Topical Issue Debate

Industrial Disputes

Since the issue of the upcoming strike was raised in the House yesterday, Aer Lingus has, at the eleventh hour, invited the unions in to talks. I am not sure whether those talks have commenced. There was no indication earlier of when they might take place, but it is late in the day and follows on from the company's utterances yesterday more or less threatening workers that, should the new roster regime suggested by Aer Lingus cabin crew be brought in, the company would have no alternative but to shut its operations in Ireland and locate some of its bases in North America, with a loss of jobs.

The reality is that on Friday, hard-working, dedicated cabin crew, members of staff in Aer Lingus who no more want to join a picket line than the Minister or I, will be faced with no alternative but to do so. I ask the Minister to step back from this situation and look at the bigger picture, because there is no doubt that in recent weeks considerable and costly propaganda by Aer Lingus management has been meted out against its staff and the staff trade unions, in which the company sought to blame the unions for what it deemed as unnecessary strike action. It claimed that staff were looking for 32 extra days off and that the unions' suggestion of a trial of new rosters would significantly add to costs. Not only was it undermining its staff publicly; internally, it was engaging in vicious intimidation of those workers, organising and gearing up for the strike, writing to passengers in a way that was derogatory to the staff, cancelling flights, lining up hire-ins and so on.

We must be clear on this issue. Aer Lingus management has consistently refused to engage with its staff over three years. It has refused to attend the Labour Court on six successive occasions and, indeed, the court has written to say that it is flagrantly ignoring its recommendations, something that would not be tolerated on the workers' side. This issue is not about rosters. It is an attempt to beat the staff into submission and break the union. That is from a management that has already brought the other union, SIPTU, to court. That is the real agenda.

When Christoph Mueller came to Aer Lingus I attended a meeting at which he spoke about cabin crew. He said that cabin crew was once a job that people joined in the position of courier before progressing through the ranks, getting promoted and so on, but to his mind, across Europe and internationally, the job was being done by students on a casual and part-time basis. Workers could be hired and fired at will with no progression or security.

It is clear that the rosters Aer Lingus management is seeking to impose are an attempt to push workers out of the company.

There can be no other rationale for it. The workers are only seeking the same arrangement that exists for the pilot group and staff of all other airlines in Ireland and across Europe. All they are asking for is certainty in their work-life balance. Why would a company impose on workers a regime that provides for changes to their rosters with two, three or four hours notice? In other words, a person rostered to start work at 9 a.m. could at short notice be required to start work at 5 a.m. and a person due to finish work at 6 p.m. might have to stay until 10 p.m. Also, no scheduled meal breaks are provided. This is a pressurised work environment. Staff have reported severe fatigue to the IAA. The Minister is aware that their flight hours are capped by legislation. Staff are not seeking to work fewer hours. All they want is to be able to work in a more family-friendly environment.

There is no reason Aer Lingus management could not have discussed this issue with the staff. The Government's shareholding in Aer Lingus when combined with the staff shareholding equates to the largest shareholding in the company. What does the Minister propose to do in terms of holding management to account on this matter? I note the Minister's statements that the strike is regrettable. Nobody regrets it more than the staff. However, the cause of it is management. When does the Minister propose to call them to heel?

First, industrial relations issues are primarily matters for the company. The State's 25% shareholding does not allow it to interfere in the management of the airline. The largest shareholding is held by Ryanair and the staff and State shareholding is not combined. It is often the case that the interests of the State and staff differ.

IMPACT's Aer Lingus cabin crew members recently voted overwhelmingly in favour of industrial action up to and including strike action on two separate industrial relation matters, namely, to achieve agreement on the dispute with Aer Lingus on the IAS pension scheme and the failure to agree the implementation of revised rostering arrangements for cabin crew. The cabin crew branch of IMPACT served notice of industrial action on Aer Lingus on 13 May in regard to the rostering dispute which concerns the implementation of a revised roster for short-haul services and implementation of acceptable time-off arrangements following long-haul flights. The statement from IMPACT states that all cabin crew will engage in a 24-hour work stoppage this coming Friday, 30 May. Cabin crew members will place pickets at Dublin, Cork and Shannon airports for the duration of the stoppage. The outcome of the ballots and IMPACT's decision to serve strike notice on the company for action on Friday is regrettable, particularly as it comes so soon after the last threatened strike action over St. Patrick's weekend.

