Leaders' Questions

I ask Members to have regard to the time allowed.

Today, 507 secondary schools throughout the country are closed, which represent 70% of secondary schools in the country, as 17,500 secondary school teachers are on strike and approximately 250,000 pupils are being told to stay at home, with the inconvenience added to their families. This is all because the Government has sleepwalked us into a situation with the ASTI and it is on strike. Pupils are being denied an education and they are the victims in what is another industrial relations shambles under the watch of the Government. We have been saying for weeks the Government should seize the initiative and prevent this strike by teachers.

At the beginning of the week, the ASTI asked for reassurance from the Government on teachers receiving equality of treatment in their pay. This is a relatively reasonable request, one would imagine, and it would have reassured the ASTI that the Government has an interest in resolving the dispute so that schools could open today. My colleague, Deputy Thomas Byrne, has called consistently on the Minister, Deputy Bruton, to confirm a pathway on how teachers will have equality of pay treatment, now and after 2018. This would not have to be outside the Lansdowne Road agreement and may have created the conditions to avoid today's strike and, more importantly, to avoid what is coming.

What is coming is even more serious and detrimental to the country. The Joint Managerial Body has issued a warning that next Monday week, after the mid-term break, many schools may not be able to reopen. The country is facing complete and utter shut down of the secondary education system unless a resolution is found. Instead of creating the conditions to resolve this and seeking to build trust to resolve and avoid it, the Government has chosen a provocative and aggressive strategy by issuing a circular that ASTI members will not be paid if they withdraw from supervision and substitution. This circular has inflamed an already serious situation. To add confusion to the already chaotic situation, a spokesperson on behalf of the Minister stated that pay will only be deducted from ASTI members where schools cannot open. I understand the staff of 375 schools are comprised entirely of ASTI members and 150 schools are dual union. Will the Tánaiste clarify which of the schools will open on Monday week? How many students will be inconvenienced on Monday week because of the Government's inability to come up with a contingency plan or to create the conditions where a resolution could be found?

The Tánaiste is the deputy head of the Government. Is it not time for the Government to commit to pay equality for newly qualified teachers? Look at the seriousness of the situation. Today the Irish Independent states that depending on whether teachers were recruited in 2013, 2014 or 2015 they could be on three different pay scales. Is it not time to commit to proper equality?

Like the Deputy and other Members of the House, we are all extremely concerned at even one day's interruption to the schooling of our young students, and of course we want to do absolutely everything to avoid this interruption and to avoid any further days of interruption. This is what the Minister, Deputy Bruton, and the Department have been working towards. As the Deputy knows, there has been a huge amount of discussion and talks between the ASTI and the Department, which continued right up to yesterday. The parties agreed that contact will be made tomorrow, with a view to arranging further talks after today's one day strike.

I remind the House that a deal is on offer to the ASTI, which would see pay increases of 15% and 22% for new entrant teachers with further benefits in working conditions and a route to further possible improvements after this through the public pay commission. The INTO and the TUI have been able to accept this. I urge the ASTI to re-engage and look at the deal on the table so these interruptions to our young people's lives as far as their schooling is concerned can be avoided.

With regard to a number of the other points made by the Deputy, equality is at the heart of everything we do and we want to create a new equality for all our people. We have just come from a situation of national bankruptcy, which the previous Government had to deal with. This Government is dealing with the aftermath of this. What we want to be is fair to everyone. We want to be fair to our teachers, An Garda Síochána and other public servants and public sector workers. We want to be fair to the taxpayer and the community. We have put forward a way of doing this, in terms of the current negotiations under way and the unwinding of the emergency legislation that was brought in and which was so necessary. Many people made sacrifices. Our gardaí made sacrifices as did our teachers.

With regard to the equality issue, I ask the Deputy to take a broad view of it. As I said, equality and fairness are at the heart of everything the Government is trying to do, particularly in the area of education where the Minister, Deputy Bruton, is particularly focused on creating better opportunities for people from disadvantaged areas in our school system and in higher education. The recent budget contained measures to deliver on this. Let me go back to the new entrant teachers mentioned by the Deputy. They will see pay rises of between 15% and 22%, between €4,600 and €6,700, for new entrant teachers. Let me conclude by saying negotiations, I hope, will be ongoing tomorrow, and every effort will be made by the Government to ensure the outcome of the negotiations are successful.

