Written Answers Nos. 67-86
67. Deputy Richard Boyd Barrett asked the Minister for Finance if the issue of shadow banking here was discussed at the meeting of EU Finance and Economic Ministers that he attended last week; and if he will make a statement on the matter. [23986/13]
View answerShadow banking was not discussed at the ECOFIN meeting of EU Finance and Economic Ministers on 14 May.
The agenda dealt with Banking Recovery and Resolution; the draft Budget; Savings Taxation agreements with third countries; tax evasion and fraud; macroeconomic imbalances; Economic and Monetary Union, including the introduction of a Convergence and Competitiveness Instrument and ex ante economic policy reforms; and discussions on G20 Finance Ministers and Governors (18-19 April) and IMF/World Bank.
The Commission will in summer 2013, as a follow up to their Green Paper of March 2012, and the international work coordinated by the Financial Stability Board, address the systemic problems related to shadow banking. My Department is awaiting the publication of the Commission’s proposals and will engage fully with efforts to improve regulation of shadow banking.
68. Deputy Seán Crowe asked the Minister for Finance if the National Asset Management Agency has been approached by, or on behalf of, farmers seeking to harvest fodder on lands under NAMA’s control; and if so, the way NAMA has responded; NAMA’s position on such requests; and if NAMA has communicated its position to its borrowers. [23952/13]
View answerI am advised by NAMA that such requests, in so far as there may be any, would be received by its debtors and receivers and not by the Agency itself, given that it is a secured lender and does not own agricultural land.
I am advised by NAMA that farmers seeking access to an individual property should in the first instance contact the owner of the property or the receiver, if one is in place. If farmers are experiencing difficulty in relation to contacting such parties, they can contact NAMA directly through the Agency’s dedicated email address for members of the public, info@nama.ie and NAMA will bring any requests received to the attention of debtors or receivers.
69. Deputy Seán Crowe asked the Minister for Finance if he will report on progress made towards a banking union. [23951/13]
View answerThe European Council meeting of 29 June 2012 considered a report from the President of the European Council in cooperation with the Presidents of the Commission, Eurogroup and ECB which set out building blocks for future Economic and Monetary Union. One of these building blocks is an integrated financial framework or banking union which comprises three elements (a) an integrated system for the supervision of cross-border banks in the form of the single supervisor mechanism (‘SSM’), (b) a recasting of the deposit insurance scheme directive (‘DGS’) to further harmonise national DGSs, and (c) a European harmonised Bank Recovery & Resolution scheme commonly referred to as the BRRD. Significantly the statement of the Euro area Summit clearly stated that when a single supervisory mechanism was in place for banks in the euro area the ESM could, following a regular decision, have the possibility to recapitalise banks directly. Furthermore to complete the Banking Union initiative the European Commission will this summer bring forward proposals for a Single Resolution Mechanism (SRM) to coordinate the application of resolution tools to banks. The European Council of December 2012 noted the Commission’s intention to submit a proposal for an SRM for Member States participating in the SSM to be examined as a matter of urgency during the current parliamentary cycle of the EP i.e., before May 2014.
The stated position of the Ecofin is that the building blocks for Banking Union should be put in place as soon as possible. This is a sensible approach and our work as Presidency is helping to advance Banking Union in as speedy a manner as possible. As we move into the final weeks of our Presidency we will continue to afford top priority to the legislative files relating to Banking Union in line with the conclusions of the European Council which set out a time frame and series of steps for achieving this.
The Irish Presidency is giving absolute priority to all the files relating to the promotion of Banking Union in line with the ambitious agenda for Banking Union. We have achieved agreement on the Single Supervisory Mechanism (SSM) - a very significant step forward towards ensuring financial stability and thus facilitating growth.
We have also achieved agreement on the Capital Requirements Directive IV, which aims to strengthen the capital requirements for banks and the overall effectiveness of regulation for the sector and enhance financial stability.
