Adjournment Matters

Flood Prevention Measures

Senator Deirdre Clune

I thank the Minister of State for coming to the House to respond to my Adjournment matter. I raise the matter of the flooding in recent days and in particular flooding in Cork city which was devastated last night. Cork has experienced many flooding events over the years. The two flooding events this week are related to high tides, a lot of rain and winds from the south east. This combination is dynamite for the Cork city area.

When I was a child my father had a shop in Princes Street in the city centre. The fire brigade often rang at 3 a.m. or 4 a.m. to say the place was flooded. He always kept a pair of waders inside the door. Some floods happened as a result of blocked culverts. I am asking for a response from the Minister of State so that I can go back to the traders and householders in Cork and tell them what the Government plans to do. The Minister of State, Deputy Brian Hayes, made the point that not everywhere can be protected and I accept that. However, the protection of people's homes and businesses should be prioritised. Priority should be given to the value of the property, not just its monetary value but also value related to the use of the property. Significant funding will be required and the Minister has said it will come sooner rather than at the end of 2016. I hope this will be the case. Rather than a fire-brigade response all the time, we need a long-term plan of action to alleviate and to respond to flooding issues.

Minister of State at the Department of the Environment, Community and Local Government (Deputy Fergus O'Dowd)

I thank Senator Clune for raising this important matter. I apologise for the absence of the Minister of State, Deputy Brian Hayes, who is unable to be present. I will bring the Senator's comments to his attention.

The Government is acutely aware of the flooding situation in Cork city and surrounding areas. The Minister of State, Deputy Brian Hayes, has visited the city on many occasions in recent times. He is travelling to Cork again tomorrow to receive a briefing on the current situation from the city manager and to meet with elected representatives and residents in Cobh. The residents and business owners of Cork city, as indeed in other flooded areas of the country, have had to deal with a truly awful situation during this recent period of storms and flooding. The scenes of devastation we have seen on television are really heart-rending. There have been many tributes paid to the emergency services over recent weeks and I wish to acknowledge the tremendous efforts of the emergency response teams who put themselves in the front line in difficult and sometimes dangerous conditions and who have made great efforts to mitigate the very worst effects of these events.

The flooding situation in Cork city has been under active consideration for some time. While there has been criticism of the length of time it is taking to implement a flood defence scheme for the city, it is important that there is a clear understanding that the flood situation in Cork is not straightforward. The work being undertaken by the OPW, the council and their advisers, in progressing a scheme for the city, involves complex and detailed preparations to ensure that the best possible long-term solution is found. A catchment flood risk assessment and management study for the River Lee catchment which was commissioned by the OPW in 2006, produced a draft plan which identified potential options for the alleviation of flood risk in Cork city and county along the lower Lee. The OPW appointed Arup engineers as consultants in April 2013 to further develop the proposals.

The main objectives of the work currently being undertaken by Arup include: the development of a flood forecasting system for Cork city and the lower reaches of the River Lee, downstream of Inniscarra, to facilitate optimum decision-making on dam discharges; assessment and development of a viable, cost-effective and sustainable scheme, to permit greater discharges from Inniscarra dam without causing flooding of properties and to provide protection along the lower Lee and through Cork city against residual fluvial flooding and flooding from high tides and surge levels; and assessment and development of a viable, cost-effective and sustainable scheme for Blackpool and Ballyvolane, to protect against flooding from pluvial, fluvial, tidal and surge.

The work by Arup is well under way, with most of the emphasis on detailed hydrological analysis and hydraulic modelling of the channels involved, along with the development of a flood forecasting system. A public information day was held on 17 July 2013.

A site investigations contract is due to be tendered shortly. This will aid in the development of the outline scheme. The options for defences will then need to be examined from an environmental perspective before a preferred scheme can be identified. The OPW intends to bring the emerging preferred scheme before the public on 29 July 2014. Subject to no major obstacles emerging at the information day, the scheme will be further refined, an environmental impact assessment, EIA, will be completed, statutory scheme documents will be completed and a formal public exhibition will commence towards the end of the year. This will be held over a four-week period and detailed information will be provided on all aspects of the scheme, after which the public will be invited to make submissions.

Subject to the proposals being generally well received, detailed design will then commence, from which contract documents will be drawn up for the procurement of a civil works contractor to undertake the works. The OPW is examining whether there are possibilities to bring forward certain elements of the detailed design in advance of that time.

I emphasise that any scheme for Cork city has the potential to be a large project, possibly the largest flood relief scheme ever undertaken by the OPW. This will be a substantial investment by the State, which can only be done when we are absolutely sure that we have the right solution for the city. Therefore, the time being taken to complete full and comprehensive hydrological analysis and hydraulic modelling will be well spent in the long term. In addition, the flooding of recent days has provided an opportunity to gather significant data that will help to confirm the eventual solution. It is understandable that those who have been affected want an immediate solution to the problem. However, it is important that the work be done correctly.

Apart from the proposed scheme for the central city area, studies are also being advanced in areas near the city at Glanmire-Glashaboy, Douglas-Togher and Crookstown, where Cork County Council is taking the lead role, with funding being provided by the OPW. It is hoped that proposals to deal with the areas' problems will be made before the end of 2014.

