Written Answers Nos. 283-300
283. Deputy Stephen S. Donnelly asked the Minister for Finance for the full year cost of the tax breaks given in budget 2016 to those earning, €70,000; €100,000; and €150,000, in tabular form; and if he will make a statement on the matter. [37162/15]
View answerI understand from clarifications given by the Deputy that his Question relates to the impact of the Universal Social Charge (USC) changes and the introduction of the Earned Income Credit (EIC) announced in Budget 2016 on PAYE workers and the self-employed.
I am informed by the Revenue Commissioners that the estimated, full year, combined cost of the USC changes and the introduction of the EIC to those earning gross incomes of €70,000 and over, €100,000 and over and €150,000 and over, for both PAYE and Schedule D income earners, is as set out in the following tables. The figures are cumulative and therefore the figures given in respect of incomes of €70,000 and over, for example, include all incomes above that level.
|
PAYE |
|
|
|
Gross Incomes |
Cost of USC & EIC measures |
Income earners |
|
€70,000 and over |
€272 Million |
311,321 |
|
€100,000 and over |
€132 Million |
140,232 |
|
€150,000 and over |
€45 Million |
52,083 |
|
Schedule D |
|
|
|
Gross Incomes |
Cost of USC & EIC measures |
Income earners |
|
€70,000 and over |
€53 Million |
53,791 |
|
€100,000 and over |
€35 Million |
32,608 |
|
€150,000 and over |
€19 Million |
17,575 |
The retention of the 8% and 11% USC rates, originally provided for in Budget 2015, serve to limit the maximum benefit from the Budget 2016 USC measures and ensure that those with very high incomes will only benefit from USC reductions on their income of up to €70,044. This reinforces the highly progressive nature of the Irish income tax system.
Budget 2016 also increased the USC exemption threshold to €13,000, and it is expected that in 2016 over 700,000 people, approximately 29% of income earners, will be outside the scope of USC. The exemption threshold of €13,000 relates to income liable to USC, and is in addition to any income which is not liable to USC such as social welfare pensions.
All the figures provided are based on estimates for 2016, using the actual data for the year 2013 (the latest year for which data are available) adjusted as necessary for income, self-employment and employment trends in the interim. They are provisional and may be revised.
284. Deputy Pearse Doherty asked the Minister for Finance the estimated expenditure of his Department in 2015 in tabular form; the budget for expenditure agreed at the start of the year for 2015; the extra expenditure or savings in this budget during the year to date; when and under what process this expenditure and these savings were approved; and his Department's budget for expenditure in 2016. [37262/15]
View answerThe information requested by the Deputy is set out as follows:
|
Programme |
Programme Expenditure |
2015 Budget Estimate (€000) |
2015 Estimated Outturn (€000) |
Excess/Savings for 2015* |
Date Savings/Excess approved |
Approval process |
|
A |
European Union and International Policy |
2,908 |
2,908 |
0 |
N/A |
N/A |
|
B |
Financial Services Policy |
10,744 |
10,744 |
0 |
N/A |
N/A |
|
C |
Fiscal Policy |
4,104 |
4,104 |
0 |
N/A |
N/A |
|
D |
Economic Policy |
1,860 |
1,860 |
0 |
N/A |
N/A |
|
E |
Provision of Shared Services |
12,351 |
12,351 |
0 |
N/A |
N/A |
|
|
Totals |
31,967 |
31,967 |
0 |
|
|
*A number of projects are ongoing and, while the final end year spend cannot be predicted with certainty at this point, my Department expects to remain within budget in 2015.
A token supplementary estimate will be required in 2015 to provide for a new service the Disabled Drivers Fuel Grant Scheme (Programme C).
|
Programme |
Programme Expenditure |
2016 Budget Estimate (€000) ** |
|
|
A |
Economic and Fiscal Policy |
18,518 |
|
|
B |
Banking and Financial Services Policy |
11,407 |
|
|
C |
Delivery Of Shared Services |
10,680 |
|
|
|
Total |
40,605 |
** The 2016 Estimate Structure has been realigned across three programmes to better reflect the restructuring of the Department around two Directorates.
285. Deputy Pearse Doherty asked the Minister for Finance the allocation for his Department in 2016 which covers the Lansdowne Road agreement; and the demographic or other inflationary pressures. [37278/15]
View answerI wish to inform the Deputy that the Paybill estimate of €18.5 million for my Department for 2016 will encompass all Paybill costs anticipated including those under the Lansdowne Road agreement.