We have made good progress towards agreement on the Bank Recovery and Resolution Directive as the essential next step, with a view to agreement by June of this year, as envisaged by the European Council. Once this has been agreed, the European Commission is expected to submit a proposal for a single resolution authority, which will build on the work now underway. The remaining work on the DGS can commence once the financing elements of the BRRD have been agreed.
An important complement to the Banking Union package is the development of an operational framework for the direct recapitalisation of banks by the European Stability Mechanism (ESM) which should include the definition of legacy assets. It is expected that the ESM guidelines on the Direct Banking Recapitalisation instrument will be completed by end June.
70. Deputy Robert Troy asked the Minister for Finance his views on the future of Permanent TSB; the way it can assist in strengthening consumer choice in the Irish banking sector; and if he will make a statement on the matter. [23939/13]
View answerAs I stated in response to PQ 2009/13 a way forward for Permanent TSB was agreed with the Troika in April 2012 which envisaged it playing an important role in the future of Irish retail banking, being a more focused retail bank bringing an element of competition to the marketplace which has consolidated significantly since 2008. In this regard Permanent TSB submitted a Restructuring Plan to the European Commission in June 2012. Permanent TSB has made significant progress in delivering its Restructuring Plan and has announced plans to lend €450 million for Mortgages, Personal Loans and Credit Cards in 2013, a significant increase on the €90 million lent in 2012.
I welcome the commitment to new lending by Permanent TSB which should be of assistance to the wider economy and strengthen consumer choice in the Irish banking sector.
71. Deputy Brendan Smith asked the Minister for Finance the actions that he will take to assist in combatting international tax evasion; and if he will make a statement on the matter. [23938/13]
View answerI am advised by the Revenue Commissioners that they are strongly focused on ensuring optimal compliance with tax obligations, and that non-compliance is confronted and penalised. Revenue’s overall approach to managing compliance is to undertake a range of targeted interventions that are most appropriate for dealing with the specific risks presented in individual cases. In 2012, Revenue carried out more than 537,000 compliance interventions, which yielded more than €492 million. I am advised also that Revenue continues to develop innovative ways of identifying non-compliance and bringing to account those who fail to comply with their tax obligations, including those who seek to evade their responsibilities through the use of offshore accounts and structures. They are assisted in this work by robust legislation to support compliance activities, including, for example, the recent obligation that has been placed on merchant acquirers and other payment settlement entities to make returns of transactions, principally credit card transactions, to Revenue. Their work is also supported and enhanced with appropriate technology, including their Risk Evaluation Analysis and Profiling (REAP) risk identification system and capture of data from multiple sources.
Ireland has been to the forefront in acting against the use of offshore accounts for the purposes of evading tax. Revenue set up a dedicated unit, tasked with identifying and investigating Irish residents engaged in this form of tax evasion, in 2001. Further investigations targeting the settlement of funds and assets on trusts and similar offshore structures were initiated in 2009. Schemes of voluntary disclosure and investigations undertaken have, to date, resulted in collection of €1.1 billion in tax liabilities, statutory interest payments and penalties, of which almost €19 million was collected in 2012. These investigations are ongoing and most recently have led to the uncovering of two types of cash extraction schemes with total tax at risk of €198.5 million. Recent developments have also included analysing details of payments made in Ireland using foreign credit cards. Revenue will continue to act in a very determined way to deal with tax evasion in all its forms.
Ireland is also committed to working closely with other countries to combat offshore tax evasion. 69 bilateral Double Taxation Agreements and 21 Tax Information Exchange Agreements are in place which ensure a system of full exchange of tax information. In addition, in December 2012, Ireland became one of the first countries in the world to sign an Agreement with the United States of America to Improve International Tax Compliance and to Implement FATCA (that is, the United States Foreign Account Tax Compliance Act). This type of agreement is now being hailed as the emerging international standard for the automatic exchange of tax information. Revenue also participates in the OECD Forum for Tax Administration’s Offshore Compliance Network, which is a forum for the countries concerned to share information and experiences on practical issues relating to the fight against offshore evasion.