For all the Tánaiste's talk of negotiations and effort, schools are closed today, with 250,000 children at home and 17,500 teachers on strike. The Tánaiste said a deal is on the table, but the reason the deal will not be accepted is because the ASTI does not trust the Government. In the Tánaiste's Department, the GRA and the AGSI do not trust the Government. The Government's attempt at creating trust is to issue a circular that has added further confusion to the chaos already in our education system. The Government needs to build trust with these unions to build a deal and a resolution to resolve the situation. The Joint Managerial Body, which controls most of the secondary schools in the country, states it may not be able to reopen them next Monday week. What guarantees can the Tánaiste give today that efforts will be made to get to a situation where schools will open on Monday week and not sleepwalk back to where we are today? How will the Government build the trust that is lacking? We support the Lansdowne Road agreement, but the actions of the Government undermine it at every turn and undermine the trust of public service unions. The Tánaiste must understand this.

Let me put this in the broader context. The Deputy spoke about trust. Of course trust is important. The Government has managed to negotiate successfully with 23 unions and 300,000 public sector workers who have already come in under the Lansdowne Road agreement. It has managed to reach agreements with the INTO and the TUI. Of course we want to continue to have these negotiations successfully concluded with the ASTI.

With regard to the Deputy's point on the circular, it is a matter of planning and needed to be done. This is the reality. It is normal industrial relations practice that where workers in industrial action withdraw from core elements of their work resulting in the closure of the workplace those workers are not paid for those days.

It is not normal industrial relations to throw grenades into an already-----

There is no doubt but that supervision and substitution are a core part of teachers' work and this has been clearly set out in circulars also.

I reiterate the focus of the entire Government has been on finding a pathway, which we have managed to do successfully, as I outlined, with many other unions and which we also want to do with the unions that are currently outside the Lansdowne Road agreement. That is our goal and all our efforts, determination and focus are on achieving that.

I too wish to raise the fact that this morning 507 secondary schools, representing 70% of schools, are closed throughout the State. That is hardly to be chalked down as a success on the part of this Administration. Tens of thousands of pupils and their families are profoundly affected by this action, my own family included. The schedules and routines of parents and children are up in the air and, of course, our students are missing a valuable day's classwork. This also affects thousands of teachers who, I have no doubt, would prefer to be in their classrooms than on a picket line today. However, they are undertaking this action as a matter of last resort and because of legitimate concerns about their pay and conditions. These concerns are justifiably shared throughout the public sector following seven years of pay cuts but the teaching profession is particularly impacted because it is one of the areas in which a large number of new recruits had to be employed over the past number of years to cater for demographics.

Today is just the first of seven planned days of strike action and there are concerns that schools will be unable to open at all following the mid-term break because of withdrawal by the ASTI from supervision and substitution duties. Such a prospect is a sign that the Government is failing to address the increasing number of industrial disputes. In fact, it raises a question about its very capacity to deal with these issues. What those in the public sector want, and what they deserve, is the fair and timely unwinding of FEMPI cuts and pay restoration. All of us know that cannot be achieved overnight but, clearly, it can be timelined through a new pay agreement that offers a road map to full pay restoration. Meaningful dialogue is required now, which lays out a clear, sensible path to full pay restoration. The demands of teachers, and, indeed, of An Garda Síochána for that matter, are not insurmountable. The restoration of allowances for all post-2011 entrants would go a long way to satisfying their concerns and this issue of pay equality is crucial - equal pay for work of equal value. In other words, equal pay for post-2011 recruits needs to be put in place. I am increasingly concerned and bewildered at the fact that the Government cannot make a simple commitment to equal pay for work of equal value. I invite the Tánaiste to do so.

Everybody in the House is conscious of the impact of this closure on young students and parents and all that goes with that, and the impact of such interruptions on students' educational lives. I agree with the Deputy that a pathway forward is necessary but we have that pathway. There are ongoing negotiations and there are possible solutions on the table in respect of ASTI and, indeed, An Garda Síochána.

