Financial Provisions (Covid-19) Bill 2020: Committee and Remaining Stages

Section 1 agreed to.
Question proposed: "That section 2 stand part of the Bill."

I ask the Acting Chairman to bear with us because of the new venue. We are dealing with section 2 and I asked for an intervention.

I was not sure if the Acting Chairman was ignoring me after his earlier rants.

There will be no rants in the Chair today. Do not worry.

We do not have the Minister, Deputy Donohoe, in attendance. I am surprised that he has missed the entirety of the passage of this Bill. Will he speak on Committee Stage? Do we expect him to appear today?

Section 2 deals with the circumstances for the application of section 8, that is, a European Investment Bank, EIB, guarantee fund being formally established when states representing at least 60% of EIB capital have made appropriate commitments. Section 8 will not apply until that occasion. Can the Minister of State inform us when it is likely that this mechanism will be triggered when states representing 60% of EIB capital will have made appropriate commitments? What commitment will be required of Ireland - this State - in that regard? How will it be realised? I ask the Minister of State to provide some clarification on that point and I will come back on the section itself.

The Acting Chairman will have to forgive me. I have paper everywhere because of the venue.

We understand that. That is no problem.

I wish apologise to Deputy Doherty, the other Members of the House and the Acting Chairman. The Minister, Deputy Donohoe, is not available because he is at a Cabinet meeting. He sends his apologies. I was asked to take Committee and Remaining Stages of the Bill at the last minute. As the Deputy will appreciate, I only became aware of the size of the Bill late in the day. I am most familiar with the Committee Stage amendments. Deputy Doherty asked at what stage do the provisions of the Bill become effective. Is that correct?

I acknowledge that we are in difficult times. The Minister of State who dealt with this on Second Stage has moved portfolio, given the sacking of the former Minister, Deputy Cowen. There is an urgency in passing this legislation. I did not hear anybody on the Opposition benches say so but I can speak for Sinn Féin in saying that we are willing to support the passage of the Bill. Scrutiny of the Bill and an earlier stage was waived, which was correct because the Bill is about supporting SMEs. Given that we waived such scrutiny, it means we must have proper scrutiny on Committee Stage.

I know the Minister, Deputy Donohoe, is at a Cabinet meeting. However, this session does not just deal with the amendments but also with all sections. It is important and, indeed, crucial that we fully understand each and every part of the Bill given that it commits the State to being in hock for €750 million

As the Minister of State said, I appreciate that this is complex legislation. The Bill is 130 pages long and was published on Wednesday. We did not have the usual opportunities to scrutinise it through briefings with the Minister or his officials or through accepting submissions from sectors or other interested parties. We are where we are. The real question is when we are likely to hit the trigger mechanism of 60% of capital commitments from member states. What is Ireland's commitment in that regard? How is it realised in the Bill?

I can inform the Deputy that we are at that stage now. The 60% threshold has been reached. The Deputy also asked about Ireland's maximum financial commitment. It is €164.7 million.

How will our capital commitment be realised? Will there be a call in the event of a default on a proportion of the loans that will be shared equally by member states for that portion? How will that call be accessed? Will it happen after a period of time or after a quantum of loans are defaulted upon? What is the mechanism of the notification to Parliament regarding that?

I have to apologise to the House about the mechanics. My officials are sitting quite far away. I ask Members to bear with me.

The commitment refers to the proportion of the holding in the EIB. Deputy Doherty asked when the measure would be triggered in the event of a default on a loan. It will happen once there is a default and the calls on the member states are in proportion to their holding within the EIB.

I want to be helpful because Committee Stage is challenging given the Minister of State's unfamiliarity with the Bill and the officials not being as close to him as usual. I will ask a number of questions on the section and his officials could write a note for him. Sometimes it is beneficial to go into private session and allow officials to respond in order to speed up the process. I will leave that at the discretion of the Minister of State.

How will the guarantee fund interact with current lending schemes, such as the proposed guarantee scheme for which legislation is being drafted? Can the Minister of State spell out how a certain quantum of contribution to the fund would translate into extra financing through the credit guarantee scheme if, for example, EIB financing under the fund was exercised through portfolio risk sharing as provided for in appendix A to Schedule 2? What will the schedule of payments from the State to the Commission be under this fund? These are some questions I have in respect of the EIB guarantee fund.

With regard to the first part of the Deputy's question, I do not have difficulty with how it is proposed to take Committee Stage. If it is more helpful to Deputy Doherty that he hears directly from the Department of Finance officials, I do not have difficulty with that.

We are not allowed to go into private session. If necessary, we can suspend for a brief period to get clarification but we are not allowed to go into private session.

I have no difficulty agreeing to a short suspension of the House if there are specific questions on the remainder of the Bill that Deputy Doherty wants to raise with the officials. I do not have a difficulty with that. I appreciate the Acting Chairman's tolerance. I literally became aware of this as a result of what the Deputy alluded to earlier, that is, the changing of Ministers within the Department of Finance, of which I am not a Minister of State, and which resulted in my being here this evening. If it is helpful to the House and to Deputy Doherty, I have no difficulty with a suspension in which issues can be raised. Alternatively, we will have a situation where, unfortunately, I will be over and back to the Deputy in the context of where we are at the moment.

In the normal course of events, I would propose that this Committee Stage session be adjourned.

Unfortunately, I cannot-----

I am not suggesting this because I understand the time pressure with this Committee Stage. However, we are dealing with legislation and the Minister responsible for it is not here. Therefore, questions on it cannot be answered satisfactorily on the public record of the Dáil. It is not best practice to go into private session because then it is not on the record of the Dáil. However, if it facilitates the answers, and that is what I want at this point to inform me for Report Stage and others for the Stages in the Seanad, then so be it. Obviously, other Members here may have views on that as well.

I can be led by the House. I have no difficulty with that.

Is that agreed with Deputy Connolly?

I have great reservations about suspending at this point. This legislation must be debated in public. May I address that now?

I am not sure what ruling the Acting Chairman will make but I see where Deputy Doherty is coming from in order to facilitate the matter. This is serious legislation that must be debated in public and the Minister should be here. Last night we had a motion to extend maternity leave and the Minister for Justice and Equality in her reply, among other things, told us it was not possible because the legislation would be complicated and would involve retrospection and so on.