Combating tax fraud and evasion has also been a priority during our Presidency of the EU and work has been taken forward in a number of key areas. Following a very productive discussion on the issue at the informal ECOFIN meeting in April, Commissioner Semeta and I issued a joint letter to ECOFIN Ministers inviting them to agree a range of measures to tackle tax fraud and evasion. Significant progress was made in this regard at the ECOFIN meeting on 14 May, at which agreement was reached on a mandate for negotiating amendments to the Savings Tax Agreements with Switzerland, Liechtenstein, Monaco, Andorra and San Marino to ensure equivalence of measures with the EU. Also at the ECOFIN meeting on 14 May, Ministers adopted Council Conclusions strongly welcoming the European Commission’s Action Plan on tackling tax fraud, evasion and aggressive tax planning, and reaffirming their commitment to collective action in this area working in close cooperation with the OECD and the G20. The issue of tax fraud and evasion is an important agenda item at the European Council meeting on 22 May and it is intended to return to the matter at the ECOFIN meeting in June.
Finally, I am advised by Revenue that they have published detailed guidance in relation to employer withholding tax obligations for international employees working in the State which clarifies a number of anti-avoidance measures introduced in the Finance Act 2006 to combat non-compliance with employer statutory requirements.
72. Deputy Timmy Dooley asked the Minister for Finance the implications for the Central Bank of Ireland's pilot scheme debt resolution scheme of indications from credit unions that they will not participate; and if he will make a statement on the matter. [23918/13]
View answerThe Central Bank has commenced a process to facilitate a voluntary agreement outlining a co-ordinated approach among lenders to the resolution of multiple debts owed by distressed borrowers. An unsustainable debt position has been reached by many borrowers, which needs to be addressed for the benefit of both borrowers and lenders alike. I have been informed by the Central Bank that this initiative is being implemented to establish, on a test basis, an approach to deal with both secured and unsecured debt in a sample of approximately 750 cases where borrowers have debts with multiple lenders. The Central Bank envisage that the participants in the pilot framework will be the main retail lending banks and the credit unions that have agreed to participate, as well as certain other unsecured lenders. This pilot framework contains a restructuring waterfall that will be applied to each borrower that agrees to participate, in order to establish the most appropriate modification to put him or her on an affordable repayment path. The pilot framework is expected to commence in June and will operate for a period of three months, after which the results will be assessed to establish the effectiveness of the framework and to determine the appropriate next steps.
The Central Bank are actively encouraging the involvement of all lenders in the process to ensure maximum effectiveness of this learning and information gathering pilot stage, and are encouraged to have a number of lenders engaged to date. The Central Bank have written to all credit unions individually to invite them to participate in the pilot framework and are confident that the pilot framework will offer outcomes which support borrowers and will allow the Central Bank to test and learn from this approach.
It must be borne in mind that a key issue in a decision to opt out by some lenders is that borrowers from these institutions cannot be part of the pilot framework to restructure their debt. For example, if a distressed borrower has multiple debts and one of their lenders is not involved in the pilot scheme then they cannot be part of the pilot scheme and cannot avail of the benefits.
I am aware of the concerns expressed by the Irish League of Credit Unions regarding the Central Bank initiative and its view that the arrangements under the Personal Insolvency Act should be applied to the resolution of multiple debts owed by distressed borrowers, including credit union members. While that regime is indeed available, the Central Bank pilot scheme will offer the opportunity for distressed borrowers - including credit union members - to resolve their debts without the need to enter into the formal statutory process. In this respect, it is important that credit union members are not left with a more limited range of options than are available to customers of other financial institutions. It is in this spirit that the Central Bank has written to all credit unions to make them aware of the pilot so that the credit unions can decide whether their participation is in the interests of their members, including members with distressed debts across multiple lenders.
Credit unions have been invited by the Central Bank to nationwide information seminars on the pilot scheme to discuss its objectives and approach. The Irish League of Credit Unions has been invited to attend at these sessions and provide input into the content of them. Notwithstanding their official stance on the pilot programme, the Irish League of Credit Unions has played a constructive role in working with the Central Bank and other lenders to address this difficult issue and credit unions continue to have an important role to play in supporting distressed borrowers in resolving their problems.
