I may also appoint up to six public servants of whom at least one shall represent the Taoiseach and one shall represent the Minister for Finance. These appointments represent relevant Departments to ensure NESC's work is integrated with Government policy making. I also appointed eight independent members to the NESC in 2011, in most cases from the academic sector.
These appointments were made following careful consideration of the necessary skills, knowledge and expertise relevant to the functions of the council as required by the legislation. There has been one appointment to the National Statistics Board, NSB, in the last two years. An assistant secretary at my Department was appointed to the NSB in line with the provisions of section 18(1)(b) of the Statistics Act 1993.
Table: Details of appointments made by the Taoiseach to NESC since 9 March 2011
|
Name |
Organisation |
Date of Appointment |
|
Mr. Martin Fraser, chairperson of NESC |
Secretary General, Department of the Taoiseach |
August 2011 |
|
Mr. John Shaw, deputy chairperson of NESC |
Assistant secretary, Department of the Taoiseach |
January 2012 |
|
Prof. Edgar Morgenroth |
Associate research professor, Economic and Social Research Institute, ESRI |
June 2011 |
|
Prof. John McHale |
Economist, National University of Ireland, Galway |
June 2011 |
|
Prof. Mary Daly |
Professor of sociology and social policy, senior research fellow of Green Templeton College, Department of Social Policy and Intervention, University of Oxford |
June 2011 |
|
Prof. Anna Davis |
Department of Geography, Trinity College Dublin |
June 2011 |
|
Prof. Seán Ó Riain |
Department of Sociology, National University of Ireland, Maynooth |
June 2011 |
|
Dr. Michael O’Sullivan |
Head of portfolio strategy and thematic research, Credit Suisse, London |
June 2011 |
|
Ms. Mary Walsh |
Chartered accountant |
June 2011 |
|
Dr. Michelle Norris |
Senior lecturer, School of Applied Social Science, University College Dublin. |
July 2011 |
|
Mr. Shay Cody |
IMPACT |
September 2011 |
|
Mr. John Murphy |
Secretary General, Department of Jobs, Enterprise and Innovation |
November 2011 |
|
Mr. Seán Ó Foghlú |
Secretary General, Department of Education and Skills |
February 2012 |
|
Mr. John Moran |
Secretary General, Department of Finance |
March 2012 |
It is customary for these vacancies on State boards to be notified through the Public Appointments Commission and we welcome that. While this is a welcome development, all of the evidence to date is that it has made absolutely no difference to those who are being appointed to serve on boards. The main development is Ministers, in conjunction with the Taoiseach, are getting the people they would appoint anyway to put their CV through the State's appointments commission. It seems that many of the people who were appointed previously are being reappointed which, thankfully, would indicate the Government sees that many of the people appointed in the past had merit.
Can the Taoiseach tell us if he will undertake a review of the plethora of State boards we have across the country to indicate the extent to which these boards are being effective, whether they are doing the job they were appointed to do and if they have the correct skillsets in place? It is all very well to appoint them, and one can perhaps to some extent point to some improvement in the process of appointment, albeit that many of them still have very strong political connections. Having political connections is not a bad thing, a sin or something we should hold up to ridicule, but are they doing the job they are charged with doing effectively? What systems for monitoring the effectiveness of these bodies has the Taoiseach put in place or does he intend putting in place in the period ahead?
This is a small country and most people have a political record of one description or another. That does not mean it should be the only criterion that should apply to appointments to boards. Under previous administrations there was no process at all for public involvement in board appointments. Before this Government took up office, in the last few days of that regime, a couple of hundred people were appointed to different boards. It has been opened up for the first time ever. Every Department is required to advertise vacancies on their own websites. That enables members of the public to come forward and make their views and expertise known. While Ministers are not confined to that list, it has greatly widened the opportunity and the pool of people from whom appointees can be chosen. Quite a considerable number of appointees have come through that process and those nominated for chairpersons of State boards must attend the relevant committee in advance of appointment to set out their vision, priorities and what they see they would bring to that board. That also enhances the transparency of the board's process.
We will keep that under review. The relevance of what the Deputy raises is the question, rather than just making appointments, whether these are people who really have something to offer. Are the boards doing the job for which they were set up?
The relevant question is not simply about which appointments are made but rather that they be of people who really have something to offer; and whether the boards are doing the job for which they were established. I would assume that every Minister has an engagement with these boards and if they are not measuring up, that he or she will ensure something is done about it. Under a number of appointments that were made through the public advertisement system, I note, for example, the chief executive of Fujitsu and the head of regulation and public policy at O2 Ireland were appointed to EirGrid. The chair of Accenture Institute for Public Services Value and a member of the Smurfit Graduate School of Business, Vivienne Jupp, was appointed to the board of CIE. The chairperson of Bord Bia is currently the chairman of Jacobs Fruitfield in Ireland. Michael Carey has had senior positions in a number of multinational food companies in Ireland and the UK. Also appointed to the board via the public process was Rhona Holland, who is a managing director of Global Intelligence, and formerly of PepsiCo. These are people of exceptional calibre and quality who applied through that system. It has brought about a change in the range, calibre, quality and speciality of people who can be appointed.