This legislation is one of the most complicated pieces I have ever tried to read. The Bill itself is short and is only made up of 12 sections but the Schedules attached to it are extremely complicated. In total, there are 140 pages. This must be debated in public. I do not know how we get out of the fact the Minister responsible is not here but questions must be asked on this matter. I am no expert and I have struggled to understand it. When I put it in the context of last night's debate, it beggars belief that something as simple as extending maternity leave was refused mainly because the legislation would be too complicated.

This legislation is to facilitate two particular schemes as well as other technical matters to allow us to access funding. In order to access that funding, one of which is €100 billion and the other €200 billion, we must make certain guarantees and certain written agreements. We need details on all of this. The question asked by Deputy Doherty is a simple one. When does the 60% become activated? The reply has been that the 60% has already passed.

There are other practical questions with regard to this, for example, have we already spent money and are we now applying under that fund? They are simple practical questions here, not to mention the complicated ones. I am not in agreement with us going into private session.

Go raibh maith agat, a Theachta Connolly. I thought it might be helpful because of the distance of Members from the officials but I am in your hands. For clarification, if we suspend for 15 minutes the House will not be going into private session. It is to see if we can get some answers or a roadmap forward from our present dilemma. Is it agreed to suspend for 15 minutes?

For clarification, what does the suspension entail? There have been occasions - and I am not one to push this, although other views have been expressed - where a Minister when dealing with questions on some complex scenarios, although I would argue that these are not complex questions, the committee has gone into private session to allow officials to speak openly and freely. If we suspend, that will not allow that to happen. I can continue to ask these questions. Some of them are quite simple, but I am conscious the Minister of State, Deputy O'Donovan, might not have the answers because he is not the Minister with responsibility for this area.

The Dáil has been left without adequate representation from Government and it is not acceptable. We have facilitated, supported and allowed this legislation to be fast-tracked. It is like saying that everything will be okay and that we should just turn up and it does not matter. There are serious questions here. We have tried to put a lot of work into this and we need to make sure the terms and conditions and the details of this legislation are correct for the needs of businesses throughout the State.

I completely understand Deputy. Our group also agreed to waive the pre-legislative scrutiny. It is a difficult situation. A short suspension might give us time to find some way forward. If you want to continue to ask the questions, by all means, the floor is yours.

Does the Minister of State have any comment?

A short suspension would be helpful to give me an opportunity to discuss it with my officials and I can talk to the Deputies as well. I apologise for the fact there is a Cabinet meeting and the Minister, Deputy Donohoe, could not be here. Deputy Doherty referred to the reconfiguration of the Department today. The timing could not be more unfortunate. We know and I recognise, having received a briefing on the Bill, that the timing of this is important. It is complex and it is a massive piece of legislation. The Government appreciates all the different groupings that have facilitated it. However, a short suspension might allow me to talk to my officials and in return talk to the Department of Finance, which might be helpful to try to get the remaining Stages completed tonight.

Is it agreed to suspend for deich nóiméad? Agreed.

Sitting suspended at 5.28 p.m. and resumed at 6.01 p.m.

Go raibh maith agaibh. Bogaimid ar aghaidh. I thank the House, the Members and the Minister of State and his officials for that engagement, and our staff here as well. How stands section 2?

I thank the Acting Chairman for facilitating the brief adjournment during which we could speak to the Minister of State and the officials. I thank the officials for their engagement with myself and others on this Bill, and for any notes that were sent to us.

On section 2, I will focus, particularly at this point, on the EIB guarantee fund. I understand the total amount we are likely to be able to draw down from that fund is €1.4 billion to €1.5 billion. We have concerns in Sinn Féin about what is being earmarked in the Schedule to the legislation. It provides a breakdown of the fund across Europe, 65% is for SMEs, 23% is for companies with more than 250 employees, 5% is for public sector companies and entities active in health and health-related research, and up to 7% for venture and growth capital and venture debt. I understand those are European-wide targets as opposed to member state specific targets, but can the Minister confirm those are not the targets this member state will be chasing because, in my view, that would be completely out of kilter with the number of SMEs in this State? The most affected sector within the State is the SME sector. It is to this sector we need this type of funding to flow as opposed to venture capital and venture debt, which is what some of this will be targeted towards at a pan-European level. The Minister of State might comment on that.

My understanding of the scheme is that this funding will be raised by EIB. It will leverage up to €200 billion. As I said, up to €1.5 billion could be drawn down by the State and will be channelled through the Strategic Banking Corporation of Ireland. While it may have the word "bank" in its name, that issue comes back to haunt us, as the former Governor of the Central Bank, Professor Patrick Honohan, pointed out at the time when he argued with the previous Minister for Finance that that company should get a banking licence. We have a situation where Strategic Banking Corporation of Ireland, SBCI, will not be able to lend to SMEs because it is not a bank. It is a company. It is a non-lender. Therefore, it will lend to AIB, Bank of Ireland and other banks operating in the State providing the low interest rate from EIB. I must say the SBCI's operational costs are extremely low, with a small number of staff. Its additional costs are likely to be quite restrained.

I have absolutely no trust in the Irish banks given what they have done during this pandemic in terms of profiteering from payment breaks, what they have done in terms of the tracker mortgage scandal and the litany of other issues I could rehearse. What guarantee do we have on triple-star rated institutions such as the EIB which will lend, probably at negative interest rates, passing that on to SBCI, which will then pass it on to AIB and Bank of Ireland? What guarantee is there that they will not lump on a couple of extra percentage points to feather their own nests using this 100% guaranteed lending, which is guaranteed by the member state, basically the taxpayers of this country?

Given that the Tánaiste and Minister for Enterprise, Trade and Employment, Deputy Varadkar, is bringing forward a credit guarantee scheme which fails to hit the target because of the low level of 80% guarantee being provided, this guarantee fund we are talking about, which has us on the hook for €164 million potentially, is guaranteed at 100%. How will the banks operate this because they will have potentially two different funds - one fund that is guaranteed at 80% and the other fund that is guaranteed at 100% - and the same SME looking for credit? Both funds would be available to the same SME. What is likely to happen? In the case of AIB, for example, will it be that the bank will exhaust the 100% guarantee fund to make sure it is taking no risk whatsoever and then start lending under the other scheme? I am interested to hear if any consideration has been given to that in the credit guarantee scheme that is to be legislated for soon.