73. Deputy Sean Fleming asked the Minister for Finance his views on whether the proliferation of recent announcements on debt resolution is causing confusion amongst borrowers and may actually impede; and if he will make a statement on the matter. [23920/13]
View answer93. Deputy Sandra McLellan asked the Minister for Finance his views on the Central Bank of Ireland’s pilot scheme for consumer multi-debt restructuring launched on 8 May 2013. [23956/13]
View answer142. Deputy Pearse Doherty asked the Minister for Finance the consultation that took place with his Department by the Central Bank of Ireland before the launch of the pilot scheme for consumer multi-debt restructuring on 8 May 2013. [24130/13]
View answer203. Deputy Pearse Doherty asked the Minister for Finance the consultation that took place between his Department and the Central Bank of Ireland before the launch of the pilot scheme for consumer multi-debt restructuring on 8 May 2013. [24108/13]
View answer204. Deputy Pearse Doherty asked the Minister for Finance if there is a legislative basis by which unsecured creditors can be forced to accept write-downs in outstanding debt under the Central Bank of Ireland pilot scheme for consumer multi-debt restructuring. [24109/13]
View answer205. Deputy Pearse Doherty asked the Minister for Finance the names of creditor companies that have signed up to the Central Bank of Ireland pilot scheme for consumer multi-debt restructuring; and if he will outline the impact the reported rejection of the scheme by the Irish League of Credit Unions will have on the scheme. [24110/13]
View answerI propose to take Questions Nos. 73, 93, 142 and 203 to 205, inclusive, together.
The Deputies will be aware that the Central Bank has commenced a process to facilitate a voluntary agreement outlining a co-ordinated approach among lenders to the resolution of multiple debts owed by distressed borrowers. While the framework was an initiative of the Central Bank, the Central Bank informed the Mortgage Arrears Steering Group of the progress on its discussions with lenders on the Central Bank’s intention to introduce such a scheme.
Many distressed borrowers have multiple debts with different lenders and have to deal with each lender on each debt. The Central Bank has advised that this framework can help those borrowers because the lenders are agreeing to a coordinated approach for resolution of all of the borrowers’ debts. In addition, many distressed borrowers are not insolvent and therefore will not be eligible for an arrangement under the personal insolvency regime, but do need to have an appropriate solution in place to deal with their debts. This framework aims to test the feasibility and costs of implementing such solutions for borrowers. The framework also has the potential to reduce the costs and time it will take lenders operating on an individual basis to deal with distressed borrowers, while also potentially resulting in only the more challenged cases proceeding to the new established personal insolvency regime. The Central Bank has also advised that there is no legislative basis by which unsecured creditors can be forced to accept write-downs in outstanding debt under the Central Bank’s voluntary framework. Nevertheless, as a result of the Central Bank’s initiative, a number of secured and unsecured lenders have agreed a burden sharing framework and will now, with the Central Bank’s oversight, participate in the development and operation of this Framework on a test or pilot basis.
The Central Bank is actively encouraging the involvement of all lenders in the process to ensure maximum effectiveness of this learning and information gathering pilot stage, and it is encouraged that a number of lenders have agreed to become engaged. The Central Bank advises that it has written to all credit unions individually to invite them to participate in the pilot framework and it is confident that the pilot framework will offer outcomes which support borrowers and will also allow the Central Bank to test and learn from this approach.
It must be borne in mind that a key issue in a decision to opt out by some lenders is that borrowers from these institutions cannot be part of the pilot framework to restructure their debt. For example, if a distressed borrower has multiple debts and one of their lenders is not involved in the pilot scheme, then such borrowers cannot be part of the pilot scheme and cannot avail of the benefits that can accrue from the operation of the framework.
All existing protections afforded by the Central Bank’s Consumer Protection Code and Code of Conduct on Mortgage Arrears (CCMA) will continue to apply to participating borrowers. The framework will not include borrowers with buy-to-let or business related debts. It is envisaged that the Pilot will start in June and run for approximately 3 months after which the results will be assessed to establish the effectiveness of the framework and to determine the appropriate next steps.
