Adjournment Matters.

Services for People with Disabilities

Senator Imelda Henry

I thank the Minister of State, Deputy Kathleen Lynch, for coming to the House to deal with the motion. It is almost two years since the publication of the independent Trinity College, Dublin report, There's No Place Like Home, a cost outcomes analysis of alternative models of care for young children with severe disabilities in Ireland. It recommended that the HSE fill the estimated gap of almost €2 million to enable the expansion of Jack and Jill Children's Foundation care provision for children aged six, the age at which children begin to receive care through expanded Government programmes, rather than cutting off this service to children when they reach the age of four years. Apparently, there are cases where children have finished with Jack and Jill Children's Foundation services but where the HSE is neither willing nor able to provide the vital home care plan required for these children and their families. One case has gone all the way to the Ombudsman for Children.

It is hard to believe that the State has no national budget for pediatric home nursing care. This is shocking in this day and age when we all know it makes sense to care for children with life-limiting conditions at home, thereby saving millions of euro for the taxpayer by keeping the children out of hospital where they might unnecessarily block beds. Now is the time to reconsider the recommendations from the Trinity College report and to further analyse why it makes sense for the Jack and Jill programme to extend its age criteria. When one sits down and calculates the return from investing in the Jack and Jill Children's Foundation by extending its age criteria to children aged up to six years, and the resulting money and hassle that would be saved to the State, the answer must be a resounding yes. The main beneficiaries of such a move would be, of course, the children. The State must stop looking at the Jack and Jill Children's Foundation as an annoying little children's charity looking for a handout. It provides a vital service in the home within every community in Ireland. It gets a five-star rating from parents and saves the State millions of euro every year by keeping babies out of hospitals.

The Trinity College report showed the cost effectiveness and quality of the Jack and Jill Children's Foundation service. The foundation is ready, willing and able to provide what parents want and has the reach, flexibility and know-how to design care plans for children up to the age of six. This is something the HSE has not shown itself capable of doing in a consistent and acceptable manner across the country.

I appeal to the Minister of State to meet the Jack and Jill Children's Foundation, which has proven expertise in this field. It is a voluntary body that saves the State millions of euro. It would cost the State €40.5 million per annum if the 275 children currently under the wing of the Jack and Jill Children's Foundation landed back in hospital beds. That is based on the Trinity College report figure of €147,000 per annum for hospital care. The foundation provides a service — a lifeline — for families with the most desperately ill children. In an age in where we are more than conscious of fiscal constraints, we must give this the most serious consideration and do what is best for the children and families involved.

Minister of State at the Department of Health (Deputy Kathleen Lynch)

I thank the Senator for raising this issue. She stated the Jack and Jill Children's Foundation must not be seen as an "annoying little children's charity". Anybody who has met its staff or encountered the type of work they do would never think that. They are a highly professional specialised group of people.

It gives me great pleasure to outline the position. We have gone beyond the argument as to whether the Jack and Jill Children's Foundation is providing a worthwhile service. The report referred to by the Senator was commissioned by the Jack and Jill Children's Foundation. It recommended, among other things, that the State provide additional funding for the foundation to expand its services. As is the case with all charities, the HSE is not in a position to provide additional funding for the Jack and Jill Children's Foundation to enable the expansion of its services. However, the HSE is working with the foundation to identify and prioritise the needs of each child on a case by case basis to ensure that no child is hospitalised for want of adequate home support, provided by either the foundation or the HSE.

The report asserts that the service provided by the Jack and Jill Children's Foundation is significantly cheaper than hospital-based care. There is no dispute about the cost of hospital versus home-based services. Where a child needs hospitalisation, it will be provided. However, it is important to point out there is no provision of, or intention to provide, ongoing continuing care for children in an acute setting. In other words, they should be at home wherever they can be. The costs related to a 24 hour acute medical service will always show an unfavourable cost comparator to a home support service which is an entirely different service provided for families for a specified number of hours.

