JOINT COMMITTEE ON FINANCE AND THE PUBLIC SERVICE debate -
Wednesday, 15 Feb 2006

Business of Joint Committee.

Vice Chairman (Deputy Finneran)

I have received apologies from the Chairman, who is unable to attend today's meeting. The minutes of the joint committee's previous meeting have been circulated. Are they agreed? Agreed.

The quarterly bulletin of the Central Bank and Financial Services Authority of Ireland has been circulated to members and will be noted by the joint committee.

In a letter to the Chairman, Shared Home Investment Plan Limited offered to send representatives to appear before the committee. It is up to members to decide whether to extend an invitation in that regard.

Deputy Bruton

We should obtain a response from the Financial Regulator in respect of the points made. Based on that, we should then decide whether representatives of Shared Home Investment Plan Limited should come before the committee.

Deputy Burton

I agree with Deputy Bruton. The more information that is made available about the detail of these products, the better it will be for the people who will use them.

Deputy Ó Caoláin

Does this concern Shared Home Investment Plan Limited?

Deputy Burton

Yes.

Deputy Ó Caoláin

I agree with Deputies Bruton and Burton. Given that Shared Home Investment Plan Limited is responding to comments made at a previous meeting, we should accommodate it in order to receive a rounded picture.

Vice Chairman

Did Deputy Bruton propose that we obtain clarification regarding certain matters and then decide whether to invite representatives of Shared Home Investment Plan Limited to come before us?

Deputy Bruton

Yes. The Financial Regulator should clarify the point it is making. We can then decide whether to invite representatives of Shared Home Investment Plan Limited to come before us.

Vice Chairman

In respect of the letter to the Chairman——

Deputy Ó Caoláin

I would not like this to be interpreted as hindering the request. We should record that, following same, we would be favourably disposed towards the opportunity. I would prefer if it was not seen as a blocking mechanism but rather that it be interpreted that we are open to meeting representatives of Shared Home Investment Plan Limited. This is what was intended by Deputies Bruton and Burton.

Vice Chairman

I agree with Deputy Ó Caoláin that this was not the intention.

Deputy Burton

We should inform the Financial Regulator that we are considering extending an invitation to Shared Home Investment Plan Limited and ask for the regulator's comments on the letter sent by Shared Home Investment Plan Limited to the committee and the regulator. We should also ask the regulator for a salient briefing. In meeting the people who are selling these products, it is critical that we do not have an exchange with salespeople who are selling a financial product. We must, therefore, invite a briefing from the Financial Regulator about key elements and any concerns it may harbour.

Vice Chairman

If representatives of Shared Home Investment Plan Limited are invited to come before the committee, everyone else will want to do so because they will have an opportunity to sell their wares. However, it is a matter for the committee.

Deputy Burton

These schemes are subject to massive selling pressures in respect of older people. They are heavily advertised, particularly to solicitors. People are effectively getting money from their homes now and either selling the equity in them or building up loans which will be covered by the equity in their homes. The terms of some of these schemes are far from clear. We would be performing a public service by helping people to better understand these products and getting the Financial Regulator to ensure that, as far as possible, people are not ripped off in respect of these products.

Deputy Ó Caoláin

I would not like to think that any promoter of these financial products would view attendance before this committee as aiding the promotion of their products. They must consider very carefully whether exposure before, and the scrutiny of, the committee would necessarily aid the marketing of their products. I hope that we would, as Deputy Burton suggests, subject them to very vigorous scrutiny and questioning.

Vice Chairman

We will follow that procedure.

Deputy Bruton

We should receive the response from the Financial Regulator before we sign off on an invitation. There are rival products on the market and we have received a submission from a company selling one type of product, a product which the Financial Regulator appears to be less comfortable with from the perspective of consumer protection. Before we decide to meet a company offering one type of product, it would be prudent to discover anything with which the regulator finds fault. We could make an informed decision on that basis. I share the Vice Chairman's belief that the committee may find itself in an awkward position if it invites one company that sells one type of product to appear before it but ignores another company which is arguably more protective of consumers.

Vice Chairman

There is nothing wrong with Deputy Bruton's earlier suggestion.

Deputy Bruton

I am not trying to divide the committee.

Vice Chairman

We could examine Deputy Ó Caoláin's suggestion after receiving the response from the Financial Regulator. Does Deputy Ó Caoláin wish to pursue the matter?

Deputy Ó Caoláin

Having heard Deputy Bruton elaborate and in light of other comments, I will accept deferring a decision until we have full information.

