I welcome the Minister for Finance, Deputy Noonan, to the House.
Adjournment Matters
Long-Term Illness Scheme Eligibility
Cuirim céad fáilte roimh an Aire. Ar bhealach amháin, tá súil agam gur ábhar é seo nach bhfuil mórán saineolais aige faoi, rheumatoid arthritis - cúis an-dáiríre agus cúis sláinte gan dabht ar bith. Táim an-bhuíoch don Aire Airgeadais as teacht isteach mar tuigim go bhfuil sé gnóthach go maith.
This issue has been raised with me by a number of constituents in the Galway area. Rheumatoid arthritis is a serious issue for many people. It is not as might be perceived a condition limited to older people, with many now suffering from juvenile arthritis. I wish to raise with the Minister the costs to people suffering from this ailment. While, thankfully, medical expertise in this area has improved dramatically over the past number of years, this has had a knock-on effect for those suffering from this ailment. While previously a person suffering from rheumatoid arthritis was entitled to a disability payment and, therefore, eligible for a medical card, given improvements in this area people currently suffering from this ailment can remain in employment and children suffering juvenile arthritis are able to continue with their schooling while trying to live as normal a life as possible. However, to do this they are required to take an extensive concoction of drugs. No drug works in the same way for each patient. The concoction of drugs taken by one particular constituent suffering from seropositive rheumatoid arthritis includes plaquenil, methotrexate, anti-tnf biologic drugs, mobicam, arcoxia and ixprim. She is also taking dietary supplements such as vitamin D, fish oils, glucosamine chondroitin, etc.
It is also suggested by way of treatment that people should improve their nutrition and take up exercise such as swimming, cycling, yoga and Tai Chi and should have acupuncture where possible and engage with a podiatrist, including having orthotics made. They should also undergo regular eye tests and chest x-rays before taking biologic drugs and should undergo regular blood tests to monitor inflammation and the side effects of drugs on the liver, etc. All of this amounts to expensive treatment. I am asking that the Minister for Health will consider the inclusion of rheumatoid arthritis as an illness under the long-term illness scheme. This is a long-term illness that is not curable. Some people are not entirely debilitated and as such are not entitled to a disability payment or eligible for a medical card and are faced with extensive costs in terms of treatment for rheumatoid arthritis.
The cost for another constituent diagnosed within the past year who does not have a medical card and remains in employment was approximately €3,000, of which it was only possible to claim €500 under the Med 1 tax regime. There are also knock-on effects to this person's career in that because of this condition she cannot work to the same extent as previously. The estimated cost of treatment for this particular individual is approximately €1,500 to €1,800 per annum plus an additional cost of €130 per month for probiotics, fish oils, etc.
The symptoms of rheumatoid arthritis have been compared with those of diabetes, which is included on the list of long-term illnesses in respect of which people are eligible for a medical card. The science would indicate they are similar illnesses. If we do not allow people suffering from rheumatoid arthritis to have a medical card to assist them in coping with their illness they will be unable to meet the cost of their treatment and will, sooner rather than later, end up on disability payments. In not allowing this, we are also preventing these people having as good a lifestyle as possible, including remaining in employment. I call on the Minister to consider the inclusion of rheumatoid arthritis on the long term illness scheme in respect of which people are eligible for a medical card, thus enabling such people to treat their ailment and maintain as healthy a lifestyle as possible.
I am replying on behalf of the Minister for Health, Deputy Reilly. As set out in the programme for Government, the Government is committed to the introduction within its first term of office, on a phased basis, of a universal GP service without fees. This policy constitutes a fundamental element of the Government's health reform programme. This Government is the first in the history of this State to commit itself to implementing a universal GP service for the entire population.
Having examined the progress made in the universal GP care plan, it became clear that the legal and administrative work required to provide a robust basis for eligibility for a GP service based on having a particular medical condition is likely to be overly complex and bureaucratic for a short term arrangement. Relatively complex primary legislation would be required in order to provide a GP service on the basis of a person having a particular illness. As well as primary legislation there would be a need for secondary legislation to give full effect to this approach for each condition.