I encourage Ministers on a regular basis to see to it that the strategy and requirements of the boards are met and followed through and that a programme and plan are being followed in order that we can make progress. From my point of view, I chair the Cabinet sub-committees. People occasionally attend from agencies and are required to report on progress made in so far as implementing the programme for Government is concerned and on the planned strategies of the individual groups or organisations.
I agree with the Taoiseach it is a very positive development that the chairs of these boards are now coming before Oireachtas committees and have an opportunity to set out for themselves in a clear way the vision they have for the development of their respective organisations in the years ahead, and also that the representatives of the political parties, and of none, have the opportunity through the Oireachtas committees to engage with these people, put questions to them and tease out the agenda they have. That is entirely positive and I commend the Taoiseach on it. It is a pity that initiative was not taken many years ago.
I put it to the Taoiseach, however, that there still is considerable political influence at play in how people are appointed to these boards, irrespective of the involvement of the State Appointments Commission. I am not convinced there is anything in particular wrong with that but there certainly is something wrong in suggesting that although it was wrong for the previous Administration to do this it is in some way right if this Administration proceeds to do the same. It is alleged against the previous Government that a multiplicity of appointments was made in the interregnum between the completion of the term of the last Government and the beginning of the new Government, but that was nothing different to what had happened down through the generations. The Taoiseach's party, when in Government, did it; so did the Labour Party. The Taoiseach's Government will probably do it again when its current term of office finishes.
I refer to the business of monitoring by committees of the efficacy of the appointed boards, which is of considerable importance. The Minister for Arts, Heritage and the Gaeltacht, Deputy Jimmy Deenihan, was in the Chamber until just a while ago and this is a matter we have been exploring over the course of Question Time. I welcome that the Taoiseach is asking Ministers to monitor how the State boards are performing. That is good, and fair enough. The Taoiseach needs to go a step further, however. These boards are of significant importance and the people who serve on them consider themselves privileged to be doing so. I encourage the Taoiseach to encourage his Ministers to devise some kind of formal process of assessment so that the boards can understand they have a challenge to live up to and that the objectives set out by the chair when the chair meets with the Oireachtas committees are being assessed, at least on an annual basis. In this way the boards can be given the challenge of working towards the agenda which has been set out for them and they can produce, to the Oireachtas, the Minister or whomsoever, annual reports that indicate the progress that been made.
The Deputy is aware that annual reports are produced by the boards in respect of the work programmes they follow. I engage with Ministers on a regular basis and in preparation for the Estimates for every budget. I talk to each individual Minister about his or her departmental responsibilities and also about the boards that are related to each Department and under each Minister's aegis. At that point, one asks how board X or Y is doing, whether it is measuring up and whether the chairperson is able to do the job. That is only normal practice. These are very important positions and some are more sensitive than others.
First, it is a duty of the chairperson of the board to see that it performs its function; second, it is the responsibility of the Minister involved to see that the board is driven and motivated to make a difference; third, the board must report to Oireachtas committees and to the public. I hope those appointed fulfil their duty, that the requirements of the board are met, as determined by the Department and the Minister, in respect of whatever skill needs or ranges of experience are needed, and that they get on with the business of being effective, run their boards properly and make a difference - which is the reason they were appointed in the first place.
I thank the Taoiseach for his answer. It is a good and positive advance that vacancies on these boards are publicised on the websites of Departments and that chairpersons come to Oireachtas committees and give an account of their vision. However, I note that an Oireachtas committee cannot prevent the appointment of a chairperson. I made the case previously to the Taoiseach that a real democratic revolution would be in place if Oireachtas committees had the same status as committees on Capitol Hill have, which can actually stop such appointments. Perhaps that is work for another day.
Can the Taoiseach give us some sense, in respect of boards under his auspices or those of his Department, as to what percentage of board members are women? Has the Government considered any additional measures to secure gender equality or advance that objective? The Taoiseach may recall that recently there was considerable controversy during the industrial dispute involving Bus Éireann when we discovered the chairperson of the board was resident in Dubai. Does the Taoiseach know if any other chairs of State boards are resident abroad, including those under his Department?
I thank Deputy Adams who, along with Deputy Ó Fearghaíl, has been generous enough to acknowledge that would-be chairpersons come before Oireachtas committees. That is important.
The only board under the direct responsibility of the Department of the Taoiseach is NESC, which has 14 members on the board, four of whom are women. Most members are nominated by the individual organisations and, while one might like to have a balance as close as possible to 50-50, members of this board are nominated within academia or individual groupings. I do not have that control over them.
