JOINT COMMITTEE ON FINANCE AND THE PUBLIC SERVICE debate -
Wednesday, 22 Nov 2006

Business of Joint Committee.

Chairman

Apologies have been received from Deputies Bruton and Ó Caoláin. I must acknowledge it is unfortunate to be meeting when there are questions to the Minister in the Dáil Chamber, so I will try to avoid that in future. As it so happens, there are no major issues today that should cause significant difficulty. If anyone wishes to leave issues over to the next meeting we can do so.

The first item on the agenda is the minutes of the meeting of 18 November. The draft minutes of the meeting have been circulated. Are the minutes agreed? Agreed.

One item of correspondence has been deferred from that meeting, which was item 537, a request from Senator John Paul Phelan that a delegation from a representative body in Kilkenny be heard on the matter of pension entitlements. We will defer that until the Senator is present.

Deputy N. O’Keeffe

What are we discussing now?

Chairman

We are now moving on to correspondence.

Deputy N. O’Keeffe

The Visa issue was discussed at the last meeting and we decided to bring them in, but it did not appear in the minutes. Deputy Finneran was in the chair on that particular day. That matter has broadened out into all sorts of regulations so it is important for us to discuss it. Electronic banking is part of our committee's finance remit. If we are to have a modern banking system in this country, including on-line banking to cut costs to the consumer, we will have to examine all electronic systems.

Chairman

I know that was discussed, but I did not know there was a decision.

Deputy N. O’Keeffe

There was.

Chairman

The only point made to me arising from the last meeting was that this is just a private company pushing its commercial interests.

Deputy N. O’Keeffe

No.

Chairman

It is not representative of anybody other than its own shareholders. There is an issue about bringing a private company before the committee to give them a platform to push its own business. The committee is not a trade fair for companies.

Senator O’Toole

That is right. They are probably friends of Deputy Ned O'Keeffe.

Chairman

I agree with discussing the issue but not with providing a trade fair for companies. Where are we going if that is what we are to be used as?

Senator O’Toole

You are absolutely right, Chairman. I suggest that we move on.

Deputy N. O’Keeffe

The Senator is not aware of what I am talking about.

Senator O’Toole

I think they are just friends of Deputy Ned O'Keeffe. We understand. He has made his play, but let us move on.

Deputy N. O’Keeffe

I am quite sure the Senator has Visa and franchise cards in his pocket.

Chairman

We will deal with the topic but not on the basis of one company pushing its own product.

Deputy N. O’Keeffe

The decision we took is not mentioned in the minutes.

Chairman

I guarantee we will come back to that matter at the next meeting. All I have is what is in front of me. The next item on the agenda is correspondence and I am proceeding with the schedule of correspondence that has been issued.

The first item is a response from the Department of Finance about the inclusion of rent allowances in pensions payable to prison officers. Have members had an opportunity to consider that? The last paragraph from the Department of Finance states: "We can, if you wish, prepare specific figures for prison officers in this regard. However, the committee should be aware that it cannot be considered in isolation from the public sector." We will ask the Department to prepare the specific figures for prison officers. They offered to do that, so we should ask them to. Is that agreed? Agreed.

Deputy C. Murphy

The point made at the time was that there was not another comparable group. Perhaps we should ask them if they can demonstrate another comparable group. If they cannot, it answers the question for us and it is not a precedent.

Chairman

Yes, I agree with the Deputy. The letter from the committee will refer to that. The prison officers are adamant that they are a unique case. The Department says the issue of pension entitlement has knock-on consequences. The prison officers probably feel that the Department is using a bigger picture to prevent their specific case from being dealt with.

Deputy C. Murphy

They told us they felt that the Minister had been misled by his Department in saying that it would create a precedent.

Chairman

We shall put that in the letter, asking them to demonstrate how there is a knock-on effect, if there is any.

The next item is an e-mail from the clerk to the joint committee with an invitation to attend a joint parliamentary meeting organised by the Parliament of Finland and the European Parliament on 4 and 5 December in Brussels, and a draft programme for the meeting.

Deputy N. O’Keeffe

Will we leave it to the convenors?

Chairman

Do we want to send a representative of the committee?

Senator O’Toole

Do we have money for that purpose?

Chairman

Yes. We have not travelled extensively.

Deputy C. Murphy

What is the proposed meeting about?

Chairman

It is a joint parliamentary meeting in Brussels organised by the Finnish EU Presidency on 4 and 5 December. There is a letter from the president of the European Parliament. We could agree to send one Government and one Opposition representative. The convenors can contact the Whip in this regard. If people want to travel we will come back with a proposal and if nobody wants to travel that is fine. We can agree in principle that if people wish to travel, there will be one from each side. Is that agreed? Agreed.

