Written Answers Nos. 132-141
132. Deputy Pearse Doherty asked the Minister for Finance if he will confirm the amount of debt forgiveness that will be provided by Allied Irish Bank to Independent News and Media as part of the latter firm's recently announced reorganisation plans. [21178/13]
View answer150. Deputy Luke 'Ming' Flanagan asked the Minister for Finance if he will state, in both absolute and percentage terms, the amount of the debt being written down by wholly and partly State owned lending institutions for Thomas Crosbie Holdings Limited and Independent News and Media Limited; and if he will make a statement on the matter. [21415/13]
View answer152. Deputy Luke 'Ming' Flanagan asked the Minister for Finance the percentage stake the State will now hold through Allied Irish Banks and Bank of Ireland in Independent News and Media Limited as a result of the debt for equity swop to facilitate the write down of INM Limited debt; and if he will make a statement on the matter. [21424/13]
View answerI propose to take Questions Nos. 132, 150 and 152 together.
I have been informed that due to data protection rules and customer confidentiality the banks are not in a position to discuss details of individual customer circumstances.
133. Deputy Pearse Doherty asked the Minister for Finance his latest estimate of the gross and net cost of bailing out Anglo Irish bank and Irish Nationwide Building Society. [21179/13]
View answer134. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Question No. 283 of 18 September 2012, in which he stated the bank's CEO has given an indication previously that the likely outcome for Anglo Irish Bank would be in the €25-€28 billion region, if, following the planning of the special liquidation of Irish Bank Resolution Corporation from October 2012 when he stated that he first consulted KPMG on the matter and following the appointment of a special liquidator on 6 February 2013, his views on whether this outcome of €25-€28 billion still holds. [21180/13]
View answerI propose to take Questions Nos. 133 and 134 together.
It is important to note that comments made by the former executives in IBRC were based on the assumption that IBRC was to continue as originally planned and that payment of interest and capital on the Promissory Notes would also continue which is not now the case. There are numerous benefits from the arrangements that have been undertaken. There are efficiency gains from housing ‘legacy assets’ in a single vehicle, NAMA. Exceptional Liquidity Assistance and the inherent risk associated with short term borrowings has also been removed from the Irish banking landscape. There is also an expected reduction in the underlying deficit by c.€1 billion per annum over the coming years with a reduction in government debt over time. These all need to be taken into account in assessing the benefits of the IBRC liquidation.
It is far too early to predict the outcome of the liquidation process and the overall cost for the State in relation to IBRC. It will not be possible to conclude for certain whether the value of the assets to be sold by the Special Liquidators, is sufficient to compensate NAMA for the amount paid for the net IBRC debt that it has acquired, until the valuation of those assets has been completed.
As part of the role of the liquidators, the assets of IBRC will be valued independently before being sold. Any assets not sold to third parties at or above the valuation price will be sold to NAMA at the independent valuation. This ensures a ‘floor’ price on the assets of IBRC and that where required, assets with limited sale potential now, can be worked through in the medium term by NAMA rather than sold to the best available third party at any price. This approach ensures a fire sale of assets will not occur. This Government’s approach is consistent and focused on the best outcome for the Irish State and its people.
135. Deputy Pearse Doherty asked the Minister for Finance the total actual and potential claims by local authorities against Irish Bank Resolution Corporation in respect of unpaid developer bonds relating to building developments; and if he will confirm the way such liabilities will rank amongst IBRC's creditors. [21181/13]
View answerI am advised that development bonds previously entered into by IBRC in favour of the various County Councils or local authorities remain in place. However it should be noted that it is likely that any liabilities arising under these arrangements, if called upon, will rank as unsecured claims in the special liquidation. It must be stressed that these bonds are contingent liabilities and will only be called upon where developers breach planning conditions and are not in a position to meet any liability that arises as a result. Any local authority should contact the Special Liquidators directly in respect of such claims should they arise. The Special Liquidators are in the process of establishing the level of bond/guarantees and indemnities entered into by IBRC (prior to liquidation) in favour of County Councils.
136. Deputy Kevin Humphreys asked the Minister for Finance the way liability and qualification for deferral of the local property tax determined in a case where two siblings jointly own a home, but both individuals' income are below the threshold to allow for deferral of the tax, but jointly would be over the threshold; if siblings are jointly assessed in this case or just one liable individual; and if he will make a statement on the matter. [21205/13]
View answerLocal Property Tax (LPT) is a self-assessed tax and it is a matter for a property owner to calculate the amount of LPT due based on his or her assessment of the market value of the property. I am advised by the Revenue Commissioners that the amount of LPT due is determined by reference to the valuation band based on the market value of the property. As the siblings are joint owners of the property, they are jointly and severally liable for the LPT. However, in cases of joint ownership, only one of the owners is designated by the Revenue Commissioners for the purposes of submitting the LPT return form and paying the tax. For individuals on low incomes the Finance (Local Property Tax) Act 2012 (as amended) provides for a system of deferral arrangements for owner-occupiers where there is an inability to pay the tax and certain specified conditions are met. Owners may qualify to defer all or part (50%) of their LPT liability.