The Deputy is aware that a number of the appointments made to RTE are made, in part, by the Oireachtas committee which recommends names to the Minister for Communications, Energy and Natural Resources. That is a particular case where the committee is in a position to make nominations which the Minister subsequently approves. I do not have data in respect of any particular Minister but I am sure if the Deputy tables parliamentary questions the Departments in question will be happy to supply answers to him. In the case of NESC, the appointees are either academics or are nominated by individual unions or sectors.
The direct appointment from the Taoiseach's office is limited to public servants at assistant secretary level, as in this case.
Deputy Adams referred to the person in Dubai. I understand from memory that the chairman made a substantial number of trips home at his own expense in order to deal with the questions arising in Bus Éireann. From what I know of him, he is an exceptionally competent person and I am glad the matter was resolved and that the drivers continue to do an excellent job.
In regard to Deputy Ó Fearghaíl's question, the target of 40% representation for women was restated in the national women's strategy 2007-16. The programme for Government commits to taking steps to ensure that all State boards comprise at least 40% representation of each gender. Clearly, it is not possible to make appointments until vacancies arise. In 2011, a proposal from the Minister for Public Expenditure and Reform to advertise future vacancies on State boards on the website of the relevant Department was brought to Government and approved. Public advertisements inviting these applications state that due regard will be given to Government policy on gender balance on State boards. I have discussed on previous occasions the suitability of applicants for boards. Composite data on women's participation in State boards in recent years indicate that approximately 34% of places on boards were held by women. Progress towards achieving the gender target has been slow and significant deviations persist between Departments. A pattern has emerged over the years whereby significant numbers of women are on boards with a caring focus but fewer are on boards with an economic or business focus. I have outlined a number of examples of exceptional and competent people, including women in particular, who were appointed following public advertisements for important economic bodies. I would like to see that continue.
EU Presidency Engagements
Micheál Martin
Question:3. Deputy Micheál Martin asked the Taoiseach his plans to discuss concerns regarding the 26 million persons who are unemployed across Europe; the actions that need to be taken at the next EU Council meeting; and if he will make a statement on the matter. [22126/13]
Micheál Martin
Question:4. Deputy Micheál Martin asked the Taoiseach if he will be distributing any position papers prior to the June EU Council meeting being held; and if he will make a statement on the matter. [22131/13]
Micheál Martin
Question:5. Deputy Micheál Martin asked the Taoiseach the details of his discussion with the German finance Minister, Mr. Wolfgang Schäuble; and if he will make a statement on the matter. [22132/13]
Micheál Martin
Question:6. Deputy Micheál Martin asked the Taoiseach if he gave any position papers to the German finance Minister, Mr. Wolfgang Schäuble, when he met him; and if he will make a statement on the matter. [22133/13]
Micheál Martin
Question:7. Deputy Micheál Martin asked the Taoiseach if he requested support from the German finance Minister, Mr. Wolfgang Schäuble, for Germany to support empowering the European Stability Mechanism to retrospectively compensate member states for taking on banking losses; and if he will make a statement on the matter. [22134/13]
Micheál Martin
Question:8. Deputy Micheál Martin asked the Taoiseach if he directly discussed a separation of bank and sovereign debt; if he directly requested Mr Wolfgang Schäuble support for this position; and if he will make a statement on the matter. [22135/13]
Micheál Martin
Question:9. Deputy Micheál Martin asked the Taoiseach if he distributed papers at the meeting in Brussels on 6 May 2013; and if he will make a statement on the matter. [22383/13]
Joe Higgins
Question:10. Deputy Joe Higgins asked the Taoiseach when the next EU Council meeting is taking place; and if he will outline the key issues likely to be taken. [23970/13]
Gerry Adams
Question:11. Deputy Gerry Adams asked the Taoiseach if he will report on his attendance at the European Council summit on 22 May. [25199/13]
Gerry Adams
Question:12. Deputy Gerry Adams asked the Taoiseach if he raised the issue of youth unemployment at the European Council summit on 22 May. [25200/13]
Gerry Adams
Question:13. Deputy Gerry Adams asked the Taoiseach if he raised the issue of the retrospective recapitalisation of the Irish pillar banks at the European Council summit on 22 May. [25201/13]
Richard Boyd Barrett
Question:14. Deputy Richard Boyd Barrett asked the Taoiseach if corporate tax was discussed at the EU Council meeting on 22 May 2013; and if he will make a statement on the matter. [25466/13]
Richard Boyd Barrett
Question:15. Deputy Richard Boyd Barrett asked the Taoiseach if the tax regime for oil and gas here was discussed during the talks on energy efficiency at the EU Council meeting on 22 May 2013; and if he will make a statement on the matter. [25467/13]
Richard Boyd Barrett
Question:16. Deputy Richard Boyd Barrett asked the Taoiseach if he will report on his meeting with the German finance Minister, Mr. Wolfgang Schäuble; and if he will make a statement on the matter. [25468/13]
I propose to answer Questions Nos. 3 to 16, inclusive, together.