The last point I want to make on this section is that while my party supports this legislation and I have been extremely critical in the past in terms of European member states, on this occasion what we are seeing before us is the harnessing of the credit rating of Europe to assist member states and that is beneficial. That should have happened a long time ago. There is more that needs to be done, but we are entering these schemes without any understanding of the interest rates that will be charged and the duration or maturity of the instruments. We are acting blind in what is before us.

I thank the Acting Chairman and the other Deputies for facilitating the brief interruption where we were able to discuss with officials some of the issues raised by Deputy Pearse Doherty.

In relation to the issues Deputy Doherty raised, particularly around the start of the point, the Deputy is correct that the percentage of the fund that will be available to SMEs is not necessarily that which will be available to Ireland. It is available to the European Union as a whole.

On Deputy Doherty's last point, before I get into the some of the other issues, the Deputy is correct as well in relation to the European response to this. There has been much criticism of Europe's response and it is noteworthy that, from an Irish perspective, as the Minister for Finance has stated previously, we must be seen to respond to those countries in the greatest level of need. While the initial response from the EU was rightly criticised, there is now upwards of €0.5 trillion over three different instruments, two of which are subject to the legislation we have here before us this evening, and those countries that are in the greatest level of need will have the greatest level of access.

Deputy Doherty asked in relation to the SBCI. The Deputy is correct again that it is via the pillar banks those moneys can be accessed from the scheme before the House this evening.

The Deputy also asked whether there would be memoranda of understanding with the Strategic Banking Corporation of Ireland, SBCI. There will. These will determine the extent of the administrative charges. This applies to all schemes for which the SBCI will act as intermediary. That is the case as it stands.

The last point the Deputy raised related to the credit guarantee scheme on which the Tánaiste began interfacing this week. He is quite correct in his assessment. We want to make sure all instruments that are available, including the SBCI instrument and any of the other instruments for which we are legislating this week, provide the greatest level of access to those with the greatest need. I again thank the Deputy and the other Members of the House for their indulgence. I again put on the record of the House my apologies on behalf of the Minister for Finance.

The apology is accepted. We understand that we are in uncharted waters.

I have one final question on this matter. It relates to the pillar banks' ability to use this guarantee to lend. They can lend to SMEs and larger companies. We went through that and through my concerns about how it needs to be targeted earlier. Will the banks be able to use this guarantee to lend only to companies that are tax-resident within the State? Will they have the capacity to support a business located in, for example, Strabane?

As a result of Brexit, the people of the North have been dragged out of the European Union without their consent. We have been very vocal here in trying to ensure that European Union supports are provided to the greatest degree possible to citizens, businesses and universities, in respect of research and development and so on, in the North. That is challenging. The State needs to stand up and make sure that cases such as this are dealt with. We saw the situation with regard to the pandemic unemployment payment. I will make that point again. It has been made by myself and many of my colleagues. People who live in the North but who live and pay their taxes and social insurance contributions here were not able to get the pandemic supports available to others who pay their taxes and PRSI here in the same way. Many companies are located just on the other side of the Border in our country. They employ many people on both sides of the Border. They need support. They may not be getting it. They will not be getting this European support through Westminster. Will this scheme be available to a hypothetical company in Strabane that employs 100 people, comprising 50 on either side of the Border? Will such a company be able to go to AIB or Bank of Ireland and, everything else being equal, access this type of fund?

Unfortunately, the Deputy probably knows the answer before I give it. The legislation applies to those companies that are domiciled, registered and fulfil every other legal requirement in this jurisdiction. I do not disagree with anything he has said about people being taken out of the European Union against their will but, unfortunately, this is a European Union instrument. The instrument will not be available to those in jurisdictions outside the European Union, including the United Kingdom.

I will speak on this section. I thank the Minister of State for the time he and his officials gave us beforehand. It helped to clarify some matters. I will say again, however, that although this Bill is extremely short with only 12 sections, the three schedules attached to it pose a great difficulty. It brings into acute focus the democratic deficit that has arisen in the European Union. We are really back to a patriarchal situation in which we are told this is good for us but are given very little time to discuss it. The Minister of State will agree with that. I realise that there is a pandemic under way and that this presents difficulties but we have had a number of months. We have not had a chance to tease out this at committee level. This Bill is approximately 140 pages long and, despite my own background, I found it extremely difficult to read. On occasions the English is not intelligible. It has been obviously translated from various instruments in Europe. It does not make for easy reading. I now have to depend on the word of Government, in which I have little trust, that this is very good for us. On the positive side, Europe is finally acting in unison, though belatedly, as best it can to allow us to access funding.

I will refer to this particular scheme, which is operated through the European Investment Bank, EIB. I understand from reading the Bill and from the clarification just before the break that we are in this for a commitment of up to €167.5 million. That will be our liability as set out in the legislation. It is capped at that. That is part of a fund of €25 billion which will allow the EIB to leverage up to €200 billion, which all of the countries may then apply to access. The criteria for applications for moneys are not yet clear. The Minister of State has pointed out that this money will then come through the Strategic Banking Corporation of Ireland, which is just a medium through which it will be accessed by the other banks. As guarantees are being given all around, including that in respect of the €167 million, I presume there is a guarantee that any bank which is given the privilege of loaning to the SMEs and other entities will make no profit on that loan and will simply make back its administrative costs, given that the money will be borrowed at zero or negative interest. That is my first question.

To move to my second question, I understand that health entities can benefit from this scheme. Will the Minister of State clarify this in simple English? All Deputies are inundated with calls from people whose loved ones have senile dementia or disabilities and who are not able to access day centres because they are closed. There are myriad examples; I will not go into them. Will the Health Service Executive be able to benefit from a loan at an interest rate of 0% to enable these entities to open? Am I reading the legislation incorrectly? I am reading it as best I can.

What oversight will the Dáil have of this measure? At what stage will it come back before the House? Reading the Bill, it seems to be coming back after the event. If somebody defaults, our guarantee is called upon and we pay up, a report will come back to the Dáil afterwards. Will the Minister of State clarify that point?