While it would not be impossible to achieve this, it would take several months more to finalise the primary legislation, followed then by the preparation of statutory instruments. The Cabinet committee on health has discussed the issues relating to the delay in the initial step of the rollout of the universal GP service. In doing so, it has considered the importance of weighing the balance between, on the one hand, resolving the legal issues but with a further delay and, on the other, the need to bring forward an important programme for Government commitment with the minimum of further delay.
No decision has been taken by the Cabinet committee or the Government on changing the first step of the plan to extend GP care without fees to persons with chronic illnesses. Instead, it has been agreed that the Department of Health should examine a number of alternative options with regard to the phased implementation of a universal GP service without fees. The Minister, Deputy Reilly, and the Minister of State, Deputy White, expect to report back to the Cabinet committee in the near future.
Currently, medical cards are provided to persons who in the opinion of the Health Service Executive are unable without undue hardship to arrange GP services for themselves and their dependants. Assessment for a medical card is determined primarily by reference to the means, including income and reasonable expenditure, of the applicant and his or her partner and dependants. In the assessment process the HSE can take into account medical costs incurred by an individual or a family. Those who are not eligible for a medical card may still be able to avail of a GP visit card which covers the cost of general practice consultations. The long-term illness scheme is a separate non-means-tested scheme that provides free medicines and medical appliances to people with specified conditions. There are no plans to extend the list of conditions covered by this scheme.
I appreciate that the Minister, Deputy Noonan, is taking this matter on behalf of the Minister for Health. I ask that he convey to the latter my request that he consider a review on the inclusion of rheumatoid arthritis in the long-term illness scheme. Given that finance and the budgetary process is in the remit of the Minister for Finance, perhaps he will review the amount that can be reclaimed under Med 1 in order to help those who are finding it difficult to cope with their medical expenses. He might make provision to allow those with rheumatoid arthritis, in particular, to claim more in the interim until a specific review can be completed.
I will inform the Minister, Deputy Reilly, of the Senator's views and will ask him to read the Official Report to ascertain those views as expressed. It is too early to speak about what might or might not happen in the budget. Perhaps the Senator will raise that issue with me at a later stage.
NAMA Staff Recruitment
I thank the Minister for Finance for taking this matter on the Adjournment which relates to the need for him to outline the protocols or contract stipulations, if any, that are in place to stop NAMA employees moving into the private sector immediately following their employment with the agency. This matter has come to national attention in recent times as a result of reports that a senior official at NAMA who was responsible for managing some of its biggest and most indebted borrowers took up a new job with a London-based property investment firm just weeks after leaving his position with the agency. To allow a senior NAMA official to end up in a private property company raises serious questions about the judgment of NAMA's board and potentially shows a flagrant disregard for Irish taxpayers, on behalf of whom NAMA was set up to acquire the best return on those assets transferred from Ireland's bad banks. These are the same banks that the Irish taxpayer bailed out.
The conflict that emerges between this individual and the well-being of the Irish taxpayer and the State is that Paul Hennigan, as a partner of Prime London Partners, brings a huge benefit to this firm. In his prior incarnation in NAMA he would have gained vast knowledge of the properties on the NAMA loan book, the valuations of those properties and the outstanding loans on them. He would also know the best buys, so to speak. He also brings with him a network of people in NAMA with whom he has worked. Many of my fears were confirmed by an article in The Irish Times of Friday, 3 May 2013, which stated: "senior asset recovery manager Paul Hennigan...has just left Nama to join a UK fund that wants to expand its Irish interests." Did the State not put a price on this or put in place a contractual stipulation between NAMA and its employees? This latest scandal to envelope NAMA comes in the aftermath of an incident involving another employee, Enda Farrell, who forwarded 29 e-mails to his wife's e-mail account and 15 e-mails to a property investment company containing details of every property controlled by NAMA. Coincidentally, this property company subsequently employed Mr. Farrell. Something is going wrong in this agency and it has to be addressed now. These actions have the potential to significantly undermine NAMA's ability to recover the optimum amount for its assets on behalf of the Irish taxpayer.