The Deputy made a point about equality. She would be probably be the first to say that we must bear in mind a range of issues relating to equality, including equality between public servants in different parts of the public service and between public servants and people who work elsewhere, such as the self-employed or those who do not work at all. As IMPACT said during the week, it would not be equal or fair for us to do sectoral deals with particular public servants that leave other public servants who have signed up to the Lansdowne Road agreement disadvantaged and it would also not be equal or fair for us to do unaffordable deals with particular groups of public servants that mean we do not have the money left in the public purse to do the things the Deputy would call for such as developing public services, improving social welfare payments and so forth.

It is clear that the Government has laid out a road map that has been accepted by the vast majority of unions and public servants. We have laid a road map in respect of the work of the public sector pay commission, which will then feed into the replacement of the Lansdowne Road agreement. All of that has been laid out by the Minister for Public Expenditure and Reform and the Government is committed to that. In the meantime, we want to continue the negotiations that will resolve the particular issues of concern to ASTI, GRA and AGSI and the Government is open to that. Hopefully, there will be further discussions tomorrow with ASTI and the Garda representative associations.

I mean no disrespect but the Tánaiste sounds like a broken record. We are hearing the repetition of the same mantra from her and her colleague, the Minister for Education and Sills, who seems to find this matter amusing. Rather than setting out a road map, the Government parties have walked us into quite a cul-de-sac and not content with that, they have sabre rattled and, at a time of great sensitivity, seem to wish to ratchet up what they see as pressure on teachers, but, in fact, they have made a difficult situation all the more difficult.

I asked the Tánaiste a simple question and she just needs to answer that. Is it the position of Government that there will be pay parity for all teachers within the system? The post-2011 teaching entrants call themselves LPTs, lower paid teachers.

I thank the Deputy.

They need to hear from Government that there will be pay equalisation, not tomorrow, not next week, but a firm and solid commitment that is Government policy and that it will happen. The Tánaiste has so far refused to make that commitment and I invite her again in the midst of this dispute and its disruption to tell members of the ASTI and the teaching profession-----

The Deputy has made her point.

-----that there will be equalisation of pay for teachers. That is all I want her to do. That might get the Government out of the cul-de-sac and on to some sort of road map.

We all care about these disputes and we want them resolved-----

Why did the Government let them out on the streets?

-----but it is worth repeating to highlight to public sector workers and all who care about this that there are offers on the table and-----

I did not ask that.

-----that we are open to negotiations. The Deputy talked about culs-de-sac.

Pay equalisation.

There are offers on the table. We want to continue with that discussion.

With regard to Deputy McDonald's point about equality, of course the Government is committed to equality. We want to create a new equality that was not possible when the country was bankrupt

Some are more equal than others.

One voice please.

I reiterate that we have laid out a route forward for that. There is a pathway that guarantees as far as is possible that the economic recovery will continue and, indeed, that we will be in a position to pay for what everyone in this House wants to see, which is good wages in the public sector and money available to invest in public services. The route we have outlined in respect of the unwinding of FEMPI and the public pay commission----

No answer again.

-----in order that we can have a success to the Lansdowne Road agreement is the way forward to achieve what the Deputy was speaking about.

The issue I wish to raise is what is being called "the silent addiction", which is governed by what the Tánaiste called "entirely outdated and not fit-for-purpose regulation and legislation". That silent addiction is gambling, which is divided into gaming, governed by the Gaming and Lotteries Act 1956, and betting, which is primarily regulated by the Betting Act 1931. These Acts are outdated and virtually unenforceable, and, in particular, they do not take account of the massive shift in gambling to online and mobile-based forms. The industry has licensed bookmakers and online betting licences but there are private members clubs and casinos, some regulated and some not, gaming arcades, some licensed and some not, and gaming and amusement machines, some licensed and some not, in a wide variety of venues.

However, being licensed is not the same as being regulated and does not mean that any of those organisations or any part of the industry is bound by a code of conduct. With no appropriate statutory powers of enforcement, there is no ensuring that gambling is conducted crime free, the machines and software are operated fairly and the gambling services are provided in a socially responsible manner.