Section 7 confers on the Minister the power to enter into a contribution agreement. At what point would such an agreement be drawn up? Will we see it? The section goes on to say that if there is an amendment to the agreement, it will come before the Dáil. Who decides that the agreement will be amended and how it will be amended? Will the Minister of State deal with those three issues for me?

On the Deputy's initial point about this Bill being patriarchal, I do not disagree with the sentiments she has expressed. In fact, criticism of the lethargy with which the European Union's institutions responded to Covid is very justifiable. Member states and Members of this House have made such criticisms. The Deputy is quite right. It has taken a long time. Perhaps it took the infection hitting some of the larger and wealthier states harder than the Mediterranean states for Europe to wake up and realise it needed to respond to the plight of those in the greatest need. The Minister for Finance has said this on the record.

During the interaction we had in the short recess, many of the Deputy's points were discussed. Again, I apologise for the fact that the committees are not up and running.

If the Select Committee on Finance, Public Expenditure and Reform had been up and running we would have had a greater level of scrutiny than we have been allowed to have here this evening. That is regrettable.

Deputy Connolly is correct in what she said about the €167 million odd . That is the capped amount that has gone in from an Irish point of view. She is also correct in saying it is almost like a virtual insurance policy that the State is providing.

We discussed oversight, which was the subject of Deputy Doherty's amendments. I am sure we will come to them at a later stage. Oversight is envisaged as happening after the fact because, unfortunately, the instrument has to operate as a whole. As referred to in Deputy Doherty's amendments as well, there is a five-day provision for the trigger to be pulled; in other words, if a state needs assistance or if there is a need to draw down from a fund, unfortunately there is not sufficient time for each individual member state to debate the issue in parliament. That would lead to a situation where we would not be able to respond in the spirit of these instruments, which is, with speed.

Deputy Connolly also mentioned oversight. It is hoped that the Minister for Finance himself will make a statement on this matter in the Seanad debate tomorrow. He is committed to laying before the Houses of the Oireachtas any report which is deemed necessary to provide a response or justification for decisions he has made under the provisions of the Bill to which the Deputy referred, which I think is section 11.

The Health Service Executive is already eligible to apply for funding through the European Investment Bank. There is cheaper funding available at the moment. It depends on what rates they go out to the market at and where the greatest level of money is available. I do not disagree with the Deputy at all on the impact Covid has had on carers and those in care homes. One of the points the Deputy made is the fact that many respite centres are not able to open.

The contribution agreement is the State's agreement to contribute to the scheme. I can confirm that the total is €167.5 million. I think they were the main points the Deputy raised.

I am pleased to get the opportunity to ask the Minister of State a few questions. We have read and heard stories that the Germans have applied for massive amounts of money, with the interest rates at practically nil, for infrastructural projects and for any deficiencies they have in their country or economy. They have it done for many weeks. They are ahead of us. It appears to me that they are ahead of the posse. It is interesting to think that a country as financially advanced as Germany is availing of funding for several different projects.

Can we look for funding for infrastructural projects such as roads, for example? The Minister of State, Deputy O'Donovan, is from a neighbouring county. I refer to projects such as the Adare bypass and the Killarney bypass that we have been promised since 2004, 16 years ago. It has even been going on longer than that.

Another project that is needed is the Kilcummin sewerage scheme. Our county is in an awful state due to the lack of sewerage schemes. Let us take Brosna, for example. One will only get permission for one house in Brosna to connect to the sewerage scheme. In Kenmare, which is a large town, likewise, one will only get permission for one house. No development is permitted because of the deficiency in the sewerage treatment system. A place such as Curra does not even have a sewerage schemes. It has fallen between several stools. The same is true of the neighbouring parish of Scartaglin. Then we hear whizz kids saying on the radio this morning that no more planning should be granted on farms or in rural areas and that everyone should be moved into villages. We do not have sewerage schemes in the villages to cater for the plan the man on the radio had early this morning. I cannot think of his name. I think he was a Mr. Gilligan.

Can the Government access funding now that we badly need it for roads, sewerage schemes, water schemes and group water schemes? They are needed in several parts of Kerry where they will pay their way but the State is not able to advance their applications.

I was very disappointed to hear that rural publicans are not allowed to open until 10 August.

The Deputy is straying a bit now.

Such people need assistance too to give them the wherewithal to open their doors again. We are not being fair on them. I accept I am straying a bit.

The fact is that one has to travel 15 miles to get a pint in a rural area because all the rural pubs are not open.

We will get the Minister of State to reply.

I have just one other point to raise, which is about the banks and mortgages. AIB has deferred the granting of mortgages to couples because one of the parties is on the Covid payment, even if the other person is quite entitled to draw a mortgage but because the application is a joint one AIB is deferring their application. That will nail small builders as a result and it is holding up progress. Could we access funding the same as the Germans are doing? Surely we are as good as them.

I will ask the Minister of State to reply if he can about the funding.

Deputy Healy-Rae is correct; we can access funding in the same way. Many of the infrastructural projects that are under way are funded by European Investment Bank funding. He will know from the national development plan that we have €116 billion worth of a plan over a period. Some of the funding will come from the Exchequer, some of it will be borrowed, some of it will come from the European Investment Bank, some of it will come from the Council of Europe development bank and some of it will come from elsewhere. We are already seeing large infrastructural projects that are being funded in that mechanism. I can think of one off the top of my head, namely, the redevelopment of the city centre in Limerick, which is being led by the city and county council and is being funded by both of those agencies.

Deputy Healy-Rae made a very valid point about rural sewerage schemes. That is something I feel very strongly about. The Deputy might have heard me speak about it in this House before. There is provision in the programme for Government so that the very towns and villages the Deputy talks about will be looked at differently under the new programme because under the rural development fund there will be specific targeted funding for those towns and villages that currently have no scheme with a view to trying to get them.

I will make three points for the purposes of clarification on how we ensure that the needs of Ireland are not submerged by the demands of bigger countries. The three member states that have received the most financing should not exceed 50%, which is fair. The 15 member states who have received the least financing should exceed 10% of the fund. That ensures that areas with a small population will not be forgotten and it underlines the financial structures that are by their nature multi-country, covering two or more member states, that are not included in the above. It is designed to be as fair as possible and to respond to as many as possible.