More disturbing, there has been an attempt by Mr. Hennigan to silence me on this issue and to bully me into submission.
The Senator should not name people who are not here to defend themselves.
I will not name Mr. Hennigan again.
That is a bit cynical.
On Monday morning I discovered a message from him on my voicemail after he called my office asking me to remove from my website what he described as a highly offensive statement regarding my earlier submission on this issue to the Seanad. He indicated that he would take legal action against me because of the insinuations I was making. I want to make it clear that I am making no insinuations. I am merely trying to protect the Irish taxpayer from possible improper actions by former employees of NAMA. I accept that people have a right to earn a livelihood and to move on and take up employment elsewhere as they deem fit and as job opportunities arise, but to be allowed do this immediately with the kind of commercially sensitive information to which I referred or to use this information as a means of securing a position is quite simply beyond what is acceptable.
In light of the circumstances of these cases - and these are only the two of which I am aware - I call on the Minister to undertake an immediate review of all existing contracts for senior officials to ensure that employees are prohibited from taking up positions of employment in any property-based company for a minimum of one year following their employment in NAMA and that all employees of the agency sign confidentiality agreements. It is common practice in most jobs of this status and description that a non-compete and confidentiality clause is inserted into a contract to prohibit an employee from taking up a similar post in a rival firm or speaking of the information garnered in his or her prior position for a period of time. We need to protect the family silver. We cannot have practices like this being facilitated by this State and we need to put an end to them now.
At the outset, I note that all NAMA employees are employees of the NTMA and are assigned to NAMA by the NTMA. Under the NTMA business model, all employees are recruited on the basis of individually negotiated contracts. In addition to NAMA, the NTMA carries out a range of commercial asset and liability functions on behalf of the Government and its ability to successfully perform these functions is critically dependent on its ability to attract employees, often with specialist skills, from the private sector, including those at middle and senior management level. That is the basis on which NAMA has recruited close to 300 staff from the private sector over the past three years and it would not have been possible to move from a standing start in December 2009 to become fully operational with a €32 billion balance sheet one year later without that ability to recruit the appropriate expertise and experience from the private sector. That expertise and experience are now producing results for NAMA. The Senator will have noted that NAMA recently announced a profit for the second consecutive year and that it has generated cash of €12 billion in its three years of existence. It is important that the NTMA's ability to attract private sector employees is not in any way disrupted. Mobility with the private sector is a critical component of the NTMA model and if it is to be successful we have to accept that such mobility can be a two-way street.
Employees assigned to NAMA, as is the case with all other NTMA staff, are subject to section 14 of the National Treasury Management Agency Act 1990, which prohibits an employee from disclosing any information obtained while carrying out his or her duties as an employee of the NTMA. In addition, employees assigned to NAMA are also subject to a prohibition on the release of confidential data under sections 99 and 202 of the National Asset Management Agency Act 2009. NTMA employees, including those assigned to NAMA, are also subject to the Official Secrets Act and contravention of these various legislative prohibitions is a criminal offence.
The prohibition on disclosing confidential information applies indefinitely and extends to former employees. I am aware that NAMA is very conscious of the risk of potential abuse or misuse of information by staff who leave the agency. The NAMA CEO recently noted that the best defence against such possible abuse or misuse of information is to ensure, as NAMA does, that assets are openly marketed and subject to competitive sales processes.
In the private sector, employers normally deal with potential post-employment issues through inclusion of longer notice periods for certain positions and, in certain cases, through contractually agreed provisions whereby the employee agrees not to work in certain sectors or for certain firms for a defined period after departure. I am advised that the notice period for NTMA employees assigned to NAMA is typically three months. NTMA contracts for employees assigned to NAMA contain a provision entitling the NTMA to place an employee on garden leave at any point during the notice period during which time he or she may not work for another employer.