HSE disability services reviewed the report, There's No Place Like Home, as part of its ongoing engagement with the foundation. Subsequently, a review was undertaken pertaining to children aged over four years. This process was to ensure that all children with life-limiting conditions would receive services on an equitable basis and through a standardised approach. The review resulted in approximately 100 children being provided with alternative care. Some care plans have reduced hours as the child is now attending education, or availing of other respite options. In some cases, no further hours were required following discharge by the Jack and Jill Children's Foundation, as the supports provided by the HSE or other providers involved in the case were sufficient to meet the child's and family's needs. For the Jack and Jill Children's Foundation, the priority remains the birth to four year age group, with HSE community services and other non-statutory agencies meeting some level of assessed need thereafter. In some specific cases the foundation will continue to provide services for children aged over four years, as agreed with the HSE.

The Health Service Executive's national service plan for 2012, which has been drawn up against the backdrop of significant funding challenges, is designed to reflect the changed priorities of the new Government and the significant programme of reform to be undertaken. The allocation for disability services will reduce in 2012 by 3.7% as a consequence of the impact of efficiency, procurement and targeted pay reduction savings. However, the aim of the HSE will be to tailor such reductions in a way which minimises as much as possible the impact on service users and their families. The Jack and Jill Children's Foundation service is part of a range of services provided for families funded by the HSE and other service providers for children with life-limiting conditions, of whom there are approximately 1,300. Many of the children availing of services provided by the Jack and Jill Children's Foundation also avail of other specialist hospital and community health supports and disability services.

The Health Service Executive is committed to working with the Jack and Jill Children's Foundation to ensure that all children with life-limiting conditions receive services on an equitable basis and through a standardised approach, and that they be progressed through the children's palliative care steering group. The national policy, Palliative Care for Children with Life-Limiting conditions in Ireland, will ensure a national approach to the provision of services for children with life-limiting conditions. All services and service providers will be governed by this approach.

North-South Interconnector

An Leas-Chathaoirleach

I call Senator Reilly, who has four minutes. I have been told to be very strict with times because too much latitude is being granted. I welcome the Minister for Communications, Energy and Natural Resources, Deputy Pat Rabbitte.

Senator Kathryn Reilly

I welcome the Minister to the House and I am delighted he could attend in person for the discussion on the report he commissioned. I thank him for convening that group and publishing its report.

The commissioned report is a detailed piece of work, the result of intensive lobbying by concerned communities throughout the State, especially in the Cavan-Monaghan-Meath region, in respect of the North-South interconnector. It is a by-product of an election promise by the Government to review and report on a case for, and cost of, placing underground all or part of the Meath-Tyrone 400 kV powerlines.

At often great personal cost, financial and otherwise, community representatives have challenged and matched the unlimited resources of the State's apparatus in their journey to get these cables underground. The lack of a definitive recommendation as to whether the electricity cables should go above or below ground leaves wide open the avenue for the Minister to instruct EirGrid to place the cables underground. Unlike EirGrid, which has vehemently opposed the placing underground of the interconnector, the key finding must be that the expert commission found that such an option is a realistic solution. It was not that it was impossible, nor that it would cost 20 times the cost of having them overground, as had been stated previously by EirGrid in debates prior to this.

EirGrid must now accept that placing underground these cables is a viable solution. It is primarily driven by significant technical developments and a commercial breakthrough of the most recently developed VSC-HVDC technology. The report is of significant value to the argument surrounding the use and feasibility of such technology. The report's findings and EirGrid's stubbornness in failing to admit that it could place the cables underground have been described as being similar to someone still using analogue television when the rest of the world is moving on to digital services. This endorses what Sinn Féin and the campaigning communities have consistently stated and it flies in the face of EirGrid's assertions.

The commission notes that the project will be slightly more expensive but it does not take into account the additional costs associated with overhead power lines and pylons. Issues of note that were not provided for in the terms of reference include environmental impact assessments, land and property devaluation, the impact on farming and agriculture and the potential effects of pylons on people's health.

Where to now? The Minister stated that following a brief period of consultation he would revert to the Government with a memorandum on security of energy supply to which EirGrid and the planning process will have regard. How long will the consultation process last and to whom will it be open? What influence will the Oireachtas Joint Committee on Communications, Natural Resources and Agriculture exert over this? When can we expect the memorandum to be published? Will it be enforced by the Minister or will it simply be an advisory note to which EirGrid and planners can choose to have regard? If EirGrid had had its way, there would not have been a report, these massive pylons would have been erected by now and the people would still be fed the same story that placing cables underground is not possible or feasible. Most important, will the Minister halt further activity on the interconnector until the consultation process on the report coupled with the analysis of the memorandum has been completed?