I was pleased to hear yesterday that IMPACT had accepted an invitation from the company to talks. I strongly urge both parties to make every effort to address the issues at the heart of this dispute so as to avert the proposed action on Friday and the potential further action to which IMPACT has alluded, although I understand that no formal notice of any further action has been served on the company. Even if Friday's action is called off at this stage, significant damage has already been done to the company's reputation, forward bookings and profits. This is not in the interests of staff or shareholders, such as the State, whose interests are clearly linked to the financial performance of the company.

There is little doubt that if the proposed industrial action on Friday goes ahead and if further threats of action are made, this will be damaging to Irish tourism as we enter the peak tourism season. It will cause disruption not only to Irish passengers travelling abroad on business and to visitors on hard earned breaks but also to the many tourists scheduled to travel here on Aer Lingus flights. Only a few short years ago the financial position of Aer Lingus was precarious and its future uncertain. In a recent trading update to the Irish Stock Exchange, Aer Lingus reported positive trading for April 2014, substantially ahead of the previous year and significantly ahead of management's expectations. However, management's current assessment is that the adverse effect of the strike called for 30 May will offset the potential gains which would otherwise have been realised by Aer Lingus. It is important for all parties to bear in mind how easily these recent gains could be lost and how volatile the aviation sector is. As Minister with responsibility for transport and tourism I am making a formal request to both sides in the dispute to work intensively today to find a resolution to avert Friday's action and to continue that work to avoid further threats of industrial action. The LRC and the Labour Court remain available to them.

On the pensions issue, which is the second issue on which IMPACT has balloted, I again point out the importance of reaching agreement on this long-standing dispute. The resolution of the funding difficulties in the scheme is a matter for the trustees, the companies participating in the scheme, the members of the schemes and the pensions authority. However, following consultations between the Departments of Transport, Tourism and Sport and Jobs, Enterprise and Innovation, IBEC and ICTU, an expert panel was established on 3 March 2014 to carry out an investigation of how the industrial relations issues relating to the scheme could be resolved. The expert panel has reported to the two Departments, IBEC and ICTU on two occasions, on 31 March and, most recently, on 11 April and is due to report again shortly.

I continue to urge the parties to put all their efforts into engaging with the expert panel. It is important that the panel's work be allowed to continue, notwithstanding the current dispute. In expressing my concern about the proposed strike action, I do so not only on my own behalf but also on behalf of both the 200,000 people employed in the tourism sector and the tens of thousands of passengers potentially affected by the proposed action.

The Minister's response is a bitter disappointment. It indicates to me that he and his colleagues have not listened to what the electorate had to say over the past number of days.

The reality is that the State shareholding when combined with that of the staff equates to a 40% shareholding, which is the largest shareholding. In this instance both interests should be at one. However, it appears from the Minister's response they are not. The Minister has sought to blame the staff for the situation. While everybody regrets the inconvenience caused to passengers, unfortunately that is a consequence of the intransigence of management over the past three years. While the Minister has welcomed that IMPACT has agreed to return to talks he made no reference to the desperate attempts over the past years to secure talks and engagement with the company, all of which were blatantly refused. The only conclusion one can draw from this is that the blame for this situation rests with management. What other option is there for people? Does the Minister believe it is acceptable for women and men in a modern economy to be required to go to work and not know at what time they will finish, to not have legitimate breaks and to work to a roster which takes no account of their need to care for their children and families?

All the staff are seeking is the putting in place of a structured arrangement similar to that which is available to their pilot colleagues and staff of other airlines. If the result of this is an inconvenience to passengers and a loss of revenue for the company, the question that must be asked is why then is management pushing it? The only conclusion that can be reached is that this is a management seeking to break a unionised workforce. The chief executive of Aer Lingus sits on a pension pot which the Minister has deemed excessive and voted against paying him bonuses. The chief executive therefore has a cheek to inconvenience passengers and, more importantly, workers in this situation. The reality is that the Minister can do something about this. He can send out the message that it is not acceptable for managers, particularly those of companies in which the State has a shareholding, to treat workers in this way.