286. Deputy Robert Dowds asked the Minister for Finance the reason it is necessary to get a personal public service number for a deceased foreigner who is leaving a legacy to an Irish relative; and if he will ensure that the process for getting such a legacy is simplified. [37331/15]
View answerI am advised by the Revenue Commissioners that the requirement for a Personal Public Service Number (PPSN) ensures that the aggregation of gifts and inheritances from different disponers, as required for the calculation of Capital Acquisitions Tax liabilities, is correctly dealt with, thereby ensuring that the correct reliefs are applied and the correct amount of tax is paid. As regards the specific PPSN requirements, the Inland Revenue Affidavit (CA24), which is the form used by the Probate Office in processing estates and legacies, requires that a PPSN is provided in all cases before a grant of probate can issue. Furthermore, when a beneficiary is subsequently submitting their Capital Acquisitions Tax Return (IT38), the PPSN of the deceased disponer is required by Revenue.
The Department of Social Protection's Client Identity Services (CIS) provides a service to deal with cases involving non-residents, where a PPSN is required. CIS can be contacted by telephone at 1890 927999 or 071 9672616.
287. Deputy Catherine Murphy asked the Minister for Finance if he will indicate, in respect of State boards under his Department's remit, the name of each appointee made from 7 March 2011 to date in 2015; the date of appointment; whether or not each appointee came through an advertised public application process; the number of vacancies which exist on State boards under his remit; and if he will make a statement on the matter. [37362/15]
View answerIn response to the Deputy's query, please find, in tabular form, the name of each appointee made; the date of appointment; whether or not each appointee came through an advertised public application process and the number of vacancies which presently exist on State Boards, in period March 2011 to date 2015. I have included ex officio members in the figures provided.
I would ask the Deputy to note that The National Treasury Management Agency Advisory Committee, State Claims Agency and the National Development Finance Agency have all been dissolved following the commencement of the relevant sections of the National Treasury Management Agency (Amendment) Act 2014.
|
State Board |
Name of each appointee made from 7 March 2011 to date (27th October) in 2015 |
Date of appointment |
Whether or not each appointee came through an advertised public application process |
Number of vacancies which presently exist on State Boards under his remit |
|
Central Bank
|
Alan Ahearne (original appointment and re-appointment) Blanaid Clarke (re-appointment) Michael Soden (re-appointment) Des Geraghty (re-appointment) Patricia Byron (original appointment) John FitzGerald (re-appointment) Philip Lane (original appointment) |
Alan Ahearne - 8 March 2011, re-appointed 8 March 2015 Blanaid Clarke - 1 October 2013 Michael Soden - 1 October 2014 Des Geraghty - 1 October 2014 Patricia Byron - 1 January 2014 John FitzGerald - 1 October 2015 Philip Lane - 21 October 2015 |
Alan Ahearne - No Blanaid Clarke - No re-appointment Michael Soden - No re-appointment Des Geraghty - No re-appointment Patricia Byron - Yes John FitzGerald - No re-appointment Philip Lane - Yes State Board appointments arrangements Exception 9.1.5: In the case of proposed re-appointments to State Boards where the Minister is satisfied having consulted with the Chair that the Board member has already demonstrated through their performance as a member of the State Board their effectiveness and contribution which warrants their re-appointment. |
1 Section 18CA(1)(b) of the Central Bank Act 1942, as amended, provides that the Central Bank Commission comprises of at least 6, but no more than 8, members appointed by the Minister. The Commission currently comprises of 7 members appointed by the Minister. The Minister has the discretion to appoint 1 additional member. |
|
Credit Union Restructuring Board (ReBo) |
Mr Bobby McVeigh Chairman Mr Eoin McGettigan Mr Tom Kavanagh Mr Brendan Burke Ms Kathleen Prendergast Mr Stephen O'Donovan Mr Joe O'Toole Mr Pat Fay ILCU Mr Jimmy Johnstone - ILCU Mr Kevin Johnson - CUDA Mr Tim Molan CUMA Mr Neil Ryan - DoF Ms Elaine Byrne - CB |
31/08/2012 31/08/2012 31/08/2012 31/08/2012 31/08/2012 31/08/2012 31/08/2012 31/08/2012 31/08/2012 31/08/2012 31/08/2012 31/08/2012 31/08/2012 |
All Board posts were advertised on Publicjobs.ie. 6 appointments were made as a result of applications through the Publicjobs.ie website. |
None |
|
Financial Services Ombudsman Council
|
Mr Dermott Jewell Mr Paddy Leydon Mr Frank Wynn Ms Caitriona Ni Charra Mr Tony Kerr Mr Michael Connolly Ms Elizabeth Walsh |
Mr Dermott Jewell - 29 October 2013; Reappointed 29 October 2015 Note (The current Council is reappointed with effect from 29th October 2015 to 28th October 2016 (one year only) or the date of the amalgamation of the Offices of the Financial Services Ombudsman and the Pensions Ombudsman, whichever is the sooner.) Mr Paddy Leydon - 29 October 2013; Reappointed 29 October 2015 (see note above) Mr Frank Wynn - 29 October 2013; Reappointed 29 October 2015; (see note above) Ms Caitriona Ni Charra - 29 October 2013; Reappointed 29 October 2015; (see note above) Mr Tony Kerr - 29 October 2013; Reappointed 29 October 2015 (see note above) Mr Michael Connolly - 29 October 2013; Reappointed 29 October 2015; (see note above) Ms Elizabeth Walsh - 29 October 2013; Reappointed 29 October 2015; (see note above) |
No public application process (In view of the short term of the Council and the amalgamation of the Offices of the Pension Ombudsman and the Financial Services Ombudsman which required the experience of the existing Council to effect, these positions were not advertised. The appointment of an additional person with specific legal qualifications and experience was also required.)
