171. Deputy Pearse Doherty asked the Minister for Finance if he has been approached by any covered institution seeking a system of bonus payments for senior staff. [5210/14]View answer
Written Answers Nos. 171-193
171. Deputy Pearse Doherty asked the Minister for Finance if he has been approached by any covered institution seeking a system of bonus payments for senior staff. [5210/14]View answer
As the Deputy will be aware this Government's policy with respect to banking remuneration has been in place since mid-2011. In summary, remuneration in State supported banks is capped at €500,000 (excluding normal pension entitlements) and the payment of bonuses is not permitted. I can confirm that at one of the recent meetings that took place between AIB and the Department of Finance, AIB raised the issue of new staff incentivisation measures in the context of our shared objective to return the bank to profitability and ultimately deliver a return for the taxpayer. I can also confirm for the Deputy that no policy changes are planned in the area of banking remuneration and this message has been communicated to the bank.
172. Deputy Jack Wall asked the Minister for Finance the mechanism available to persons (details supplied) in County Kildare to resolve a problem regarding their P45; and if he will make a statement on the matter. [5211/14]View answer
I have been advised by the Revenue Commissioners that they have been in contact with the former employer concerned. Revenue requested that he issue Forms P45 to the employees concerned. The former employer confirmed that he will immediately arrange for the issue of the Forms P45 to the relevant individuals.
173. Deputy Maureen O'Sullivan asked the Minister for Finance if his attention has been drawn to a possible arrangement between the Government and flood insurance companies which offers fairer solutions that balance out the flood cost between stakeholders, while making flood cover affordable to residents; and if he will make a statement on the matter. [5226/14]View answer
At the outset, it should be noted that the issue of flood cover and its unavailability in some instances is one which I am familiar with. I am also very conscious of the difficulties that the absence of such cover can cause to householders and businesses. While the lack of availability of flood insurance affects a relatively small number of people, the consequences for these people are very serious should their house or commercial premises be damaged by flooding. However, I am not in a position to direct insurance companies to provide flood cover to specific individuals. The issue of provision of new flood cover or the renewal of existing flood cover is a commercial matter for insurance companies, which is based on a proper assessment of the risks they are accepting.
The idea of making flood insurance compulsory has been considered. However if this was the case, it would mean that in areas where there was likely to be regular flooding, the cost of insurance would almost certainly be prohibitive and could make premiums unaffordable not just for affected policyholders but for policyholders in general.
What the Government can do to try and help those who have been affected by flooding, is try to address the underlying problem through appropriate remedial works where this is economically feasible. The Office of Public Works is committed to alleviating the impact of flooding through the provision of defences as well as a comprehensive assessment of flood risk throughout the country and development of flood risk management plans for the areas most at risk under the National Catchment Flood Risk Assessment & Management (CFRAM) Programme. This commitment is underpinned by a very significant capital works investment programme which will see up to €225 million being spent on flood relief measures over a five year period from 2012 to 2016.
In addition, the OPW and the Insurance Ireland have been engaged in discussions to agree on a sustainable system of information sharing in relation to completed flood alleviation schemes and works undertaken by the OPW or, in certain instances, by local authorities with OPW funding, and where the standard of protection afforded by these works could be verified. There is agreement in principle but with some operational details to be finally sorted by the insurance companies. The outcome of these discussions means that the insurance industry will have a much greater understanding of the extent of the protection provided by flood defence works and will therefore be in a position to provide the necessary flood cover to householders in areas where works have been completed.
The Deputy refers to the use of a reinsurance scheme whereby insurance companies could pool their flood insurance liabilities, similar to the temporary scheme in the UK known as Flood RE. However, the introduction of such a scheme would likely lead to a significant increase in household insurance premiums as those in low risk areas would be required to subsidise those in high risk areas. Furthermore , the Exchequer would also be required to provide financial assistance to such a scheme in circumstances where the claims were above the level of funds in the pool. I am continuing to monitor how the difficulties around the Flood Re scheme are being addressed in the UK.
The Government has also examined the introduction of a scheme to protect householders who cannot obtain household insurance in respect of flooding from regular insurance bodies. However, this approach has not been considered financially viable because it is believed that over time it would incentivise industry to discontinue the provision of cover in medium and high risk areas thus making the cost of such a scheme prohibitive.
In cases where individuals who are experiencing difficulty in obtaining flood insurance believe that they are being treated unfairly they can contact Insurance Ireland which operates a free Insurance Information Service for those who have queries, complaints or difficulties in relation to insurance. Their service can be contacted at (01) 676 1914 or by email at email@example.com.