Deputy Danny Healy-Rae is correct about the issues he has raised and that is why the provisions that have been made in the national development plan and the programme for Government are clear as to what he has asked about there.

I have one more question. Will the funding for the sewerage schemes come to Irish Water, which is now responsible for the treatment plants that already are there? I know that Irish Water has responsibility for the Kilcummin scheme. Will the funding for these schemes come to Irish Water or can the Minister of State say how the Government is proposing to fund them?

I understand that it will be worked out together between the Minister, Deputy Darragh O'Brien, and the Minister, Deputy Humphreys.

Both Departments will work on it.

I do not want to be an irritant to the Minister of State and I do not expect him to apologise for it again but it is utterly shameful that the Minister for Finance, Deputy Donohoe, is not here today to take this session. It is an insult to the House. I understand it is because there is a Cabinet meeting. We asked during the suspension about the timing of this Bill because it is being pushed through. As Deputy Doherty said, we are going into this with a certain amount of blindness, which is not a healthy state for Members who are supposed to pass legislation to be in. Nevertheless, we accept the blindness on the basis of the urgency. We were told during the suspension that this has to be done and dusted, signed up to by all member states and backed up by legislation before it can be enacted. However, France, Estonia and Germany have still not signed up to it and we are told they will not do so until the end of this month. This House will be sitting until the end of this month and it is utterly disgraceful that we are pushing it through today in this manner, without proper scrutiny and without a proper sitting committee that could scrutinise and delve into this highly complex Bill.

A point was made about Germany looking for a lot of funding. I have no particular axe to grind with Germany but the experience in this country of the European Union and the banking system within Europe has left a bitter taste in our mouths. For us to go into this without being able to scrutinise it properly is unwelcome and unfortunate and, at the end of the day, may not be the healthiest thing we have ever done in this Parliament. The question asked by Deputy Doherty was not answered sufficiently. Will funding be available to businesses that operate on both sides of the Border or are we excluding businesses because, as was said, people on the northern side of the Border were forced out of the EU against their will? They have suffered the pandemic like the rest of us. They straddle the Border in their economic activity, as workers have long done, and they were let down in respect of the Covid payment. Will businesses that operate on both sides of the Border also be left out in the cold? That hugely important question needs to be clarified, as do many other questions that we have about the Bill, which we will come to in other sections.

I appreciate and accept the frustration that the Deputy has expressed. It is not a position that I am overly enamoured with either but the Business Committee set out to try to put in place the legislative agenda between now and the recess. This Bill was identified as priority legislation. Although I could be wrong, it is my understanding that it was so identified in the absence of a finance committee. It was in that context that it was scheduled by the Business Committee and I reiterate it is unfortunate.

I have just checked with the officials and if it is an Irish company that is owned, operated, registered and everything else in this jurisdiction and trades in the North, it will be eligible. It cannot be owned, operated, registered and so on north of the Border because that is a different jurisdiction. In the same way as we are going to have Irish SMEs trading with the United Kingdom into the future, trading with the UK will not debar them from accessing the funding. However they have to be Irish companies because this is a European Union mechanism and the United Kingdom will no longer be a European Union country.

I wish to raise a point that my colleague in the Seanad, Senator McCallion, has raised quite a lot about the supports that are there.

What the Minister of State says about it being outside the jurisdiction and that it is a European fund for European companies is all fair in a normal scenario. This, however, is not a normal scenario. We are dealing with Brexit, with a part of our island which is now under the same customs guidance as the rest of the EU and is different from Britain. That has happened because we actually asked for it to happen, because we believed that the island had to be treated as an all-island entity. There are other things there that also apply to the North that will not apply to Britain because we recognise the importance of it. As such, we have to look at it both ways and my understanding is that there is a huge amount of goodwill across Europe for the situation in which the people of the North have found themselves, which is being taken out of Europe against their will. I would argue strongly that if a case were presented by the Government on this scenario, it would be looked on favourably. This is because we are not just talking about an ordinary jurisdiction outside of the European Union, we are talking about the North of Ireland, which already has got exceptional status in European law as far as customs and other matters are concerned. I could be wrong but I guess that the Minister never raised these issues. Even at this late stage, I ask the Minister of State to bring it to the attention of the Minister, Deputy Donohoe, and to raise the point that supports are needed for companies that operate on the other side of the Border. I come from a Border constituency, Donegal, and thousands of our workers are employed on the other side of the Border, just as thousands of people from counties Derry, Tyrone and Fermanagh are employed in County Donegal or the neighbouring Border counties.

If the request has not been made, I encourage the authorities to make it. They should do so not just in relation to this issue but also to ensure that European supports, where practical and sensible, be extended to a part of this island that never wanted to leave the European Union in the first place, which voted to remain in the European Union and which, because of Tory infighting and Tory politics, has been left, particularly during the pandemic, without the European supports on which it would have been able to rely in the past.

In response to Deputy Doherty and to reinforce what I said earlier, this scheme is designed to be available to European Union countries. He is absolutely right that the United Kingdom has made the decision to withdraw but that does not negate its need to look after the people within its own jurisdiction. Deputy Doherty, being from an Ulster constituency, is very cognisant of the people who, as he said, go back and forth across the Border every day. They are people who have to be brought into the discussion here. It is something that I will bring to the attention of the Minister for Finance, Deputy Donohoe. I have asked the officials that are here to bring it to his attention and to that of the Tánaiste because there is an upcoming North-South Ministerial Council meeting and there has been a bit of a vacuum there. The Deputy may agree with me about the voicing of concerns given that the North-South Ministerial Council has not been able to function due to the Covid situation. There is an Executive now, which probably created a vacuum as well, so there might have been an unfortunate delay in voicing the concerns of the people to whom Deputy Doherty refers. It is important as well to draw attention to the references in the programme for Government that set out what this Government wants to achieve on an all-island basis into the future.

