Commencement Matters

Greyhound Industry

I welcome the Minister to discuss this Commencement matter which relates to the Irish greyhound industry. I question the modus operandi of the Irish Greyhound Board which is in receipt of a taxpayer subsidy of €285,000 per week this year. However, its level of communication with and flow of information to the Irish Greyhound Owners And Breeders Federation which represents the owners and breeders of greyhounds in this country is abysmal and shocking, to say the least. This is an ongoing issue. I could talk about the greyhound industry until midnight. It is a highlyfunded industry that has had many shortcomings, some of which were addressed by the previous Oireachtas Joint Committee on Agriculture, Food and the Marine under the Minister of State's stewardship as Chairman. An excellent report on the greyhound industry was produced and is available in the Oireachtas Library for all Members to read. The report highlights the significant shortcomings of the industry, particularly in the corporate governance of the Irish Greyhound Board, the drugs issue and the need for new legislation to be brought forward to deal with transparency in the sector.

The most recent report which was commissioned by the Irish Greyhound Board was on anti-doping and the medication review, the findings of which are alarming. The report was published last summer and it highlights the shortcomings of the Irish Greyhound Board in dealing with the drugs issue in greyhound racing. This is a sector of huge significance to many people throughout the country. The greyhound is often referred to as the poor man's horse. This is a wonderful industry which deserves to be supported by the State. The industry is being significantly supported by the State, but, unfortunately, it appears that it continues to lose money. The State agency involved refuses to engage with the breeders and owners of greyhounds. That is shocking, alarming and unacceptable. The Minister of State was probably given the line today by the Irish Greyhound Board that a forum had been established to deal with all of these concerns, but, unfortunately, the breeders and the owners have no confidence in that forum. They have made a decision not to be part of it.

There may be questions around that. I believe the reason the breeder and owners have done that is because they want to keep their own integrity. Given the fact the chairman of the Irish Greyhound Board is also the chairman of the forum, it appears that the forum is dining à la carte as to who is on it and who comes before it.

If questions have been raised by the industry - they have not been made up by me here today - then they have to be addressed. The only way to address them is through proper and meaningful legislation. To be fair, this was dealt with by the then Minister, Deputy Simon Coveney, with the Horse Racing Ireland legislation in the previous Oireachtas. The Minister of State, Deputy Andrew Doyle, has written to me recently about his own efforts to bring in legislation for the greyhound industry. I cannot emphasise enough, however, the need to do this quickly to save this great industry from its near collapse and to secure its future.

I thank the Senator for raising this matter. I agree it is critically important that Bord na gCon seeks to interface with representative bodies for the sector. With that in mind, Bord na gCon recently established the national greyhound consultative forum, bringing all stakeholders together on a wide variety of greyhound related matters, including anti-doping and medication control.

The first meeting of the forum was hosted by the board and the executive of Bord na gCon on 15 March 2016 with representatives from a cross-section of groups. I understand from Bord na gCon that representative groups are invited to the forum on the basis that they are mandated to represent their members. Several matters were discussed, including proposals for the allocation of additional funding, the SIS TV contract, the breeder incentive scheme and public trainer funding.

The second meeting of the national greyhound forum took place on 14 July 2016. I was in attendance at the most recent meeting of the forum on 10 November 2016, together with a cross-section of stakeholders and members of the board and executive of Bord na gCon. The meeting lasted three and a half hours and a legal representative from the Department was with to me to discuss the heads of the proposed Bill for the greyhound sector. The meeting was informative with a frank and interesting exchange of views. For my part, I provided an outline of the proposed measures in the new Bill, the chief executive officer provided a brief update on progress on the implementation of the Indecon and Morris reports while other attendees contributed to discussions on a range of topics, including welfare, the Harold's Cross stadium and Brexit.

As the controlling body of several greyhound owners and breeders associations, the Irish Greyhound Owners and Breeders Federation, IGOBF, has been invited to the forum to represent those affiliations. Other groups, including but not limited to greyhound owners and breeders associations which are no longer affiliated to the IGOBF, have also been included on the same basis. The other groups invited included Greyhound Racing Integrity Ireland, the Greyhound Group, the Trainers Association, Limerick and Clare Greyhound Owners and Breeders Association, stud keepers and private stadia general managers.