This time last year, Fine Gael, the largest Government party, promised that it would direct EirGrid to halt further activity on the interconnector until the analysis had been conducted but that has not happened. The party also said it would instruct EirGrid to reimburse community groups for all relevant costs associated with participation in the oral hearing process in 2010 and that has not happened either. Given EirGrid has completed the first round of non-statutory public consultation in preparation for submitting a formal new application to An Bord Pleanála, people do not just have the right to inform the process but, as the option has been deemed feasible, they have the right to have their costs reimbursed. I would like the Minister, separately, to instruct EirGrid to do that. The company should not be allowed to plough ahead with its plans until this report has been seriously analysed.

Minister for Communications, Energy and Natural Resources (Deputy Pat Rabbitte)

I would like to stress the strategic imperative for the economy and citizens of cost effective investment in electricity networks. The Government is committed to ensuring that the investment plans of EirGrid and ESB Networks are delivered across the country. The significant level of grid investment required in the next decade is critical for safe and secure electricity supply. It will underpin regional economic growth and job creation and it will enable delivery of the Government's renewable energy ambitions in line with Ireland's EU targets.

The security of energy supply is fundamental to the well-being of all society and the economy. Ireland is a peripheral island energy market which is vulnerable to the effects of international disruptions to oil and gas supplies. I confirm that I will bring a memorandum on security of energy supplies to the Government in the coming weeks and the consultation period I envisaged at the time I published the report was approximately six weeks. I cannot control the Oireachtas Joint Committee on Communications, Natural Resources and Agriculture and, therefore, I do not know how long it will take to assess the issue. The committee will influence the outcome. I will stop all development until the consultation period is over. Having said that, there is a necessity to get on with this project as quickly as we can.

The memorandum to which the Senator referred will address the imperative of cost effective investment in the electricity and gas transmission and distribution networks and the need to build other critical energy infrastructure in the national interest. The North-South interconnector is vital infrastructure for the island, something that is not questioned by any reasonable citizen. The lack of sufficient interconnection between the North and South is preventing the full benefits of the all-island market being realised. The continued absence of the interconnector is costing the economies, North and South, up to €30 million every year. It is vital for security of electricity supply on this island. It is critically needed to connect renewable energy to the system and to deliver economic development in the north-east region.

The North-South project has been under development since 2005 and is recognised by the EU as a strategically vital project. In common with all such transmission line projects around Europe, the plans for the North-South line have been marked by controversy. The programme for Government committed to the appointment of an international commission to review and report on the case for, and cost of, placing underground the Meath-Tyrone power lines. I appointed the international expert commission last July. The members, from Sweden, Norway and Belgium, have long-standing professional and academic credentials and experience in transmission and power systems.

Meetings were held by the commission members with EirGrid, the CER, ESB Networks, County Monaghan Anti-Pylon Committee, the Irish Farmers' Association, and the North-East Pylon Pressure Group and, at my request, they also met Oireachtas representatives from counties Cavan, Monaghan and Meath. The commission also toured much of the proposed route. I received the commission's report on 9 January and, having advised Government colleagues, published the report on my Department's website on 17 January. I also forwarded the report to the Chairman of the Oireachtas committee. Publication of the report allows for a period of reflection for some weeks. I encourage Senators to read the report.

In the time available, I do not propose to go into the detail of its analysis but the report is succinct, thorough and easily accessible. I welcome it as a further independent input into the debate on transmission lines. The commission recognises the importance of the Meath-Tyrone transmission line for consumers and security of supply, North and South. The commission notes that there is no single "right" solution. Technical solutions must be project specific. The report does not, therefore, recommend any particular technical option, while recommending against wholly going underground using AC cable. It provides its own views on the feasible technology options available for consideration for the Meath-Tyrone project, including HVDC technology, given the changes in technology, suppliers and costs in recent years. In that context, the commission estimates that the cost of implementing the project as an HVDC underground cable option would be three times the cost of the traditional overhead line option, while noting that costs estimates are always uncertain. I commend the report to the Seanad. I welcome its scrutiny and a thoroughgoing debate by the Oireachtas joint committee in the near future.

