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Seanad Éireann debate -
Tuesday, 12 Nov 2013

Vol. 227 No. 7

Adjournment Matters

Regulatory Impact Assessment Usage

I thank the Minister of State, Deputy Kathleen Lynch, for coming to the House to deal with this matter. It is great to see her.

The issue I wish to raise relates to regulatory impact assessments. We were promised that the Government would cut red tape. "Reform" became part of a ministerial portfolio, the purpose of which was to cut red tape. When I asked how many regulatory impact assessments had been carried out in the Department of Social Protection, I was informed that only one had been carried out. Much bureaucracy and paperwork have been created. In many respects, it is more to do with covering the officials and bureaucrats than improving the system. A red tape report was carried out on Valentia Island. We found that if we could reduce the amount of red tape, 70 jobs would be created. I refer to foreshore licences, planning and other areas.

I wish to focus on nursing homes which are being crippled by red tape. What often happens is that when something goes wrong, as has been the case when patients receive bad care or in certain cases are the victims of cruelty and treated more like prisoners in the 1800s than patients in the 21st century, the follow-on action by the Government involves significant levels of reporting which generates enormous amounts of work for people who are trying to carry on a business. BDO has carried out a cost-pressure survey report on the nursing home sector. Independent commentators have revealed that in the long term the demands placed on nursing homes in terms of pricing are not sustainable. I know the Minister is working hard on that issue. I have been told by people who run nursing homes that paperwork that used to take a couple of hours now takes staff two days to complete and submit. One wonders how many people are required to read the reports.

On a practical level, I accept that the Minister wishes to ensure the necessary care is available, but the over-reaction and bureaucracy created to counteract cases of poor care have stifled the provision of care in some cases and made it unviable for people to continue in the sector at a time when we need more nursing homes, not fewer. People are being squeezed out of the sector, not only because of pricing by the HSE but also because of the level of bureaucracy being created as part of a reporting mechanism. Will the Minister of State outline whether the Government carried out a regulatory impact assessment on the impact of regulations and the practical implications of compliance in terms of staff time required to fill in forms and reporting on an ongoing basis? Was a regulatory impact assessment carried out as to whether we could do it better?

I look forward with interest to the reply of the Minister of State.

I thank the Senator for raising this issue. Before I give the official response, I wish to outline that the balance is delicate because we are dealing with vulnerable people. Because of the approach taken to long-term residential care for older people we must strike the balance well. We do not want regulation and bureaucracy to interfere with the care people receive, but, on the other hand, we must be extremely careful that the type of light-touch regulation we have seen in the past is not applied to a sector which must be regulated and in which we must ensure people receive the best of care.

As the Senator is well aware, Government policy is to support older people to live in dignity and independence in their own homes and communities for as long as possible and to ensure only the most highly dependent people are in long-term nursing home care. We are dealing with a vulnerable cohort of people and must be careful about how the care is delivered. There is and will always be a cohort of older people who require the long-term residential care option. Residential care for older people is provided in a range of public, private and voluntary facilities throughout the country. In recent years there have been two significant developments in the nursing home sector, both of which were the subject of regulatory impact analyses, RIAs. The introduction of the nursing homes support scheme in 2009 put in place a system of financial support that ensured nursing home care was affordable to all. It is a very generous scheme of assistance under which the State bears the larger part of nursing home costs. Contributions from individuals who choose their own nursing home from an approved list are related to their ability to pay. More than €970 million is allocated to the scheme this year to support more than 22,700 people. Under the Health Act 2007, statutory responsibility for registering and inspecting nursing home settings against national quality standards was given to the Health Information and Quality Authority. Access to appropriate quality long-term residential care is now underpinned by both a strong regulatory regime and an excellent system of financial support.