I am not blaming management or the unions for the current situation. As is the case in all industrial relations disputes there are two sides to every story. It appears to me that Deputy Daly is the one not listening. Based on her contribution, it would appear that she has only heard one side of the story, that of the unions, and has decided to repeat it here in this Chamber. The Deputy should listen to both sides involved in the dispute. She might then have a more balanced and nuanced opinion than that which she has expressed here today.

In the Deputy's initial remarks she called on me to step back and look at the bigger picture. I do look at the bigger picture. The bigger picture to the Deputy is always about a conflict between capital and labour. When I look at the bigger picture, I see the impacts on citizens and the economy. The impacts on citizens who want to travel this weekend and on the economy are negative. That is the bigger picture to which the Deputy should have regard.

This is a dispute about rosters and it should be resolved bilaterally in talks between the unions and management. I now understand that talks are due to happen soon. I see no reason that the strike should not be called off. If for some reason the parties cannot agree bilaterally, they should go to the LRC. I call on Aer Lingus to make use of the LRC. I certainly call on unions, be they representing workers in Aer Lingus or Irish Rail, to go along with the recommendations of the Labour Court. I hope the Deputy will join me in calling on unions, irrespective of the sector they are in, to accept recommendations made by the Labour Court. I hope she will join me in asking for the strike to be suspended because of the talks that are under way. That is what the electorate to which I am listening wants to happen.

Credit Unions Regulation

I thank the Office of the Ceann Comhairle for selecting this topic. I mean no disrespect to the Minister of State, Deputy Perry, in saying I would have preferred it had the Minister for Finance, Deputy Michael Noonan, been present. I understand that is simply not possible.

There is an old saying that the sins of the fathers should not be visited on the sons. This is certainly true and I am positive that the past sins of the banking system must not be visited on credit unions, yet I am being informed constantly by credit union members that this is exactly what is happening. There is no need to recount what happened in the Irish banking sector and the role that light-touch regulation had to play in that calamity. However, there is a need to highlight the fact that the strictures introduced in the banking system are having an unduly negative effect on credit unions, once again favouring large corporate banks.

I wish to highlight two aspects of the difficulties facing credit unions, the one-size-fits-all regulatory approach and section 35 restrictions on rescheduled loans. Micro-managing credit unions is not the way forward. One should remember that the beauty of credit unions is the fact that they are local, know the people they are dealing with and are aware of conditions on the ground. Too often in this country, we throw out the baby with the bath water. The approach to credit unions appears to be another example of this. After our banking calamity came a raft of restrictions aimed at ensuring it would not be repeated. However, those most affected by the new regulations are the very people least responsible for the banking crisis, namely, credit union members. The Central Bank really needs to engage with credit unions and gain a better understanding of their work. If the Central Bank had a more realistic and common sense approach to the work of credit unions, consultation papers such as CP76 would be radically different.

The Government's achievement on the jobs front is the result of the targeted, motivated and well-organised campaign aimed at increasing job numbers. Common sense decisions are at the heart of this, yet I believe a blind spot continues to exist in respect of credit unions. Credit unions must be treated in a very different manner to banks. Their very existence has a different focus. Staff are not driven by bonus pay and incentives; rather, the movement exists thanks to the good will of thousands of volunteers. It is time for a complete rethink in regard to credit unions and their treatment by the State.

An example of why a complete rethink is necessary is the section 35 restriction on rescheduled loans. A credit union cannot grant further credit unless a rescheduled loan has performed for at least a year. Where the new terms have not been compiled for a year, a new loan cannot exceed €1,000. This is quite simply ridiculous. If a young person in a rural or urban area is fortunate enough to secure a job, he or she will need to visit his or her local credit union to seek funding for the transport necessary to go to work. Where will he or she get that money? Local people in the credit union are best placed to decide whether the advancement of €10,000 to a young person to allow him or her to obtain a car, purchase insurance and get on the road to work is a good investment. If the Central Bank does not understand the economics of such a transaction, the members of the Government do. The ethos of giving people a hand up rather than a handout must be reflected in the new regulatory framework.

Credit unions are not a luxury in our economy; they are the very essence of what our banking system should be. I refer to encouraging people to save, rewarding those with a good saving record and making sensible decisions on who to advance money to while all the time maintaining a commitment to the local community and encouraging prudent, financial habits and willingness to volunteer to help one's local community.

This issue is worth highlighting. While we all recognise the need for restrictions on lending, a common sense approach and one that values the ethos of the credit union is what is needed most.