Tourism Promotion

Senator Martin Conway

I welcome the Minister to the House and thank him for taking this matter. I was surprised when I was contacted by representatives of surfing groups recently to point out that the 23% VAT rate applied to surfing lessons. Despite my limited knowledge of surfing, I was surprised to learn that. They made the case that given surfing lessons are primarily taken by local children and tourists, the 9% VAT rate would be more appropriate and I am inclined to agree with them. The Government has made significant progress with the tourism jobs initiative that was introduced last July and it had an instant effect in breathing confidence into the tourism sector. Like the Cathaoirleach, I represent a coastal county and surfing has evolved, particularly in the past decade. We now have a situation in many of our towns, from Donegal to Cork and Waterford, whereby visitors come to surf not only during summer months but also in the depths of winter. Surfing is an activity that provides significant additional value to the economy and it continues to offer considerable potential for growth. The number of young people who express interest in learning how to surf is increasing. Unfortunately, however, the cost of the activity is becoming prohibitive. If the Government introduced a provision in the Finance Bill to reduce the VAT rate on surf lessons from 23% to 9%, another small step could be taken towards offering an overall tourism product.

As our unique climate means we cannot be weather dependent, we must develop a product that attracts families to the coast in all weather conditions. There has been significant investment in indoor facilities. In my constituency alone, over €100 million has been invested in indoor facilities for several years. We have also seen what I describe as healthy investment in nature walks. My own area of the Burren has secured investments in the order of €100,000 to upgrade walks to attract hikers.

My proposal would send a clear message that the Government is prepared to invest in surfing. The facilities provided to surfers are modest. Most beaches do not even have shower facilities and anybody who is familiar with surfing will be aware of the importance of washing wetsuits after they are used. I do not propose that the VAT reduction should extend to surf equipment, whether surf boards or wetsuits. One surf operator in my area who previously employed three full-time and five or six part-time instructors has had to reduce his staffing to three or four part-time instructors alongside his own role as a full-time instructor. In light of the potential direct benefits in terms of employment, I hope the Minister will have good news from the Department of Finance.

Deputy Pat Rabbitte

I am pleased to have this opportunity to respond to the important matter raised by the Senator on behalf of my colleague, the Minister for Finance.

VAT is charged on the supply of goods and services. The rate applying is subject to the requirements of EU VAT law, with which Irish VAT law must comply. The EU VAT directive governs VAT law and the rates applicable to various goods and services. The directive provides that member states must apply a standard rate of VAT to the majority of goods and services and this rate must be between 15% and 25%. Ireland's standard rate is currently 23%. Member states may also apply up to two reduced rates of VAT of between 5% and 15% on set goods and services listed in annex III of the VAT directive. Ireland, along with the majority of member states, operates two reduced VAT rates of 9% and 13.5%. The VAT directive also allows member states to apply a zero rate, reduced rate or a rate of less than 5% to goods and services where such a rate applied to those goods or services on 1 January 1991.

The supply of surfing lessons is subject to VAT at the standard rate of 23%. As annex III of the directive does not include surfing lessons it is not possible to apply a reduced VAT rate to surfing lessons. Furthermore, as surfing lessons did not qualify for reduced, super reduced or zero rate of VAT on 1 January 1991 it is not possible to apply any of those VAT rates to surfing lessons. Consequently, surfing lessons must be charged at the standard VAT rate of 23%.

For Ireland to apply the 9% reduced VAT rate to the supply of surfing lessons we would require an amendment in the VAT directive to include the supply of surfing lessons in annex III. Changes to the VAT directive are made periodically by the European Council of Finance Ministers following detailed analysis and negotiation at the Council working party on tax questions. A number of goods and services were added to annex III in 2009, primarily related to labour-intensive services, following six years of negotiations on the matter.