|
3 Vacancies (Although the full complement of 10 has not been filled over the past number of years, there is an option for the Minister to appoint people to fill all positions. Currently there are 7 members on the Council)
|
|
Irish Fiscal Advisory Council
|
Prof. John McHale Dr Róisín O'Sullivan Mr Sebastian Barnes Dr Donal Donovan (term expired 31/12/2014) Prof. Alan Barrett (resigned May 2015) Dr Íde Kearney Michael G. Tutty |
30 June 2011* 30 June 2011* 30 June 2011* 30 June 2011*
30 June 2011* 11 March 2015 24 September 2015 |
Of the 5 current members of the Fiscal Council, 2 were appointed through the State Boards appointments process. Following a recent State Boards appointments process, an appointment will be made to fill a further vacancy on the Council in January 2016 |
No vacancies at present. |
|
National Asset Management Agency
|
Mr. Frank Daly Mr. Brian McEnery - Board member Mr. William Soffe - Board member Mr. Oliver Ellingham - Board member Ms. Mari Hurley - Board member Mr. John Mulcahy - Board Member Mr Conor O Kelly became an ex-officio Board Member automatically when he became CE of NTMA on 4 January 2015 |
Mr. Frank Daly - Re-appointed 22 December 2014 Mr. Brian McEnery - Re-appointed on 22 December 2013 Mr. William Soffe - Reappointed on 22 December 2013 Mr. Oliver Ellingham - Appointed on 10 April 2013. Ms. Mari Hurley - Appointed on 8 April 2014. Mr. John Mulcahy - Appointed on 7 March 2012 .
|
All the positions were not part of a public process |
2 |
|
National Treasury Management Agency Members (The Board)
|
Mr John Corrigan Mr Derek Moran Mr Robert Watt Mr Willie Walsh, Chair Ms Mary Walsh Ms Susan Webb Mr Martin Murphy Ms Maeve Carton Mr Brendan McDonagh |
18 Dec 2014 18 Dec 2014 18 Dec 2014 18 Dec 2014 18 Dec 2014 18 Dec 2014 18 Dec 2014 18 Dec 2014 18 Dec 2014
|
Ex. officio member Ex. officio member Ex. officio member Ministerial Appointment Ministerial Appointment Ministerial Appointment Advertised process Ministerial Appointment Ministerial Appointment |
There are no vacancies |
|
National Treasury Management Agency Advisory Committee |
Mr John Moran Mr Willie Walsh Mr Donald C Roth Mr Derek Moran
|
Mr John Moran - 06 Mar 2012 Mr Willie Walsh - 11 Nov 2013 Mr Donald C Roth - 16 Dec 2013 Mr Derek Moran - 03 Sept 2014 |
Secretary General Dept. of Finance Ministerial Nominee Reappointment Secretary General Dept. of Finance |
The NTMA Advisory Committee has been dissolved. It has been replaced by the NTMA Members (The Board) |
|
National Pensions Reserve Fund Commission |
Mr Maurice Keane Dr Frances Ruane |
04 April 2012 01 July 2014 |
Reappointment Reappointment |
Pending the transfer of the assets of the NPRF to the ISIF the NPRF Commission will consist of one Member, the Chief Executive of the NTMA |
|
State Claims Agency Policy Committee |
Dr Noel Whelan Mr Fachtna Murphy Ms Wendy Thompson Mr Charlie Hardy Ms Mary Jackson |
01 Jul 2012 27 Jun 2012 27 Jun 2012 27 Jun 2012 04 Dec 2013 |
Reappointment Advertised process Advertised process Department of Health representative Department of Health representative |
The SCA Policy Committee has been dissolved |
|
National Development Finance Agency Board |
Mr Brian Murphy Mr Gerry Murray Ms Petrina Smyth Mr Robert Watt |
01 Jan 2013 18 July 2012 18 July 2012 18 July 2012 |
Reappointment Advertised process Advertised process Secretary General Dept. of Public Expenditure and Reform |
The NDFA Board has been dissolved |
|
Strategic Banking Corporation of Ireland |
John Corrigan (Chairperson - retired) Conor O'Kelly (Chairperson) Ann Nolan Nick Ashmore (CEO ex officio director) Tom McAleese Barbara Cotter AJ Noonan Eilis Quinlan Richard Pelly Rosheen McGuckian |
John Corrigan- 10 Sept 2014 (interim)12 January 2015 Conor O'Kelly - Interim appointment 10 Sept 2014. Confirmed 19 March 2015 Ann Nolan - Interim appointment 10 Sept 2014. Confirmed 19 March 2015 Nick Ashmore - Interim appointment 10 Sept 2014. Confirmed 19 March 2015 Tom McAleese- 19 March 2015 Barbara Cotter - 19 March 2015 AJ Noonan - 19 March 2015 Eilis Quinlan - 19 March 2015 Richard Pelly- 19 March 2015 Rosheen McGuckian - 19 March 2015 |
John Corrigan - No Conor O'Kelly - No Ann Nolan - No Nick Ashmore - No Tom McAleese - Yes Barbara Cotter - Yes AJ Noonan - Yes Eilis Quinlan - Yes Richard Pelly - Yes Rosheen McGuckian - Yes |
Nil |
* Initially appointed on an administrative/non-statutory basis in June 2011. IFAC subsequently established on a statutory basis on 31 December 2012, Members already serving from June 2011 were appointed to the statutory Fiscal Council on that date.