With regard to contractual provisions not to work in certain sectors or for certain firms for a defined period of time after leaving, these can create difficulties because, in effect, they restrict an employee's scope and legal right to earn a living in his or her particular area of expertise. The situation is exacerbated by the position in NAMA where, because of its finite life, people are recruited on specified purpose contracts, namely, their period of employment lasts for as long as their function is required by NAMA. Unlike other public sector employees, their contracts do not extend to the normal retirement age. There is a danger that if specialist staff are offered specified-purpose contracts with rigorous clauses limiting their freedom to return to their sector of expertise afterwards in order to earn a living, that it would become very difficult to recruit staff. I make these points simply to note that the issue is complicated and that I do not believe it is amenable to a one-size-fits-all approach.
As was indicated by the chief executive of the NTMA at a meeting of the Oireachtas Joint Committee on Finance, Public Expenditure and Reform on 24 January last, the NTMA has been engaged in a review of its policy in respect of notice periods and post-termination restrictions on employment. The review commissioned by the NTMA was conducted by the law firm, Matheson, and has now been completed. Arising from the review, I am advised that the NTMA is implementing a number of changes to its employment contracts, including the introduction of longer notice periods of three to six months - up from one to three months - for middle and senior NTMA management employees and garden leave provisions to be included in all employment contracts. These changes will be introduced immediately for new NTMA employees and for existing employees as they are promoted. As already stated, the three-month notice period and garden leave provisions already apply to NTMA staff assigned to NAMA. I am advised that additional post-termination restrictions on employment will be considered on a case-by-case basis in respect of senior NTMA management employees in particular. However, the imposition of such restrictions will need to be carefully balanced against the NTMA's need to recruit good candidates for whom such restrictions may act as a significant disincentive to taking up employment with the NTMA.
The Senator may ask a final question and I caution her not to make any person identifiable.
I note the contents of the Minister's reply. I also note the specific requirements contained in section 14 of the NTMA Act 1990 and section 99 of the NAMA Act 2009. Will the Minister provide confirmation that criminal proceedings will be taken against those employees who breach the sections to which I refer? Will such employees or the companies for which they work be precluded from negotiating property deals with NAMA at this time?
With respect, I am of the view that the notice period should be longer. A period of three to six months is not significant, particularly in light of the fact that we are dealing here with a property-based business. The pace of recovery in this country has been incredibly slow and not much will change in the property market in the three to six months after employees leave NAMA. As a result, such individuals would be in an advantageous position going forward. I would be concerned about that fact. As already stated, I am only interested in taxpayers getting bang for their bucks and in ensuring that we obtain optimum prices for all properties sold through NAMA. I would hate to think that anything untoward might be happening. The prohibition period is not sufficiently significant and I am of the view that it will not stem the problem which will arise as a result of employees leaving NAMA and taking up work elsewhere.
There are three items of legislation which compel employees of the NTMA and, consequently, NAMA to respect the need for confidentiality. I refer to the NAMA Act, the NTMA Act and the Offences against the State Act. It is a matter for the Garda to investigate whether breaches of these Acts have taken place. It is then a matter for the DPP to decide whether any breach warrants a prosecution. That is the normal procedure when offences are alleged and that is what applies in respect of breaches of the laws to which I refer. As stated, Matheson carried out a review of the contracts being given to the employees in question and has recommended the implementation of a longer notice period of three months to six months before such employees can return to the private sector. As stated earlier, the NTMA and NAMA are also considering introducing longer periods in respect of certain senior officials. This matter is ongoing and, in that context, I will draw the Senator's views to the attention of Mr. Frank Daly, chairman of NAMA. My advisers can discuss it with him when the opportunity arises. A number of those advisers are abroad but I will be meeting them on Thursday and I will draw the Senator's views to their attention.
I thank the Minister.