A regulatory impact analysis was completed in advance of the introduction of both the nursing homes support scheme and the nursing homes standards drawn up by HIQA. The Department of Health prepared information leaflets, A Guide to the Fair Deal and a frequently asked questions document. In addition to dealing with queries and representations from interest groups, public representatives and members of the public, the Department also met interested parties. The factors arising from the RIA were taken into account in implementing the scheme. For the RIA on the national quality for residential care settings for older people in Ireland the Department commissioned an independent consultancy to carry out an assessment of costs on the impact of the standards. In addition, a consultation session was hosted in Dublin Castle. The Department has also recently carried out a regulatory impact analysis arising from two changes to the nursing homes support scheme announced in budget 2013. One of the changes was related to the contribution. All three RIAs are published on the Department's website. The Senator will be aware that a review of the nursing homes support scheme is under way and will include a broad analysis of how future overall provision for older people can be made sustainable and best meet people's needs. The review is being carried out by the Department, in collaboration with the HSE. Work will continue on the review in the coming months with a view to completion in early 2014.

I accept the Senator’s point on bureaucracy and form filling, but one must bear in mind that the sector deals with vulnerable people and that it is only the most vulnerable who receive such long-term residential care.

We must be extraordinarily careful that one does not impact on the other and at the end of the day, the care is really what is important.

I thank the Minister of State for coming to the House and I agree with what she has just said. However, instead of having officials in the Department reading the reports and determining whether all of the reports from the various nursing homes were received, we should be deploying more inspectors for surprise visits. We need boots on the ground. As the Minister of State knows, one can read a paper report on a nursing home that does not reflect the reality. When one sees the home in reality, one can understand the situation better. Surprise visits are very effective, especially if those running the homes know they will be inspected once or twice a year. That is a better approach than simply reading reports. I thank the Minister of State for coming to the House and for her efforts in this area.

Senator Daly should be aware that we have just recently employed an additional 48 HIQA inspectors. At a time when we are being asked to dramatically reduce the numbers of staff employed by the State, that is significant. We are prioritising areas where we need additional staff on the ground. Where there is a concern about a care institution, HIQA returns to that institution repeatedly. It is not as if the announced visit is a once-off event and nothing else happens. If there are concerns then those concerns are addressed by continuous, regular visits. It is very difficult to hide something that is wrong if an inspector is constantly at the door. That is what we need. I make no apologies for that happening. The majority of people who deliver care in this country to our older people do an extraordinary job. We hear that from families and the older people themselves. However, that does not mean that we should not be vigilant.

Roadworthiness Testing

I have been contacted by a number of road hauliers who are struggling at the moment. Part of the problem is the fact that their vehicles are off the road because business is so poor. They are concerned that a road worthiness certificate will only be issued for six months. There are also delays in the issuing of commercial roadworthiness certificates. I raise this issue in an effort to bring clarity to the matter and determine if the Minister of State and his officials and aware of this anomaly. There are significant additional costs involved in having roadworthiness tests carried out every six months. I am not sure that the Department is aware of the fact that there is a delay in issuing a certificate when a vehicle has succeeded in meeting the criteria. I look forward to the Minister of State's response. I hope common sense will prevail and the issue can be resolved.

I thank Senator Conway for raising this very important matter. I am sure the Senator is aware that commercial vehicle owners have always been obliged to test their vehicles annually. This is a legal obligation throughout the European Union. The minimum testing frequency of commercial vehicles is specified in Directive 2009/40/EC of the European Parliament and of the Council on roadworthiness tests for motor vehicles and their trailers. There have never been exemptions from the requirement to have commercial vehicles tested annually and this is not determined by the period during which the vehicle is or has been in use, nor its mileage. The law stipulates that it is an offence to use a commercial vehicle, including a trailer, in a public place unless, at the time, there is in force in respect of the vehicle, a certificate of roadworthiness. Roadworthiness testing standards are aimed at detecting any wear and tear, deterioration or modifications that could adversely affect the roadworthiness or safety of the vehicle and its compliance with road traffic construction and use regulations, where these items can be assessed by inspection. In cases of vehicles which were off the road, their condition can degrade and deteriorate so it is just as important that they are tested also before they re-enter service.