In the context of the Deputy’s question, where the joint owners are siblings, one owner will be the designated owner for filing and payment purposes. It is only the gross income of the designated owner, provided he or she is an owner-occupier, that is taken into account to determine if the deferral conditions are met, i.e. there is no aggregation of the gross incomes of all of the joint owners. In this case, as both incomes are below the individual threshold the designated owner will qualify for a deferral. To determine whether deferral applies for 2013, the designated owner is required to estimate on 1 May 2013 what his or her total gross income for 2013 will be. Where a deferral is being claimed on the basis of income threshold, the LPT Return must be completed and the relevant deferral condition selected.
On 25 April I provided details on the option of deferring payment of LPT based on income threshold in my reply to Parliamentary Question No. 69 on 25 April (19691/13). I am advised by the Commissioners that full details of all deferral options are outlined in the Guidelines on Deferral or Part Deferral of Local Property Tax, which are available on Revenue’s website www.revenue.ie.
138. Deputy Dara Calleary asked the Minister for Finance if his Department and agencies under its aegis, who own or rent property in commercial developments are in compliance with their responsibilities under the Multi Unit Development Act 2011; if he will outline those agencies who have representation on the boards of owners' management companies; if he will provide a list of the agency, the relevant management company and its associated property but not the name of the individual representing the said agency; and his views on the implementation process of the Multi Unit Development Act within his Department. [21245/13]
View answerIn response to the Deputy’s question my Department does not own or rent property in commercial developments. In respect of bodies under the aegis of my Department I am not aware that any of these bodies own or rent property in commercial developments.
139. Deputy Charlie McConalogue asked the Minister for Finance his views that a well regulated debt management advice sector can provide assistance to persons with personal debt difficulties who do not qualify for the reliefs set out in the Personal Insolvency Act; and if he will make a statement on the matter. [21262/13]
View answerThe amendment to the Central Bank (Supervision and Enforcement) Bill 2011, which I proposed at Committee Stage, and was agreed on the 24th April 2013, will provide for a regulatory regime for debt management and debt advice companies. On the issue more generally people in debt or in danger of getting into debt can avail of the services of the Money Advice and Budgeting Service (MABS). This is a national, free, confidential and independent service. MABS have offices throughout the State. It is strongly suggested that anyone with debt or budgeting difficulties should approach their local MABS Office with a view to securing a confidential consultation with a money adviser to consider their particular circumstances.
The Deputy should be aware that the Government has introduced a range of additional information and guidance resources to assist mortgage holders through what can be a difficult and stressful process. A dedicated website, www.keepingyourhome.ie , has been put in place to provide general public information on mortgages arrears issues. In addition, there is a Mortgage Arrears Information Helpline, which is established under the aegis of the Citizens Information Board, to provide more tailored information to individual callers. Finally, a panel of accountants has been put in place to provide “one to one” independent advice to borrowers who have been provided with a long term forbearance resolution offer by their lender in respect of a mortgage on their primary home. All of these information services are provided at no direct charge to the users of the service.
140. Deputy Charlie McConalogue asked the Minister for Finance if he will ensure that his plans to regulate the debt management advice sector prohibits misleading advertising, ensures reasonable charges and appropriate protection for client funds; and if he will make a statement on the matter. [21263/13]
View answerThe amendment to the Central Bank (Supervision and Enforcement) Bill 2011, which I proposed at Committee Stage, and was agreed on the 24th April 2013, will provide for a regulatory regime for debt management and debt advice companies. Under the proposed legislation the Central Bank will require that debt management firms will be obliged to comply with an appropriate code of conduct. The existing protections of the Consumer Protection Code will apply to debt management firms and it is via this code that protections for consumers with regard to advertising and charges etc. will be provided for.
Debt management firms will be authorised to provide debt advice and debt negotiation services as provided for in the definition of debt management services in the Central Bank (Supervision and Enforcement) Bill 2011. They will not be authorised to hold client funds on the basis of solely holding a debt management firm authorisation. Where debt management firms propose to receive client funds and make payments on behalf of clients to their creditors they may require a payment institution authorisation under the European Communities (Payment Services) Regulations 2009 or a money transmission business authorisation under Part V of the Central Bank Act 1997 (as amended) depending on their business model. It is under these regimes that the appropriate protection for client funds is provided for.
141. Deputy Ann Phelan asked the Minister for Finance if his attention has been drawn to the disparity that exists in the sale of nicotine replacement patches in Northern Ireland and here (details supplied); and if he will make a statement on the matter. [21274/13]
View answerI am advised by the Revenue Commissioners that nicotine replacement patches are subject to the standard rate of VAT in Ireland, currently 23%. Unlike other nicotine products, such as nicotine inhalers, tablets and chewing gum, which are categorised as oral medicines and therefore qualify for the zero-rate of VAT, nicotine replacement patches do not fall into this category and are therefore subject to the standard rate. While in the UK nicotine patches are liable to a reduced VAT rate of 5%, under the EU VAT Directive it is not possible for Ireland to apply a 5% VAT rate to the supply of nicotine patches. This is because the VAT Directive only permits Member States to apply two reduced rates of VAT, and as Ireland already applies two reduced VAT rates of a 9% and 13.5%, it would not be possible to apply a 5% rate to nicotine patches.