Vice Chairman

We will move on to a letter to the Chairman, dated 25 January 2006, from the head of corporate affairs at Ulster Bank regarding a recent initiative on its part. It is proposed that the letter be noted. Is that agreed? Agreed.

The next item is a letter to the Chairman, dated 25 January 2006, from the private secretary to the Minister for Foreign Affairs acknowledging the letters sent regarding the proposed relocation of Development Cooperation Ireland. The letter is duly noted.

The next item is a copy of the Department of Finance's change management fund expenditure review from November 2005, which is duly noted.

The next item is a letter to the Chairman, dated 3 February 2006, from the Department of the Taoiseach, enclosing a copy of the NESC strategy 2006: People, Productivity and Purpose, which is duly noted. A copy of the strategy is available on request.

The next item concerns reports from the Department of Finance under section 32 of the Freedom of Act 1997, which were circulated on 8 February 2006. We will defer discussing them until later in the meeting.

The next item concerns two e-mails to the clerk to the committee, the first of which is dated 7 February 2006, from Kevin Leyden regarding last week's meeting in Brussels and the report of the joint conference on the Lisbon Agenda, respectively.

A letter to the clerk refers the Finance Bill 2006 to the Select Committee on Finance and the Public Service. I understand that agreement has been reached among members of the committee regarding next week's sittings on this Bill. I hope, we can proceed on that basis.

Deputy Nolan

Can I get a revised copy of the new arrangements for taking Committee Stage?

Vice Chairman

It has been suggested that we deal with the Bill over a three-day period next week. We would devote three hours to debating the Bill to section 13, three hours to sections 14 to 18 and a further three hours to sections 19 to 36. The remainder would be debated for three hours.

Deputy Bruton

It was my understanding that the remainder would be open ended rather than taken for three hours. The original schedule circulated was unbalanced in its content. Sections 1 to 13, 14 to 18 and 19 to 36 were natural divisions in the Bill. I suggested that three hours would be provided to debate each of these divisions and the remainder would fall into place afterwards. My suggestion seems to have broad support.

Vice Chairman

If the committee agrees, we can contact the Department of Finance regarding the suggestion. Is that agreed? Agreed.

The committee will note the Austrian EU Presidency's updated agenda attached to an e-mail to the clerk from Mr. Kevin Leyden on 8 February 2006.

Correspondence was circulated to committee members on 13 February 2006, a letter to the Chairman from the Irish Association of Older People regarding equity release products and enclosing the association's newsletter, which is available on request. We could refer this matter, which follows on from our earlier discussion.

Deputy Bruton

Could the clerk send me a copy of the newsletter?

Vice Chairman

Is it agreed that we refer this matter for comment?

Deputy Burton

I received correspondence regarding the association and Mr. Paul Murray, who works with older people. If the committee were to make arrangements during the summer or autumn to meet a number of the promoters of equity release products, it would be appropriate for Mr. Murray from Age Action Ireland or someone from the Irish Association of Older People to set out their views and concerns on these products.

Vice Chairman

If it is the committee's wish, we can arrange a series of hearings.

Deputy Burton

We should get the financial regulator's briefing first.

Vice Chairman

A letter to the Chairman dated 8 February 2006 was received from the Minister for Finance regarding an individual taxpayer.

Deputy Ó Caoláin

Regarding that correspondence, despite the committee drawing attention to another case, I accept the Minister's point that the two are not the same. However, I have received further correspondence from the Office of the Revenue Commissioners. On foot of this I have proposed to write to the Chairman and have that correspondence circulated to all the members of the committee in the coming week. It merits further consideration because what we are examining is precedent setting in relation to the individual case of the County Waterford resident. It is important that further information is factored in before we close the discussion on the Minister's stated position.

Deputy P. McGrath

This case seems to be dragging on for a long time. Previously, we were undecided on how we could or should proceed. Hence we wrote to the Minister for Finance, who is bringing finality to the matter. However, the case remains. The Ombudsman made a recommendation, Revenue decided not to endorse the recommendation and a bit of horse trading took place. The taxpayer ended up getting half the amount of money that was involved.

It is strange that the Ombudsman's report would not carry through in that case. Are there many cases in which a recommendation or ruling from the Ombudsman has not been enforced or is this a unique case? Is there information in this regard? We have all encountered cases in our constituencies in which the ball is at the other foot. It is not easy to get the Revenue Commissioners to halve the amount of money owed. One wonders what has happened in this case and why events have occurred in this way.