The new certificate of roadworthiness, CRW, issuing system is aligned to the long-standing obligation to have commercial vehicles tested annually. The period of validity of the CRW is calculated by reference to the last test due date and any delay in completing the test has the effect of reducing the validity period of the CRW. The longer the delay in completing the test, the shorter the validity period of a CRW. In cases where a vehicle is overdue its test by more than one year and is presented for testing, commercial vehicle roadworthiness testing regulations provide that the validity for the CRW shall be either for the six month period after the testing date or a period determined by reference to the anniversary of the test due date, whichever is earlier. This modification to the previous scheme has been introduced in order to ensure that an operator who does not test the vehicle by the due date does not gain any economic advantage over an operator who tested his or her vehicle in accordance with the legal requirements. This point answers the question posed by Senator Conway.

Regarding the printing, posting and issuing of a CRW to the vehicle's registered owner, I can confirm that when a vehicle passes a commercial vehicle roadworthiness test, this results in a request for the issue of a CRW being sent to the driver and vehicle licensing computer services division of the Department of Transport, Tourism and Sport. In order to facilitate cases where vehicles may be undergoing a change of ownership, there is an in-built time lag of one hour after the completion of the test before the vehicle details on the National Vehicle Driver File, NVDF, are updated. Accordingly, one hour after the test has been completed, the person can renew his or her motor tax online or in the motor tax office. The driver and vehicle licensing computer services division arranges the printing, posting and issuing of the certificate to the vehicle's registered owner as a matter of course at the end of each working day. I am advised that certificates are usually received by their vehicle owners within one to three days of the commercial vehicle test having been passed. Thus, with the CRW details being available online within one hour after the test and the CRW being posted out immediately, operators who are having their vehicles tested on time need have no concerns about not having a CRW for a day or two.

Furthermore, RSA vehicle inspectors have access to the online record and will know that the vehicle possesses a valid roadworthiness certificate. Where a vehicle is travelling abroad, the operator can avail of the new facility to have the vehicle tested up to one month early and receive a certificate for up to 13 months, thus enabling operators to ensure that the vehicle has a valid CRW for any international operations. Under the new system, operators may also choose to change the date of the test for a time during the year that better suits their business needs.

The new centralised CRW issuing system has been in operation since 1 October 2013. I am advised that there were a few occasions in the initial week or two where there were some technical difficulties in communicating between the commercial vehicle information system, CoVIS, and the driver and vehicle licensing computer services division which may have resulted in delays in the issuing of CRWs. I am advised that in such instances, the CRWs were subsequently successfully issued to the vehicle owners and all issues were resolved..

Separately, the RSA is also aware of exceptional cases of delay in the issuing of CRWs in respect of imported vehicles where these vehicles had been registered by the Revenue Commissioners on the same day and the NVDF had not been updated. There are also exceptional cases relating to older trailers whose records are not on the NVDF. In these cases, the Department and the RSA have facilitated the vehicle owners by enabling the trailer record to be updated without the owner of the trailer having to go back to the motor tax office. These are transitional issues arising in individual cases and once the record has been updated on the NVDF there will be no complications with the vehicle record subsequently.

Under the new system, the vehicle test details are recorded centrally. This supports effective enforcement of the obligation to have the vehicle test annually and ensures that compliant operators can go about their daily business with minimum disruption at the roadside while non-compliance can be quickly and easily identified and addressed.

These changes are part of wider reforms which the RSA is implementing to improve the roadworthiness standard of commercial vehicles on our roads.

The Road Safety Authority's reform focuses on three key areas: making the roadworthiness test more effective; introducing premises checks for operators of commercial vehicles to review their maintenance system, records and procedures; and increasing the effectiveness of roadside inspections of vehicles by the Road Safety Authority and An Garda Síochána. I am confident commercial vehicle roadworthiness reform will make our roads a safer place for everyone.

I thank the Minister for his comprehensive reply. I will bring it to the attention of the Irish Road Hauliers Association which I am sure will come back with a response in due course.

Credit Unions

Cuirim fáilte roimh an Aire Stáit, ach caithfidh mé a rá nach é a bhí uaim ar an ócáid seo. Nílim ag caitheamh anuas ar an Aire Stáit atáim in aon chor nuair a deirim go raibh mé ag súil le bualadh leis an Aire Noonan.