While many tourism related services were made subject to the lower reduced VAT rate of 9% from 1 July 2011, this rate only applies to those tourist related goods and services that are listed under annex III of the VAT directive. Some tourism related activities not listed under annex III continue to be subject to VAT at 13.5% and 23%, while others are exempt from VAT. The 9% VAT rate introduced on 1 July 2011 applies to restaurant and catering services and hotel and holiday accommodation, including guesthouses, caravan parks and camping sites.

Other activities related to tourism that are subject to the 9% rate include various entertainment services such as admissions to cinemas, theatres, certain musical performances, museums, art gallery exhibitions and fairgrounds or amusement parks. The use of sports facilities, including green fees charged for golf and subscriptions charged by non-member owned golf clubs, also apply at the new lower VAT rate. Admissions to historical houses and gardens, including open or pet farms, also apply at the 9% rate. Hairdressing services, a growing activity connected to hotel services, also apply at the 9% rate, as does printed matter such as brochures, maps, programmes, leaflets, catalogues and newspapers. Books are already subject to VAT at the zero rate.

Tourism related activities charged at the 13.5% rate include tour guide services and the short-term hiring of cars, boats, caravans, mobile homes, tents or trailer tents. Passenger transport, including the transport of tourists, is exempt from VAT. All other goods and services related to the tourism industry, including surfing lessons, apply at the standard VAT rate of 23%. In addition, while restaurant and catering services apply at the 9% rate, alcohol or soft drinks sold as part of a meal, or otherwise, are liable to VAT at the 23% rate. However, an exemption from VAT may still apply to surfing lessons in certain circumstances. Surfing lesson providers, like any other service businesses, may opt not to register for VAT if their turnover is under the VAT registration threshold of €37,500 per annum. Where this is the case VAT will not apply to the lessons.

Senator Martin Conway

I thank the Minister for a comprehensive and informative reply. In regard to his comment that rates "must be between 15% and 25%" can a case be made for creating a VAT rate of 15% for certain activities? There are health benefits to getting people out on the water to exercise. Perhaps he might investigate with the Minister for Finance whether there is scope for creating a rate of 15%. During the next round of negotiations, which will probably be even more difficult than the previous round, the Government may consider exempting surf lessons from VAT.

Deputy Pat Rabbitte

I will be glad to raise the Senator's questions with the Minister for Finance, Deputy Noonan. The usual argument applies. A good case can be made to extend the 9% VAT rate. That is not possible in these circumstances for the reasons I explained, that is, it is not included in annex III of the VAT directive. The specific point made by the Senator about the 15% to 23% range is something about which I would be glad to talk to the Minister for Finance. There are any number of good arguments that can be made to reduce the VAT rate and I imagine the Minister will be looking at it from the point of view of the impact on the Exchequer.

Senator Mark Daly

The Minister should not forget the hurleys. If he is taking in surfing lessons, he might just bring in hurleys and sliotars too.

Senator Martin Conway

They are not good at hurling in Kerry.

Senator Mark Daly

We won the first All-Ireland final, I remind the Senator.

An Leas-Chathaoirleach

Senator Daly wants to expand the discussion, but the Minister is entitled to take his leave.

Community Development

Senator Mark Daly

I welcome the Minister of State, Deputy Jan O'Sullivan, to the House. We had an interesting discussion while we were waiting.

An Leas-Chathaoirleach

Does that mean the Senator is dismissing the matter?

Senator Mark Daly

We could dispense with the debate, but it will be held in public nonetheless. It was an entirely different topic we were talking about. My question was about the need for the Minister with responsibility for local government to clarify, with regard to the interim report of the local government and local development alignment steering group, whether he seeks closer amalgamation or co-operation of local development companies with local authorities or integration of the development companies into local authorities. This is an important question because there is a large amount of funding available to Leader groups. It is important that the local development companies have autonomy and independence in respect of local authorities, and that local authorities do not have undue influence or control over the Leader groups, especially in light of the finding of the European Court of Auditors in 2010 regarding the Leader approach to rural development, which found: "The potential added value of a partnership approach was not achieved in [local action groups] where the decision-making was dominated by the local authorities". It also states: "One of the key features of the Leader approach is that decisions should be made not by public authorities but by a wider local partnership, where the local government is included but does not have a majority vote". The clear point is that the European Court of Auditors has said we are doing it the right way and that local groups should have the final say. The input from local authorities is very important but if they have the majority this funding will be directed more towards local authority concerns and initiatives than those of the local partnerships and organisations.