According to surveys in the UK and America, 30% to 35% of the industry's revenue comes from problem gamblers, but there is an information gap in Ireland. We are told that this is an addiction about which Ireland does not know enough. The perception is that gambling is just an odd flutter on the grand national, but we have some 40,000 problem gamblers and there has been a significant increase in adolescent gambling. As with other addictions, there is a human cost. People with a gambling addiction speak of psychiatric difficulties, relationship breakdowns and the loss of incomes, jobs, homes and vast sums of money. There is anecdotal evidence of an increase in the incidence of suicide among those who have a gambling addiction. People with this addiction speak about the uncontrollable urge to gamble and the gambler's fallacy that, no matter how many the losses, there will be a win.

Gambling can be accessed everywhere. It is reckoned that some €5 billion is gambled yearly in Ireland. As to private members' clubs, 1% of the industry is regulated for money laundering, which means that 99% that is not. A few months ago, a €38,000 betting slip was seized during a raid on a prominent criminal gang.

The gambling control Bill is long overdue. The general scheme was published in July 2013 and pre-legislative scrutiny was conducted in November 2013, but there has been nothing since. I ask that the Bill be seen as a matter of urgency for the gambling industry and those affected by gambling.

I thank the Deputy, who has highlighted an area that is of huge concern in terms of the impact on individuals and families and the addiction that is often central to involvement in it. As the Deputy stated, the Bill's scheme was published some years ago. The Minister of State, Deputy Stanton, has taken responsibility for dealing with this issue and is prioritising it in his work. The scheme that was published suggested that there was a need for further research to support those who were impacted in the way that the Deputy says. There is a public information deficit. The Deputy mentioned adolescents, who are getting addicted at a very early age to gambling, and the huge impact that has on their early adolescent years and, indeed, their adult lives.

There is also a need, as the Deputy says, to regulate the sector and the many new emerging forms of gambling. That will be part of the new legislation as well. I will ask the Minister of State, Deputy Stanton, to liaise directly with the Deputy in respect of it.

The Deputy also made a point about possible criminal elements that may be involved. Of course, that would be of concern as well. There is also revenue being lost to the State that should not be.

I can only agree with what the Deputy is saying, that this is an important area for legislation and regulation and also needs the development of greater awareness and more services to be made available to those more vulnerable people who are being very adversely affected by this addiction.

Unfortunately, there has been no movement on this matter in the past three years. I understand that the Financial Action Task Force, FATF, is undertaking an evaluation of Ireland. Criticism is expected for our lack of appropriate legislation to prevent money laundering through the gambling industry.

There is no fundamental protection of the consumer and even basic responsible practices are being ignored by many operators. Companies will stop people if they are winning too much, but we do not see the same being done if customers are losing significantly. Best practice entails self-exclusion facilities, gambler ID cards that must be used when betting and enforced time-outs. There must be a legal distinction between betting and gaming. All forms of gambling should have appropriate licences and there should be a prohibition on free alcohol in private members' clubs. Advertising must be examined, as it glamorises gambling. The industry should contribute to a social responsibility tax that would go towards research, treatment and awareness campaigns. There is almost no access to treatment in this country. Many private insurers will not cover gambling addiction and there is no public funding. The legislation exists, but it needs movement.

The gambling control Bill's published scheme will have consumer protection at its centre. Its measures will include, as the Deputy rightly says, controls on advertising, promotions and sponsorship. The Government delegated powers to the Minister of State, Deputy Stanton, under the Gaming and Lotteries Acts. He has asked the Department to examine whether there are particular issues that could be brought forward more quickly that might deal with some of the issues that the Deputy has identified. He has had consultations with the stakeholders in the area and is continuing those at present. I just want to repeat to the Deputy that this is an area of priority for him. He has been working on it quite intensively and intends to move forward as quickly as possible with the appropriate legislation.

Businesses all over Dublin are coming under significant pressure because of spiralling commercial rents. Dublin has the second highest rents in the eurozone. Not only are they high, they are rising quickly. In the past two to three years, commercial rent in Dublin has nearly doubled. Obviously, that is bad for businesses, but it is also bad for consumers, who must pay too much money for what they buy, and for people who are trying to buy or rent a home, given that the returns on developing commercial property are so much higher than those on residential property that developers want to build offices and not homes.

Why is this happening? It costs approximately the same amount to build in Dublin as it does everywhere else. People earn approximately the same amount in Dublin as they do everywhere else. Hence, the cost of commercial rents should be the same, but they are not.