The next item is an acknowledgement of a letter dated 5 November from the Department of Finance regarding a pre-budget submission from MS Ireland. I suggest that we should note that. Next is a letter dated 16 November regarding a pre-budget submission, which we will note.

The next item is a letter dated 15 November from the Government Chief Whip, Deputy Kitt, concerning this year's supplementary Estimates. The secretariat has been in contact with the Department of Finance to try to arrange a date if there is to be a supplementary Estimate. Timetables have been provided to every committee of the House in order to be ready for supplementary Estimates.

Senator O’Toole

Which Estimates are they?

Chairman

They are supplementary Estimates for this year, not the ones published last week which are for next year. In December, there are often supplementary Estimates from different Departments covering extra spending to be agreed before the year ends. Every committee received this letter in order to be ready in the event of a supplementary Estimate for the relevant Department. We have not confirmed it yet, but it is putting us on notice that we may be required to have such a meeting.

Senator O’Toole

Is that completely independent of the budget for the Houses of the Oireachtas Commission?

Chairman

Absolutely. We are talking about supplementary Estimates for the Department of Finance budget.

Senator O’Toole

I misread it. I thought it referred to the committee.

Chairman

It is not the Oireachtas Commission. In our case, it is the supplementary Estimate from the Department of Finance. We have not yet established if that will happen.

The next item is the annual report from the Department of the Environment of which members have a copy. We can note it.

Deputy C. Murphy

A huge amount of money is spent every year on annual reports and strategies. I am a great believer in having a long-term view, targeting money to match it against the outcomes. I went through this report.

Chairman

Did the Deputy get the Irish version as well?

Deputy C. Murphy

I do not think so. I just got the English version. Even if I got the Irish version I am ashamed to say that I would not have been able to get through it.

I regard myself as being reasonably well tuned in terms of local government because I was a councillor for 14 years. However, I cannot see this document as anything other than a promotion. I question the value of spending money on such a document. I see nothing wrong with having an annual report but this is not a critical report about what went right or wrong and what needs to be done. It is a promotion, a sanitised version of what has happened. I question whether we should be spending public funds on that type of report. It is beautifully produced but I cannot see where its value is. There are nice photographs in it, including a lovely photograph of the Minister on a building site.

Senator O’Toole

The Deputy has made a valid point. In fairness to the Department, however, it was produced internally and it is a fine document in terms of its quality, as the Deputy said. The Irish language version is available electronically. It is not printed, which is also useful. The most irritating aspect — apart from the photographs of Ministers selling fire extinguishers and roller painting — is that there are no captions on any of the other photographs, including a beautiful photograph on page 45. I would like to know where the photograph on page 45 was taken.

I looked at the report to see if it contained anything to do with the register but it was not mentioned anywhere.

Deputy N. O’Keeffe

That is the report of the previous year.

Senator O’Toole

Yes. That is the year it was supposed to be done.

Deputy N. O’Keeffe

It only became a live issue this year.

Deputy C. Murphy

I thought it was a live issue every year.

Senator O’Toole

Absolutely. It is particularly a live issue this year because it was not done last year.

Chairman

Under the Public Service Management Act 1997, each Department is obliged to produce an annual report. The idea of a report is good but it has been said that it is a bit vague. I have looked through the report. I am a great man for looking for charts, statistics and figures county by county but I could not find any.

Deputy C. Murphy

In regard to local government, in 2005 I raised issues such as management companies and unfinished housing estates. Those issues need to be tackled. Do not misunderstand me — a report is useful and I understand its function. However, the content of the report is important. It should be a "warts and all" report, not simply a promotion of the Department.

Chairman

I believe the reason the Oireachtas has a particular issue with the Department of the Environment, Heritage and Local Government is that most of the activities overseen by the Department are carried out by the local authorities, which do not report to the Houses. The Committee of Public Accounts has the same problem. Most of the money going to the Department is spent at local authority level and there is no accountability to the Houses of the Oireachtas in regard to what is done at that level. Most of what we are interested in is done by the local authorities. This deals only with the Custom House. The Department of the Environment, Heritage and Local Government has that problem. The Department of Education and Science, for example, is responsible for all the schools in the country.

Deputy C. Murphy

I will make a point of reading the Department of Education and Science's reports.

Senator O’Toole

While I agree with all the points made on that issue, the desktop publishing unit in the Department, which would have no control over the content, has done an excellent job. It is a beautiful production considering it was done in-house.

