I have not had time to consider the draft work programme in detail. Another item which arises is travel proposals.
Business of Joint Committee.
Are you moving on from the draft work programme?
I will open No. 4 for discussion and preface my remarks by saying I do not have a draft work programme to circulate today. We will include in it items raised by members today for the next meeting.
Unfortunately, due to other pressures I was unable to attend an earlier meeting at which my colleague presented the Chair with a detailed note on three particular issues I would like the committee to consider including in our work programme.
The first relates to the World Bank and the IMF. I propose that the Minister for Finance's report on Irish involvement in the World Bank and the International Monetary Fund should be included in the committee's work programme. This is the appropriate place for the report to be presented when published. Third world debt is a huge issue, something about which a significant section of the people are greatly concerned. There needs to be close scrutiny of the Government's policy and actions in this regard. I commend the inclusion of the report at the appropriate time.
The second issue relates to the national pension reserve fund. The Minister and representatives of the National Treasury Management Agency which manages the fund should be asked to attend the committee to answer the many questions members may wish to pose about the way the fund is invested. A whole raft of questions need to be answered. There is significant public interest and quite a disparity of opinion on the fund and its stewardship by the National Treasury Management Agency, a matter which needs to be addressed.
The third issue relates to the addressing by the committee of the implementation of the national development plan in May 2001. I propose that this is something the committee should do annually. The plan is an important plank in the Government's policy position and requires the scrutiny of the committee on an annual basis. As some 24 months have passed since we last addressed the issue, we should signpost an early review of the plan which we should address in the light of publication of the national spatial strategy, which we have not had an opportunity to address in detail, and also the changing economic circumstances, of which we are reminded almost daily in the Dáil Chamber.
It would be beneficial if we had a list of items to be addressed in order that we could prioritise. I have already written to the Chairman on the World Bank-IMF issue, on which I support Deputy Ó Caoláin. I also support his remarks on the national development plan. We are told by the Minister for Finance that the cost, only two years into the period of the plan, is already 54% over budget and that the cost of completing it has escalated dramatically. We need to have a better understanding of whether these are issues beyond the control of the public sector or of poor design and anticipation which are contributing to the cost over-runs.
We also need to look at the issue of public private partnerships. This is the new kid on the block for which there is great enthusiasm in Government. However, some of the experiences to date are not so reassuring. As a committee, we need to insist that the exclusively public sector comparator is properly debated and assessed in relation to new projects. We should request submissions where PPPs have been undertaken and look at the alternative costings and merits of taking the public finance route solely. There is a fear that what is driving PPPs is more a need to overcome the restrictions on capital spending rather than genuinely getting better value from private sector participation. Everyone knows private sector funding is more expensive per se. It is only where the private sector brings savings elsewhere, other than in the funding mechanisms, that there are actual gains. We need to look closely at such projects and ensure, in our capacity as watchdog for the taxpayer, the selections are made on good grounds.
We have previously discussed the alarming under-estimation of tax revenue in the past couple of years which would suggest that something in the models for tax estimation is not right. Perhaps we should hear from officials of the Department of Finance on whether this is part of the Estimates process when they come before us. We should hear how they are estimating tax receipts and why they appear to be getting it wrong on a consistent basis, particularly in respect of income and corporation tax. That is an issue of concern.
There are other issues on our agenda. The Committee of Public Accounts appears to have indicated that it is not going ahead with its investigation into the redress board. We need to have an assessment of whether we can take on that study. I look forward to receiving a full slate of options. The Chairman could give an initial opinion without making any commitments and we could tease out whether his priorities coincided with ours.
It will be circulated in advance of our next meeting.
I agree that we should discuss the national development plan. Attending my first meeting of this committee I said it should help the public to become aware of how the Government was spending its money. The issue of costs vis-à-vis costs in other European countries, particularly infrastructural costs, is a major one. At 4.8%, our inflation rate is twice that of our European colleagues. We should convey to the public what is happening and help it understand the reason there must be a reduction in public sector spending to keep the country competitive. Rather than fudge the issue of the reason for the reduction, from 13% last year to 7% this year, we should explain it. We can help the people understand that costs need to be kept in line. We are uncompetitive because of the short supply of labour and pressure on wages. The committee should act as a spokesperson for the Oireachtas to the public, otherwise information will not become available.
We will return to the issue at our next meeting. We will circulate the matters to be discussed in advance.
We may have different reasons as to why we want some of them to be discussed.
It is all for the sake of integrity.
Deputy Ó Caoláin This is only a minor reflection on the last contribution.
I understand that.
It does not matter if the reasons are different. We must have transparency and convey to the public what is happening in the economy and elsewhere in Europe. It is also important to look at the effects of the war in Iraq on the economy. Where will it leave us? What are the economic costs and what effect will they have on inflation and competitiveness? It is a mystery as to where we will end up. We seem to be all right this year but the Minister for Finance is quite——
Bullish.