Deputy Ó Caoláin

I can answer Deputy Paul McGrath's question. Among others, that was the specific information my parliamentary question sought to ascertain. I can confirm that the case is absolutely unique. I have the correspondence from the Revenue Commissioners.

Following on from the latest missive from the Minister, I propose to have the correspondence circulated to every member of the committee, as I advised earlier. It is very important and, as I described a few moments ago, precedent setting. It merits the Minister's further attention. However, I will circulate the correspondence to the members for address at our next meeting when we can collectively decide what further action, if any, we should take.

Deputy P. McGrath

In light of Deputy Ó Caoláin's comments I would be interested to see the correspondence. Perhaps it can become an agenda item for the next meeting so that we can review it.

Vice Chairman

I suggest that we write to the Ombudsman to inquire as to whether there were more cases that were not published.

Deputy Ó Caoláin

There were not. We now have that in writing. Thanks to over 21 years of the Ombudsman's function, we have detailed information, case by case, in respect of each year's relationship between the Ombudsman and the Revenue Commissioners. All of the information is present. However, the critical point Deputy Paul McGrath is seeking to ascertain concerning a recommendation of the Ombudsman to the Office of the Revenue Commissioners on a repayment that was not proceeded with in full is that there has been only one case. I will send the correspondence to the Chairman for distribution to members. When everyone is fully apprised of the information, the committee can consider the matter from a fully informed position.

Deputy P. McGrath

Without casting any aspersion on the authenticity of the report, has Deputy Ó Caoláin's information come from the Ombudsman, through parliamentary questions or via freedom of information requests? If, as the Vice Chairman suggests, we could have the Ombudsman state whether this is the only case, it strengthens the case the Deputy and I are trying to make.

Deputy Ó Caoláin

It arose as a result of a parliamentary question towards the end of last year. The response is directly from the Office of the Revenue Commissioners. It has all of the strength we require. It is a detailed three-page response. The commissioners have taken the time to go back through every case referred to them in the 21 years or more of a relationship between the two offices. It is clearly stated from the Office of the Revenue Commissioners directly to me that there is no other case comparable to this individual's.

Deputy Bruton

As we have received opinions from the Ombudsman and the Revenue Commissioners I suggest the secretariat summarise the correspondence. A potted history of the issue would be useful for next week's meeting.

Vice Chairman

The secretariat will prepare a note on all correspondence and we can deal with it at the next meeting under "any other business".

Deputy P. McGrath

Why deal with it under "any other business" rather than as an agenda item? It is important enough to be an agenda item.

Vice Chairman

It can be an agenda item. I was trying to be accommodating. I am informed it is an individual case on which the committee cannot adjudicate so it may be more appropriate under the heading "any other business".

Deputy P. McGrath

We can give our opinions.

Deputy Ó Caoláin

I apologise as I must absent myself.

Vice Chairman

I propose we note e-mail No. 9206 from Mr. Kevin Leyden to the clerk regarding European Parliament business next week.

The next matter is a letter to the Chairman, Deputy Fleming, regarding section 32 of the Freedom of Information Act. The letter refers to the Chairman's previous correspondence from the Information Commissioner in connection with her report to the committee under section 32(5) of the Freedom of Information Act, regarding non-disclosure of records. The letter states the Department of Social and Family Affairs has recently contacted the office to advise that contrary to the commissioner's understanding and her observations on page 41 of that report, the Office of the Pensions Ombudsman is not included in the first schedule to the Freedom of Information Act and is therefore not subject to the Act. It further states that it is understood the Department of Finance is currently drafting a regulation to effect its inclusion and that it will be appreciated that the commissioner's observation on section 145 of the Pensions Act 1990 is dependent on the Office of the Pensions Ombudsman being subject to the Freedom of Information Act and, given the circumstances described above, those observations no longer apply. The letter advises that the Department of Justice, Equality and Law Reform has recently contacted the office to inform the commissioner that the Equality Tribunal administrative functions will become subject to the Freedom of Information Act during 2006.

Deputy Bruton

Does the Vice Chairman propose to discuss this now?

Vice Chairman

No, it is item No. 4. on the agenda. I propose we note the Department of Justice, Equality and Law Reform annual report; the fax No. 9106 from the Revenue Commissioners attaches figures requested by this committee at its meeting of 1 February and the letter from the clerk, No. 9206, to the Sub-Committee on European Scrutiny with proposals to be considered by the sub-committee. There were no proposals referred to the joint committee in that case.

Sitting suspended at 3.44 p.m. and resumed at 3.46 p.m.