288. Deputy Michael McGrath asked the Minister for Finance the reason the Investor Compensation Company Limited levy applies to public loss assessors in the insurance sector, given that the fund does not benefit their customers, they are not investment firms, and they do not handle client moneys; and if he will make a statement on the matter. [37375/15]
View answerBy way of background, the Investor Compensation Company Limited (ICCL) was set up in compliance with section 10 of the Investor Compensation Act 1998 ('the Act'). It has a defined set of objectives, the most important of which is to establish and maintain funds from which clients can be paid compensation in the event that an investment firm fails to return money or investments which are due to them.
An insurance intermediary is an investment firm for the purpose of the Act. The Act (Section 2) provides that an "investment firm" includes 'an insurance intermediary or a person who was formerly an insurance intermediary' and that an 'authorised investment firm' includes, inter alia, 'an insurance intermediary'.
The European Communities (Insurance Mediation) Regulations 2005 define an insurance intermediary as:
"a person who, for remuneration, undertakes or purports to undertake insurance mediation;"
It further defines "insurance mediation" as:
"any activity involved in proposing or undertaking preparatory work for entering into insurance contracts, or of assisting in the administration and performance of insurance contracts that have been entered into (including dealing with claims under insurance contracts)".
The work of loss assessors is deemed to fall within the definition above as it is concerned with "dealing with claims under insurance contracts".
As Loss Assessors fall within the definition of an insurance intermediary they are deemed an investment firm for the purposes of the Investor Compensation Act 1998 as per Section 2 of the Act and are therefore liable for the ICCL levy, as is the case for all authorised investment firms.
289. Deputy Andrew Doyle asked the Minister for Finance if a married couple (details supplied) in County Wexford, who were not given the correct marriage allowance for the past 18 years, will be reconsidered for the moneys forgone; and if he will make a statement on the matter. [37391/15]
View answerIn accordance with Section 865 of the Taxes Consolidation Act 1997 any claim for repayment of tax must be made within 4 years after the end of the year to which the claim relates.
I am advised by Revenue that following a contact from the persons concerned in November 2014 a review of their tax affairs was undertaken by Revenue for the years 2010 to 2013 inclusive and tax repayments were made for those years. It is not possible at this stage to review matters prior to 2010.
290. Deputy Éamon Ó Cuív asked the Minister for Finance the position regarding tax allowance and credits for couples living together; the reason the anomalies between married couples and unmarried couples still exist; if details of how they are treated can be outlined for both working and one working; the reason unmarried couples continue to be discriminated against; if it is an issue that can be corrected by legislation, or if it has constitutional implications; if he will further explain the matter; and if he will make a statement on the matter. [37501/15]
View answer317. Deputy Sean Fleming asked the Minister for Finance the position regarding a couple who are not married but living together, where one person of the couple is working and cannot claim tax credits in respect of the partner, but at the same time when it comes to claiming social welfare the couple are looked at as a cohabiting couple and treated as one unit for Department of Social Protection purposes; his views that this different treatment by two Departments is fair; and if he will make a statement on the matter. [37912/15]
View answerI propose to take Questions Nos. 290 and 317 together.
I am advised by the Revenue Commissioners that the position regarding tax allowances and credits for couples living together is as follows.
Where a couple is cohabiting, rather than married or in a civil partnership, each partner is treated for the purposes of income tax as a separate and unconnected individual. As a consequence credits, tax bands and reliefs cannot be transferred from one partner to the other.
A cohabiting couple where both partners are working are entitled to claim, in aggregate, the same tax credits as a married couple or a couple in a civil partnership where they are both working. The amount of income subject to tax at the standard rate (€33,800 for each individual in 2015) equates to the €67,600 marginal rate threshold in the case of a married couple or a couple in a civil partnership.
The difference between the two groups is the ability of married couples or civil partners to transfer certain elements such as the personal tax credit and part of the standard rate tax band. Specifically, part of the standard rate band entitlement of €67,600 may be transferred, allowing one spouse or civil partner to earn up to €42,800 at the standard rate. This is of benefit where one of the individuals earns more than the standard rate threshold of €33,800 and where the other individual earns less than €33,800 or has no income.