174. Deputy Sean Fleming asked the Minister for Finance when a tax refund will be paid in respect of a person (details supplied) in County Laois; and if he will make a statement on the matter. [5242/14]View answer
I am advised by the Revenue Commissioners that the person concerned is jointly assessed with his spouse and that PAYE Balancing Statements in respect of the years 2012 and 2013 issued to the spouse of the named individual on 29/01/2014. The relevant refund cheques will issue shortly.
175. Deputy John Browne asked the Minister for Finance the reason the non-deductibility of local property tax from private rental income is being excused on the basis that it would reduce the tax base, when it is an expense wholly and necessarily incurred in the business of letting private rental property; his views that a business cost is a business cost regardless of its impact elsewhere, as otherwise it could be argued that anything that reduces exposure to taxation reduces the tax base, whether that be income tax, corporation tax, VAT refunds, personal reliefs and so on; and if he will make a statement on the matter. [5357/14]View answer
Local Property Tax is due on all residential properties in the State (with limited exemptions), regardless of whether they are occupied by the owner, rented out or unoccupied. Unlike trading activity, in the case of rental activity, taxable income is the gross rent as reduced by a limited number of specified deductions as set out in section 97 (2) TCA 1997. These are:
- any rent payable by the landlord in the case of a sub-lease;
- the cost to the landlord of any goods provided or services rendered to a tenant;
- the cost of maintenance, repairs, insurance and management of the property;
- the interest paid on borrowed money used to purchase, improve or repair the property (which, in the case of residential property, is restricted to 75% of the interest and is subject to compliance with PRTB registration requirements for all tenancies that existed in relation to the property in the relevant year); and
- payment of local authority rates.
In addition, wear and tear capital allowances are available in respect of the capital expenditure incurred on fixtures and fittings provided by a landlord for the purposes of furnishing rented residential accommodation. These allowances are granted at the rate of 12.5% per annum of the actual cost of the fixtures and fittings over a period of 8 years.
As I have indicated on many previous occasions, the Government has in principle accepted the recommendation of the Thornhill Group (that the Local Property Tax paid in respect of a rented property should be deductible for income tax or corporation tax purposes, in a similar manner to commercial rates) but has not considered the manner or the timing in which this will happen.
176. Deputy Andrew Doyle asked the Minister for Finance the terms of the emergency legislation to liquidate IRBC; the protection measure provisions currently in place regarding the protection of over 13,250 mortgage holders previously with Irish Nationwide Building Society; if protection is included under the current legislation from any fund taking over the home loans valued at €1.8 billion currently owned by the State; and if he will make a statement on the matter. [5367/14]View answer
The Irish Bank Resolution Corporation Bill 2013 (the " IBRC Act") was passed by the Dáil on 7 February 2013. The IBRC Act provided for the winding up of IBRC in an orderly and efficient manner in the public interest. On 7 February 2013, I as the Minister for Finance, made an Order pursuant to Section 4 of the IBRC Act providing for the winding-up of IBRC under the provisions of the IBRC Act. Pursuant to the same Order, Mr. Kieran Wallace and Mr. Eamonn Richardson (the "Special Liquidators") of KPMG were appointed joint special liquidators of Irish Bank Resolution Corporation Limited (in Special Liquidation) with all of the duties and powers conferred upon them by the IBRC Act. I am advised that the contractual terms and conditions of customer mortgages and other borrowings of IBRC will not change as a result of the appointment of the Special Liquidators or the ultimate sale of the obligations to a third party.
The Special Liquidators have also confirmed that the residential mortgage customers of IBRC Limited (in Special Liquidation) continue to enjoy the protection of the Central Bank Code of Conduct on mortgage arrears and other protections in Irish consumer law. I have been advised by the Special Liquidators that they continue to engage with customers who are in difficulty through the implementation of CCMA and are entering into appropriate MARS strategies with them.
The Special Liquidators are in the process of conducting a sales process in respect of the IBRC residential mortgage portfolio. The continued applicability of the Central Bank Code of Conduct on Mortgage Arrears and Mortgage Arrears Targets Programme will depend on the regulatory status of the ultimate acquirer of the portfolio which we will not know until the sales process has concluded. In the event that NAMA ultimately acquires this portfolio, the NAMA Board will determine its strategy at that stage and will, in doing so, be mindful of its legal obligations. I am advised that, should they acquire the portfolio, NAMA is likely to apply best practice in this regard and no borrower will in any worse position.