On 29 April, in the course of a visit to Spain, I had a bilateral meeting with the German Minister of Finance, Wolfgang Schäuble. We discussed a range of major EU and Presidency agenda items including the negotiations on the multiannual financial framework, MFF; progress on banking union; the growth and jobs agenda, particularly the European Union's competitiveness; and developments in the euro area. I also updated Minister Schäuble on economic developments in Ireland, progress made during the Irish Presidency and ambitions for the rest of our term.
In relation to unemployment in the European Union, the compact for growth and jobs provides a clear framework for the key actions necessary to return our economies to sustainable growth and job creation. We must ensure that it is implemented. There will be a full review of progress on this vital work at the June meeting of the European Council, one year on from its adoption.
The agenda for the June meeting of the European Council is being prepared in the normal way. President Van Rompuy prepared an annotated draft agenda for consideration by last week's meeting of the General Affairs Council, which was chaired by the Tánaiste. The draft agenda includes conclusion of the European semester process for 2013, with the endorsement of country specific recommendations; assessment of implementation of the compact for growth and jobs; and progress on banking union. The meeting will also consider President Van Rompuy's response to the four questions on economic and monetary union that he was asked to explore by the European Council in December. The meeting will also consider developments in the EU's relations with strategic partners and on enlargement. In due course, President Van Rompuy will circulate draft conclusions for the June European Council, which will be discussed by ambassadors in Brussels and subsequently by Ministers meeting at the June General Affairs Council, which the Tánaiste will again chair. In the usual manner, at each step in the process, Ireland will continue to input its views, as appropriate.
The Tánaiste and I met President Barroso and President Schulz in Brussels on 6 May to discuss the way forward on the MFF. I did not distribute any papers. We agreed to start formal negotiations between the Presidency, the Commission and the Parliament on the MFF, and in parallel to negotiate on the draft amending budget for 2013. This was a problem for the Parliament. An Irish Presidency compromise proposal on the draft amending budget was endorsed by the meeting of the ECOFIN Council earlier this month. The proposal put on the table a first tranche of €7.3 billion out of a total ceiling of €11.2 billion. We agreed that negotiations on the MFF would begin with a trialogue on 13 May to focus on matters of particular concern to the Parliament, as set out in its 13 March resolution on the MFF, namely, flexibility, a review clause, own resources and unity of the budget. It was also agreed not to re-open the figures on administrative expenditure under heading five of the MFF and to speed up negotiations on the staff regulations, which are part of the MFF legislative package. The first trialogue took place on 13 May. A further trialogue, in which the Tánaiste is participating, is taking place today. The Irish Presidency aims to get political agreement on the MFF in June.
I attended the meeting of the European Council which took place in Brussels last Wednesday. As I will be making a statement to the House on this meeting tomorrow, I will merely give a short summary of its proceedings. Discussions at the meeting focused on energy and on tax policy in the context of the EU's efforts to promote growth, jobs and competitiveness. On energy, leaders agreed on a series of guidelines in four fields that should help boost competitiveness and assist us in responding to the challenges of high energy prices and cost. These are urgent completion of a fully functioning and interconnected internal energy market; facilitation of the required investment in modern energy infrastructure; diversification of Europe's supplies; and enhanced energy efficiency. In my intervention, I highlighted potential gains from energy efficiency. Our discussion of tax policy had a particular focus on how to improve the efficiency of tax collection, and how best to tackle tax evasion and fraud. This discussion largely reflected the agenda set by the Minister for Finance, Deputy Noonan, and Commissioner Šemeta in their joint letter on tax issues. There was a strong endorsement of our ambition as Presidency to reach agreement on VAT fraud counter-measures in June. The Council also briefly discussed Syria, reaffirming its commitment to a political solution. It adopted a decision to continue with the situation whereby each member state nominates a Commissioner.
I wrote last week to each of my colleagues in the European Council as we enter the final stages of the Irish Presidency. I thanked them for the excellent level of co-operation which we have received and highlighted a number of areas on which we would appreciate further support over the coming weeks. To this end, I identified a range of files on which we hope to make progress, including measures that will boost employment and assist businesses to grow in the Single Market area, especially the digital single market. I also highlighted the importance of concluding a draft negotiating mandate for the transatlantic trade and investment partnership between the EU and the US.
As the Taoiseach will be aware, public discontent with the EU is at its highest level ever and, with 27 million people unemployed, nobody believes it is taking serious or urgent action to help. I have to mention the plague of youth unemployment, particularly in countries such as Greece and Spain, which have youth unemployment rates in excess of 50%. The escape valve of emigration has kept the rate in Ireland at between 29.5% and 30.5%, although many of the people who are leaving Ireland are in fact the fathers of people in their mid to late 20s and are following their sons and daughters to places like Canada and Australia.
We also looked at the enviable record of Malta, the Netherlands and Austria, where youth unemployment levels are particularly low. We are used to hearing lists of what has been agreed at summits but it is increasingly clear that a difference exists between the statements and what is happening on the ground.