Property Taxation Collection
I thank the Minister for coming before the House to deal with this matter. In raising it, I am representing a couple who are on unemployment benefit. Two of their children are sitting the leaving certificate and, despite the shambles which occurred with certain examination papers, I hope they will obtain enough points to allow them to go to college in the autumn. The couple to whom I refer are indicative of couples throughout the country at present. They pay all their bills on a monthly basis because they have no other choice and it is the only way they can afford to do so. They pay for their home and car insurance and their broadband - which is not a luxury because they need it in order that their children might carry out homework and exam research online - in this way. Like many others, the people to whom I refer have been put to the pin of their collar in the context of paying their bills. While they do not agree with the property tax, they are going to pay it because they do not want to break the law.
When they came to me, we researched the various methods of payment and they chose the option of paying by direct debit. They opted for a direct debit because if one pays at one's local post office, one is obliged to pay €1 per transaction. If, therefore, one pays on a weekly basis, one's property tax will increase by €52. In any event, the couple in question set up a direct debit on their deposit account but when they sent in the necessary information they were informed that it is not possible to set up direct debits on deposit accounts. They went to their bank and were informed that the only way to pay would be by means of standing order. They were also informed that they could open a new deposit account and keep €2,500 in it and they would not, therefore, be obliged to pay any charges. If they had €2,500, I would not be raising this matter.
The couple in question tried to pay by standing order but the local property tax section of the Revenue Commissioners stated that it could not accept this form of payment. I contacted the section and an official informed me that this method of payment had been discussed but that a decision against its use had been taken. I became infuriated at this point because he said that the Revenue Commissioners would not be able to identify payments from people that were made by means of standing order. That is absolutely ludicrous, particularly as the Revenue Commissioners collect tax from almost every citizen. I pay a number of bills by means of standing order and those to whom the money is going have no difficulty identifying my payments. If I miss a payment, I will quickly be informed of this fact.
I would like the Minister to instruct the Revenue Commissioners to accept local property tax payments made by means of standing order. If people do not pay their local property tax Revenue will, as it has categorically stated, take the money from their deposit accounts. We are faced with a situation whereby Revenue will do the latter but will not allow people to pay the tax from their own accounts.
It is a crazy set-up. A significant number of people will not or cannot pay the local property tax and it is incumbent on us to make the process of paying it as easy and as cheap as possible. I would welcome the Minister's comments and his agreement that people can pay the local property tax via standing order.
I thank the Senator. The Finance (Local Property Tax) Act 2012, as amended, provides that the liable person shall elect in the local property tax return to pay the tax by one of the methods specified by Revenue in the return. It is a matter for the Revenue Commissioners, who are charged with the administration of the tax, to determine the range of payment options available. Given that more than 1.55 million local property tax returns have been filed by property owners to date and, by the end of last month, over €121 million had been transferred by Revenue to the Exchequer, I am very satisfied with the range of options that the Commissioners have made available to pay the tax.
Instalment payments can be made by way of deduction at source from employment, occupational pension income or from certain payments made by the Department of Social Protection and the Department of Agriculture, Food and the Marine, by direct debit, or in cash through approved payment service providers. For those wishing to pay in cash, they can pay weekly, monthly or they can pay the charge in a single payment, using one of three approved payment service providers, namely, An Post TaxPay, Payzone and Omnivend.
The Revenue Commissioners advise that where any of the phased payment options is chosen, no additional administration or interest charge is imposed by Revenue. Normal transactional charges, however, may be levied by the property owner's financial institution or by a payment service provider where the property owner chooses to make the payment via a single debit authority, a debit or credit card, a direct debit or by way of cash payments.
The range of options provided has meant that property owners can choose a method of payment that suits their particular circumstances, and it is clear that property owners have responded to the flexibility provided.
Senator Moloney is requesting that Revenue also accepts local property tax payments by standing order. I am advised by Revenue that standing orders do not facilitate the orderly collection of taxes for the Exchequer. This is due to the arrangements put in place to manage standing orders by financial institutions.