I apologise on behalf of the Minister for Finance, Deputy Noonan, who, regrettably, cannot be here today. He would like to confirm his view that the credit unions have an important role to play in providing credit in local communities around the country. He is supportive of safe, responsible lending by credit unions. He is very much aware of the issues currently facing the sector and thanks Deputy Connaughton for raising this important issue.

Credit unions have a separate regulatory framework to that which applies to banks and are regulated and supervised under a dedicated Act, the Credit Union Act 1997. The Registry of Credit Unions at the Central Bank is responsible for the registration, regulation and supervision of credit unions. In recognition of the unique nature of credit unions, a statutory position of registrar of credit unions was explicitly created within the Central Bank of Ireland to assume responsibility for the regulation of credit unions.

The Commission on Credit Unions made a number of recommendations in its report regarding the strengthening of the regulatory framework for credit unions, including more effective governance and regulatory requirements. Many of these recommendations have been reflected in the Credit Union and Co-operation with Overseas Regulators Act 2012.

Acting as the independent regulator, the registrar of credit unions has applied lending restrictions to some credit unions. The Minister has been informed that these restrictions are viewed as short term in the majority of cases and are imposed as a means of allowing a credit union to address identified concerns as quickly as possible. Where lending restrictions are imposed, they tend to take the form of a restriction on individual loan size or on commercial lending activity and, in some cases, a limit on the total lending permitted each month.

At this time fewer than 10% of all credit unions have a restriction in place which limits the total amount of lending within the month, while close to 40% of all credit unions have a restriction on commercial lending activity. Currently, the average loan rate in the sector is just over €6,000 and about a dozen individual credit unions have lending restrictions that limit the amount loaned to less than €10,000. This ensures that the vast majority of credit unions can continue to make loans significantly greater than the average loan for the sector.

Section 35(2) of the Credit Union Act 1997 permits a credit union to have up to 30% of its loan book outstanding for more than five years and up to 10% of its loan book outstanding for more than ten years. Based on the most recent information provided by credit unions to the registrar of credit unions in the December 2013 quarterly prudential returns, average lending over five years as a percentage of gross loans was some 11%, while average lending over ten years as a percentage of gross loans was about 2%. These figures indicate that, in general, credit unions are currently well within the limits set down in the 1997 Act.

The section 35 stipulations require that a credit union must not approve further agreements for additional credit where an existing loan has been rescheduled unless a member's ability to repay all credit owed and the proposed additional credit has been clearly established. Where such circumstances have been established, a credit union may grant additional credit to a member with a rescheduled loan where that rescheduled loan has performed in accordance with the new terms for an appropriate period, in most cases not less than one year.

There will be another two minutes allocated in which the Minister of State may respond further.

I just have to put this response on the record. I might as well do so now.

There will be two minutes allowed for a further reply. First, Deputy Connaughton has two minutes.

This is the reply of the Minister. I will be finished in just one moment.

Under Standing Orders-----

The last responder, Deputy Varadkar, benefitted from quite a lot of discretion.

I am informed I must apply the Standing Order. I will call the Minister of State after Deputy Connaughton.

Before the Minister of State gives the rest of the reply, I will point out that quite a number of credit unions have many people who want to borrow money from them, which, thankfully, may be a sign of confidence coming back into the economy. However, many of these credit unions find that, due to the restrictions placed on them, they are unable to lend the money.

I understand from the reply that these regulatory effects are rechecked on a continuous basis, but it needs to happen an awful lot more quickly. We cannot throw the credit unions in with the main lending banks, as was done in the past. These are the people who keep our small rural towns and villages going. As the Minister of State who represents small business will very clearly understand, we have an issue with getting money out to some of our SMEs, and these credit unions have an ability to provide loans to give people a start, whether they have work to do, want to make an investment in a house project or are looking to buy a car. I am concerned when I continually hear from credit union members that these restrictions are not allowing them to do the job they were set up to do.

Again, we must remember that the credit unions were set up and run by the community for the community. They cannot be treated as we would treat the regular lending banks. It is very important that the Central Bank gets the message that, in order to drive this economy, we must take away the regulations and restrictions on these credit unions. I am not suggesting that we take away all the structures completely, because we must have very good lending rules and regulations. However, who better to set out those concerns and to make sure this happens than the credit unions themselves? It is important that we recognise the work they have done before and the great work they can do to drive on this economy. I would like the Minister of State to bring back to the Minister, Deputy Noonan, and to the Central Bank the message that we have to give the credit unions a level playing field to allow them to continue the great work they have done.