The basis for the current tax treatment of married couples derives from the Supreme Court decision in Murphy vs. Attorney General (1980). This decision was based on Article 41.3.1 of the Constitution where the State pledges to protect the institution of marriage. The decision held that it was contrary to the Constitution for a married couple, both of whom are working, to pay more tax than two single people living together and having the same income.
To the extent that there are differences in the tax treatment of the different categories of couples, such differences arise from the objective of dealing with different types of circumstances while at the same time respecting the constitutional requirements to protect the institution of marriage. Any change in the tax treatment of cohabiting couples can only be addressed in the broader context of future social and legal policy development in relation to such couples.
From a practical perspective, it would be very difficult to administer a regime for cohabitants which would be the same as that for married couples or civil partners. Married couples and civil partners have a legal status that is verifiable. By contrast, it would be difficult, intrusive and time-consuming to confirm declarations by individuals that they were actually cohabiting. It would also be both intrusive and administratively difficult to establish when a period of cohabitation started or ceased for any given couple.
The treatment of cohabiting couples for the purposes of social welfare is primarily a matter for my colleague, the Minister for Social Protection, Ms Joan Burton TD. However, it is also based on the principle that married couples should not be treated less favourably than cohabiting couples. This was given a constitutional underpinning following the Supreme Court decision in Hyland v. Minister for Social Welfare (1989) which ruled that it was unconstitutional for the total income a married couple received in social welfare benefits to be less than the couple would have received if they were unmarried and cohabiting.
291. Deputy Éamon Ó Cuív asked the Minister for Finance if he will clarify the matter of the 2015 Central Bank category C industry funding levy which shows a 45% increase over last year, and a 300% increase in some cases; if he is aware of concerns from the Irish Brokers Association and the Professional Insurance Brokers Association; if he has yet received the submission from the Central Bank of Ireland for approval; if he will prevent such huge increases occurring; and if he will make a statement on the matter. [37503/15]
View answerEvery year, in order to cover the costs of financial regulation, the Central Bank prescribes levies to be paid by entities subject to such regulation. The Central Bank had briefed industry representatives in August that it was proposing significant increases in those levies in 2015. The proposed increases were driven by a proliferation of legislative regulation and corresponding regulatory activity; a need to meet a shortfall from 2014's levies; and an increase in staff pension costs arising from Financial Reporting Standard 17 (which was coupled with prevailing low yields on the bond market).
The Central Bank's original proposals have since been revised to partially mitigate those increases as per a statement of 30th September 2015 published on the Central Bank's website. The revised proposals significantly reduced the increase in pension costs charged to the regulated sector in 2015 which is instead spread over coming years thereby easing the burden on financial services sector firms this year.
It is important to note that a robust regulatory environment benefits the financial services industry by promoting stability, a level playing field and facilitating prudent development and innovation. A well regulated financial services sector also benefits consumers, industry, and the economy at large. In order to ensure a well regulated financial services sector the Central Bank must be sufficiently resourced, particularly in terms of staff who are key to an effective regulatory regime. Pensions are a standard component in financial regulation costs given their link to staff costs.
Under Section 32D of the Central Bank Act 1942, the Central Bank is required to seek my approval for the Regulations prescribing industry levies. As part of that process officials from my Department met with intermediary industry representatives in order to hear their concerns on the increase in levies payable by their members. Following the publication of the Central Bank's revised proposals, which significantly reduced the pension element of the 2015 levies, I approved the Regulations prescribing the 2015 levies on 7 October last.
292. Deputy Paul J. Connaughton asked the Minister for Finance if he will consider changing the date that the exemption from inheritance tax applies, to the date of death of the benefactor, and not the date when the grant of probate is finalised; and if he will make a statement on the matter. [37521/15]
View answerWhen an individual receives an inheritance the rate of Capital Acquisitions Tax (CAT) due and the tax-free threshold to which the individual is entitled are those in place on the date of inheritance, which is defined as the date of the latest death that had to occur for the successor to become beneficially entitled to the property. I have received representations suggesting that instead of this, the rate and thresholds which apply should be those in place at the time of the grant of probate. I have no plans to make such a change. It is a general legislative principle that tax legislation should follow general law. According to the law of inheritance an inheritor comes to own an inherited asset on the date of inheritance, rather than on any other date. This is therefore the soundest and most appropriate date on which the rates and thresholds can apply.
The amount of time elapsing between inheritance and grant of probate can vary greatly, and can also be determined to a large extent by inheritors themselves. As such, were the rate of tax due and the tax-free threshold available to be defined by date of probate there would be considerable scope for individuals to delay probate with the hope that the CAT regime would become more favourable for them.