A good example of this is the proposal for project bonds agreed last year. I ask the Taoiseach to explain the reason not one project bond has commenced. We hear a great deal about the need for stimulus and all of us, including the Taoiseach, agree on the issue. I could identify a number of major national projects for which project bonds would appear to be a potential solution but nothing seems to be happening.
Will the Taoiseach explain the reason the agenda for last week's summit was so limited? Why were no issues related to the major economic and financial issues of the moment discussed? Is it acceptable that EU leaders could meet at this time without discussing immediate action on employment? While I am conscious that other Deputies wish to speak, I would appreciate an opportunity to contribute again on this group of questions.
Certainly.
Deputy Ó Fearghaíl asked some good questions. It is completely unacceptable that 28 million people are unemployed in the European Union. No leader can be happy with that situation. Depending on competitiveness and whether budgets are under control, the position as regards unemployment and employment will vary between countries. I visited Spain and Portugal recently. The rate of unemployment among young people in Spain is 57%, which is a horrendous problem and would be an enormous challenge for any prime minister. Portugal also has a significant level of unemployment among young people and Greece announced last week that more than 50% of its young people are unemployed. What is to be done? One issue that has to be dealt with is the European Union budget for the period from 2014 until 2020, which is known as the multi-annual financial framework or MFF. Under the current proposal, a €6 billion fund has been allocated for addressing youth unemployment. Following the European Council meeting, there is a direct focus on countries preparing effective programmes to provide opportunities for young people and front-loading this allocation, which they cannot access until the MFF has been agreed. This is the purpose of the Tánaiste's visit to Brussels today. The Irish Presidency hopes to secure agreement on the multi-annual financial framework in the next couple of weeks.
This is an urgent matter. When one speaks to the Austrian Chancellor, Dutch Prime Minister or leaders of other countries which have low rates of unemployment, Germany for example, one finds that they have a structure in place for providing young people with training and apprenticeships. In Austria, for instance, when a young person decides to leave the formal education system there is a structure in place for channelling him or her into an area that would be of interest and in which he or she would develop skills and so forth. As a result, the level of youth unemployment in Austria is very low - perhaps 3%, 4% or 5% - whereas it is more than 30% here and we also have continuing emigration.
The agenda of last week's meeting was limited because the issues were of such importance. When one starts to discuss issues with 27 different member states, all of them will have a view. VAT fraud costs in the order of €1 trillion each year and systems need to be put in place to deal with the problem. The digital world has clearly moved ahead of the capacity of taxation systems to be able to catch all of these activities. The issues of VAT fraud and tax evasion were the subject of significant discussion at the meeting. Some comments were also made about multinational companies, which had implications for Ireland. While individual companies were not mentioned, I was happy to clarify for the European Council that Ireland wants to be part of an international movement in setting new international codes of practice, whether this is the FATCA system in place in the United States or a new code that emerges globally. This is an issue on which European leaders are now focused.
Deputy Ó Fearghaíl made a point about energy, an important issue. If we do not understand that energy prices are impacting on costs and, therefore, competitiveness, we will not be at the races. I can testify that serious developments in the United States in the areas of fracking, shale gas and extra drilling have led to a decline in the country's energy dependency. It is expected that the United States will become an energy exporter in the next decade and the country's energy costs have dropped by more than 30%, whereas they have increased by the same amount in Europe. As a result of these developments, major investment can take place in the United States at fixed-term prices and with relatively low energy costs. This has implications for jobs in Ireland and every other country. European leaders must agree on an integrated, interconnected European grid for energy. Ireland is at the end of this pipeline, which has significant implications for those who are working in manufacturing and industry. Three quarters of the meeting was spent discussing energy and decisions were made on which we hope to follow through in June.
The other issue discussed was on securing agreement in principle from countries that were very secretive about taxation and sharing information on tax matters. As I stated, we need to recognise that the digital world has swiftly moved far ahead of the capacity of individual national tax systems to cater for it. There is a need for a political focus from leaders to deal with this issue and this was accepted in principle by everyone who attended the meeting.
Was the Taoiseach in any way uneasy, to say the least, when the European Council meeting moved on to a discussion on taxation? I note from the communiqué issued after the summit that measures to fight tax evasion, fraud, etc., were discussed "in order to protect revenues and ensure public confidence in the fairness and effectiveness of tax systems." Leaving aside the issue of fraud for the moment, did the Taoiseach give an explanation in regard to the Irish tax system and mounting evidence to show this State is used as a taxation haven by many multinational corporations? I am not referring only to the hearings in the US Senate. On the day before the summit, the London editor of The Irish Times, the respected journalist, Mark Hennessy, pointed out that Marks & Spencer accounts for goods sold and handled in the United Kingdom through Ireland to avail of the 12.5% tax rate, in other words, to avoid paying significant tax in Britain. How can this mechanism be described as anything other than consistent with a tax haven?