We are about to embark on the publication of the heads of a new Bill for the greyhound sector. The new Bill presents an opportunity for all stakeholders to act as a collective group and move forwards in the interests of the greyhound industry. There are common goals shared by all stakeholders such as to improve welfare, to tackle the use of prohibited substances and invigorate greyhound racing. There will be an opportunity for representatives from various interested parties to make presentations to the Oireachtas Joint Committee on Agriculture, Food and the Marine when the pre-legislative scrutiny phase of the legislation begins, like what happened with the Horse Racing Ireland legislation. This will be an opportune time to contribute to the creation of the best and most enduring legislation possible which will empower and future-proof the industry. I sincerely hope the various representative groups can come together and cohere their efforts in the context of that exercise.

In broad terms, the new Bill seeks to address the deficiencies in the existing legislation, which dates back to 1958, as identified in the Indecon report, by the Joint Committee on Agriculture. Food and the Marine and the Morris report. It addresses the governance of Bord na gCon, strengthens regulatory controls in the industry, modernises sanctions and improves integrity with a view to building a reputation for exceptional regulation in the sector. An improved reputation will instil confidence in the industry and attract larger sponsorship which will, in turn, revitalise the industry.

The heads of the new Bill have been drafted and will shortly be presented to the Government - I am hoping to get them to it before the Christmas break - and then to the Joint Committee on Agriculture, Food and the Marine for pre-legislative scrutiny. I look forward to the continued joint efforts to modernise the Greyhound Industry Act 1958 so as to provide the strongest possible statutory regulatory response, in particular, to medication control and anti-doping. I believe the new Bill will strengthen the greyhound industry to enable it to deal with the existing challenges and maximise its future potential.

In spite of recent difficulties in the sector, I am, nonetheless, confident that the greyhound sector has tremendous growth potential, with sporting, leisure, tourism and cultural appeal across a wide national demographic. However, in order for the sector to realise its full potential, it is imperative that all stakeholders work together towards this common goal and maximise the contribution of the sector to the economy and the social and cultural fabric of the country. For its part, Bord na gCon has assured me that it will continue to prioritise relationships with its key regulatory partners and the wider greyhound bodies in the pursuit of policies to benefit the sector at large.

In view of the fact that the Minister met them for three and a half hours and there is legislation coming before both the House and the committee, I am sure the Senator does not need to ask a supplementary question.

I thank the Minister of State for the comprehensive response. He understands this issue. I also thank him for his efforts in bringing forward the legislation and his commitment which we welcome to try to have it introduced before Christmas. He is correct. The path of engagement is one which can resolve some of these issues on both sides. My only supplementary is to ask the Minister of State to use whatever influence he can to encourage the Irish Greyhound Board to reply to representations made to it.

I hope to be in a position to brief Oireachtas Members before the legislation goes to the committee. Likewise, we are also hoping to alert the committee to the fact that it will have to include this item in its work programme for 2017.

Which is coming upon us.

Carbon Monoxide Poisoning Campaign

The next item is Senator Keith Swanick's which is being taken by the Minister for Communications, Climate Action and Environment, Deputy Denis Naughten, whom I welcome. I note that it is one Roscommon man engaging with another. Ar aghaidh libh, a Rosaithe.

I thank the Cathaoirleach and welcome the Minister.

In this morning's headlines there is an unfortunate and heart-breaking story of an elderly man in County Armagh who has passed away as a result of suspected carbon monoxide poisoning. This devastation has been made all the more tragic by the fact that this was another utterly preventable death.

At the end of September, during carbon monoxide awareness week, I raised the issue of local authorities' obligation to play a role in dealing with this silent killer. In Ireland six people, on average, die unnecessarily from carbon monoxide poisoning each year. A 2015 study found that 1.2 million people were living in houses without carbon monoxide alarms, including 100,000 over the age of 65 years who were living alone. Furthermore, almost half did not even know where to purchase a carbon monoxide alarm.

After I raised this matter in the Seanad, I wrote to the chief executive of each county and city council asking him or her to provide, in tabular form, the number of local authority houses and the number of boilers serviced in 2014 and 2015. The responses varied greatly. Some local authorities did not reply at all, while some simply provided the figures for the numbers of boilers serviced. Others stated it was not their responsibility. As the largest landlord in the State, I strongly believe clarification is needed on local authority housing. I ask the Minister whether he is in agreement with the Minister for Housing, Planning, Community and Local Government, Deputy Simon Coveney, that there is no requirement to carry out an annual service on home heating boilers.

I also want to highlight radon, a radioactive colourless, odourless and tasteless gas which occurs naturally as a decayed product of radium. It is the leading cause of lung cancer after smoking and responsible for up to 250 lung cancer cases in Ireland every year. My party colleague, Councillor David Costello of Dublin City Council, brought this serious concern to my attention and while almost every household in Ireland is familiar with carbon monoxide and its effects, not too many are familiar with or respect the harmful effect of radon gas.