177. Deputy Róisín Shortall asked the Minister for Finance with reference to the single person child carer credit, if a person who cares for a child for a cumulative total of 2,400 hours per year is eligible as a secondary carer; and if he will make a statement on the matter. [5409/14]View answer
178. Deputy Róisín Shortall asked the Minister for Finance with reference to the single person child carer credit, if a person who intends to care for a child for 100 days this year is eligible as a secondary carer; and if he will make a statement on the matter. [5410/14]View answer
179. Deputy Róisín Shortall asked the Minister for Finance with reference to the single person child carer credit, if days where responsibility is shared jointly between the primary and secondary carer are considered eligible for inclusion in the necessary 100 days; and if he will make a statement on the matter. [5411/14]View answer
I propose to take Questions Nos. 177 to 179, inclusive, together.
The position is that as a result of an amendment which I brought forward at Committee Stage of the Finance Bill, a primary carer who is entitled to the credit and who does not wish to avail of it can choose to surrender it. A secondary carer may then make a claim for the credit, provided that the qualifying child resides with him or her for not less than 100 days in the tax year. The definition of a day includes the greater part of a day. For example, where a secondary carer takes a child on a Saturday morning and the child returns to the primary carer on Sunday afternoon or evening, then that period will be actually treated as a period of two full days for the purposes of this legislation. Two people cannot claim for the same day, nor can an entitlement to the credit be built up through an accumulation of hours over the year.
It should be noted that where a primary carer is married, in a civil partnership or cohabiting they would not be entitled to the new credit (or indeed the former one). In such circumstances the primary carer cannot relinquish the credit to a secondary carer. In addition, a secondary carer who is married, in a civil partnership or cohabiting, would not be entitled to the new credit (or indeed the former one) regardless of the marital status of the primary carer.
180. Deputy Pearse Doherty asked the Minister for Finance the number of applications that have been granted by the Central Bank under section 149 of the Consumer Credit Act for the provision of a new service or an increase in existing customer charges by each bank operating here since 1 October 2013; and if he will detail each application granted. [5413/14]View answer
Section 149 of the Consumer Credit Act 1995 (as amended) came into effect in May 1996 and requires that credit institutions and bureaux de change notify the Central Bank if they wish to:
- introduce any new customer 'charge' for providing a service or
- increase any existing customer 'charge' for providing a service.
The following table, provided by the Central Bank, shows the notifications processed by the Central Bank under Section 149 of the Act between 1 October 2013 and 31 January 2014.
Section 149 Notifications
Note : ('partial approval' figures may include some rejected charges)
I as Minister for Finance do not have a role in approving or rejecting a charge notified to the Central Bank and so I am not in a position to provide details of each application approved by the Central Bank.
181. Deputy Jack Wall asked the Minister for Finance if a person (details supplied) is entitled to claim a tax rebate; and if he will make a statement on the matter. [5416/14]View answer
As you are aware the One-Parent Family Tax Credit has been replaced with a new Single Person Child Carer Tax Credit from 1 January 2014. However, the credit is more targeted in that it is, in the first instance, only available to the principal carer of the child. The person who receives the child benefit payment is being used as the initial indicator by the Revenue Commissioners to identify the individuals who are likely to qualify for the new credit. However, the credit will in the first place go to the person who cares for the child for most of the year. Agreement as to who will be the principal carer of a child is a matter for the parents or guardians.
As a result of an amendment which I brought forward at Committee Stage of the Finance Bill, a primary carer who is entitled to the credit and who does not wish to avail of it can choose to surrender it. A secondary carer may then make a claim for the credit, provided that the qualifying child resides with him or her for not less than 100 days in the tax year. It should be noted that where a primary carer is married, in a civil partnership or cohabiting they would not be entitled to the new credit (or indeed the former one). In such circumstances the primary carer cannot relinquish the credit to a secondary carer. In addition, a secondary carer who is married, in a civil partnership or cohabiting, would not be entitled to the new credit (or indeed the former one) regardless of the marital status of the primary carer.
If it is the case, as indicated in the details supplied, that the mother, who is married, is the primary carer then she would not be entitled the credit, and therefore would be unable to surrender it to the child's father. It follows then that the issue of a rebate would not apply.
182. Deputy John Deasy asked the Minister for Finance the apps his Department or attached agencies have been involved in developing for smartphones and other multimedia devices in the past three years; and the cost and the software developer employed in each case. [5459/14]View answer
An innovative approach to the EU Presidency in 2013 was adopted by my Department in the development of the EU Presidency App which was available on iTunes and the Google Play Store. This App was designed to assist all delegations coming to Ireland to enjoy a more interactive way of finding out relevant information for their meetings, travel, accommodation and other amenities.