One of the reasons for this is tax breaks. In recent years, the Government introduced generous tax deferral mechanisms for landlords, including large foreign landlords, namely, real estate investment trusts, REITs, and Irish collective asset management vehicles, ICAVs. These tax deferral mechanisms have led to large foreign landlords pouring money into Ireland and, specifically, Dublin, which is jacking up rents on commercial property as well as the cost of commercial and residential property.

We were told that these mechanisms were going to be shut down in the Finance Bill. That was the clearly stated intention of the Minister for Finance, Deputy Noonan. He stated that economic activity carried on in Ireland must be taxed properly in Ireland. This obviously includes property. However, not only has the Finance Bill not shut down REITs and ICAVs, but it has turned tax deferral mechanisms into complete tax breaks. We have gone from landlords being able to defer tax to them having to pay no tax whatsoever.

The Finance Bill will make the entire commercial property sector tax free. This will tax a large chunk of assets out of the tax net. It will drive up the cost of doing business, which will drive up the cost of living and lead to Irish banks lending into a property bubble again less than ten years after the last property bubble collapsed.

In the middle of a housing crisis and a commercial property bubble and at a time when we need more public money to invest in services and infrastructure and we need to be reducing the costs of business and living, why is the Government about to make the entire commercial property sector completely tax free?

We are not intending to do that, which is the first thing I want to say. Obviously, the Finance Bill is before the House at present.

I know Deputy Donnelly has been in consultation with the Department on a number of the issues he has raised here in recent weeks, including section 110 and other issues. Committee Stage of the Finance Bill 2016 will be taken in the House shortly, with Second Stage due to conclude today. That is the place to tease out the particular issues raised this morning in terms of the tax treatment of commercial properties. There are several initiatives under way to deal with the differential as it is now and to reduce the differential between residential and commercial property. For obvious reasons, in particular the bankruptcy which the country faced, there has been a shortage in this area in recent times. The position changed very quickly from one in which there was a lot of availability to the current shortage now being experienced. This is a reflection of the economic growth that has occurred in the country. There is a huge amount of building currently going on, much of which is to increase commercial supply. This is necessary for the continued growth that we are seeing and will, hopefully, continue to see in the economy.

The Deputy will have an opportunity on Committee Stage of the Finance Bill to tease out the various issues he has raised this morning in regard to the tax treatment of this particular issue.

I will be seeking to meet the Minister, Deputy Noonan, privately and I will obviously be tabling amendments. The problem is that this is not a technicality in the Finance Bill. The Finance Bill provides for the establishment of a new vehicle called an Irish real estate fund, IREF. It explicitly states that once a commercial property is held for five years there will be no capital gains tax liability. That is an absolutely extraordinary tax break that nobody saw coming. The Bill also explicitly states that commercial property investors, foreign landlords, will pay 20% dividend withholding tax unless they are a pension fund, a life insurance fund or what is know as a collective investment undertaking. Almost 100% of the foreign landlords coming here are either pension funds, life assurance funds or collective investment undertakings. As I said, this is not a technicality in the Finance Bill. The Bill explicitly states that in respect of a property held for five years no capital gains tax will apply and that if landlords are one of a particular class of investors, which all of them are, they will also pay no dividend withholding tax.

Thank you, Deputy.

This is a policy position: it is not a technicality in the Finance Bill.

The Deputy must conclude.

I will conclude on this point. Does the Tánaiste believe that the Irish commercial property sector should not become tax-free? I am asking that she take up this matter with the Cabinet and, in particular, the Minister, Deputy Noonan, and find out what is going on because I doubt that any Deputy will be able to bring about serious policy change on Committee Stage.

I take the Deputy's point in regard to policy but we do need supply drivers. As I said, we were in a situation where there was no office space available. We have seen a huge improvement in terms of the commercial property that is now being built and is absolutely essential. This measure is one of the drivers to increase supply. It is a policy issue, which no doubt will be raised on Committee Stage of the Finance Bill. I will bring the points made by the Deputy to the attention of the Minister. I reiterate that there was a total deficit in this area and that situation is now changing. As I said, this measure is clearly a supply driver in terms of the need to ensure we have sufficient commercial official space available across the country.