The recent Central Bank initiatives in the mortgage arrears area, in particular the Mortgage Arrears targets initiative announced last March and the more recent framework pilot on the development of a coordinated, holistic and voluntary approach by secured and unsecured lenders, is consistent with the overall whole of Government approach to deal with the mortgage arrears problem. In particular, the Government, while significantly modernising Ireland’s bankruptcy and insolvency law and procedures, has also advocated and encouraged borrowers and lenders to address situations of debt difficulty, where possible, on a bilateral and informal basis, and the recent Central Bank initiatives should underpin that process.
Recent announcements by Government such as the launch of the Insolvency Service of Ireland (ISI) are important steps in the overall framework to deal with mortgage arrears. Borrowers seeking specific information on support available can contact the ISI’s helpline for information on insolvency matters or can seek advice from the general mortgage arrears information service for general mortgage arrears queries.
74. Deputy Róisín Shortall asked the Minister for Finance if he will ensure that arrangements are put in place to refund property owners when it is found that they have mistakenly overpaid the local property tax because they have over-valued their property. [23846/13]
View answer150. Deputy Brendan Griffin asked the Minister for Finance the redress available for persons who inadvertently overpaid property tax after using the estimate on the return form they received from the Revenue Commissioners; and if he will make a statement on the matter. [23714/13]
View answerI propose to take Questions Nos. 74 and 150 together.
The Finance (Local Property Tax) Act 2012 sets out how a residential property is to be valued for Local Property Tax (LPT) purposes. I am informed by Revenue that LPT is a self-assessed tax so in the first instance it is a matter for the property owner to calculate the tax due based on his or her assessment of the market value of the property. The Commissioners have also comprehensively explained the purpose of the Revenue Estimate and advised property owners that the Revenue Estimate may be used as the self-assessed valuation band, only where the property owner is satisfied that it fairly reflects their own valuation for their property. For the purposes of LPT, values for properties under €1 million are organised into valuation bands, with a range of €50,000 in each band. As property owners will not be required to provide a precise value for their property, it is anticipated that for the most part overpayments of LPT should not happen.
The initial valuation of a property on 1 May 2013, assuming it is made in good faith, is valid up to and including 2016 and will not be affected by any increase or decrease in property prices or other changes, during this period. This will ensure a measure of certainty for all property owners. Accordingly, where an owner assesses that the value of a residential property on 1 May 2013 places it in a particular valuation band but, due to a general decrease in property prices after that date the reduction in the value of the property would place it in a lower valuation band, the owner will not be entitled to a refund of tax. By the same token, if the property increases in value in that period, no additional charges will apply. The owner will, however, have the opportunity to re-assess the value of the property on the next valuation date, which is 1 November 2016.
Notwithstanding the above, I am advised by Revenue that Section 26 of the 2012 Act (as amended) provides for the possibility of a refund where an overpayment of LPT was made due to an error or mistake on a Return or a statement made by the liable person, subject to certain conditions being satisfied. This might arise, for example, where a liable person had paid their LPT charge but they subsequently discovered that their property was exempt from the charge. In the context of Section 26 where an error or mistake is proven, I am advised that once a true and complete Return has been prepared and delivered to Revenue and all the information required to make a determination on the case has been provided, a refund may issue where a claim for repayment is submitted within the normal four year time limit.
The Revenue Commissioners have advised me that they will issue detailed guidelines later in the year setting out the procedures to be followed by those who consider that they have either over or under valued their property for LPT purposes.
76. Deputy Charlie McConalogue asked the Minister for Finance his view on the rate of registration to date for the local property tax; and if he will make a statement on the matter. [23927/13]
View answerI am informed by the Revenue Commissioners that Local Property Tax (LPT) Returns, personalised letters and an LPT Guide have issued to owners of 1.66 million residential properties either by post or by way of their ROS (Revenue On-line Service) inbox. The Commissioners have confirmed that in excess of 948,522 LPT Returns have been filed up to close of business on 20th May 2013. This represents 57% of the total Returns issued. Of the Returns received, 657,157 we re filed electronically and 291,365 were paper Returns.