I would like to outline the current position of the credit union sector. The reserve position in the sector is very strong, with 95% of credit unions reporting that they meet the 10% reserve requirement. Of all individual credit unions, only 19 are below the 10% minimum, with a combined reported deficit in these credit unions of €11 million. Provisions now exceed arrears. Some 96% of credit unions are reporting a surplus and the sector is extremely liquid - in fact, excessively so. The average dividend rate of 0.9% is not sustainable, the sectoral average loan-to-asset ratio is very low, at 32%, and the sector is significantly under-lent and is sitting on a large amount of low-yielding cash.

A Central Bank PRISM review reveals its concerns about issues with regard to governance, risk management and other systems at credit union level, but these should improve over time as the new regulatory system is rolled out and beds down.

The imposition of lending restrictions is the responsibility of the Registrar of Credit Unions, who is the independent regulator of credit unions at the Central Bank. Within her independent regulatory discretion, the registrar acts to support the prudential soundness of individual credit unions to maintain sector stability and to protect the savings of credit union members.

I have been informed that it has been necessary to put lending restrictions in place in individual credit unions where there are regulatory concerns about their operation and the resultant risk to members' savings. The criteria assessed to determine the imposition of lending restrictions include, but are not limited to, the following: prudential returns, which are unaudited returns, submitted by the Registrar of Credit Unions; financial ratios, which cover levels of arrears and provision coverage; and the governance framework within the credit union. Decisions on regulatory restrictions, which are imposed in the form of directions under the Act, are made by the registrar. Other regulatory restrictions may be imposed as part of an ongoing supervisory engagement with the credit unions.

It is very important that the role of small business be facilitated. I have met a number of credit unions and know they are supporting SMEs. However, they must meet the requirements of this independent governance.

Insurance Industry Regulation

I wish to set out the position with regard to the closure of Setanta Insurance. The weakness in the regulatory system has allowed this company to avail of EU rules essentially allowing it be regulated in another EU jurisdiction while operating solely in this jurisdiction, with 75,000 policyholders, most of which are small and medium enterprises. We are all well aware of the difficulty these small and medium enterprises are experiencing without this kind of disaster being visited upon them. While this issue has been raised by way of parliamentary questions and Topical Issues, I want clarify the current legal position in regard to the policies, what assistance is available to policyholders and, critically, the role of the Financial Regulator, an issue which has been a fairly hot chestnut in this country in recent years.

Setanta claimants and customers do not know what is happening one month after the Malta-registered insurer went into liquidation. Questions about who knew what and when in regard to Setanta Insurance are beginning to mount up. It has now emerged that the Central Bank had been aware of difficulties in the company since November of last year. Setanta stated in January of this year that it would stop taking new business and cease existing policies but, in the meantime, the bombshell was that it published on its website last month the news that its operation was to be liquidated and claims would not be met. I want to know what the Central Bank knew last November and what it did - or, critically, what it did not do - about it. There is also discussion between the Central Bank and the Malta Financial Services Authority, and I want to know the exact detail of that. Was the Minister or the Department aware of it and, if so, what action did they take in regard to it?

Protecting the consumer means more than knowing there are problems and then doing nothing about it. Protecting the consumer is exactly that. There has been a long litany of disasters in this country in recent years in regard to people who knew things and did not do anything about them or, further, regulatory authorities that were not doing what they were supposed to be doing. We learned yesterday there are currently more than 600 firms licensed to carry out insurance business in this country that are not regulated for prudential purposes by the Central Bank. This poses an extremely serious risk to Irish consumers and there are no guarantees that what happened in regard to Setanta Insurance will not happen in regard to other businesses or other people availing of such services. The matter requires further analysis. The lessons we are currently learning in regard to Setanta Insurance must inform how we are able to cope with future issues that will invariably arise.

I understand the Minister for Finance, Deputy Noonan, has given a commitment that the Department of Finance and the Central Bank will review the circumstances around Setanta Insurance and will report on what lessons can be learned and how the regulatory framework can be strengthened. As we speak, however, there are thousands of people who have been, in effect, disenfranchised by what has happened. It is not good enough that another EU member state would host a company which would come in here and do precisely what it has done to people trading in this country.