While I understand that there are inheritors for whom it would currently be advantageous for the tax-free threshold and rate of tax to apply according to the date of probate, as the threshold for inheritances from parents has been increased, there have been and could again be situations where the opposite is the case, for instance when the thresholds have been reduced or the rate increased.
293. Deputy Tom Fleming asked the Minister for Finance if he will refrain from commencing the recommendcations in Consultation Paper 88 while considering the recommendation of the International Credit Union Regulators' Network report for the review it says is necessary; if he will examine correspondence (details supplied) regarding same; and if he will make a statement on the matter. [37523/15]
View answer311. Deputy Brendan Griffin asked the Minister for Finance his views on a matter regarding a credit union (details supplied); and if he will make a statement on the matter. [37852/15]
View answer327. Deputy Thomas Pringle asked the Minister for Finance for an update on his intentions to commence certain provisions of the Credit Union and Co-operation with Overseas Regulators Act 2012, as part of the Consultation Paper 88 issued by the Central Bank which is to be enacted by 1 January 2016; if he is aware of the concerns raised by members of credit unions, such as the imposition of a €100,000 cap and lending restrictions, and the regulatory reserve ratio, which ultimately restrict credit unions' involvement in important social issues, such as funding social housing; and if he will make a statement on the matter. [38114/15]
View answer333. Deputy Michael McCarthy asked the Minister for Finance his views on the Consultation Paper 88 issued by the Central Bank of Ireland; if he will refrain from commencing its recommendations while considering the recommendation of the report of the International Credit Union Regulators' Network peer review; and if he will make a statement on the matter. [38290/15]
View answerI propose to take Questions Nos. 293, 311, 327 and 333 together.
The Government recognises the distinct and important role that credit unions play in Irish society and the financial sector and is committed, with the Central Bank, to achieving our vision of financially strong, well governed credit unions providing services to current and future members.
I have been informed by the Central Bank that the draft regulations set out in Consultation Paper 88 (CP88), will be introduced at end December 2015. I will ask the Registrar of Credit Unions to consider the views of the credit union movement as regards the draft regulations and their implementation and report back to me before I commence the remaining sections of the 2012 Act on 31 December 2015 in line with the introduction of the regulations. These sections of the 2012 Act, when commenced, will replace, amend or supplement existing sections of the Credit Union Act 1997.
The need for credit unions to grow income has been recognised as a requirement for sector viability. While developing new products and services is a necessary element of this, the Central Bank has highlighted the importance of credit unions ensuring that they are in a position to grow their income from their traditional lending business. It is also recognised that there is a level of change in the sector arising from the voluntary restructuring programme.
I am aware of the concerns highlighted by the credit union sector and am satisfied in relation to the cap on members' savings that the Central Bank is developing an application process for credit unions to apply to continue to hold member accounts with savings in excess of the €100,000 cap. Credit unions will be provided with the relevant information before end 2015.
Regarding lending restrictions placed on certain credit unions by the Central Bank, the Registrar of Credit Unions announced a review of lending restrictions in February 2015 with a closing date for applications of 30 September 2015. The Central Bank has informed me that 59% of applications received have been reviewed. Of the applications which have been fully reviewed, 83% have had their lending restriction lifted and are now operating under the board s stated credit risk appetite. As of this week c. 40% of credit unions are now subject to a lending restriction.
The Central Bank has informed me that since 2010 it has received less than 10 applications for approval of additional services under sections 48 to 52 of the Credit Union Act 1997. These applications have all been received in recent months and are currently at a various stages of the approval process. The Central Bank further informed me that it is open to working with the credit union sector to ensure that prudent and appropriate development can be facilitated within the regulatory framework. In supporting the sustainable and prudent development of the sector, the Central Bank is working to ensure that proposed changes to the business model are prudently structured and implemented. To that effect the Central Bank has invited a number of interested parties in the credit union sector to participate in focused dialogue in November 2015 with a view to gaining a better understanding of how credit unions want to develop their business model and to identify changes that may be required to the regulatory framework to facilitate prudent development.
Commencement of all sections of the 2012 Act has been aligned with the credit union financial year and the introduction of the underpinning Central Bank regulations, with a view to implementation of the 2012 Act in a coherent and cohesive manner. The publication of the regulations marks another important step in the development of a strengthened regulatory framework for credit unions. It is considered that these regulations, combined with the commencement of the remaining sections of the 2012 Act and the prudential and governance requirements already in place, provide an appropriate regulatory framework for the credit union sector at this time.
The provision of regulation making powers to the Central Bank on commencement of the remaining sections of the 2012 Act provides flexibility so that the Central Bank can, in the future, review and update the regulations as appropriate on a timely basis following consultation. The Central Bank is keen to ensure that the regulations remain appropriate for the credit union sector and in the future, where credit unions set out a clear path on how they wish to develop the Central Bank will consider any amendments to the regulations that may be appropriate.