- showcased Ireland as a Technology hub;
- highlighted key features of our drive towards a knowledge economy; and
- provided practical information about Dublin to visiting delegates and provided information about EU Presidency events in Dublin Castle.
The App was subject to the Presidency sponsorship guidelines drafted by the Department of Foreign Affairs & Trade. The total estimated cost for the development of the App was in excess of €73,000. Deloitte agreed to provide the majority of the development and project management costs free of charge and it was agreed that the Department of Finance would fund the design, digital architecture, licensing and a portion of the development costs. The invoice from Deloitte (24 May 2013) was for €25,000 plus VAT of €5,750.
This is the only App that my Department or attached agencies have been involved in developing for smart phones and other multimedia devices in the past three years.
Questions Nos. 184 to 186, inclusive, answered with Question No. 158.
183. Deputy Pearse Doherty asked the Minister for Finance further to a Parliamentary Question of 28 January 2014 if he will provide the nature of the consultancy contract awarded to a company (details supplied) and a description of the work carried out; and if he will make a statement on the matter. [5481/14]View answer
As the Deputy may be aware, my Department commissions biannual SME credit demand surveys, securing completed responses from 1,500 SMEs, to ascertain the situation in relation to:
- the demand for credit from SMEs;
- their level of knowledge on their rights in relation to credit;
- the reasons given for refusal of credit and;
- the failure of SMEs to seek credit.
Following a competitive tendering process, Red C were awarded the contracts to carry out these surveys for the periods October 2012, March 2013 and April 2013 and September 2013. The combined cost of these surveys was €118,572 in 2013. Bank of Ireland and Allied Irish Banks reimburse these costs to my Department. The most recent of these surveys is available on the Department of Finance website: http://www.finance.gov.ie/sites/default/files/Dept%20of%20Finance%20SME%20Credit%20Demand%20Survey%20Report%20-%20Apr-Sep%202013.pdf.
187. Deputy Terence Flanagan asked the Minister for Finance the position regarding the price of home heating oil (details supplied); and if he will make a statement on the matter. [5532/14]View answer
Fuel prices are driven by a number of factors including the price of oil on international markets, exchange rates, production costs and refining costs. The fluctuation in oil prices over recent years reflected additional factors such as geopolitical uncertainty in Northern Africa and the Middle East with potential supply disruptions.
As Minister for Finance I have no jurisdiction or control over market pricing of fuel. I have responsibility only for the tax element of fuels. The tax applicable to marked kerosene and marked gas oil used in home heating oils at present are as follows:
Marked Gas Oil (per 1,000 litres)
Kerosene (per 1,000 litres)
188. Deputy Alan Farrell asked the Minister for Finance his views on the need for regulation of the production and distribution of licence plates for vehicles registered here; and if he will make a statement on the matter. [5537/14]View answer
I am informed by the Revenue Commissioners that Statutory Instrument (S.I.) No. 318 of 1992, Vehicle Registration and Taxation Regulations (as amended by Statutory Instrument No. 542 of 2012) prescribes the format, lettering, dimensions and technical specifications of registration plates to be displayed on vehicles in the State. I am also informed by the Revenue Commissioners that the correct format of the registration plate is a requirement for the National Car Test (NCT), and where the registration plate is not in the prescribed format the vehicle will fail the NCT Test. In addition, it is an offence to display the wrong registration number on a vehicle or to display the registration number in the incorrect format and a person convicted of such an offence is liable to a fine of up to €5,000.
While the format of the number plate is regulated, there are no controls or regulations in relation to the manufacture of such plates. This is a matter that has been considered by the Revenue Commissioners but they concluded that such controls would not be effective given the simplicity and widespread availability of the technology for manufacturing number plates. I am satisfied that the measures in place provide an appropriate deterrent to non-compliance with the regulations on registration plates. Further information may be obtained on the Revenue website at the following link: http://www.revenue.ie/en/tax/vrt/leaflets/format-vehicle-registration-plates.html .
189. Deputy Michael McGrath asked the Minister for Finance the number of expressions of interest that were received in relation to Mount Carmel Hospital; if the National Asset Management Agency secured any formal bids for the hospital; and if he will make a statement on the matter. [5593/14]View answer
190. Deputy Michael McGrath asked the Minister for Finance if the National Asset Management Agency has held discussions with the Health Service Executive with a view to the agency taking over Mount Carmel Hospital without assuming outstanding liabilities of the hospital; and if he will make a statement on the matter. [5594/14]View answer
191. Deputy Michael McGrath asked the Minister for Finance the amount of money the National Asset Management Agency provided as working capital to Mount Carmel Hospital; and if he will make a statement on the matter. [5595/14]View answer
I propose to take Questions Nos. 189 to 191, inclusive, together.
