Written Answers Nos. 84-93
84. Deputy Timmy Dooley asked the Minister for Finance if he supports the extension of the fuel rebate for hauliers announced in budget 2013 to bus and coach operators; and if he will make a statement on the matter. [8548/13]
View answer85. Deputy Timmy Dooley asked the Minister for Finance the measures he will put in place to help bus and coach operators; and if he will make a statement on the matter. [8564/13]
View answer89. Deputy Dessie Ellis asked the Minister for Finance if he will provide an update on plans to extend tax rebates on fuel to other industries which rely on road transport and for which fuel makes up a significant part of their overheads. [8577/13]
View answerI propose to take Questions Nos. 84, 85 and 89 together.
The proposal to introduce an auto-diesel excise duty relief for licensed road hauliers that I announced in the Budget was, initially, confined to licensed and tax compliant hauliers.
However having received a number of submissions from, and on behalf of, private coach operators seeking to have this relief extended to them, Deputies will now be aware that I have extended the relief to the licensed passenger transport sector in the context of the Finance Bill published on February 13th. The maximum amount of the relief will be 7.5 cents per litre and will be price dependent.
86. Deputy Dara Calleary asked the Minister for Finance his views that the pillar banks are fulfilling their obligations to the small and medium enterprise sector; and if he will make a statement on the matter. [9087/13]
View answer87. Deputy Dara Calleary asked the Minister for Finance the amount of new lending to small and medium enterprise by the pillar banks in 2012; if he will outline the value of facilities renewed in 2012; and if he will make a statement on the matter. [9070/13]
View answerI propose to take Questions Nos. 86 and 87 together.
The Deputy will be aware that the Credit Reviewer said in his most recent quarterly report that “Both banks have achieved their €3.5bn SME loan sanction targets. Over €8bn was sanctioned in 2012; of which approx. €2.5bn (27%) is new lending drawn down.”
According to the Credit Review Office, the balance of the sanctioned lending represented restructured or refinanced credit to SMEs which the Credit Review Office in the past has noted is important in terms of sustaining the businesses and the associated jobs.
One of the most powerful ways of ensuring that the pillar banks provide credit to viable is the availability of the Credit Review process. The Credit Review Office can review decisions by the pillar banks to refuse, reduce or withdraw credit facilities, including applications for restructured credit facilities, from €1,000 up to €500,000. The Credit Review Office is currently overturning 55% of the refusal decisions referred to them and anyone who has been refused credit by the banks should avail of the services of the Credit Review Office.
88. Deputy Brian Stanley asked the Minister for Finance the number of jobs that would be created by an annual €1 billion enterprise stimulus; the multiplier effect this investment would have on the economy and the savings to the State. [9063/13]
View answerThe economic and labour market impact of any stimulus depends upon the type of measure involved. Fiscal multipliers vary according to the fiscal instruments used, and the impact on both growth and job creation as a result can differ accordingly.
Ireland is a small, open economy with imports accounting for over three quarters of GDP. As a result, a considerable amount of any stimulus is likely to leak out through a reduction in these imports. For this, and other reasons, the fiscal multiplier in Ireland tends to be somewhat lower than in many other European countries.
When discussing the implications of an additional stimulus package for the Irish economy it is important not to lose sight of the current fiscal position of the State and the opportunity cost of such funds. The Government is acutely conscious that there remains a considerable gap between what we get in revenue and what we spend. This situation is not sustainable over the longer term. In addition to the requirement to bring our deficit to under 3% of GDP by 2015 as per the Excessive Deficit Procedure, it makes sense that we bring balance back to the public finances and stabilise and reduce our debt burden. This is how we will ultimately create growth and jobs on a sustainable basis.