I put it to the Taoiseach that the State is also a tax funnel in that it acts as a facilitator for transfusing revenues that are raised around the world, including in the poorest countries, through the tax mechanisms available in this State and onto places such as Bermuda. In the case of Apple, for example, which is a massive corporation, a tax mechanism known as the "double Irish" enabled the company to keep its international taxes to 3.2% of foreign profits in 2011, 2.2% in 2010 and single digits for the past half decade. These figures are taken from The New York Times. As a result of these mechanisms, the Apple corporation is sitting on $100 billion in accumulated profits.
Is the Taoiseach aware that development agencies and organisations such as, for example, Christian Aid have studied this matter in some detail and that they very convincingly highlight how this type of tax avoidance and minimisation of tax liability - with the help of the Irish taxation system - is cheating people who live in the poorest countries on Earth of resources which should be used to develop their societies? How can he stand over that type of activity, which is immoral by any standard? What did he say at the EU summit in respect of this matter or did he say anything? I am not asking him to just contradict some of the specific allegations that were made in the US Senator about a 2% deal, which, very possibly, are not correct. However, the substance is correct, namely, that the double-Irish mechanism and other instruments facilitate a huge minimisation of massive levels of tax liability by these most powerful corporations and that people in this country and throughout the world are thereby cheated of resources which could be used to develop their societies, create jobs and attract investment. If such investment were forthcoming, it would be possible to ensure that some of the 26 million people throughout the EU who, tragically, are unemployed could get back to work.
The discussion which took place at the European Council was constructive and positive in the sense of reflecting an understanding that the world has changed utterly in the way multinational companies do business in different jurisdictions. From our perspective, I stated before I entered the meeting that if the matter arose, I would deal with any issues of transparency or accountability in respect of Irish tax law in so far as corporate tax rates are concerned. I also stated that no special deals were done with any individual company and that this is because our rate of 12% has been set out in law. The latter has been deemed to be an effective rate of 11.8% or 11.9% by the World Bank.
The issue which arises relates to how to deal with this matter. Clearly, it cannot be dealt with by any individual country. That is why Ireland was the fourth country to sign up with the US in respect of the sharing of information. Ireland has participated very strongly in the analysis carried out and group hearings held by the OECD. Ireland wants to be at the forefront in the context of individual and collective decisions by countries to put in place a new international code in respect of tax. The Minister for Finance, Deputy Noonan, and EU Commissioner Šemeta recently sent a joint letter to the Finance Ministers of the other 26 member states in which they outlined seven different areas where concrete action can be delivered in the short term. Four of those have been adopted and significant progress has been made in respect of the others.
Deputy Higgins will be aware of the OECD's four indicators in respect of what constitutes a tax haven, namely: having no taxes or only nominal taxes; a lack of transparency; an unwillingness to exchange information with the tax administrations of OECD member countries; and an absence of substantial activity in the country concerned. It is clear that many of the multinationals which have been mentioned in the recent past employ substantial numbers of people - on high wages - in this country. In addition, there is no question with regard to the substance or extent of activity in the Irish economy. As already stated, this matter will not be resolved by an individual country. However, it is being dealt with by the OECD - at European level - through the base erosion and profit-shifting process. This is the appropriate mechanism and we fully support it.
The Deputy referred to the hearings which took place in the US Senate. The relevant report was clearly written to address concerns regarding the US taxation system as distinct from any other. Its final sentence reads "Congress can change those incentives by closing offshore tax loopholes and strengthening U.S. tax law". This emphasises that the central issues addressed in the report are specific to US as opposed to Irish tax law. While the report's central focus concerns perceived problems in the US tax system, it does contain some misleading and some inaccurate references to the Irish tax system. As the Deputy pointed out, there are references in it to a special rate of less than 2% being negotiated with the Irish Government. It is not possible to negotiate a particular rate in Ireland which deviates from the two main statutory rates of 12.5%, for trading income, and 25%, for non-trading income. There are no special rates for particular companies or types of companies. For trading companies, taxable profits are calculated under domestic rules which are based on internationally accepted principles that are themselves mainly influenced by the OECD.
The Deputy also referred to the double-Irish mechanism. The profits charged in Ireland reflect the functions, assets and risks that are located here by multinational groups. Payments to non-resident companies represent the expected higher remuneration of extremely valuable assets owned outside the State. Ireland could not, therefore, expect to retain the remuneration of these assets.
It facilitates tax evasion by them.
Our treatment of residence of companies for tax purposes, as determined by the location of management and control, was settled long before it could have any relevance to current international structures. The structures described have been arranged by US-owned groups of companies in order to take advantage of specific aspects of US tax law and also the differences between the Irish and US approaches to determining the residence of companies for tax purposes.
As already stated, Ireland strongly supports the base erosion and profit shifting project. We are moving to a point where - at least in the context of the discussion on tax at the European Council - there is agreement that there is a requirement for a new international code. To my knowledge, all countries participating at the Council meeting last week accepted that principle. This matter will be discussed again at the June meeting.