Last week, the EPA reported radon levels 24 times the accepted level in a house in County Wicklow. That is the equivalent of 17 chest X-rays every day. Currently, the agency provides a testing service for radon gas in the home, which costs €50, a not insignificant cost for low-income families given the financial constraints of the past decade. However, the real cost kicks in when a house is determined to have high levels of radon following testing. If it is found to have a high level for radon, which is a cancer-causing gas, the EPA will advise the carrying out of remediation works, which can cost between €500 and €12,000 and can achieve a reduction of up to 98%, depending on how much is spent. There is no grant available to alleviate the cost of remediation. The Government is ignoring the International Atomic Energy Agency report by not providing remediation grants.

The home renovation incentive scheme allows homeowners and landlords to qualify for tax credits equal to 13.5% of the cost of renovation, repair or improvement works. The scheme covers work needed to reduce radon levels in the home but the household needs to spend at least €5,000 to qualify for the scheme, which rules out most remediation works below this threshold. The over-65s may be eligible for a grant to have the work carried out under the housing aid for older people scheme but this is at the discretion of individual local authorities. There is no consistency and there is no rhyme or reason to provision. Some of the most vulnerable members of society are eligible for funds to carry out remedial works, while others are not.

We need to address these silent killers, ensure compliance with boiler servicing to prevent carbon monoxide poisoning and demand a remediation incentive for dealing with radon gas with consistency in its allocation.

I thank the Senator for giving me the opportunity to address this issue.

Carbon monoxide is a poisonous gas which is produced when fossil fuels such as coal, wood, petrol, oil or gas do not have enough oxygen to burn completely. Unlike radon gas, carbon monoxide is produced when fuels are burned and can be produced in homes with poor ventilation, blocked chimneys or damaged appliances. It was brought home to us by the tragedy on the Mayo-Sligo border a number of years ago. Raising public awareness of this domestic threat is a key element in dealing with the issue and my Department, together with a range of industry partners led by Gas Networks Ireland, has initiated a range of public awareness campaigns over the past several years. These are centred on an annual carbon monoxide awareness week, which I was happy to launch on 28 September this year. The campaign is vital to inform and educate all of us in order that we can make changes in our everyday lives and minimise risk before it is too late. The impact and effect of carbon monoxide awareness week in previous years has shown that people take more notice when there is a sustained campaign of broad scope. Home ownership of carbon monoxide alarms increased from 25% in July 2014 to 53% in October 2016. My Department and the regulator are sponsors, as are members of the energy industry, which do great work in getting safety information out to their customers. The National Standards Authority of Ireland, alarm manufacturers and suppliers, together with registered gas installers and oil technicians, are all involved as well. The awareness campaign takes place at the end of September when most of us are increasing fuel use and this is supported with a dedicated website,, which provides safety precautions advice on appliances and contact details.

The Senator commented on local authorities carrying out annual services on boilers. I am happy to engage further with him on the survey he has completed and the response he received from local authorities. Taking off my energy hat and putting on my climate change hat, it is important that all boilers be serviced on an annual basis because it improves their efficiency, reduces the fuel burned and, as a consequence, reduces the bill for consumers. We should make sure the boilers of those living in low-income households and local authority housing are operating as efficiently as possible.

Radon is a lung carcinogen and linked with five cancer diagnoses per week.

It is a serious public health hazard. It can only be measured with special detectors and produces radioactive particles when inhaled. These particles are deposited on the airwaves and result in a radiation dose on a person's lungs. It is the second biggest causer of lung cancer after smoking and is the leading cause of lung cancer in non-smokers.

We have a national radon control strategy that is targeting the improvement in standards in building regulations, which have been revised since 1998 and which have had a direct impact on improving the standards of homes across the country. Some of the key measures set out in the national radon control strategy are: the installation of passive preventative measures in new buildings; the use of property transactions - sales and rentals - to drive action on radon; raising radon awareness and encouraging individual action on radon; provision of advice and guidance for individual householders and employers in high radon areas; promoting confidence in radon services; and addressing radon in workplaces and public buildings. This is a matter of which I am very conscious, particularly in the context of places such as Ballintober, County Roscommon, and Fohanagh-Ahascragh in east Galway that have been listed as "red" by the Environmental Protection Agency, which means there is potential for high radon gas levels. The Senator's part of the country, Ballina, is a hot spot for radon gas. We need to raise awareness, particularly in those communities, and we need to do more to encourage people to test for radon gas and put supports in place to carry out remedial action.