Tá súil agam nach bhfuil an Seanadóir ag rá gur sop in áit na scuaibe atá ionam. Ar chuala sé é sin riamh?

Chuala mé. Tá sin an-mhaith.

I welcome the Minister of State but it is the Minister for Finance, Deputy Noonan, who should be here instead.

He is in the other House as we speak.

I would have liked if there had been a representation from the Department of Finance at the very least, given the issue of tremendous urgency that has arisen with Newbridge Credit Union. The events of recent days are not only a disappointment to the people of Newbridge but also to this House and the High Court. This House, even more so now with the absence of any representative from the Department, has yet again been treated with contempt by this Government. Only last week I asked the Minister what the plans were for the future of Newbridge Credit Union. I was told they could not be discussed due to the fact there was a High Court order. Later in the week, the Government told the media its plans before telling this House or the High Court.

Whatever the agreed and uncontested evidence of irregularities in lending practices at the credit union, the events over recent days and the actions taken by the Central Bank have sent shockwaves through the credit union movement. The speed and pace with which the Government acted under these special powers which were originally meant for banks was unbelievable. Now, the people in the area are without a credit union. The Ministers from the Department of Finance are giving mixed messages to the 2.8 million credit union savers nationwide. The Minister of State, Deputy Brian Hayes, says Newbridge is the only case while the Minister, Deputy Noonan, claims a quarter of all credit unions are potentially in trouble.

This credit union was treated like another failed bank. However, credit unions are not banks. They are owned and built by communities, brick by brick. There should have been more consultation. For the past 23 months there has been a special manager appointed to the credit union yet there was this lightning surprise development over the weekend, reminiscent of the late-night decisions regarding the banks.

The late night application by the Central Bank to the High Court was reminiscent of the worst night of the last Government, the night of the bank guarantee. People deserved more consultation locally. There needs to be more transparency. I do not buy the arguments that everything has to be done in absolute confidentiality. The lightning strike actions at the weekend do not reassure people in the slightest. There are specific questions that people want answered. People want to know which credit unions have been placed on a watch list by regulators. Media reports suggest one in four is in trouble. Which credit unions are these? What percentage of credit union loans are non-performing? What stress tests are in place to gauge the support the sector needs in the future? Most importantly, will the Minister for Finance commit to more consultation with members of the sector and no more late-night takeovers of the kind we have seen?

I regard it as contempt for this House what has gone on in circumstances where specific questions were asked last week but there was no transparency or accountability from the Department. Tonight, again, there is no representative from the Department of Finance, which is regrettable, not regarding the personal regard I have for the Minister of State, Deputy McGinley. If the Government wants to change the way business is done and mark its difference from the last Government, there must be honesty, respect for depositors and savers, as well as respect for transparency, accountability and being upfront in its actions as well as those of the Central Bank.

I am deputising for the Minister for Finance who is engaged in the other House.

On Sunday, 10 November, the Central Bank applied to the High Court under the Central Bank and Credit Institutions (Resolution) Act 2011 and received approval for the transfer of the assets and liabilities of Newbridge Credit Union, excluding the premises, to Permanent TSB. This action was necessary to safeguard members' savings as the only alternative option available to the Central Bank was liquidation which would have seen unprotected savings of €1.1 million lost. These would have included the savings of charities, schools and individuals. The Central Bank has published extensive information on its website setting out the details of the transfer, including the relevant background material and financial details.

On foot of a request from the Governor of the Central Bank, the Minister for Finance agreed to the payment to Permanent TSB of a financial incentive of up to €53.9 million to support the transfer. This consists of €23 million in cash up front, €4.25 million for restructuring and integration costs, €2 million for other transferring liabilities and a maximum additional €24.7 million to cover additional costs resulting from all loans being written off with nothing recovered. A 50:50 risk-sharing agreement is in place where the resolution fund will absorb 50% of losses where loans perform below their transfer value and 50% of gains where loans perform above their transfer value. The financial incentive provided in the Newbridge case is fully recoupable from the financial services sector over time in the form of a levy.