With the 28 May on-line filing deadline approaching, I take this opportunity to outline the options available to residential property owners. Depending on the owner’s requirements, one of the following options will address their particular needs. Property owners can login to LPT on-line at www.revenue.ie themselves using their PIN and the Property ID that was provided to them as part of the general issue of LPT Returns earlier this year. For property owners for whom e-filing is not practical, I am informed by the Revenue Commissioners that the legislation provides that another person may file an LPT Return on-line on their behalf. Alternatively, they can visit their local Revenue office where computers and assistance to file on-line will be available. Owners may also contact the LPT helpline on 1890 200 255 (mobile phone users can contact the helpline on 01 702 3049) to file a Return on-line. To avail of this option, the caller needs their property details, PPSN and details of the bank account or other source from which they wish the payment to be deducted.
I have indicated to the House on a number of occasions, most recently in my reply to Questions 20686 and 20652 (numbers 92 and 87 of 1 May), that owners who have not received a return from Revenue must still self-assess the amount of LPT due, complete and file their LPT Return and pay the tax due. They should contact the LPT helpline on 1890 200 255 or they can login to LPT on-line and file a return by clicking on the "I have not received a Property PIN" tab.
I am also advised that the LPT helpline, and Revenue’s offices, have been operating extended opening hours this week and will do so until Tuesday 28 May. Details of the extended hours are available from the Revenue website www.revenue.ie .
Given the range of options that have been made available by Revenue to assist people experiencing any type of difficulty in meeting their LPT obligations and, the fact that owners of residential properties have already filed in excess of 948,522 Returns, I am very satisfied with the current arrangements that Revenue has in place and with the rate of filing.
77. Deputy Gerry Adams asked the Minister for Finance if he will provide an update in the possible recapitalisation of banks here through the ESM. [23943/13]
View answerI wish to inform the deputy that work continues at a technical level to complete the design of the ESM’s Direct Banking Recapitalisation instrument before the end of June, as has previously been agreed at political level. Once the final version has been agreed by Ministers the instrument will need to pass national procedures which would take place during the second half of the year before it can become operational. Ireland continues to engage and put the case that retrospective recaps should be facilitated.
As the Deputy will be aware, the European Council in October 2012 reaffirmed that the “the Eurogroup will draw up the exact operational criteria that will guide direct bank recapitalisations by the European Stability Mechanism (ESM), in full respect of the 29 June 2012 euro area Summit statement. It is imperative to break the vicious circle between banks and sovereigns”.
78. Deputy Michael McGrath asked the Minister for Finance his views on reports of financial institutions leaving the International Financial Services Centre; and if he will make a statement on the matter. [23907/13]
View answerI am informed that fifteen banking licences were revoked by the Central Bank since 2010. All of the revocations were at the request of the bank concerned and the rationale for the revocation was a commercial decision for each of the banks involved. The Deputy may be aware that this subject was raised in the House last week and the details of these bank closures can be found in PQ Ref: 22277/13. Since the onset of the financial crisis, Ireland in conjunction with its European partners has sought to improve supervision and regulation of the financial services sector. This is necessary to ensure a solid basis for the operation of the financial services sector in future and to ensure that the banking sector contributes to growth in the real economy. Regulation of banks in Ireland has intensified since the crisis, in line with evolving practice worldwide. The Central Bank attaches priority to its statutory responsibility to ensure the proper and effective regulation of financial service providers and markets, but is careful to avoid placing an undue burden on regulated firms.