To date, of the homes that have been tested, 700 have shown raised radon levels, of which 80 have extremely high radon levels. Based on the national radon survey, it is estimated that approximately 110,000 homes across Ireland have radon concentrations above Ireland's threshold limit of 200 Bq/m3. That means we have identified less than 1% of the total number of households. There is a European radon awareness day and a website, We use the conveyancing mechanism of the legal profession to try to identify radon when properties are being transferred. We are now working with the Department of Education and Skills to determine what actions can be taken under the scheme to support schools on the maintenance and remedial systems that can be put in place. The EPA has also engaged bilaterally with Tusla on how best to increase awareness and promote action amongst relevant agencies and crèche owners. Next year there will be a roll-out of a campaign with Tusla inspectors and voluntary organisations. There has been a programme of radon testing, particularly with older people. The Senator touched on the housing aid for older people scheme which can be used for that purpose. There is also the home renovation incentive scheme which is of benefit to some families. We are actively looking at other incentives to facilitate and encourage radon testing. There are proposals before me to consider the introduction of financial incentives. If the Senator or the industry have thoughts or suggestions on this matter, I would be very happy to hear from them.

I look forward to working with the Minister, initially on the carbon monoxide issue. The State is the largest landlord in the country. As there is a lack of consistency across counties, we need uniformity. On the radon issue, I implore the Minister to take on board some of the recommendations from the International Atomic Energy Agency which advised that a remediation grant should be made available. As the house renovation incentive scheme kicks in at a figure of €5,000, perhaps a lesser sum might be acceptable.

The home renovation incentive scheme kicks in at a figure lower than €5,000. The maximum is €5,000, but there are grants below that figure which is available to homeowners. The big problem is raising awareness of radon.

The Senator is right and we must put a remediation programme in place. There is not much point in telling people they have a problem unless we can assist them with it.

I am quite prepared to consider how we should put a structure in place. As the Senator knows, we have limited finance available and perhaps we could start with a pilot scheme to see the scale of the problem. We have done that successfully within the energy division in my Department through the Sustainable Energy Authority of Ireland with other programmes. We have some very good models. I am quite happy to engage with the Senator to see how we can progress both of the issues.

Tax Code

I welcome the Minister of State to discuss this very important matter. As he is aware, in September the Brazilian tax authorities issued normative instruction 1658/2016, adding Ireland to its list of designated tax havens also known as the blacklist. The change came into effect on 1 October. Ireland joins the illustrious company of states such as Panama, Monaco and the Isle of Man on the blacklist and, needless to say, such classification is damaging to our international reputation. The category that includes Ireland has countries that have no tax, that hide banking or trade information or that have a corporate income tax rate of less than 20%. This is unwelcome news, considering the increased international scrutiny this year already as a result of the Apple tax ruling and the startling GDP results. With Brazil being one of the top ten economies in the world, this is seriously problematic for the Ireland-Brazil trading relationship and poses significant challenges to Irish exporters, particularly in the post-Brexit world.

Transactions involving entities resident in Ireland are now subject to greater Brazilian tax regulation, including mandatory transfer pricing rules for any transaction involving goods, services and rights, even if between non-related parties; stricter thin capitalisation rules; stricter tax deductibility rules that require detailed identification of the effective beneficiary of payments made; and the fact that transactions with entities resident in countries on the blacklist are subject to increased holding taxes of 25% instead of the regular level of 15%. The ruling has particular effect on three key areas where Ireland and Irish companies in particular have a strong strategic interest, namely aircraft leasing, agriculture and insurance.

Over 60% of commercial aircraft in Brazil are leased through Ireland and the country has, rightly, developed a reputation as the international hub for aircraft leasing. This decision, if it is not reversed, will likely have a negative effect on this area. The European Union is preparing details of a trade deal with Brazil and the wider Mercosur region. While offering potential benefits, this deal is of particular concern to the Irish beef industry. This recent ruling will greatly undermine Ireland's negotiation stance entering these talks. The ruling is also having major effects on the insurance sector, where there are a number of Irish companies active in Brazil. They are unable to enter any new business while contracts with an automatic renewal clause can only be renewed for one more year as of the suspension date.

I am aware that the Irish ambassador to Brazil met representatives of the Brazilian revenue service to refute these allegations and seek Ireland's removal from the blacklist. A formal request for Ireland to be removed from the Brazilian list was submitted on 27 September. However, it appears there has been no official response as of yet from the Brazilian authorities to our request to be removed from this blacklist. For the reasons outlined, it is imperative this be changed as soon as possible.