The purpose of the International Credit Union Regulators' Network (ICURN) review was to assess the performance of the Central Bank's performance of its regulatory functions in relation to credit unions. The review assessed the legal, regulatory and prudential supervisory framework in place to fulfil the Central Bank's mandate under section 84 of the Credit Union Act, 1997 and accordingly focused on the legal and regulatory framework for the regulation of credit unions in effect at the time of the review. Overall the review found that the Central Bank effectively performs its functions in the regulation and supervision of the credit union sector.
ICURN made a number of recommendations for refinements. Under the heading Communications and Guidance, ICURN also suggested that consideration be given by the relevant authority to directing a review to evaluate the implementation of the recommendations of the Commission on Credit Unions. ICURN further stated that this is not a matter for the Central Bank.
I am aware of the suggestion made in the ICURN report that a review to evaluate the implementation of the original recommendations of the Commission on Credit Unions could be carried out by the Credit Union Advisory Committee.
The Government's priorities remain the protection of members' savings, the financial stability of credit unions and the sector overall and it is absolutely determined to continue to support a strengthened and growing credit union movement.
294. Deputy Thomas P. Broughan asked the Minister for Finance if he will confirm the result of any cost benefit analysis carried out by his Department on the rounding-up of prices, and change to the nearest 5 cent; whether the Government intends to eliminate the production of 1 cent and 2 cent coins; the timetable envisaged for this change; and if he will make a statement on the matter. [37613/15]
View answerRounding of cash transactions has been rolled out from 28th October 2015. Participation in rounding is voluntary for retailers and consumers. It is expected that the introduction of rounding will reduce the use of 1 cent and 2 cent coins. The production costs of 1c coins exceed their face value (unit cost of 1.65c), while the production costs of 2 cent coins is only slightly lower than their face value (unit cost of 1.94 cent). While no formal study has been done on the overall economy-wide cost of having 1 cent and 2 cent coins in widespread circulation, extrapolating from an international study suggests that they cost approximately €10m per annum when the costs of storing, transporting, counting and processing is included. The Central Bank has produced 2.5 billion of these coins since the launch of the euro, though these are taken out of circulation by consumers rather than being used in shops, indicating that consumer see them as little benefit in facilitating transactions. The Central Bank ran a trial of Rounding in Wexford in 2013 which showed strong support for Rounding, with 85% of consumers and 100% of retailers who expressed an opinion wanting it rolled-out nationally.
The Government does not intend to eliminate the production of 1c and 2c coins. These coins retain their legal tender status, a status which can only be changed at a eurozone level. The EU Commission reviewed the continued use of these coins in 2013 and set out a number of options given the cost of their production and the fact that EU consumers seem to hoard the coins rather than actually use them for transactions. However it was decided not to abolish these coins at a Eurozone level at this stage.
295. Deputy Thomas P. Broughan asked the Minister for Finance if his Department has estimated the impact of European Central Bank quantitative easing on growth rates on tax revenues since this policy began; and if he will make a statement on the matter. [37614/15]
View answerUnder the European Central Bank's Expanded Asset Purchase Programme, often referred to as "Quantitative Easing", the eurosystem (comprising the ECB and the national central banks of the euro area) has been purchasing €60 billion of public and private assets per month and plans to do so until at least September 2016, or until there is an improvement in inflation to levels consistent with price stability. Purchases of sovereign debt began on 9 March 2015.
While it is difficult to estimate directly the impact of Quantitative Easing (QE) on growth rates here since this policy began, the Irish economy should have benefited from the programme through a variety of channels, namely, by:
- reducing the likelihood of persistent 'deflation', this will have supported consumer spending and investment;
- the absence of deflationary pressures which will make legacy debt less burdensome as the real debt burden becomes less onerous;
- lowering real interest rates and by increasing liquidity, QE should lead to an easing of credit conditions and increased bank lending to the real economy over time;
- supporting inflation and real economic activity in the euro area, a key export market for Irish goods and services; and,
- the exchange rate channel the depreciation of the euro is benefiting Irish exports to markets outside the euro area.
Also, as QE has boosted nominal growth, this is one factor behind strong tax revenue growth this year.
296. Deputy Clare Daly asked the Minister for Finance further to parliamentary Question No. 245 of 20 October 2015, if he will clarify the apparent contradiction in the last two paragraphs in his reply in the context of information collected by the Fingal Senior Citizens Forum in respect of the home renovation incentive ( details supplied). [37618/15]
View answerI am advised by the Revenue Commissioners that the application for the HRI tax credit must be submitted through Revenue's MyAccount portal at https://www.ros.ie/myaccount-web/register.html?execution=e1s1. As previously explained, there is no paper process for the HRI. The HRI system accumulates the value of the various qualifying works carried out, thereby simplifying the process of claiming the tax credit, but the application requires an electronic declaration submitted by the applicant. This is a necessary check to ensure that the tax credit is going to the person entitled to it.