79. Deputy Mary Lou McDonald asked the Minister for Finance how the prolongation of maturities in some of Ireland's debts will affect budget 2014; and if he will outline the likely period of additional scrutiny including visits by the troika or EU Commission these extensions will bring. [23945/13]
View answerAt the Ecofin and Eurogroup meetings in Dublin last month, EU Finance Ministers agreed in principle, subject to national procedures, to lengthen the maturities of the EFSF and EFSM loans to Ireland and Portugal by increasing the weighted average maturity of the loans by seven years. This is also conditional on continued successful programme implementation being confirmed by the Troika together with completion of the 9th review of the Irish adjustment programme and of the 7th review of the Portuguese programme. The 9th review of Ireland’s programme has now completed all approval stages by both the IMF and the EU. The principal benefits of the maturities extension will be the smoothing of our debt redemption profile, the consequent improvement in our ability to fund ourselves in the financial markets and the beneficial impact on our debt sustainability. It is not a measure intended to directly improve our deficit. Accordingly the extension of maturities will not have any impact on Budget 2014.
Any cash savings that may arise would only build up gradually over the full lifetime of the extended maturities.
As to its impact on the duration of post programme surveillance, I have already explained, in response to a Parliamentary Question on 21 March 2013 (PQ No 59), that until the details of the implementation of the maturity extension are known, it will not be possible to assess the impact, if any, of such changes on the duration of the post-programme surveillance arrangements.
Formal approval by Ministers for the extension of our EFSF and EFSM loans is now expected to be provided next month, after which the details of its implementation can be finalised.
80. Deputy Pádraig Mac Lochlainn asked the Minister for Finance if his attention has been drawn to the Ernst and Young Report commissioned by Irish Nationwide and uncovered by the documentary "Inside Irish Nationwide"; and if so, if he will publish the report. [23958/13]
View answerA report by Ernst & Young concerning Irish Nationwide Building Society was furnished to the Department of Finance. As the Deputy is aware, this report was produced at the request of the INBS Board. A copy has been provided to the Central Bank. A report has also been provided to An Garda Síochána in this regard.
However, I have been advised that given the on-going nature of the investigations by the Authorities, including in particular the investigation being conducted under the Central Bank’s Administrative Sanctions Procedure into historic lending practices at INBS, as well as internal considerations within the bank, the report cannot legally be published at this time. Publication of the report may be considered when the Central Bank proceedings are concluded or when any Garda investigation has been finalised (or any proceedings arising from such investigation concluded).
81. Deputy Michael Moynihan asked the Minister for Finance his views on whether bank stress tests should be completed prior to the completion of Ireland's programme of EU / IMF support; and if he will make a statement on the matter. [23931/13]
View answerIt is Government policy to align as closely as possible the timing of any stress testing of the Irish banking system with that of the stress testing of the European-wide system. As part of the agreement relating to the State’s exit from the programme of EU/IMF support, an evaluation is required to demonstrate that the banks are adequately capitalised. The State, therefore, may be required to complete its stress testing somewhat ahead of the rest of the European system.
82. Deputy Billy Kelleher asked the Minister for Finance if he is satisfied with the progress made to date in the liquidation of Irish Bank Resolution Corporation; if the special liquidator has given an initial indication of the cost to the State of the liquidation; and if he will make a statement on the matter. [23921/13]
View answerI can confirm that I am satisfied with the progress made to date in the liquidation of IBRC. I have been advised that the Special Liquidators will ensure that the valuation of all IBRC assets is completed by 30 November 2013 and that the sale of all IBRC assets is agreed or completed by no later than 31 December 2013 or as soon as practicable thereafter. The Special Liquidators have indicated that they believe that it is too soon to comment or provide an initial indication of the cost to the State of the liquidation.
83. Deputy Eamonn Maloney asked the Minister for Finance the current position of the Irish Bank Resolution Corporation staff; the plans for staff not being retained after 7 August; and if he will make a statement on the matter. [23988/13]
View answerWhile the Special Liquidators have indicated that they cannot provide any specific information on the retention of staff beyond the 7th August they can confirm that information in relation to the timetable regarding the valuation and subsequent sale of assets was communicated to IBRC staff on the 17th May. The Special Liquidators have been asked to ensure that the valuation of the assets is completed by the 30th November 2013. Additionally, the Special Liquidators are required to ensure that the sale of the assets are agreed or completed by the 31st Dec 2013 or as soon as practicable thereafter. I have been advised that the Special Liquidators, in order to provide additional comfort to IBRC staff about the duration of their employment with IBRC in Special Liquidation, have committed to talking to employees individually or in small groups within the next 10 days in order to provide clarity on the duration of their contracts with IBRC in Special Liquidation.