Further afield, the OPW and Cork County Council are at an advanced stage for schemes in Bandon and Skibbereen. Both have been through the public exhibition stage, with works due to be commenced in Bandon in mid-2014 and in Skibbereen towards the end of 2014. Consultants have also been appointed to develop proposals in Clonakilty, with a preferred scheme due to be tabled for public consultation before the end of this year. It is also hoped to introduce proposals for a scheme in Baile Mhic Íre towards the end of 2014. All of the work being done in respect of these areas underlines the commitment to deal with the most significant flooding problems in Cork.

On the broader national level, there has been a significant amount of investment since 1995 in flood relief works, with approximately €320 million invested by the OPW. This investment has brought benefits estimated at more than €1 billion in terms of damage and loss avoided and has provided flood protection to more than 10,500 properties. In Cork alone, more than €57 million has been spent on capital projects since 2002. In addition, the OPW has funded 23 projects in County Cork under the minor flood works and coastal protection scheme since its introduction in 2009. The Government has prioritised investment in flood risk management by allocating €225 million for the period 2012 to 2016 as part of its infrastructure and capital investment framework.

The OPW will continue to work closely with its partners, Cork city and county councils, to advance all these projects in a timely manner. There are and will be challenges in developing such large projects, but I assure the Senator there is a commitment to progressing the projects in order that the people of the city and county will reap the benefits as soon as possible.

Senator Deirdre Clune

I thank the Minister of State for highlighting the commitment to progressing the projects. It is important we keep hearing that. He recognises the fact there is frustration in the city centre. When will these projects start construction? Could certain elements of the scheme be advanced once identified? The floods of the past week will have provided further information.

Deputy Fergus O'Dowd

I am happy to bring the Senator's comments to the attention of the Minister of State, Deputy Brian Hayes, and his officials. This work must be done properly and as quickly as possible. I assure the Senator that the Minister of State is aware of her views on expediting the work.

Senator Deirdre Clune

Go raibh maith agat.

Tax Credits

An Cathaoirleach

I welcome the Minister of State, Deputy Perry, to the House.

Senator Marie Moloney

He is a great man for taking my Adjournment debates. I can always rely on him being present.

Deputy John Perry

I thank the Senator.

Senator Marie Moloney

The recent changes in the budget to the single parent tax credit have had an adverse effect on single parents, predominantly men in this case. The devil is in the detail. Not only do single parents lose the tax credit, but they also move up to the higher tax band more quickly as a result. It is a double whammy. The knock-on effect is a large reduction in income, leading to a substantial reduction in their maintenance payments to their partners, one party taking the other to court for maintenance and higher one-parent family payments.

I called for this debate to address a situation that has arisen whereby there is a requirement for one partner, the primary carer, to give written permission for the other parent to avail of the tax credit. We are going backwards. It is like how a husband used to have to give written permission for his wife to use a tax-free allowance. We must address this issue. In real life, many marriage and relationship break-ups can be nasty and result in collecting children at the door without partners speaking to each other. There are many good men who are willing to be part of their children's lives despite those break-ups and it is demeaning to make them get written permission in order that they might avail of this tax credit. Revenue must be in a position to know whether a primary carer is working and to make the tax credit available to the other parent if the primary carer is not using it. I await the Minister of State's response.

Minister of State at the Department of Jobs, Enterprise and Innovation (Deputy John Perry)

The one-parent family tax credit was reformed and replaced with a new single person child carer credit from 1 January. While the single person child carer credit is of the same value, that is, €1,650, as the earlier tax credit and also carries the same entitlement to the extended standard rate tax band of €36,800 per annum, the new credit is targeted such that it is available only to the claimant who is the principal carer of the child, that is, the individual with whom the child resides and who looks after the child for the year or the greater part of the year. A maximum of one credit is available per single carer-claimant, regardless of whether he or she cares for more than one child.

Given the difficult fiscal environment, it is essential that all tax reliefs, credits and incentives are kept under review to ensure they are properly targeted and, if necessary, refocused in order that they might achieve the socioeconomic objectives set for them. The one-parent family tax credit was, in certain cases, being claimed by multiple individuals in respect of a single child. A system that allows multiple claims in respect of the same child is unsustainable in the current budgetary circumstances.

It is important to point out that this new credit has been designed to work as an activation measure and to be an in-work benefit to support the primary carer to take up or remain in employment. It will assist single parents or carers with the cost of child care.

In addition, it should be noted that this new policy has been agreed by Government based on a recommendation put forward by the Commission on Taxation that the tax credit should be retained but that it should be confined to the principal carer only. The Government is satisfied that the restructuring of the credit will achieve such an outcome.

In the first instance, it is the responsibility of the parents to look after a child, including financially. Tax credits should not be considered a supplementary source of income, or an alternative to the financial support of a parent.

It is worth pointing out that where a principal carer is married, in a civil partnership or cohabiting they would not be entitled to the new credit, or the former one. In such circumstances the principal carer cannot relinquish the credit to a secondary carer. In addition, a secondary claimant who is married, in a civil partnership or cohabiting would not be entitled to the new credit, or the former one, regardless of the marital status of the primary carer.