The increasing investment and emphasis on Revenue's online offerings is in line with the Government's Public Service ICT Strategy of digital first to deliver improved efficiencies and better value for money, as well as providing more user centred and innovative services for customers. Revenue has confirmed that where the HRI applicant is not e-enabled, a family member or trusted third party can provide assistance. Alternatively, Revenue will assist a person in registering for MyAccount and in submitting their HRI claim.
If the Deputy wishes to provide my officials with the applicant's details, I will pass these to the Revenue who will be happy to follow-up to ensure that the applicant receives his/her entitlements as soon as possible.
297. Deputy Clare Daly asked the Minister for Finance his views on the Central Bank report published in May 2015 entitled Influences on Standard Variable Mortgage Pricing in Ireland, in the context that this report acknowledges that the banks currently continue to break contractual mortgage agreements they have with customers; and the action he will take regarding same. [37624/15]
View answerAs the Deputy will be aware, I have taken steps to ensure that the banks provide options for mortgage holders to reduce their monthly repayments. Last May, I requested a report from the Central Bank on the topic which I subsequently published. This report was entitled 'Influences on Standard Variable Rate Pricing in Ireland'.
The Central Bank has informed me that in its research on mortgage interest rates, it has focused mainly on four aspects. First, the cost and risk factors which have influenced, and are likely to continue to influence, mortgage rates. Second, the influence of the competitive environment on the rates charged. Third, the distribution of borrowers as to size of loan, date of borrowing and rate currently charged. Fourth, the transparency of the banks' policies for determining movements in rates, especially their "standard variable rates". This Influences on Standard Variable Mortgage Pricing in Ireland document summarises some of the findings of this research. Contrary to the premise of the question, this particular document does not refer to mortgage contracts.
With regard to my action in relation to mortgage holders more generally, as you know, I have taken steps to ensure that the banks provide options for mortgage holders to reduce their monthly repayments. Last May I met with the six main mortgage lenders May and outlined my view that the standard variable rate being charged to Irish customers was too high. The banks agreed to review their rates and products and, by the beginning of July, to have simple options to reduce monthly mortgage payments for SVR customers.
In September I concluded a series of follow up meetings with these banks and the reality is that the majority have put options in place to allow borrowers reduce their repayments. These options range from lower variable rates to new suites of variable rates based on loan to value and reductions in fixed rates.
While, it is a matter for each individual borrower to decide what suits their circumstances, I have encouraged borrowers to contact their bank to see what is available to them in their circumstances or consider moving to another bank, where possible, if the offer is not satisfactory.
298. Deputy Lucinda Creighton asked the Minister for Finance the amount of local property tax collected in the Dublin City Council area for the nine months, ending September 2014; ending September 2015; and if he will make a statement on the matter. [37685/15]
View answerI am advised by the Revenue Commissioners that statistics relating to Local Property Tax (LPT) can be found on the statistics webpage of the Revenue website at http://www.revenue.ie/en/about/statistics/index.html. Specifically, LPT information including LPT collected by Local Authority, are available at http://www.revenue.ie/en/about/statistics/lpt-compliance.html. The Deputy may wish to note that the data in respect of the months from January to end September 2014 can be accessed in the earlier version of the statistics as published in October 2014.
299. Deputy Paul Murphy asked the Minister for Finance the projected payment schedules for future housing projects funded by the National Asset Management Agency; and his views on claims that there are administrative blockages in the agency, which appear to be hindering the release of funds to contractors and design professionals for works carried out in certain projects to date. [37702/15]
View answer300. Deputy Paul Murphy asked the Minister for Finance his views on reports that in many projects funded by the National Asset Management Agency design works are required to be completed prior to any funds being paid to design firms; and the average time projected for payments to project design professionals for work to be undertaken on future agency housing schemes. [37703/15]
View answerI propose to take Questions Nos. 299 and 300 together.
As the Deputy is aware NAMA has acquired loans from five participating institutions and is not the owner or manager of properties. NAMA's role is, like a bank, that of a secured lender. Properties securing NAMA's loans are managed by their existing owners or, in the case of enforcement, on NAMA's behalf by duly appointed insolvency practitioners. These owners and insolvency practitioners are responsible for managing all assets, including the procurement of design, planning and construction services as required. NAMA requires debtors and receivers to agree project budgets in advance of incurring any expenditure. Where drawdown requests are made by debtors or receivers in line with agreed budgets NAMA typically processes such requests within 2 working days. In the context of such short approval periods, the suggestion that there are administrative blockages does not stand up to scrutiny. While there is no question of NAMA's credit application and drawdown processes giving rise to any material delay in the payment of approved expenditure, the Deputy will no doubt appreciate that expenditure of taxpayers' money must be managed rigorously and prudently.
Within the context of the above, NAMA expects its debtors and receivers to discharge all approved expenditure in a timely fashion. The Deputy will appreciate that in most commercial situations works commissioned will require completion prior to payment. If the Deputy wishes to raise a particular case then I would encourage him to contact NAMA using the dedicated Oireachtas email address oir@nama.ie and NAMA has assured me they will examine the matter.