Certainly future leadership can be taken from the harmony in the response of the Chief Medical Officer and the North's chief medical officer to the pandemic, with regard to other directions, whether supports or otherwise, that might be needed from an economic point of view. Lessons have been learned about what can be achieved when an all-island approach is taken. The Government has not been, and will not be, found wanting on articulating the views of the people of the North who, as the Deputy has quite rightly said, voted to remain in the EU but are being taken out of it. It is not just the people in the North; the people in the adjoining counties in the Southern jurisdiction who travel to work there will also be impacted. We are very conscious of this.

The Deputy is correct that significant goodwill has been expressed by the EU. We only need to consider all of the visits done in the immediate aftermath of the deadline for the first crash-out, when Ministers with responsibility for European affairs and finance and Prime Ministers stood on what is a borderless border and saw it for themselves. The Government is in a strong position to articulate on behalf of the people of the North. We have taken a position on the programme for Government on how we hope to achieve this. The North-South Ministerial Council is a vehicle to do this. The voices of Northern businesses, chambers of commerce and business associations are articulating through their MLAs and the Executive that they want to see co-operation and this is all helpful.

At the end of the day, no more than the pandemic and virus did not recognise the difference between Tyrone and Monaghan, it does not matter whether a person's income is in Tyrone or Monaghan. They still have to raise children, pay a mortgage and go out to school in the morning. The Government is a co-guarantor of the Good Friday Agreement, which ultimately underpins all of this. The Deputy is absolutely right that there is a compulsion and an obligation on us and we take this seriously. If the House can respond to what the Deputy has suggested in the all-party mechanism available to the House we will be doing the people of the North some service.

I did not see Deputy O'Donoghue so I will let him in briefly. We are straying a lot and we have only another 20 minutes to finish the section.

I will try and not take the full 20 minutes. Deputy Danny Healy-Rae said earlier this funding is very welcome and wanted but it must be given in a responsible way. I have no confidence in giving funding to Irish Water as it has wasted what money we have had in the country to date. It put in meters throughout the country and used all of its funding but was able to keep back €500,000 to top up wages when the money was running out last year.

This funding has to go into rebuilding Ireland. The Minister of State can see in his own constituency that for the past 30 years Askeaton has been promised a sewerage system. Every Government has promised it a sewerage system and no one has delivered. This time there will be a task force. I welcome this and I will look forward to it but will it happen? Oola is the same, as is Fedamore. Five towns on boil notices are waiting for €1 million for five bore wells for water. Irish Water is looking for €4 million for a pipe from the Shannon Estuary to Croom. It cannot pump the water from the Shannon Estuary because raw sewage is going into the estuary from Askeaton. I do not want to waste money unless we fix the infrastructure and I have no confidence whatsoever in Irish Water.

I am very concerned about the tourism sector, which generated €9 billion in revenue last year. Since the recession, it has created 90,000 new jobs. Earlier, we spoke about Apple, which has 6,000 jobs in Ireland. Prior to Covid, 270,000 people were employed in tourism and now those jobs are at risk without support. There are practical steps that could make a major difference to the survival of industry. One of these is a continuation of the wage subsidy scheme, which is due to finish on 10 August, until April 2021. The tourism sector is very labour intensive and more than 40% of the turnover goes on wages.

The Deputy is making a Second Stage speech and we have limited time.

I am sorry but everyone else spoke at length. The Acting Chairman said he did not see me. I would like to get a couple of these facts out.

I did not see the Deputy, I am sorry.

I thank the Acting Chair. All restaurants were closed for 105 days during this time. There was significant cash burning. Large hoteliers were out of pocket by €2,000 at day. Local authority charges need to be waived. This funding needs to be given to local authorities so they can waive the rates system to get our businesses back up and running. That is one way to do it. The money needs to be given back to our councils to invest in housing voids so we can put people back into our towns and villages and use the housing stock we have. The Government talks about building new houses left, right and centre. We haves massive stock that could be rebuilt.

It is about the here and now and this summer. In Northern Ireland, gatherings, including weddings, are determined on the size of the venue. Last week, we spoke about churches, which had a limit of 50 people but then it was decided that this could be increased depending on the size of the church. This also needs to be done for hotels. We must be very conscious of the funding coming through and ensure the cost of the money is not borne by the companies keeping us afloat during the pandemic. We want to make sure the funding gets in now and is continued for 12 months to ensure these companies come back strong.

We are under time constraints and I should call the Minister of State but I see one more Deputy.

They can be taken together.

If it is allowed. I will bring in Deputy Michael Healy-Rae briefly.

I want to take this opportunity, because I did not have one already, to congratulate the Minister of State, Deputy O'Donovan, and wish him nothing but good luck in his role in the Government. I sincerely congratulate him.

This is a very important time, as I said in an earlier debate, because the decisions taken and the legislation being passed by the Dáil in the coming days and weeks before the end of July is very important. Every bit of funding that can be got for the July stimulus must be used wisely, which is the main point. I am very upset this evening because I believe the Government has shot itself in the foot by delaying for another 25 days the opening of our public houses. People might say this is straying from the debate but it is not because what we are speaking about in this debate and other debates is how to get the wheels of our economy going, whether through borrowing money from Europe or getting people in Ireland to spend money again. If the doors of our public houses were to open next Monday, it would put money back into circulation. I truthfully believe the decision to delay this for a further 25 days will endanger people's health because it will concentrate where we send people to spend money; in other words, only to places that serve food. It will also stop the wheels of commerce from rolling again. All these people had taken in stock in recent days. People were rostered to work from next Monday. All of this has now been stopped. I see this as a negative financial impact on our country and I do not see it saving one life or one person from getting ill. It is ill-founded and wrong.

To return to the debate and where we are going with regard to securing funding and all that involves, if we look at the lessons we learned from an economic point of view, and the economic cycles we go through in life, and if we look at the previous downturn in the economy and the previous burn-out we had when we had nothing but austerity, now we have an opportunity to deal with the problem in a different way because we can access money at an affordable rate and we should be doing so. We should plough on with building more roads and putting in place more infrastructure.

There is so much we can do in this country. We have a workforce. People have returned from America, England and Australia. They are here and ready and able to work. All we must do is get them back to work. We can do that by getting money rolling into the economy and getting major infrastructure projects, many of which are shovel ready, started.