In line with the resolution options available, the Central Bank undertook a process which involved the examination of possible credit union combinations. This resulted in an approach being made to several credit unions. Ultimately, however, no credit union considered it was in its best interests to complete such a combination, even in the context of extensive taxpayer support. This partly reflected the relative scale of Newbridge Credit Union in the sector and the exceptional nature of its financial difficulties. The Central Bank also considered proposed solutions put forward by various interested parties but none proved feasible.

It was in the context of a possible liquidation that the Department of Finance, with the support of the Central Bank, requested Permanent TSB to undertake this transaction. The participation of Permanent TSB, for which I express my thanks, has brought stability and certainty to the situation and specifically to the members and staff of Newbridge Credit Union, providing an alternative to liquidation. This transfer means that Newbridge Credit Union members can be assured they can continue to operate their loan and deposit accounts as normal.

The bad practice in Newbridge over many years can be illustrated in the following key lending statistics. There was an individual loan of €3.2 million which was in excess of the Credit Union Act restriction of a maximum of 1.5% of the total assets. Up to 52% of the loans exceed the five-year duration as opposed to the maximum set out in the Credit Union Act of 20%. The average loan in Newbridge Credit Union was €17,281 as compared to the average credit union loan which is €7,764. There were 26 loans of an average value of €550,000, which were seriously distressed.

These statistics illustrate that Newbridge was very different from a normal credit union. The structure of many of these loans was more akin to development loans with bullet repayments as opposed to regular repayments.

The Central Bank has informed me that, based on data submitted by credit unions as at 30 September 2013, some 20 credit unions have reported regulatory reserves below the minimum requirement of 10% of assets. This gives rise to a capital shortfall in the region of €11 million in total. The Central Bank continues to work through a portfolio of approximately 100 credit unions on a case by case basis. The programme of work to engage with such credit unions is informed by levels of arrears; inadequate bad debt provisions; high fixed asset to total asset ratio; and other supervisory concerns including weak lending practices. The outcomes of these engagements can include governance changes; risk mitigation programmes; lending and other business restrictions; and requirements for credit unions to seek capital support.

The Government has made available €500 million to support the stability of the credit union movement. This amount is divided between two funds of €250 million each, one for resolution, which is being used in the Newbridge case, another for voluntary restructuring under the Credit Union Restructuring Board. The funding required for Newbridge is fully recoupable from the financial sector via a levy over time.

The Government recognises the important role of credit unions as a volunteer co-operative movement and the distinction between them and other types of financial institutions. The Government's priorities remain the protection of members' savings, the financial stability of credit unions and the sector overall. The Government is absolutely determined to support a strengthened and growing credit union movement and would encourage the movement to work with its stronger credit unions so they can provide a viable option for assisting weaker credit unions. In particular, the Government supports the future return of a credit union to Newbridge.

I thank the Minister for doing as much as he could but it is not good enough to focus on Newbridge. We did not get the information we sought last week. This response ignores the questions I asked. I repeat that savers and members are being treated with contempt with a lack of information and, in some cases, mixed messages from the Department of Finance. I wonder who will next wake up to find their credit union is secretly a bank. The Minister mentioned 20 credit unions having reported regulatory reserves but out of how many that have reported is that? Is that 20 in total or is it only the figure the Central Bank is prepared to tell us? Overall, I am unhappy with the level of information from Government.

The Central Bank has informed the Minister that based on data submitted by credit unions as at 30 September 2013, some 20 credit unions have reported regulatory reserves below the minimum requirement of 10% of assets. This gives rise to a capital shortfall in the region of €11 million. The Central Bank continues to work through a portfolio of approximately 100 credit unions on a case-by-case basis. That is the information the Central Bank has provided to the Minister for this evening's discussion.