The Commissioners further advise that they do not use standing orders for tax payments for a number of reasons. Customers set the date of payment and where there are insufficient funds on the date payment is due, no payment will be made. Revenue will not be notified of any unpaid standing orders. Revenue would be obliged to check each month to ensure each standing order is paid and managing large amounts of standing orders creates significant reconciliation difficulties. This can occur where customers do not provide sufficient information to identify the source of the payment. By contrast, direct debit payment gives greater certainty and facilitates the orderly collection of taxes while ensuring safeguards for customers. A direct debit requires the customer to authorise Revenue to take a payment. The customer can cancel the payment at any time. From an Exchequer point of view, if the payment goes unpaid, Revenue will be advised within five working days and will be able to pursue payment. This is not possible with standing orders. In addition, with direct debits, Revenue will always know the source of the payment and will be able to update the customer record accordingly electronically. It is not possible to manage standing orders in this fashion.
Consequently, I am advised by the Revenue Commissioners that there is no intention to change their practice of not including standing orders as a payment option, and that this policy applies across all taxes.
If the objective of the Senator's motion is to facilitate the payment of local property tax by equal instalments from bank accounts, it seems to me that the direct debit option fits this need very well, while at the same time providing security for the Exchequer and administrative efficiency. It would not be reasonable for me to suggest that Revenue would move to a payment system, which is riskier from the Exchequer's point of view and is less efficient in that it leads to administrative delays and costs.
I am satisfied that the Revenue Commissioners have put a significant amount of information into the public domain on payment options, and both the LPT return and booklet covers this in some detail. It is also open to any property owner who has a query on any aspect of the various payment options to call Revenue's dedicated LPT helpline on 1890 200255.
I thank the Minister for that reply but I cannot say I am happy with it because he is only telling me what I already know. He outlined what customers who have insufficient funds can do but that can happen with a direct debit as well. If they send in a direct debit and there are insufficient funds, the outcome will be the same. Not many people will be in the same position as the people to whom I refer. Some weeks ago their daughter needed €5 for class materials but they did not have it. Money is very tight for this couple in terms of having to opt for cash payments for these charges. The Minister said it is not the Revenue Commissioners who are imposing this charge on them but technically they are still being charged, regardless of whether it is An Post or another entity.
These people want to pay this tax but we are not making it easy for them to do so. Many people will not pay it. I cannot understand why the Minister could not suggest to Revenue to accept standing orders as a method of payment. Surely it can identify who is paying them and if they are not being paid. I am not happy about this and people throughout the country will identify with the position in which this couple find themselves. I know they will not take this lying down. They suggested they would raise the issue on the Joe Duffy radio programme but I asked them to wait until I raised it with the Minister and got a reply from him. I told them I was sure he would be able to facilitate them but, unfortunately, they were right and I was wrong. I am very disappointed with the Minister's reply.
The Revenue Commissioners have given the reasons they do not accept payment of any tax, not just property tax, by way of standing order. It is different from a direct debit because if there is no cash to meet the direct debit, the Revenue is notified within five working days. With the way the banks operate standing orders, it is not notified. It has to go back and check paperwork and continue checking it to see if it is paid. There are other options. In terms of the couple the Senator describes, first, if they are on social welfare with two children it seems to me that they are below the limit. They could defer it and not pay it on the basis of a deferral. Second, if they are on social welfare they could ask the Revenue to deduct directly from social welfare payments.
It cannot be done through unemployment benefit.
The Revenue says it can deduct from social welfare payments if it is voluntary. It cannot compulsorily deduct from social welfare payments but with the agreement of the couple, the Revenue can deduct from them.
I am sorry but it cannot be done through unemployment benefit.
I will check that for the Senator.
I would be delighted if the Minister would do that.
I think the Senator is mixing it up. The Revenue Commissioners cannot compulsorily deduct but they can deduct on a voluntarily basis. There is also a cash option through a post office. There are other options but Revenue will not collect any tax by way of standing order for the reasons I have outlined. The Revenue Commissioners are independent in the exercise of their tax collection functions. They are not subject to being compelled by me or by anybody else. I will not ask them to do this because the reasons they have given for not doing it seem to me to be good, sound reasons.
I thank the Minister.