The allocation of child care responsibilities is primarily for parents to agree. However, having listened carefully to the views expressed by colleagues in both Houses, the Minister brought forward an amendment on Committee Stage, such that a principal carer who is entitled to the credit and who does not wish to avail of it can choose to surrender it. A secondary claimant may then make a claim for the credit, provided that the qualifying child resides with him or her for not less than 100 days in the tax year. It is entirely appropriate that such surrendering of the credit should be evidenced in writing. This allows for certainty for the full duration of the tax year - this may be the point on which the Senator was seeking clarification - and caters for situations where a principal carer expects to have no tax liability, is actively seeking work, or simply wishes to relinquish the credit despite having the requisite income to utilise it.

The single person child carer credit is initially granted to the principal carer and it is only in circumstances where that individual chooses to relinquish his or her claim that a secondary claimant can then make a claim for the credit. The procedure for relinquishment is that the principal carer proves entitlement to the credit in the first instance and then notifies the Revenue Commissioners, using the same approved form, that he or she wishes to relinquish or surrender this entitlement. It is only in the event of such a relinquishment or surrender that a secondary claimant can then make a written claim to the Revenue Commissioners for the credit. Rather than requiring the second parent to get permission from the first to claim the credit, the legislation requires the first parent to notify Revenue of his or her intention to surrender the credit. That detail clarifies the point. Once the credit has been awarded to a secondary claimant, it will remain with that secondary claimant until such time as the primary claimant wishes to re-enter a claim for the credit. In such circumstances the credit will only be restored to the primary claimant from the start of the next tax year where a formal claim for reinstatement of the credit is made before the end of the current tax year.

In the situation where a principal carer is unwilling to relinquish the credit, it would not be possible to easily identify a secondary claimant, who could be a grandparent, parent or sibling, any one of whom might present a claim to the credit. In addition, a primary claimant could be awaiting a change in his or her employment status before claiming the credit, and as a result, may not want to give it up.

To allow the credit to a secondary claimant without it being surrendered voluntarily by a principal carer could reveal information about the financial or civil status of the principal carer and therefore be in breach of confidentiality. I trust the reply, while is quite technical, has clarified some of the points the Senator raised.

Senator Marie Moloney

The reply has clarified some points but not others. I would refer to a paragraph in the reply, which states:

Of course they should not but people were availing of this credit and they were basing their maintenance payment on the income they had, but now their income has been substantially reduced. It was not that they were taking this credit as a source of income but that their net pay has been substantially reduced. That statement is a little harsh in inferring that people that they were looking for the credit as a supplementary payment - they were not. They were taking what was available to them and using it,and it was the law of the land. The Minister of State is right in that this credit is open to a high level abuse and there have been cases of people pretending to be separated in order to avail of it. I know of a family where the three children in the family have three different fathers and each of them were availing of this credit. They did so - this is the crux of the issue - because there was no monitoring or follow-up on it. All they had to say to the tax office was that the child was staying with them overnight. I note it is stated that it would be a breach of data protection to give the credit to the second carer but it is not easy for someone to get written permission to avail of the tax credit. The Minister of State has said that the second carer does not have to get permission from the first carer but that the first carer can surrender credit to the tax office but we should be realistic about this in that we will have to ask that parent to go to the tax office and surrender the tax credit. Such people will not do it voluntary especially if the break-up is not amicable.

I am not happy with the answer but unfortunately it is one I have got. We have gone backwards on this. We are going back to the old days where a husband had to sign off on his wife's tax free allowance. I thought that day was gone but obviously not. I thank the Minister of State for coming into the House to take this matter.

Deputy John Perry

I would make a further point that might be helpful. Agreement as to who would be the principal carer of a child is a matter for the parents or guardians. However, in the first instance, only the principal carer will be entitled to the credit, a policy change recommended by the Commission on Taxation in 2009. As regards the parent who is taking care of the child, while he or she may not agree to give a concession in respect of the credit, there is provision for agreement having been made with Revenue supported by documentary evidence. Even without the secondary carer getting a letter from the primary carer, agreement can have been given in this respect.

There is no specific tax credit for children in the tax code and the Senator should be aware that married or cohabiting couples are unable to avail of any additional credit in respect of their children. This is despite the fact that in certain cases such couples also have to maintain two households due to the location of employment. Notwithstanding the above, as a result of the amendment to this section, which the Minister brought forward, the primary carer may relinquish the credit such that it can be claimed by a non-primary carer in situations, for example, where the primary carer has no tax liability. That is the key point. I can forward the Senator the full briefing note on this and it may address some of the queries she raised.

Senator Marie Moloney

I would pleased if the Minister of State would do that.

Deputy John Perry

In one sense, this is about ensuring that taxpayers' money goes to the people who are most entitled to it. That objective has been agreed. I will forward the Senator the back-up file on this and she can study the detail of it that covers some of the points she raised.

The Seanad adjourned at 8.20 p.m. until 2.30 p.m. Tuesday, 11 February 2014.

Seanad Éireann debate - Wednesday, 5 Feb 2014