The fact so many small businesses are still here in 2014 is a great tribute to the way in which they have been able to weather economic catastrophe in recent years. To think that, just when there is almost light at the end of the tunnel and they can see the horizon for the first time in a hell of a long time, they would have to deal with such a calamity is unacceptable. In particular, the role of the Central Bank needs to be established without doubt. If people in the Central Bank were asleep on the job or did not do their job, the consequences of that are now going to be felt by honest-to-God unfortunates around the country who are left in limbo by this debacle.

I thank the Deputy for raising this very important matter. I apologise on behalf of the Minister, Deputy Noonan, who has a very important engagement at this time.

At the outset, the Deputy should note that Setanta Insurance Company Limited is a Malta-incorporated company which was both authorised and prudentially supervised by the Malta Financial Services Authority. While its financial position is not supervised by the Central Bank of Ireland, as the Central Bank has no role in that regard, the firm is supervised by the Central Bank for conduct of business rules - that is, consumer protection obligations. The Central Bank is in contact with the Malta Financial Services Authority in regard to Setanta Insurance, the impact on policyholders and the provision of relevant and appropriate information.

Under EU law which governs non-life insurance, an insurer is required to inform the regulator in its home member state - its home regulator - that it intends to pursue business in another member state. The home regulator must then provide the host regulator with a certificate attesting that the insurer covers the EU solvency capital requirement, as well as the nature of the business which the insurer intends to undertake. The insurer may start to pursue business from the date that the certificate is communicated to the host regulator, in this case the Central Bank of Ireland.

Setanta was regulated at EU level in accordance with a directive known as Solvency I, which currently places requirements on the amount of regulatory capital European insurance companies must hold against unforeseen events.

The Minister for Finance understands Setanta met its EU regulatory obligations up until its insolvency and was, therefore, entitled under EU law to trade across EU borders up to that point.

On 16 April the MFSA determined that the company was insolvent. This means that Setanta does not have sufficient funds to be able to honour its full obligations towards claimants, policyholders and other creditors. It was formally placed in liquidation by the MFSA on 30 April and Mr. Paul Mercieca was appointed as liquidator. Officials of the Department of Finance, together with officials of the Central Bank, met the liquidator and his representatives in Ireland on 7 May and the Central Bank is in ongoing contact with him regarding the position of Setanta policyholders. The liquidator has confirmed that all policyholders who have not already done so should arrange alternative cover without delay as claims are unlikely to be paid in full. He has issued letters to policyholders informing them that their insurance cover will be cancelled within seven to ten days in accordance with their policy documents. This process has commenced and there were less than 20,000 policies with Setanta Insurance on 27 May. It is expected that all remaining policies will be cancelled this week in line with the terms of the policies. In the circumstances, the Minister for Finance continues to strongly advise policyholders to make alternative insurance arrangements without delay and that they should contact their insurance broker or an insurer directly to seek alternative cover. This is also the advice of the Central Bank. The liquidator has advised that arrangements are in hand for policyholders to obtain their no claims bonus certificates from Setanta. Insurance Ireland has informed me that these certificates will be honoured by other insurers and we are aware that many insurers are being flexible surrounding requirements for documents.

In addition, the Insurance Ireland declined cases agreement is available to policyholders of Setanta. The current declined cases agreement was drawn up in 1981 and is adhered to by all motor insurers in Ireland. The Minister for Finance is informed that under the agreement, the insurance market will not refuse to provide insurance for an individual seeking insurance if he or she has approached at least three insurers and has not been able to obtain cover from them. The Minister understands Insurance Ireland is also making information available to those who have queries, complaints or difficulties regarding this matter through its service at (01) 6761914 or by email at

With regard to Setanta premiums and claims, the position on each policy is for the liquidator in the first instance to decide in due course. Department of Finance officials and the Central Bank will remain in close contact with the liquidator and the Minister for Finance has asked that public statements be provided to clarify matters for policyholders and claimants.