Exactly. I have been very impressed by him whenever he has appeared in the Seanad. The issue is, where will we be over the next two years?
Absolutely. We will return to the draft work programme at our next meeting.
Item No. 5 is: travel proposal. An invitation has been issued to me to represent the committee at a meeting with representatives and national parliamentarians in Brussels on 22 April concerning economic and monetary union and related issues. The estimate is before members. Option 1 is €502.90 while option 2 is €550.18 - the difference between economy and business class. Can we seek agreement on the option to be chosen? Is it agreed to choose option 2? Agreed.
The next item on the agenda is: any other business. Before I open it up for discussion, I want to deal with correspondence received which has been circulated to members. The first is a letter from the Professional Insurance Brokers of Ireland regarding the effect on the industry of the Insurance Act 2000. The body wants to present its case to the committee in advance of the Central Bank and Financial Services Authority of Ireland (No. 2) Bill and the Financial Services (Miscellaneous Provisions) Bill 2002. Do members wish to comment? These pieces of legislation are expected to be published later this year.
To which item are you referring?
The letter from the Professional Insurance Brokers of Ireland. The letters received were circulated with the minutes. I will give members a moment to go through the extensive bundle of paperwork received. Essentially, what the Professional Insurance Brokers of Ireland is stating is that it has issues which it had hoped would have been addressed in the financial services regulatory Bill which was dealt with by the select committee. They were not. It wants to ensure they are adequately addressed before the publication later this year of the (No. 2) Bill, as indicated by the Minister. I have not had an opportunity to study the correspondence received in detail. Perhaps we will include it in the work programme to meet in advance——
When legislation is at an early stage of development, the committee should take the opportunity to try to shape what will come through the system rather than wait for a fait accompli to be presented and scramble furiously backwards to retrieve lost ground. If there is a case being made which deserves consideration, we ought to hear it if we know that legislation will be coming our way.
We will agree to schedule such a meeting in our work programme at the next meeting.
There is also a letter from National Newspapers of Ireland thanking the committee for giving its representatives an opportunity to address it on the freedom of information issue. Is it agreed to note this correspondence? Agreed.
There is a letter from the Joint Committee on Education and Science asking the committee to consider, as a matter of urgency, the role and impact of public private partnerships on general Government debt as a possible cause of delaying building the facilities for the new school of music in Cork. I suggest we need to discuss in our work programme this issue of public private partnerships and the impact they have, according to EUROSTAT, on the national debt. We can include it in our work programme, not just how it relates to the Cork School of Music specifically but also how it affects the building of motorways and roads and all other such projects.
There is a letter regarding the agenda for the next ECOFIN meeting which we should note. As a matter of courtesy——
The context is surely the proposed revision of the stability and growth pact. As I understand it, the European Union is considering, where countries such as Ireland have infrastructural deficits, whether it should relax the pact. Rather than try to bend the rules in order that it is not deemed to be borrowing, we should look at the matter in the context of the revision of stability and growth pact.
Agreed. It is not specific to the Cork School of Music——
No, it is not.
——the issue is much broader.
For the committee's information, we received a copy of a letter sent to the Revenue Commissioners from the Joint Committee on Transport regarding the retention of tax by airlines. Is it agreed to note this correspondence? I am sure we will receive a copy of the response in due course. The Joint Committee on Transport has been doing a good job on the matter. As it is a taxation matter, we received, as a matter ofcourtesy, a copy of the correspondence. Is it agreed to note it? Agreed.
There are two other items of correspondence which have been circulated to members. The first concerns the Oireachtas scrutiny of EU legislative proposals. It is stated in the documentation that on 25 February and 12 March the sub-committee on EU scrutiny met to consider a further range of proposals, none of which was referred to this committee for scrutiny. Does the committee agree with this recommendation? We have the option of scrutinising documents which we were not requested to scrutinise. The sub-committee on EU scrutiny has issued a schedule of proposals, none of which has been referred to this committee for scrutiny as a result of its meetings on 25 February and 12 March. Is it agreed to accept the recommendation? Agreed.
On 2 April 2003 a proposal was referred to this committee with cross-cutting issues relevant to the Joint Committee on Enterprise and Small Business and the Joint Committee on Education and Science. It relates to document 203-27 regarding the European Commission Green Paper, Entrepreneurship in Europe. Is it agreed that the proposal merits further scrutiny by this committee and, if so, that a date be set for it to meet an official from the Department of Finance to discuss the issue? Agreed. I propose that it be discussed at our next meeting.
I am informed that the Revised Estimates for the Departments of Finance and the Taoiseach will be referred to the committee in early June. We will liaise with both Departments to agree dates.
The joint committee adjourned at 3.55 p.m. until 3 p.m. on Wednesday, 30 April 2003.