I call Deputy Adams.
Excuse me, I am next.
No, Deputy Adams is next. If Deputy Boyd Barrett looks at the Order Paper, he will see that.
I apologise.
The summit meeting - in respect of which I tabled a number of questions - must have been very disappointing. There are major crises occurring throughout the world. I refer to events in the Middle East, the ongoing situation in Cyprus - which does not appear to have got much mention at the summit - and the massive problem of youth unemployment. The figure for the latter here, approximately 30.4%, is substantially higher than the EU average of 22.9%. We all know the effect of emigration in dictating that figure. London beating Sligo last weekend is proof that a generation of GAA players-----
It is proof of the level of footballing skills in Ruislip.
Three months ago the European Council agreed to launch an EU-wide youth employment initiative. What concrete steps has the Government taken to further this initiative?
There is also an ongoing crisis in agriculture. As the Taoiseach will be aware, EU Agriculture Ministers are meeting at Dublin Castle to try to arrive at a deal in respect of the reform of the Common Agricultural Policy. Is the Taoiseach of the view that a deal will be completed before the end of the Presidency? Our position is to support a redistribution of funding towards the majority of small and medium working farmers.
Currently, 2% of recipients take more of the overall funds than the bottom 40%. The appropriate term is "working farmers" or "active farmers". Will there be an opportunity to debate this matter in the House before the summer recess?
I wish to revert to the issue of the fodder crisis. I met members of the Louth IFA and listened to their concerns. The Irish Creamery Milk Suppliers Association, ICMSA, predict that it could cost farmers €1 billion, with beef and dairy farmers losing up to 60% of their annual incomes. Efforts have been taken to try to deal with the crisis and I commend everyone involved, but it will spill into next year. Has the Government considered seeking emergency support from the EU Solidarity Fund to address this crisis?
Deputy Adams raised a number of interesting points. Of course, youth unemployment is a scourge. Clearly, that is why the European Council, for the first time ever, put €6 billion into the multi-annual financial framework, MFF. That is spread out from 2014 to 2020, which is of no value to somebody who is 16 or 17 years of age and facing unemployment in any country, be it our own, Spain, Portugal, Greece, etc.
The discussion last week was on whether we could work together on really proactive programmes for young people for training, upskilling, pre-work training, etc. and front-load this to make some impact and to give young people a sense of hope and confidence that these things actually work. There was a very strong view about that. This is why it is important for us as the Presidency to view as critical getting the MFF through during this Presidency. If it fails and we end up having to do annual budgets that take up three or four months and on which everyone cannot agree, at least the Council has made its decision.
The European Parliament has to give its imprimatur to the budget, otherwise it cannot function. The European Parliament, which has a very valid case, wants to consider unity of budget, flexibility, own resources and a mid-term review because who knows what the economies of Europe will be like in 2017 or 2018? That is a legitimate aspiration with which we can deal as the Presidency, but we need the support of the Parliament. Elections will be held next year and some sectors are beginning to play games. I hope they can settle down at the trilogues over the next few days and get agreement on this because it would be very important to get it through.
I might say that the draft amending budget - because there is a ceiling on the deficit of €11.2 billion - is an important element of the work we have been doing. The Tánaiste and I went to meet President Barroso and President Schulz and got agreement on that. It was pushed through by the Minister, Deputy Noonan, at ECOFIN for €7.3 billion of a first tranche. We hope to get the draft amending budget and the MFF through by July. Obviously, the Parliament will want to wait until the back end of the year to see what bills come in from the Commission for payment by countries of whatever remains, some €3.9 billion or whatever.
Central to this is youth employment. In our own country, we got an extra €150 million put in for PEACE IV, which impacts, as the Deputy well knows, on young people in sensitive areas in Northern Ireland.
The agriculture discussions are ongoing. They are informal. There is a fundamental principle of productivity. If one decides to pay a flat rate per hectare, whether there is productivity or not, one takes away the motivation and the very high incentive level and the high standards that we have achieved in Ireland. As there is a big divergence of opinion from eastern European countries to more developed countries in our agrisystem, which has an exceptionally high standard, what one does not want is a flat rate payment on a per hectare basis. It takes out that productivity element. For example, if one is running a 400 acre farm and a highly intensive dairy industry with very professional standards and someone is running 400 acres with very little activity, it would not be consistent with good agri practice to equate those levels of payment in the same way. It may well be that the discussions will take some off the very top and put it onto the bottom because reference years are different and new farms move into the system. One must retain the principle of productivity. The Minister for Agriculture, Food and the Marine is very strong on that.
As to dairy quotas going, there has been movement in the banks because of the purchase of land and arrangements for new leases. If we do not produce extra, then some other country will. This opportunity is there for young farmers who will drive, with a sense of motivation, this end of the industry. That is why there is a backlog in the applications for agri courses and so on. That is why Glanbia put its money where its mouth was in terms of south Kilkenny with a major investment, which will create 2,000 jobs on family farms from Cork up to the Deputy's own constituency. I was very pleased to see last year that Kerry Group made its decision to invest €100 million in Naas, which will become a magnet for new food innovation and research and development for years to come. These are extraordinary developments by Irish companies.