At the heart of this debacle are people, many of them in small businesses, who have weathered a very dark and horrible political and economic storm in the past few years. We have seen people struggle to keep businesses going, some with more success than others. It is cold comfort that we now know what happened should not have happened and that the framework should be in place, which I accept. The reality is that there are people who have been very badly treated. There is evidence to suggest the Central Bank knew about the difficulties in Setanta last November. A situation rolled into this year and continued last month, as a result of which the company has gone into liquidation and people have been left stranded. That is not good enough. It is not good enough when one considers the history of the Central Bank around the time of the collapse of the economy. It is absolutely infuriating for people to be left in this situation, despite the existence of those whose job it is to keep an eye on companies such as Setanta and to be in consultation with the authorities in Malta and other EU member states and aware of directives and all the talk about frameworks. In effect, they have been left high and dry. I implore the Minister of State to convey to the Minister for Finance the message that we need to step up to the plate and ensure those who have been left disenfranchised and out of pocket will have their costs redeemed insofar as it is possible to do so because they are entitled to nothing less, particularly if an organ of State was asleep at the wheel. God knows, that institution has good form in that regard.

I will clarify some matters. The Central Bank has been in discussions with the MFSA about Setanta since November 2013 when it identified issues during a consumer protection-themed inspection and immediately referred the matter to the MFSA for further investigation. There was regular contact in the following months. Issues led to the announcement in January that the firm would cease writing new business and issuing further renewals. On 21 January the Central Bank wrote to advise my Department of its concerns about Setanta Insurance's solvency and I was subsequently informed of this correspondence. Contact continued between the Central Bank and the MFSA and on 11 April the MFSA advised the Central Bank that the directors of Setanta Insurance were considering the potential liquidation of the company. There was ongoing contact in the following days and Setanta Insurance announced that the shareholders had recommended the appointment of a liquidator subject to the approval of the MFSA. On 16 April I was advised that the stakeholders of Setanta Insurance had resolved to wind up the company. As the Central Bank continues to have ongoing contact with the MFSA, I would not say it was asleep at the wheel. It was very active in dealing with the liquidator, as well as the various industrial representative bodies. It has also engaged with the brokers who sold the policies to ensure they assist policyholders and keep them informed. In addition, it contacted all brokers to instruct them to write to policyholders who held a current Setanta motor insurance policy informing them of the urgent need to make alternative arrangements.

On 16 April the MFSA determined that the company was insolvent. This means that it does not have sufficient funds to allow it to honour its full obligations towards claimants and policyholders. Setanta was formally placed into liquidation on 30 April and Mr. Paul Mercieca was appointed as liquidator. Together with officials of the Central Bank, we met the liquidator and his representatives in Ireland on 7 May. The Central Bank is in ongoing contact with him regarding the position of Setanta policyholders and he has confirmed that all policyholders who have not already done so should arrange alternative cover without delay as claims are unlikely to be paid in full. He has issued letters to policyholders informing them that their insurance cover will be cancelled within seven days. This process has commenced and there are fewer than 20,000 policies in place. If one looks at the clear evidence available going back months, one can see that the Central Bank was on the case. It was put on notice last November.

Further Education and Training Programmes

I was hoping the Minister for Education and Skills would be present because he visited the St. John Bosco Youth Centre on 27 May 2013 to attend an event marking the financial support provided by the SML Foundation. He recognised the staff in the centre and the valuable contribution made by the training initiatives run by the centre. The manager of the centre, Mr. Brian Murphy, is in the Visitors Gallery, with staff co-ordinators. The centre has been running training courses for the past 12 or 13 years and the co-ordinators are very competent. The training initiatives undertaken are of very good quality.

This year the centre experienced a difficulty with CDETB Ballyfermot in getting the go-ahead to run the two training programmes which were due to start on Monday, 26 May. I happened to be in the centre that morning and met some of the students who were there and wanted to begin the courses. There are 28 students ready to begin the Horizon programme who are waiting to sign their F103 forms. There are potentially 13 or 14 students ready to begin the Leap programme for 16 to 18 year olds. Nothing has been written down anywhere about how local training programmes should be run, but the centre has been told that there must be 18 students in each programme. Up to now, the guidelines have indicated that there should be 14 students for every two members of staff. The centre has been told it must deliver 100% of the training content, including in mathematics, in which the staff would not receive training.

Normally they bring in outside co-ordinators to deliver the maths courses and so on. They also say the centre is not allowed to accept young people aged 17, but for the past few years they have been targeting the 16 to 18 age cohort to do the LEAP programme.