Deputy N. O’Keeffe

It is a synopsis of the good the Minister has done in that Department. That is what it is about. I sympathise with Deputy Catherine Murphy and I agree with her point on housing estates and their management. Given the development in the country over the past five to seven years, there is a crisis but it is being addressed. That it is not referred to in the report does not mean it is not being addressed. The report shows the success of the Minister and the Government, who have done a great job.

Deputy C. Murphy

That is exactly my point. The Deputy could not have said it better.

Chairman

The next item of correspondence is item No. 561, a letter dated 6 November 2006 from the Irish Financial Services Regulatory Authority with a three-year strategic plan attached. I suggest we note it. Copies of the report are available on request.

Item No. 562 is a letter from the clerk regarding the Munich economic summit. The summit is over and it is a letter of acknowledgement to those who attended. We will note that. The next item is No. 563, EU scrutiny, a letter to the clerk from the clerk of the Sub-committee on EU Scrutiny. Document No. COM(2006)526 is a proposal for a directive adapting certain directives in the field of freedom to provide services by reason of the accession of Bulgaria and Romania. I do not believe the committee has been asked to study that, so we will note it.

The last item I wish to raise under correspondence is one which was brought to my attention today as a result of an article in today's Irish Independent. The heading of the article states that start-up firms face delayed shock over tax bills. Seemingly, there has been an arrangement in place where a start-up small company with a corporation tax liability of under €50,000 in its first year would pay its tax on its first year within six months of the year end. Normally companies and individuals pay their preliminary tax before the end of the year, which is to cover 90%, and the balance when the accounts are completed thereafter. There was a concession for start-up firms but it expired this week. Nobody really knew this arrangement was to expire, including the Institute of Taxation.

The Revenue Commissioners issued a brief on 20 November 2006 telling people they would have to have their preliminary tax in by 21 November 2006. They gave 24 hours notice when reminding people. It is a totally unsatisfactory way to do business, particularly for start-up businesses. In the first year of operation, start-up businesses have not even reached the end of their first financial year. Of course tax due should be paid, but there was a concession for start-up businesses which has seemingly expired. People were caught on the hop. The fact the Revenue Commissioners issued the letter 24 hours before the expiry date shows they must have known they had forgotten to tell people. I propose we write to the Revenue Commissioners seeking full clarification and perhaps to ISME.

Deputy N. O’Keeffe

We have not had a meeting with the Revenue Commissioners for some time. Perhaps the Chairman should invite them to discuss those issues. The Chairman has raised an important issue.

Chairman

I propose to invite the Revenue Commissioners in January as part of our work programme.

Deputy P. McGrath

This is urgent.

Chairman

It is in today's newspaper.

Deputy P. McGrath

The Chairman should write to the Revenue Commissioners and put this item on the agenda for the next meeting.

Chairman

I will do so if members wish.

Deputy P. McGrath

I propose we do that.

Senator O’Toole

I support that. The companies in questions should be given some leeway. This is unfair.

Deputy N. O’Keeffe

I second Deputy Paul McGrath's proposal.

Senator O’Toole

Surely companies should be given to the year end.

Chairman

Members can read the article in today's newspaper.

Deputy P. McGrath

Will the Chairman circulate the article?

Chairman

Yes. I have a copy of a letter handed to me at lunchtime from the president of the Institute of Taxation to the Revenue Commissioners. I will circulate both of these after the meeting.

Deputy P. McGrath

The Chairman should put it on the agenda and invite the Revenue Commissioners in to explain it.

Chairman

It applies to companies whose corporation tax liability is under €50,000. It concerns someone setting up a small enterprise such as a painting business or a plumping service. They would pay their PAYE and VAT every month but there was a concession that they need not estimate their final tax liability before the end of the first year and they had six months to pay it. There was never a question of its not being paid. Telling someone on 20 November 2006 that his or her tax is due in 24 hours is very sharp practice. Does the committee agree that we should invite the Revenue Commissioners?

Deputy N. O’Keeffe

I second Deputy Paul McGrath's proposal.

Deputy P. McGrath

The Chairman should perhaps invite the president of the Institution of Taxation as well.

Chairman

I would be more keen to hear from ISME. We have scheduled the issue of decentralisation for the next meeting but perhaps we will invite the chairman of the Revenue Commissioners to explain this matter. The business for the coming meetings has been set out. I do not want to spend an hour and a half on this topic.

Deputy P. McGrath

It is worthy of a special meeting if needs be.

Chairman

We will invite the chairman of the Revenue Commissioners.