There is a big understanding in the agri-sector of what is happening. Yes, the fodder crisis is a difficulty and we will clearly have a problem again next year. I have spoken to the Minister for Agriculture, Food and the Marine about this and there will be an intention to run a scheme later this year with extra fertiliser driven to have more grass cut. That farmers must now put in cattle in September-----
June.
They have not gone out yet.
-----means difficulties in terms of extra costs, feedstuffs and all the rest of it.
I thank the Taoiseach, but I want to allow Deputy Boyd Barrett to contribute.
I thank Deputy Healy-Rae. I have been-----
They have not gone out.
Will the Deputy stay quiet for a minute, please? Deputy Boyd-Barrett wishes to speak. We are short on time.
-----down in his native county and I have seen them lying in some places contentedly in the fields. We want to see more of that.
In very few places.
Over in the east.
Does the Taoiseach not believe it is time to end the cover-up in which he and his spin doctors are engaged over the growing scandal of corporation tax avoidance by multinationals? Is it not a fact that he is trying to throw mud in the eyes of the public, Deputies and his European partners in a way that will do immense damage to the international reputation about which, as he has told us many times, he cares so much? The facts are coming out. As some of us have asserted for some time, as has become apparent to our European partners, as was put to the Taoiseach at the European Council meeting and as has been discussed in the US Senate, Ireland is a tax haven and is facilitating a staggering level of tax dodging by significantly wealthy multinationals.
The latest evidence came today. Abbott Laboratories Ireland Limited, a company registered in Ireland, made €1.8 billion in profit but paid 0% in tax. If it had paid 12.5%, we would have received €235 million, almost as much as the Government is planning to take out of the pockets of public sector workers. If Apple had paid 12.5%, we would have received more than €2 billion for the Exchequer. All we get, however, is sleight of hand whereby the Taoiseach claims that our rules are different because a company must be controlled and managed in Ireland. With a nod and a wink, we have agreed this little trick with the multinationals. Our light-touch corporate tax rules allow them to dodge billions or tens of billions of euro in corporate tax obligations at the expense of the taxpayer, who is being savaged by austerity, at the expense of tax fairness and tax justice across the world and at the expense of Ireland's international reputation.
After what happened at the European Council meeting and the US Senate and given the emerging facts, does the Taoiseach not believe it is time to end the cover-up and to stop prostituting Ireland's tax system for the benefit of multinational corporations?
The Deputy is wrong. First of all, Ireland's corporate tax rate was not put to me in the European Council. As I told Deputy Higgins, before I went into the meeting I said that I would be very happy to explain anything to do with Ireland's corporate tax rate were the matter to be raised. It was not raised in the context of the discussion that took place on tax, on tax evasion and on VAT.
The Deputy is also wrong when he says that Ireland is a tax haven. I have clearly set out the four criteria that apply. Ireland fulfils all of the requirements to prove that this country is not a tax haven.
It fulfils all the criteria to prove that we are a tax haven.
The substantial number of workers in multinational companies in every constituency around the country are a testament to that. Deputy Boyd Barrett made the point that our corporate tax rate is a nod and a wink. It is a disgraceful comment from him.
Deputies
Hear, hear.
The facts speak for themselves.
Our corporate tax rate has been in situ for many years.
Zero tax is paid by Apple.
It is transparent and absolutely above board. It is set out in statute law but Deputy Boyd Barrett does not seem to want either to adhere or to understand it. The effective tax rate is 11.8%.
Not according to the EU.
The corporate rate is 12.5%. It is 25% on non-trading areas. That has been a fundamental issue for us. As I said in response to previous questions, it is the international environment of other jurisdictions where multinational companies can apply. The report of the Senate hearings in the US referred specifically to US tax law and states that the US Government is in a position to close off the loopholes if it so wishes.
This is going to blow up in our face.
For our part, the Minister for Finance has cleared a letter to be sent through the diplomatic service of our ambassador in Washington for transmission to the chairman of the Senate dealing with the inaccuracies that have been reported-----
The substance is true.
-----and the allegations that this country is a tax haven and setting the record straight.
I have repeated time and again that it is not clear whom Deputy Boyd Barrett hates more, the multinationals or-----
Shush.
From that point of view we are very proud of and very clear on how we deal with our corporate tax rate. Ireland will participate in working with our colleague countries both in the United States, where we have signed up to the FATCA agreement, and in respect of our European Union colleagues for the development of an international code that will bring transparency to the environment outside of our tax law. The matter is being attended to by the Minister for Finance and a letter has been cleared in so far as the Senate committee which dealt with the matter is concerned.
Is Deputy Higgins going to run for the US Senate? Deputy Higgins has no horizons.
Written Answers follow Adjournment.