There is a problem and nothing definite has been said by the CDETB co-ordinator in Ballyfermot. There is no proper communication line between the St. John Bosco centre and the Ballyfermot CDETB. The centre asked me and other public representatives from the area to bring this issue to the attention of the Minister for Education and Skills and to ask what is the problem and whether the guidelines have changed. If so, will he inform them in order that they can do what is necessary to bring the courses in line? If not, why there is reluctance on the part of the Ballyfermot CDETB to provide the F103 forms and to sign students up to the programmes? I met the students, who are from Dolphin House in Dublin 8 and Drimnagh, and they are enthusiastic. They want to start the training course. It has a good reputation in the area for providing a high standard of education and training at FETAC level 4. They wanted to start last Monday but they have been blocked. Will the Minister of State clarify what is happening? Will he instruct Ballyfermot CDETB to ensure the programmes are up and running as soon as possible - that is, next Monday?

I thank the Deputy for raising this matter, as it provides me with the opportunity to outline the position regarding the local training initiatives operated by the Bosco Youth Centre in Drimnagh.

The CDETB, which was established in July 2013, has responsibility for the planning and delivery of services previously delivered by the VECs and FÁS training centres. St. John Bosco youth centre, based in Drimnagh, Dublin 12, has been providing services to people in the community for more than 60 years. The centre is a community resource which provides pursuits, amenities, programmes and activities that seek to allow young people to develop personally, socially, educationally and recreationally in a high-quality, safe environment that respects its users. The centre has been receiving funding for training programmes for more than ten years through the former FÁS training centre in Ballyfermot.

The St. John Bosco centre currently has two local training initiatives, operating under the LEAP programme and the Horizon programme, with a total of 36 places available. The LEAP programme is a FETAC level 4 programme in information and communications technology. The course is 30 weeks in duration. It is a full-time course and is delivered using a co-ordinator and an assistant co­ordinator on-site in the premises on Davitt Road. The Horizon programme is also a FETAC level 4 major award in employment skills. This course is 30 weeks in duration. Recently, both programmes have experienced difficulties in attracting a sufficient number of eligible learners. The programmes were due to commence on 12 May. However, the start date was delayed by two weeks due to insufficient numbers of participants. I understand that a new start date of 16 June has been put in place to allow sufficient time to complete the recruitment process. In addition to the fact that there are currently insufficient numbers for these programmes, I also understand from CDETB that there are a number of other issues with programme delivery, which it is working with the St. John Bosco centre to address.

I thank the Minister of State for clarifying that a new start date of 16 June has been set. There has been no problem with communication between the St. John Bosco centre and the CDETB regarding the co-ordination of the programme. Eighteen students were ready to go last Monday morning on the Horizon programme while 13 were ready to go on the LEAP programme. There is a slight problem with the CDETB referring students to the centre. Most of the participants went to the centre directly to sign up for the programmes. Can the Minister of State issue a communiqué to the CDETB co-ordinator to facilitate the centre in helping to educate these young, enthusiastic people who want to start the programmes?

Programme delivery has never been a problem. The centre has always delivered 70% of them through the co-ordinators and has brought in specialists to deliver maths and one or two other subjects that the co-ordinators do not have the specific skills to deliver. They do not, for example, have a maths degree and, therefore, they cannot deliver such a course. If teachers heard that a co-ordinator was delivering a maths course within the LTI they would be up in arms about it, because they are not qualified to do that. They do not have training, skills or degrees.

There is, therefore, no problem with the programmes or the co-ordination. Perhaps the Minister could intervene with the CDETB to co-ordinate with the centre to provide these services on 16 June.

It is not the role of the Minister to intervene in the internal relationship between the CDETB and the centre in Drimnagh. Under the legislation providing for the establishment of our ETBs, they are independent, autonomous entities with resources to deliver educational opportunities within their regions to the highest standard. The information I have is that the two programmes are insufficiently subscribed and that is the reason for deferring the start date to 16 June. That will give the centre the opportunity to recruit new eligible participants to the programmes.

There are issues with programme delivery which the CDETB is proactively working with the centre to address.

That is not true.

I am hopeful that these issues can be overcome. I am also hopeful that sufficient participants can be found for the two programmes, allowing them to commence on 16 June.