Deputy P. McGrath

We should also invite the person who wrote to the Chairman. It is reasonable that we give him or her a hearing.

Chairman

The letter was from the president of the Institute of Taxation. We will invite both but will devote only a certain amount of time to this because the issue of decentralisation is on the agenda.

Deputy P. McGrath

Yes. That is important.

Chairman

We will invite both people in for a short presentation.

The next item on the agenda is intentions to travel or to attend conferences. There is a proposal to attend a conference on recent and pending cases of the European Court of Justice on direct taxation in Vienna on 15 to 17 February 2007. I put the following motion to the committee:

That the joint committee, in the interests of informing itself in pursuance of its terms of reference, hereby agrees to accept the invitation to attend the conference on recent and pending cases of the European Court of Justice on direction taxation in Vienna on 15 to 17 February 2007.

The estimated cost of attendance is €1,793.50 per member and €1,793.50 per official. Have we agreed on the number to attend?

Deputy N. O’Keeffe

No. I propose we send four members.

Chairman

A maximum of two from each side.

Deputy N. O’Keeffe

And an official.

Chairman

Yes. I am referring to the members. There will be a maximum of two members from the Government side and two non-Government members. I did not call them Opposition members.

Deputy Nolan

Why is there a difference of 20 cent between an official and a member?

Chairman

That is a misprint. Sometimes there can be a tiny difference in terms of insurance arrangements. There is a different fee for staff.

Deputy N. O’Keeffe

Who is the greater risk?

Chairman

Sometimes there is a difference of a few bob which relates to the different insurance arrangement for members.

The next item is a proposal to travel to examine the financial regulation and freedom of information environment in New Zealand. I propose that the joint committee, in the interests of informing itself in pursuance of its terms of reference, agrees to send a delegation consisting of an agreed number of members to examine the financial regulation and freedom of information environment in New Zealand in 2007. The estimated cost of the visit is €7,862 per member and €7,862 for an official. Is that agreed?

Deputy C. Murphy

What have we got to learn from New Zealand?

Chairman

It is a similar type jurisdiction. That is why New Zealand was picked. As a Commonwealth nation, it has a similar legal framework to ours.

Senator O’Toole

As we discussed here previously, New Zealand has gone through a similar number of changes in financial regulations and banking system as we have. They had a nationalised bank that they privatised and then re-nationalised. They had an airline, Air New Zealand, which they privatised and then had to re-nationalise. They have gone through the same system of deregulation as we have. We received a report from them about three or four years ago. They have also gone over the same hurdles with their freedom of information system as we did. That and the fact its is Westminster-type parliament were the reasons.

Chairman

It will suit some members and may not suit others at all. It is up to individual members.

Deputy N. O’Keeffe

What date is envisaged?

Chairman

The date is not fixed.

Deputy C. Murphy

It might be in May, would it?

Chairman

The end of May.

Deputy P. McGrath

If it is the end of May, we will go.

Chairman

The election might be called before then.

Deputy N. O’Keeffe

It should be when the weather is different, say in February or March. The election might not be until 5 or 6 June.

Deputy C. Murphy

It will cost a great deal of money. The committee would want to get value from it.

Chairman

Historically, in an election year travel budgets tend not to be used because most Members concentrate on work at home.

Deputy N. O’Keeffe

We might be safe travelling early because there might not be an election until 6 June.

Senator O’Toole

It is worthwhile going and I certainly want to go, but I may not be able to go.

Chairman

How many should we send? Two or four? I again propose a maximum of four, if four want to attend, but we might end up with only two.

Deputy N. O’Keeffe

Senator O'Toole will be campaigning until July or August.

Senator O’Toole

There are two chances of it being in June, July or August.

Deputy P. McGrath

There is also another item in the New Zealand context, which is not mentioned there. Some of us are involved in looking at Members' facilities and such like. There is much to be learned, as we have learned from the Australian system, about matters such as facilities for members of parliament, which also would be worth looking at in that same context. While I acknowledge that relates to a different committee, it involves some members here.

Chairman

The members could take in parliamentary services.

Senator O’Toole

Previously I wrote a report on the parliamentary services. The way rural members of the New Zealand Parliament, in particular, are dealt with provides an extraordinarily good role model. It was the one Deputy McGrath and I tried to move towards and that we got to some extent through the Houses of the Oireachtas Commission. They have gone through the same types of difficulties.

Chairman

Is it agreed there will be a maximum of two from the Government side and two from the non-Government side, subject to further detail? Agreed. We must have a detailed costed programme.