Local Government Reform

Tráthnóna, is mian liom an rún i dtaca leis an mBille rialtas áitiúil atá ag dul trí Thithe an Oireachtais faoi láthair a phlé, mar go bhfuil an Bille seo ag teacht in am ina bhfuil go leor ceisteanna á ardú, ní amháin sa tír seo ach ag leibhéal na hEorpa. Mar shampla, since 2007 the Council of Europe has consistently warned of a general shift towards greater centralisation in Europe and Ireland. The Local Government Bill 2013 is nothing to do with reform but is a drastic attempt simply and naively to reduce overall Government expenditure. By definition "reform" should mean improvement or changing with the modern era but the abolition of town councils and democracy in the Bill is nothing to do with reform. On 31 October 2013 the Congress of Local and Regional Authorities of the Council of Europe recommended that the Irish authorities revise the Local Government Bill to ensure the subsidiarity principle is better enshrined and protected. It stated that the importance of this (subsidiarity) principle is not adequately reflected in the local government reform legislation. It further encouraged the Government to revise the legislation to ensure the subsidiarity principle is better enshrined and protected in law and to promote this crucial principle and practice in Irish public administration.

The principle of subsidiarity is fundamental to the functioning of the EU, specifically to European decision making, in particular the principle determines when the EU is competent to legislate and contribute to decisions being taken as closely as possible to the citizen, particularly at town council level. The principle of subsidiarity is established across the EU, including in Ireland, under Article 5 of the treaty on the European Union. It appears alongside two other principles that are also considered essential to European decision making, namely conferral and proportionality.

The Irish people overwhelmingly passed a referendum in 1999 which gave recognition for the first time in Irish law to local government structures being recognised in the Constitution, under Article 28A. That created a legitimate expectation that local government structured as it was at the time would continue to be voted on every five years in town and county council elections. The doctrine of legitimate expectation regarding town councils is being eradicated under the proposed legislation coming forward under the Local Government Bill without any consultation whatsoever by the Department of the Environment, Community and Local Government and the Minister, Deputy Hogan.

I am not saying this. Fine Gael town councillors up and down the country are saying it. Last week a prominent Fine Gael county councillor in Mayo spoke on this issue locally and nationally. The members of Westport Town Council, controlled by Fine Gael, have written a very comprehensive document on this issue and I salute them for the work they have done in consultation with Fianna Fáil councillors. I mention Fine Gael councillors in particular because a Fine Gael-led Government is introducing this abolition Bill. The Minister of State, Deputy McGinley, is not responsible for this area but I call on the Minister for the Environment, Community and Local Government, Deputy Hogan and the Government to park or suspend this legislation, listen to councillors up and down the country, particularly town councillors who represent the citizen at the closest possible level. A number of town councillors have spoken publicly on this.

I also call on the Government to listen to the recommendation from the Congress of Local and Regional Authorities of the Council of Europe and its rapporteurs who are concerned that consultation with local authorities and their associates has not occurred in this country. They also call for the legislation to be suspended or parked until adequate consultation happen with each town council.

I call for the Bill to parked or suspended, that 2014 be used as local government consultation year, not local government abolition year. Let us use it to talk to the people around the country about local government. When one examines it across Europe it is very interesting. We will put ourselves at the top of the pile regarding the average population per local authority. In France there is a local authority for every 1,500 people. In Germany there is one for every 6,500. We will move to the top of the pile and be less democratic than all the other OECD countries and will have one local authority for every 139,800 people.

We are going to make this the least democratic country in the OECD. What we are actually doing is following the UK example. The State broke with the Britain and we established our own local government structures under Michael Collins. We are now disenfranchising and going back to the same principle of local government that has evolved in the North of Ireland and throughout the rest of the United Kingdom. This is wrong because there has been no consultation. I am not the one who is saying this; I am only conveying the message on behalf of town councillors throughout the country. I ask the Minister of State whether he agrees that there needs to be more consultation and that the Bill should be parked.

Ba mhaith liom buíochas a ghabháil leis an Seanadóir as an ábhar seo a ardú. Tá mé ag seasamh isteach don Aire, an Teachta Hogan, nach féidir leis a bheith anseo.