There are 52 local development companies throughout the country, which include members of local authorities, but they do not have a majority. I ask the Minister of State to let us know her views on this. Closer co-operation is important, and there is close co-operation, but if the local authorities get their hands on the funding — which this year, I believe, is something like €92 million, having risen by nearly €40 million — the local communities that normally decide where the funding goes will lose that power. The money would be seen to be going to public representatives, but the staff and the county manager would actually have an enormous input if the local authorities were to take over the running of the Leader groups. We have seen already that the local authorities have an input in the county development boards. The Leader groups do a great job and should be allowed to continue to do it in a manner that has been pointed to by the European Union as one that works.

Minister of State at the Department of the Environment, Community and Local Government (Deputy Jan O’Sullivan)

I thank the Senator for the opportunity to discuss this issue and expressing his concerns about the alignment of local communities and local government.

The programme for Government has committed to a review of local governance structures with a view to improving delivery of services to the citizen. As part of giving effect to this commitment, the Minister for the Environment, Community and Local Government, Deputy Hogan, established a high-level steering group last September to discuss enhancing the alignment between local government and the local development sector. The Minister set out on a course of alignment rather than integration — I assure the Senator in that regard — and I know he is still thinking in those terms.

The steering group was given a broad remit to review the roles of local development and local government, to identify the scope for greater synergies between the sectors, and to provide recommendations on how we might deliver simplified, cost-effective and efficient services for the citizen in a way that allows for local oversight and democratic accountability. The group has consulted extensively with stakeholders in order to receive input from all those involved in the area of local and community development, and I understand this input has proved valuable to the group in its work towards developing recommendations for greater alignment of the sectors. The steering group presented an interim report to the Minister in early December, outlining some preliminary conclusions vis-à-vis the existing arrangements and the respective roles of local authorities and the local and community development sector in the provision of local and community development services. The group reaffirmed the need for a more coherent approach to local service provision. It sees the need for a more central role for local government in planning, decision-making and oversight of local development programmes. The group also acknowledged the importance of retaining the developmental bottom-up approach to local development, with its focus on targeting those most in need and facilitating meaningful community participation. It recommended that this valuable approach be embedded as an integral part of the planning and decision-making process for the delivery of services at local level.

In the past two decades, certain gaps in service provision at local level have been filled successfully by local development companies. They now have a proven track record when it comes to supporting local communities. The Minister is aware that the local development companies have unique strengths, skills and experiences, and he will expect them to continue to play a pivotal role in the implementation of local development actions. The Minister has an equally strong belief in the central role that local government has in the lives of our communities. Local government should exercise local leadership. As part of that, local authorities give coherent and strategic direction to the delivery of community and local development interventions at a local level.

A key focus, therefore, of this alignment process is to harness the strengths and experiences of the local government and local development sectors. This is a great opportunity to bring greater coherence to the provision of services and maximise the benefits for communities, especially when resources are scarce and services are very much needed. The Minister is confident that local government and local development can work in partnership to deliver efficient, sustainable, joined-up and easy to access services for people locally.

The Senator raised the issue of the European Court of Auditors report on the implementation of the Leader approach. I recognise that it contained a number of recommendations to ensure the values of the Leader approach are retained. There is a strong record in Ireland with regard to the Leader programme and we will not introduce measures that will damage our standing in this regard. I am confident that any recommendations the steering group proposes will fully respect the findings in the European Court of Auditors' report and will not breach the Leader requirements with regard to the composition and decision-making process of local action groups as defined in the EU regulations. I understand the steering group will present its final report to the Minister in the coming weeks. Its recommendations will inform our plans with regard to the overall local government reform agenda and will be subject to careful consideration in that context. I again thank the Senator for raising this matter.

The Seanad adjourned at 8 p.m. until 10.30 a.m. on Thursday, 26 January 2012.

Seanad Éireann debate - Wednesday, 25 Jan 2012