The next item on the agenda is the work programme for January and February of 2007. I propose to include on the work programme for January the question, on which there has been much debate, of individual taxpayers who have not received their full entitlements to tax relief for medical insurance, trade union subscriptions and refuse services. There is a myriad of reliefs and allowances the public is not claiming. We could usefully bring in the Revenue and the Department of Finance to highlight the issue and then maybe produce a short report in January. It is an issue for the general public and the end of the tax year is a good time to advise people to get their new tax credit forms in order or claim what they were due for last year where they have not done so. It is an issue we have not discussed. The public would be interested in us pursuing it as a topic. Can we agree to discuss that in January?

Deputy Nolan

It is an important issue and the public is genuinely interested in it.

Chairman

We will set dates for a meeting with the Revenue Commissioners and the Department of Finance, and take the meeting from there.

Deputy N. O’Keeffe

Chairman, would you draw up a draft programme and present the committee with what you think we should do?

Chairman

The draft programme is as simple as this. I propose to spend two meetings on that in January. In February, we will be into the Finance Bill which will take us to St. Patrick's Day. There will not be too much business in this committee after St. Patrick's Day other than basic activity. There will be Estimates debates as well. The first four months of next year are easy to deal with.

Deputy C. Murphy

One of the issues we put on the list for discussion was decentralisation which will come up this month.

Chairman

At the next meeting.

Deputy C. Murphy

That is critically important. Another one raised by the Chairman, and on which I received replies to parliamentary questions, is the money that was spent fighting parents in the courts where they were seeking appropriate educational provision for children with disabilities. We were to examine that issue. It was timetabled. In fact, there was a request to meet the committee from Mr. Marc de Salvo, who works within the area of autism. My understanding was that the committee agreed that would occur. Where will that fit into that programme?

Chairman

I suggest that we write to the Department of Education and Science — this concerns a couple of Departments, and the Chief State Solicitor's Office is involved also — for an immediate update.

Deputy C. Murphy

The Department of Health and Children is also involved.

Chairman

Some of our figures — from Deputy Murphy's parliamentary questions and my information — related to different periods and one could not get a picture up until the year end. I would like to get an accurate up to date position for the next meeting and I have no difficulty in then scheduling a date for that in January.

Deputy N. O’Keeffe

What is the line-up of the meetings in December? Meetings will be held the week after the Dáil adjourns for the Christmas recess. Are we meeting that week?

Chairman

Budget day is 6 December. We will meet the following Wednesday, 13 December, and the Dáil will adjourn for the Christmas recess that week.

Deputy N. O’Keeffe

Will we meet the following week when there are committee meetings?

Chairman

No. We will not meet the week before Christmas.

Deputy N. O’Keeffe

Why would we not?

Chairman

We can do so.

Deputy N. O’Keeffe

Why not meet on the Tuesday to discuss some of the issues Deputy Murphy raised?

Chairman

We could meet on 19 or 20 December, if members wish.

Deputy Nolan

At what time will we meet on 13 December?

Chairman

At 3 o'clock. We will meet on 13 December to discuss decentralisation.

Deputy N. O’Keeffe

Wednesday, 20 December is very close to Christmas for members from rural areas. Would 18 December be alright?

Chairman

Tuesday is 19 December.

Deputy C. Murphy

We are not confined to that week.

Deputy N. O’Keeffe

Is Tuesday, 19 December all right?

Chairman

Will we agree to meet on Tuesday, 19 December?

Deputy Nolan

Yes.

Deputy N. O’Keeffe

Does Deputy Murphy have an agenda item?

Deputy C. Murphy

Yes.

Chairman

We will try to deal with that on Tuesday, 19 December.

Deputy C. Murphy

Yes, that would be fine.

Deputy Nolan

At what time?

Chairman

Because we will not meet in our normal slot we will ask the clerk to the committee to come back to us with the time. As it is not a Dáil sitting day, it will not be before 11 o'clock.

Deputy C. Murphy

It might be better to arrange it for 1 o'clock or so, where people have time to get here but at the same time we will not be here all afternoon.

A Member

What if a 3 o'clock meeting slot crops up?

Chairman

That is too late.

Deputy C. Murphy

One o'clock might be best.

Chairman

Sometime around the middle of the day. We will arrange a meeting and try to obtain the information in advance. Is that agreed? Agreed.

That concludes today's business. We had intended to deal with decentralisation today, but the people involved were not able to attend and we just went ahead with the other items of business. We will deal with decentralisation on 13 December.

The joint committee adjourned at 3.40 p.m. sine die.