I inform the Senator and the House that the Minister for the Environment, Community and Local Government did have a very successful trip to County Donegal at the weekend, where I understand he addressed a public meeting in Ballyshannon at which many of these issues were addressed. I believe his contribution was very impressive and that people's fears and concerns were allayed to a great extent. While I was not present at the meeting, I have read the media reports on what happened.

I am glad to have the opportunity to provide a policy context and some detail in the context of the Local Government Bill 2013, with particular reference to changes at sub-county level, a matter which has been raised on the Adjournment of the House a number of times recently. As Members are aware, the Government's action programme for effective local government, published in October 2012, sets out Government policy decisions on a range of measures to reform and strengthen local government structures, functions, funding, governance and operational arrangements. Chapter 6 of the action programme sets out arrangements to replace town councils with a new comprehensive model of municipal governance based on principal towns and designed to strengthen local government within counties and address weaknesses and anomalies in the current system.

Local government reform has been the subject of deliberation and discussion for many years. The process of consultation, prior to the current reform programme, effectively began with the public consultations in the context of the 2008 Green Paper on local government and has continued in the context of the 2012 action programme, the current Bill and specific aspects of the reform agenda such as the alignment of community and local development with local government and implementation of the local government efficiency review. These previous deliberations and consultations helped to inform the development of reform proposals in the action programme.

Since coming to office, the Minister, Deputy Phil Hogan, has considered submissions from and held discussions with the local government representative associations, individual local authorities and other interested groups and individuals. He also invited each individual councillor in the country to submit views to him on a number of issues relating to local government reform to help in finalising the production of last year's action programme. Following the publication last year of the reform action programme, a specific structured process was put in place for engagement with the local authority members' associations in the local government reform implementation process. This took the form of a working group for engagement with, and input by, the associations in regard to the development of the legislative provisions, including those relating to sub-county reorganisation, thereby providing a direct conduit for input and involvement by councillors in the reform implementation process. I record appreciation for the positive engagement on the part of the members' associations which has helped to inform the provisions included in the Bill.

The content of local government reform legislation was, of course, a matter for Government decision in the first instance and is now the subject of Oireachtas scrutiny and debate in the normal way. The Minister will be giving careful consideration to relevant issues, views and suggestions raised in that context within the parameters of the policy decisions taken by the Government.

Without question, the sub-county reform in the action programme is a radical departure and the decision to change fundamentally our approach to local government arrangements within counties was not taken lightly. It was taken, for example, in the full knowledge that town councils had enjoyed advantages such as proximity to citizens and the ability to respond to local needs. There is also a considerable element of history, heritage and civic status associated with town authorities. However, these strengths cannot hide the fact that the existing system of town local government contains glaring weaknesses, including limited functions, outdated boundaries, duplication of administration and insufficient scale to maximise efficiency or support expertise or resources to carry out a range of complex functions. This duplication is illustrated, for example, by the fact that in Tipperary, a county with a population of just under 160,000, there are nine local authorities involving nine sets of elections, nine annual budgets, nine annual reports, nine corporate plans, nine development plans and many other examples of political and administrative duplication. Similarly, a situation where town councillors nationally account for 46% of all local authority representatives but represent only 14% of the population is not sustainable in a modern, democratic society.

The new model of municipal governance will address these and other limitations. Equally, there is no reason whatsoever the strengths and qualities associated with many town councils cannot be extended beyond the "town walls", as it were, to embrace the wider hinterlands of the towns which are linked with them for a range of social, commercial, educational, employment and other purposes. Municipal districts will cover the entire territory of each county, reflecting European norms, removing outdated boundaries and ending the anomaly of small towns having municipal status and dual representation, while some larger centres and rural areas lack any sub-county governance. The performance of appropriate functions by members at county and district levels, respectively, will result in greater effectiveness than the current parallel town and county system. The allocation of functions between county and district levels will be determined on the basis of what is most relevant to each level. Local matters will be dealt with at municipal district level, while those of wider strategic application will be decided at county level.