There was much talk earlier about sewerage schemes. I appreciate the Minister of State's interest in this. He has always been a promoter of sewerage schemes in small villages and towns to facilitate orderly growth. The late Jackie Healy-Rae went to a place called Fieries in Kerry and demanded that a sewerage scheme be established there. At the time there was nobody there to be connected to that sewerage scheme, but today there are hundreds of young families living there simply because the infrastructure was put in place. Caherdaniel is crying out for a sewerage scheme. There are many other such villages. They have rightly been prioritised by members of Kerry County Council, not just now but over the years. These must be delivered. People are being told not to live in the countryside yet, at the same time, if they want to live in small towns or villages they cannot do so. For example, no more planning permission is being granted in Kenmare. We are told that until there is a proper upgraded sewerage scheme we will not be allowed to build any more developments there. It is crazy.

I thank the Chairman for giving me this brief opportunity to speak.

I thank the Deputies. I will start with the pubs. I have a vested interest as I have family members who are publicans. There are mixed views on this and it is probably not something to get involved in this evening. With regard to the tourism element, and I was formerly a Minister of State with responsibility for tourism, it plays a major role in the economy of the country. It is in every part of the country. It is for that reason and for the SME sector, in particular, that instruments of this nature are so important. Europe is responding to a pandemic that has affected the tourism industry not only in Deputy Healy-Rae's and my constituencies but all around the Mediterranean and elsewhere. It relates to industries such as that.

Deputy Healy-Rae is also correct about the July stimulus. It is the Government's intention to put a great deal of money into circulation through a variety of methods, such as through addressing the temporary wage subsidy scheme, which people want to see addressed, through grants and ensuring that the maximum amount of money can be released as well as through the credit guarantee scheme. With regard to the demands that exist, and both Deputies referred to this, approximately €80 billion in demands have been clocked up from the various sectoral interests in respect of the July stimulus, so there will inevitably be disappointment. However, it must be looked at in the round. The Government has already put €13 billion into the pandemic response, which is approximately 7.5% of our national wealth. That is mid-table from a European point of view and the fact that this is a small country must be acknowledged as well. The Government did so through the pandemic unemployment payment and the temporary wage subsidy scheme initially and we have said there are other measures we are prepared to consider. On top of that we gave an additional €2 billion directly for health, which Deputies voted through the House in the last week or so, to ensure we had coverage there.

You are straying slightly. We have many more sections to cover and we only have 15 minutes.

I know, but I want to respond out of courtesy to the Deputies because, in fairness, they have waited.

With regard to the capital investment that both Deputies referred to, I can highlight a positive example that was completed in the last 12 months in Athea in my constituency. While there are many waiting, some have been delivered.

Question put and agreed to.
Section 3 agreed to.

I move amendment No. 1:

In page 4, between lines 32 and 33, to insert the following:

“(2) Payments referred to in subsection (1) may be paid out of the Central Fund, or the growing produce thereof, subject to a resolution passed by Dáil Éireann.”.

I still would like to hear from the Minister about what guarantees or protections there are for the Irish taxpayers, who are providing a 100% guarantee, that the banks will not try to profit from this. Can he inform me, with regard to what is likely to be zero interest rate loans, that they will not add a couple of percentage or partial percentage points on top of that? What dialogue has there been? I understand there was dialogue today with regard to guarantee schemes, so I would be interested to hear about that. I would not support the State providing guarantees only for banks to profiteer on the back of that.

This amendment deals with oversight by the Houses of the Oireachtas. It is about ensuring payments, and in the SURE scheme we are talking about payments potentially reaching close to €0.5 billion, and makes the point that they may be "paid out of the Central Fund, or the growing produce thereof, subject to a resolution passed by Dáil Éireann". The issue I have is that there is no oversight of the scheme in the legislation presented to us for what could potentially be a payment of close to €0.5 billion in respect of a liability under this scheme. I do not believe that is appropriate or right. I heard what the Minister said regarding the fact that interest rates would apply if we do not pay within five days and the potential €483,000 that could be called upon. I am not sure what those interest penalties are; I do not think that has been worked out either. However, when the House is sitting it should be a matter of course, if it is not in legislation, that the Minister would accept that he would bring a resolution to the House for payment or partial payment of the funds from the Central Fund to meet our liability. When the House is not sitting, at least a report outlining the criteria should be provided.

Amendment No. 2 is a similar amendment. It is important that we deal with both at this point.

I support the amendment. The Sinn Féin amendment calls for oversight on this, and it is completely lacking anywhere else. It was said earlier that we could not pass an extension of maternity leave last night because it was too complex, but what we are looking at here is seriously complex and we are not getting the clarity on it that we deserve. To be honest, what is going on here is beyond the understanding of most of us in the House. We understand the urgency and accept that this is a gigantic stimulus package that is necessary to ensure that during Covid-19 and afterwards, whenever we emerge from it, small and medium businesses and workers can begin to operate again following what will probably be a recession from the pandemic. One could not argue against it or oppose it.

It seems that we have a Dáil made up of born again Keynesians who now see that stimulating the economy and putting money into public services and into jobs with small and medium businesses is how one does what the left has been saying for years, which is that one injects resources into the economy to stimulate it. That now appears to be the wisdom of the hallowed halls of the finance ministries. One would not know it from the debate in this House, but in Europe there is another debate raging. That debate has much to do with how these funds should be spent, how much should be loans and how much should be grants. Interestingly, there is talk about reforms being attached to them. This is where I wish to make my most important contribution. People in this country remember the word "reform" well, particularly those who were described by the former Minister for Finance as the low-hanging fruit - those at the bottom of society who depended on the welfare state, those who suffered from disability and public sector workers. Reform always equals attacks on pensions, labour rights and the welfare state and the privatisation of public services. Clearly, that debate has not ended.

I know I will hear the cliché being trotted out that there is no magic money tree. I accept there is no magic money tree, but we seem to forget that when it comes to tax havens, such as what we saw with Apple today, the Cayman Islands, the double Dutch and, indeed, the Irish tax haven.

The European Commission is floating other clever ideas, including a suite of environmental taxes such as carbon and plastic taxes. Who could argue with that? The problem, though, is that it does not do what it says on the tin. The tax is usually passed on to ordinary people and not the big companies.