I am advised that there were extensive efforts to find either a private or public purchaser for the Mount Carmel Hospital. I am advised that in early 2013, Goodbody Corporate Finance were retained by the owners of Mount Carmel to sell it as a going concern. A detailed sales campaign began in April 2013. 49 potential purchasers were approached, of which 28 signed non-disclosure agreements. Five bids were submitted during the Phase 1 sales process. By Phase 2 however there was only one interested party. Another party considered making a bid after the sales process. The bids received were not commercially acceptable as they were heavily conditional, involving low upfront payments together with deferred unsecured payments.
In addition to commercial bidders, the Department of Health and HSE were approached but they declined to enter into discussions with a view to the purchase of the hospital. My colleague, the Minister for Health is on the public record as saying that purchasing the Mount Carmel Hospital as a going concern would unnecessarily expose the State to significant financial risks, would be contrary to Government policy aimed at supporting the provision of maternity services on the same sites as adult acute hospitals, and could not be justified by reference to Central Statistics Office data which indicate that the birth rate is declining and that this decline is projected to continue for the rest of this decade.
NAMA acquired the loans which were secured by the assets of the Mount Carmel Hospital Group in 2010. In the interim, it has funded losses of close to €10m while it has sought, in conjunction with the owner, to put in place arrangements which would enable the hospital to operate on a viable basis. Unfortunately, it has not been possible to formulate such arrangements and financial projections indicate that this position is unlikely to change in the near future. NAMA cannot continue to fund unsustainable losses in what is a private medical business.
192. Deputy Brian Stanley asked the Minister for Finance the amount of local property tax collected in each local authority area in 2013. [5638/14]View answer
I am informed by the Revenue Commissioners that compliance data in relation to the Local Property Tax (LPT) for 2013 are available broken down by city and county councils nationally and the most up to date figures are published on the Commissioners website at: http://www.revenue.ie/en/tax/lpt/lpt-stats-11-2013.pdf. The Commissioners have confirmed that by the end of December 2013 €318m had been transferred by Revenue to the Exchequer in respect of LPT. Of this amount, €242m was in respect of LPT for 2013 and €76m relates to 2014 LPT. The Commissioners will publish 2013 year-end compliance data and also preliminary data in relation to 2014 shortly.
193. Deputy Patrick O'Donovan asked the Minister for Finance if he will respond to matters raised in correspondence (details supplied) regarding the local property tax; and if he will make a statement on the matter. [5674/14]View answer
I am advised by Revenue that Section 38 of the Finance (Local Property Tax) Act 2012, amended by section 8(e) of the Finance (Local Property Tax)(Amendment) Act 2013 provides that self-employed persons may incur an LPT generated surcharge on their Income Tax and Capital Gains Tax liability, where LPT return(s) are outstanding or where agreed payment arrangements are not met at the date of filing the IT/CGT return. Where such a surcharge arises, it amounts to 10% of the IT/CGT liability and is in addition to the actual LPT liability. A surcharge may also be applied where the Household Charge (HC) in respect of 2012 remained unpaid at 1 July 2013. This €200 arrear is collectible by Revenue in the same way as any other unpaid LPT amount and is taken into account for surcharge purposes when the liable person files his or her IT/CGT Return.
Revenue has further advised me that if payments and returns have been filed by liable persons, but are for some reason not reflected on the person's LPT records, then contact should be made with the LPT Helpline to clarify the matter. Also, if a person considers that a surcharge has been charged in error, possibly due to a problem with the LPT Register, then the person should check their LPT record online at www.revenue.ie and contact Revenue to correct the record.
Revenue has confirmed to me that it has published detailed guidelines on the application of LPT-generated surcharges at www.revenue.ie. Revenue has also confirmed to me that non-compliant property owners, who are within the PAYE system, are subject to mandatory deduction at source. Mandatory deduction at source involves the enforced collection of LPT from an owner's wages or occupational pension. This occurs where an LPT return and/or payments are outstanding, or where the payment method chosen is not honoured.
Finally, in regard to the Deputy's question on Direct Debit payments, any phased payment arrangement in place for 2013 was automatically carried forward to 2014 unless the liable person requested an alternative payment arrangement. Revenue has also published information, on Direct Debit and other payment arrangements for 2014, at www.revenue.ie.