The new sub-county governance arrangements will deliver the administrative and operational efficiency of a single county-wide organisation, while bringing county council decision making closer to local communities by virtue of assigning a range of reserved functions to elected members at district level, improving accountability and responsiveness. The increased measure of subsidiarity which the new sub-county arrangements will bring has been recognised in the recent report on local democracy in Ireland, published on 30 October by the Congress of the Council of Europe. While drawing attention to certain weaknesses in Ireland's system of local government which have developed over the decades and which the current reform programme is designed to address , the report specifically welcomed the action programme for effective local government which it referred to as "ambitious" and endorsed particular measures in it, including the structural changes at sub-county level.

Some people have disingenuously tried to suggest the Council of Europe has criticised the Bill because the congress report recommended changes in "legislation". In fact, what the report was referring to was the current legislation, since the report was drafted well before the Local Government Bill was published. On the specific issue of the replacement of town councils by municipal districts, the Council of Europe's report had the following to say:

In the rapporteurs' opinion, the structural changes are a positive element of the proposed reform, as it provides a solution to an unfair situation whereby those living in towns had two votes as compared to the rural areas which had one. It also simplifies the structure. These changes are also expected to be followed by other important steps, including greater subsidiarity, avoidance of duplication, a review of boundaries, better representational balance between urban and rural areas and a cohesive administrative/executive reorganisation.

There could hardly be a clearer endorsement of the reforms. This is entirely consistent with the fact that two amendments critical of Ireland's reform programme were voted down in the Council of Europe chamber by a large majority of the representatives of local authorities from across Europe.

I will refer back briefly to the overall local government reform programme by reminding Members that the core purpose of the programme is to put local government in a position to deliver better services, amenities and governance to communities by strengthening the structures, finances and operations generally of the system. In the context of future governance arrangements within counties, the principle of strength through unity will be a key factor in ensuring these objectives are delivered on to the benefit of all communities, urban and rural. The Local Government Bill 2013 reflects the benefits of consultation to date, the extensive studies undertaken of local government during the years and the input provided from a range of sources, not least the elected members of local authorities.

Different views are an inherent feature of democratic debate but the status quo in local government is not a realistic option. Change inevitably involves difficult decisions. It is a responsibility of the Government to take decisions that will make a real difference and the decisions that the Government have made will bring significant net benefits to local government and the communities it serves. They will deliver on the vision set out in the action programme on making local government the primary vehicle of governance and public service at local level.

The Minister of State's response did not address my question. He selectively quoted the Council of Europe but the chair of the monitoring committee of the Council specifically asked the Government not to pass the legislation until adequate consultation has taken place with local authorities. In regard to the principle of subsidiarity, the report recommended that the recommendation be revised in order to ensure that principle is better enshrined in and protected by law, to promote best practice in Irish public administration as set out in article 5 of the founding treaty.

On the issue of consultation, 14% of the Irish population live in areas governed by town councils. There is one town councillor for every 865 of these people. That ratio will now decrease to one councillor per 4,830 people. That is a major democratic shift. If the Minister for the Environment, Community and Local Government wants consultation, why has he failed to meet the elected members of Letterkenny Town Council despite umpteen requests? He was in Letterkenny last week but he failed to meet the members of the council. I attended a public meeting in the town on the issue and I am aware that similar views are being expressed in town councils all over the country. It is time for consultation not abolition. The people spoke on the Government's recent attempt to abolish the Seanad and I believe if the people in these towns were given an opportunity to speak, they would not agree with the Minister in this regard.

I do not agree with the Senator. I have outlined comprehensively the widespread consultation that took place with organisations representing members of local government bodies. They were invited to make submissions and, given that the legislation is currently going through the Oireachtas, it is difficult to imagine that the Minister would have a bilateral meeting with a town council here or there. The consultations have taken place and the Minister was available at another function in Donegal. I do not want to be parochial but I happened to be at the function and I am aware that he addressed the matter extensively. The fears expressed by those in attendance were allayed by his comments. Senator Ó Domhnaill can cite the Council of Europe but I have quoted an expansive and positive response from it to the Bill.

The Seanad adjourned at 6.25 p.m. until 10.30 a.m. on Wednesday, 13 November 2013.