Because the details are scant, it is very important we have a level of scrutiny applied to the Bill and I think we will need the State to answer questions. We were told earlier that the wage subsidy scheme, for example, could apply retrospectively. We have giant companies in this country such as Ryanair and Boston Scientific that put their hands out for the wage subsidy scheme. We have no scrutiny over their profits, cash reserves or anything else yet we paid out the wage subsidy scheme to them. There is therefore a concern as to how this fund will be used and where it will go to. As individual responsibility is demanded of all of us, we must also demand corporate responsibility and have some kind of scrutiny over how this money is given out. It is important for us to comment here on what the debate raging in Europe is about and how it will impact on whether we pass this Bill. We have to come out of this pandemic with a notion of a caring society that wants to repair the damage done. If we are to learn lessons, we need to learn lessons about investment in our public services. We have seen the void and the gap that has been created in health, childcare, public transport and education, all areas that need to be invested in. We do not want to end up, when we strip the spin away from this scheme, looking back at something dressed up as a package of funding but which is really austerity and corporate bailout, mark 2. We need to understand how that debate is taking place in Europe and how it will impact on what we do here.

Unfortunately, I cannot accept Deputy Doherty's first amendment. We had a discussion during the interruption. Article 11 of the SURE regulation states that member states' guarantees must be irrevocable, unconditional and on demand. The proposed amendment would in effect make the SURE guarantee agreement signed by Ireland a conditional rather than an unconditional one, as is required. It would have the effect of pricing additional risk into the borrowings the European Commission seeks in the market, making the cost of borrowing higher and defeating the purpose of the instrument, that is, to make loans available to pandemic-hit members states and to support their citizens. On receipt of a demand notice from the Commission under the SURE guarantee, guarantors, including Ireland, will have a maximum of ten business days to make payments. In passing the legislation, the Oireachtas will accept this stringent timescale, which was agreed after lengthy negotiation between the member states and the Commission. Should a demand be made, for example, during a period of Dáil recess, it would be impossible to comply with the provisions of the guarantee if the amendment were agreed to. In the case of the SURE guarantee, failure to meet the timeframe for payment under the guarantee would put Ireland in a technical sovereign default.

To respond to the point Deputy Bríd Smith raised, tomorrow's European Council meeting will focus exactly on what she has referred to, that is, the balance between grants and loans and how that will play into the multi-annual financial framework, which will be the European Union's budget for the coming years.

Amendment put and declared lost.
Section 4 agreed to.
Question proposed: "That section 5 stand part of the Bill."

I have raised this issue twice now. This is the third and, I hope, last time I will raise it. The Minister of State did not respond to it the first two times. I refer to the guarantee scheme. How will the Government ensure that lending from the SBCI to the pillar banks - more than likely at zero interest, given the lending capacity and the credit rating of the EIB - will not be lent on to SMEs that are struggling during this pandemic at higher interest rates that are above the operational costs of the pillar banks? How will we ensure the pillar banks do not profiteer from this 100% guarantee, just as they are doing with the mortgage interest break? I want to hear the Minister respond to that.

Can the Minister give us any indication as to when the Government will make a decision on whether it is likely to apply to draw down lending from the SURE scheme? There is no limit to the quantum of lending that any member state can borrow. Theoretically, we could apply for the whole €100 billion. That is obviously very unlikely, but the lending is for Covid-related expenditure on job retention and job supports. Therefore, there is eligible expenditure already incurred in respect of the temporary wage subsidy scheme. Other expenditure could be also applied, and future expenditure will be incurred by the State in supporting employment in the coming weeks and months. Given the favourable rates available and the fact that the State is borrowing at negative interest rates, which is to be very much welcomed, and I commend the NTMA on the debt management functions it has provided, particularly in refinancing a number of debts, and given that our profile looks very healthy for the coming years, when will a decision be made on a commercial basis as to whether it will be more beneficial to us to access borrowing through the SURE scheme or to paddle our own canoe and go to the markets and raise debt, as we have been doing, to levels that are very healthily oversubscribed and at rates that are very beneficial to the State?

I apologise to Deputy Doherty. I should have made this point to him earlier. The mechanism between the SBCI and the pillar banks is not included in the legislation because it is factored in through memoranda of understanding between them.

As to when it is envisaged the Government may wish to access the scheme, there is no date, but what I can say is that access to the SURE facility will depend on market rates and the maturity of loans offered by the Commission, and the Government will make a decision at the appropriate time. Having briefly discussed the matter with my officials here, it is anticipated the Government would access these instruments in the autumn. If the Government chooses to do so, it will be in the autumn.

The Minister said in response to my question about the banks profiteering from the EIB guarantee scheme that there will be a memorandum of understanding between the relevant parties. I presume the relevant parties in this case are each pillar bank and the SBCI. Has that memorandum of understanding been drafted? Will it be laid before the Houses? Does it actually prevent the banks from profiteering from this pandemic in the way I have outlined by increasing the rate they will on-lend to SMEs? I would like to have sight of the memorandum because, as I have said on numerous occasions, and like the former Taoiseach, not only do I not trust the banks, but I would also like to see things for myself and check and double-check them. I ask the Minister of State to answer those questions. Has the memorandum been drafted? Is it available for us to scrutinise here? I mentioned that we are asked to take this on good faith. What is the understanding as to whether the memorandum of understanding will actually prevent the banks from charging anything above the operational costs of distributing this money to SMEs?

I ask the Minister of State to respond literally in a word.

The SBCI and the pillar banks operate, as the Deputy will be aware, on the basis of the commercial memorandum that is in place. It is a commercial decision. It is operated on in people's best interests and to make sure people are protected. It is not intended to be published as part of this and is part of the regular relationship that exists between the SBCI and the pillar banks.

As the time permitted for this debate has now expired, I am required to put the following question in accordance with the order of the Dáil of 14 July 2020: “That in respect of each of the sections undisposed of, the section is hereby agreed to in Committee, Schedules 1, 2 and 3 and the Title are hereby agreed to in Committee, the Bill is accordingly reported to the House without amendment, Fourth Stage is hereby completed and the Bill is hereby passed.”

Question put and agreed to.