90. Deputy Michael McGrath asked the Minister for Finance the steps taken to engage with as wide a range of potential purchasers as possible prior to the sale of Irish Life to Great West Lifeco to ensure the maximum return to the State; and if he will make a statement on the matter. [10637/13]
View answerI can advise the Deputy that a sale process was conducted beginning in mid-2011 in which 51 bidders were contacted about the opportunity to acquire Irish Life. Great-West Lifeco emerged as the preferred bidder for Irish Life following this process. However as a result of fears of a Eurozone break-up on the part of Great-West Lifeco, they withdrew their offer in late November 2011 and the process was suspended.
As the Deputy may be aware, since the bid process was suspended valuation multiples in the life assurance industry have improved, as have Irish bond yields, while the underlying life assurance industry in Ireland remains challenging, as outlined by Mark Burke, Head of Life Insurance Supervision at the Central Bank of Ireland in a speech on 31 January 2013 to a Life & Pension industry conference.
These circumstances allowed the State to recoup in full the investment made by the taxpayer in Irish Life and a valuation which was significantly better than could have been achieved if a sale had concluded early in 2012. A fair value opinion which supported the decision taken by the State was received from our advisors Goldman Sachs. The disposal proposed achieves a good valuation for Irish Life, an asset which the State did not intend to hold for the medium-term as the acquisition itself had been financed with borrowed money.
I believe the sale represents a very good deal for the Irish taxpayer.
91. Deputy Michael McGrath asked the Minister for Finance if he intends to increase or in any other way supplement the membership and resources of the National Asset Management Agency advisory board to reflect the impending increase in assets under the control of NAMA; and if he will make a statement on the matter. [10640/13]
View answerI would like to remind the Deputy that the NAMA Advisory Group has been set up to advise me in the following areas:
- The strategy of NAMA.
- The appointment of directors to NAMA.
- The remuneration of senior executives in NAMA.
- Any further advice I may seek of them.
The group operates on an informal basis and reports directly to me. Each of the members of the group has specific and significant private sector experience.
I am satisfied that the NAMA advisory board is working effectively and there are no plans to change its composition at this time.
92. Deputy Michael McGrath asked the Minister for Finance the reason all the fixed term deposits related to investment products sold by Anglo Irish Bank were not transferred to AIB at the time of the sale of its deposit book; and if he will make a statement on the matter. [10641/13]
View answerPursuant to a Transfer Order made by the High Court under CISA on 24 February 2011 (the “Transfer Order”), Anglo Irish Bank transferred the vast majority of its Irish and UK customer deposits to Allied Irish Banks, p.l.c. (‘AIB’) and AIB Group (UK) p.l.c. (‘AIB UK’), together with its NAMA senior bonds and its Isle of Man subsidiary.
As part of this process it was agreed between Anglo and the Transferees that a variety of deposits and accounts would be excluded from the transfer and retained within IBRC in order to retain security and/or as income sweep accounts related to its lending book and also where the nature of the products were difficult to transfer. I have been informed by the Special Liquidators that as far as they are aware all deposits as set out in the Transfer Order were transferred by IBRC.
93. Deputy Michael McGrath asked the Minister for Finance his views on whether banks are responding adequately to the demand for credit from first-time house buyers; and if he will make a statement on the matter. [10642/13]
View answerDemand for credit from first time buyers is an important component of the demand side in the housing market. It is important to the economy as a whole that creditworthy individuals are able to access credit when they decide to purchase a house for the first time. Central Bank figures are published in Table A.1 Summary of Irish Private Sector Credit and Deposits which is available at http://www.centralbank.ie/polstats/stats/cmab/Pages/releases.aspx . They show that lending to households for house purchase was 1.6 per cent lower on an annual basis at December 2012. Transactions for house purchase declined by €4 million in the month of December 2012.
The IBF/PWC Mortgage Market profile shows new mortgage lending in Q4 2012 at close to €1 billion and that first time buyers are approximately 60% of this lending, by value and volume. The increase in this number over the Q4 figure for 2011 may be partly attributable to the ending of mortgage interest relief for borrowers. However it would appear to show that the banks were able to respond adequately to increased demand when called upon to do so but it is an area of activity in the banking sector that I will be keeping under review.