84. Deputy Brian Stanley asked the Minister for Finance when he will announce the budgetary adjustment for 2014. [23962/13]
View answerAs the Deputy will be aware, the Government has decided to bring Budget Day forward from the first week in December to on or before the 15th of October from now on. This means that Budget 2014 will be presented and published on Tuesday, the 15th of October this year. Debates following the presentation of the draft budget will be a matter for the House in the normal way. As has been stated in the recently published April Stability Programme Update, Government decisions on the 2014 adjustment package will take into account the most up-to-date economic and fiscal data available and in light of policy priorities. This is the most prudent course of action and is in line with normal budgetary procedure.
85. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which he and his Eurozone colleagues have reached agreement in the context of separation of banking and sovereign debt; if any projections have been done to estimate economic growth potential in the aftermath of such agreement as envisaged at the June summit of 2012; and if he will make a statement on the matter. [23889/13]
View answerI wish to inform the deputy that work continues at a technical level to complete the design of the ESM’s Direct Banking Recapitalisation instrument before the end of June, as has previously been agreed at political level. Once the final version has been agreed by Ministers the instrument will need to pass national procedures which would take place during the second half of the year before it can become operational. Ireland continues to engage and put the case that retrospective recaps should be facilitated. As the Deputy will be aware, the European Council in October 2012 reaffirmed that the “the Eurogroup will draw up the exact operational criteria that will guide direct bank recapitalisations by the European Stability Mechanism (ESM), in full respect of the 29 June 2012 euro area Summit statement. It is imperative to break the vicious circle between banks and sovereigns.”
As discussions remain on-going in relation to this issue and no conclusion has been reached it is premature to speculate on the potential impact on economic growth.
86. Deputy Thomas Pringle asked the Minister for Finance the uptake of basic payment accounts for the financially excluded in the pilot study; if he will consider allowing the post office system to participate in the final roll-out; and if he will make a statement on the matter. [23989/13]
View answerAs part of my Department’s Strategy for Financial Inclusion in Ireland, a basic payment account (named the Standard Bank Account) was offered by three banks (AIB, Bank of Ireland and permanent tsb) in three pilot locations (New Ross, Tallaght and Tullamore) from 29 June 2012. The Financial Inclusion Working Group (FIWG), which includes An Post was tasked with governance of the project. The Standard Bank Account (SBA) Pilot finished on 31 March 2013 after a 9-month pilot period.
A total of 205 accounts were opened during the Pilot, which was below expectations. The initial Pilot evaluation suggests that the lower than expected take-up of the SBA was due the lack of a ‘trigger event’ amongst the target cohort in the pilot locations, such as a requirement to have an income or benefit payment made to a bank account.
The Strategy for Financial Inclusion in Ireland noted that the post office network has the potential to play a key role in the delivery of basic payment accounts. It is a generally accepted view that many of the financially excluded trust the post office network. It is also clear that many of the financially excluded make use of An Post’s services already and that many of them use An Post branches for the receipt of social welfare payments and benefits. When the Pilot commenced An Post could not on its own offer transactional banking services to its customers as it required arrangements with banking providers to do so. However, we did secure a limited offering of the Standard Bank Account through post offices in the New Ross area from November 2012.
I am advised that the report of the FIWG on the Pilot will be submitted for my consideration in a few weeks, following which I expect that the Report will be presented to Government and published.
I understand that one of the initial conclusions from the Pilot is that the involvement of the post office network will be one of the key requirements for successful national roll-out of the Standard Bank Account. My Department through the Financial Inclusion Working Group will work closely with all potential providers including An Post over the coming months to optimise the availability of the Standard Bank Account nationally.