I thank the Senator for raising the issue and giving me the opportunity to update the House on the matter.

The Minister for Finance, Deputy Michael Noonan, and I were surprised and disappointed to learn in September that the Brazilian Federal Revenue Service had, without warning, added Ireland to Brazil's tax blacklist. The operation of the listing was initially backdated to 1 August but it was subsequently suspended until 1 October. No notice of this decision was given to the Irish Government by the Brazilian Federal Revenue Service and no explanation was received as to why Ireland has been included on the list.

Being included in the list has a number of negative consequences, including greater Brazilian taxation on flows of income from Brazil to Ireland. Since the listing was published, we have sought to engage with Brazilian revenue to seek Ireland's removal from the list. The Irish ambassador to Brazil is leading our engagement with the Brazilian Federal Revenue Service, doing a fantastic job on behalf of the Government. Officials from the Department of Finance and the Department of Foreign Affairs and Trade are in close contact with the ambassador and supporting these efforts.

Senior officials from both Departments have also held meetings with the Brazilian ambassador to Ireland to express our concern about being included in the Brazilian list.

A formal request for Ireland to be removed from the Brazilian list was submitted to the Brazilian Federal Revenue Service on 27 September. The request also sought for the listing to be suspended to allow technical discussions to take place between officials. The request remained under consideration by the Brazilian Federal Revenue Service until we received a response on 17 November.

While the request was still under consideration, the Brazilian Federal Revenue Service made some changes to the operation of the listing. These changes were designed to remove the aviation sector from the scope of taxes imposed as a result of the listing. The change means that withholding tax is not included on the payment of aircraft lease rentals from Brazilian airlines to Irish aircraft leasing companies. Unfortunately, the reply from the Brazilian Federal Revenue Service on 17 November rejected our request for the listing to be suspended. Following follow-up discussions, the Brazilian Federal Revenue Service has agreed to meet a technical delegation from the Department of Finance and the Revenue Commissioners to discuss the issue further. The Irish ambassador in Brazil is now working on scheduling a meeting as soon as possible. I was in contact with him on Friday of last week on two separate occasions to discuss this issue to see what timeline we could have for the meetings to move forward as quickly as possible.

The response received from the Brazilian Federal Revenue Service makes it clear that Ireland was included on the list because our statutory rate of corporation tax is below 17%, which is the benchmark set under Brazilian law. In our formal submission to Brazil we have highlighted that Ireland has a 25% corporation tax rate on passive income and a 33% rate on chargeable gains. We gave also stressed that the 12.5% rate has been settled policy in Ireland since 2003 and that Ireland's corporation tax take has typically been very close to the EU and OECD averages, both in terms of corporate tax as a percentage of GDP and in terms of corporation tax as a percentage of total tax revenue. We believe it is inappropriate to include Ireland in a blacklist simply because we apply a low tax rate to a wide tax base, which is fully in line with recommended OECD best practice. We remain hopeful discussions between the Brazilian Federal Revenue Service and Irish officials will enable us to fully explain our corporate tax system and, I hope, see Ireland removed from the Brazilian list.

I should add that the response received from Brazil on 17 November makes it clear that Brazil does not consider Ireland to be a tax haven. I strongly reject allegations that Ireland is a tax haven. Ireland does not meet any of the international standards for being considered a tax haven. Ireland is fully compliant with all international best practice in the areas of tax transparency and exchange of information. Ireland's corporate tax policies are designed to attract real and substantive operations to Ireland. Ireland has not been and will never be a brass-plate location. Ireland only has and wants real substantive foreign direct investment, the kind that brings real jobs and investment.

Ireland is an active participant in global work to reform the international corporate tax system. We have implemented country-by-country reporting, agreed the anti-tax avoidance directive and are working towards the implementation of the remaining OECD base erosion and profit sharing, BEPS, recommendations both domestically and internationally. On budget day the Minister published an update on Ireland's international tax strategy that highlighted our continuing efforts in that regard.

I thank the Minister of State for his detailed response. I share his disappointment with the Brazilian reply so far. I fully appreciate that this matter is being handled to the best of the Government's ability. I ask that it engage with the various entities and companies that have an interest in Brazil to see if they can work together to smooth out this matter as quickly as possible.

I thank the Senator for raising the matter. The Government takes this issue very seriously. As Minister of State with responsibility for international financial services, I take it seriously. We have done a lot of work in recent weeks and months with the various stakeholders involved to make sure we can progress the issue and achieve a satisfactory outcome for all concerned.

Sitting suspended at 3.10 p.m. and resumed at 3.30 p.m.