Written Answers Nos. 61-80
61. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Social Protection the entitlement to partial rent support of a person (details supplied) in County Kildare; if efforts will be made to ensure that the person's position is not detrimentally affected in the approach to the festive season; and if she will make a statement on the matter. [44602/15]
View answerAs detailed to the Deputy in reply to Parliamentary Question No. 46 of 19 November 2015, Rent Supplement is not payable where a person or their spouse/partner is in full-time employment. The client concerned was requested to submit to the Department an up to date Rent Supplement application form, lease agreement confirming any increase in their monthly rent and current payslips in order for their rate of Rent Supplement entitlement to be re-assessed. This documentation has not, to date, been received by the Department. The client has been advised that this claim will be closed if the outstanding information has not been received by the 21 December 2015.
62. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Social Protection if and when rent support will be approved for a person (details supplied) in County Meath; and if she will make a statement on the matter. [44607/15]
View answerThe Rent Supplement claim for the client concerned was awarded on 26 November 2015.
63. Deputy Willie Penrose asked the Tánaiste and Minister for Social Protection the steps she will take to have an application for a carer's allowance by a person (details supplied) in County Westmeath immediately dealt with; and if she will make a statement on the matter. [44628/15]
View answerI confirm that the Department received an application for carer’s allowance from the person concerned on 22 September 2015. The application is currently being processed and once completed, the person concerned will be notified directly of the outcome.
64. Deputy Michael McGrath asked the Tánaiste and Minister for Social Protection the number of persons who have availed of the back to work dividend scheme since it was introduced; how this compares to the numbers expected; her plans to review the scheme; and if she will make a statement on the matter. [44649/15]
View answerThe back to work family dividend (BTWFD) was introduced in Budget 2015 when it was estimated that the average weekly number of recipients in that year would be 9,700. By the end of November 2015 there have been just over 10,500 applicants for BTWFD with over 10,000 of those currently in receipt of a payment. Through these payments the dividend is providing support in respect of over 17,000 children.
The back to work family dividend aims to help families to move from a weekly social welfare payment into employment. It gives financial support to people with children who were in receipt of a jobseeker or one-parent family payment and who take up employment, increase their hours of employment or become self-employed.
If a person qualifies for the dividend for their first year in employment they will get a weekly payment equivalent to the increases for qualified children they were being paid on their jobseeker or one-parent family payment. This is up to a maximum of 4 children. Half that weekly amount will be paid for the second year in employment. This means that over the two years, a family with one child will receive additional support of €2,324 to supplement wages. A family with two children will receive €4,649; those with three children will get €6,973, while those with four or more will get €9,298.
My officials are constantly monitoring take up of the scheme and seeking ways to improve awareness of the dividend among jobseekers. My Department has given an undertaking to formally review the operation and effectiveness of the dividend by the end of 2017.
66. Deputy Róisín Shortall asked the Minister for Finance given the current housing crisis, why social housing comprises only 10% of the housing stock to be delivered by the National Asset Management Agency; if this conflicts with recent commitments to increase the supply of social housing and given the agency's capacity to supply housing stock, if he will task it to increase this percentage as a matter of urgency. [44443/15]
View answerI must first point out to the Deputy that NAMA does not directly deliver housing. In cases where residential development is commercially viable, NAMA funds such development in order that its debtors and receivers can maximise their repayment of debt and deliver a surplus to taxpayers. I am advised that, as part of any NAMA-funded residential development, NAMA debtors and receivers will abide by their Part V obligation to deliver 10% of the stock as social housing.
It is neither equitable nor feasible to impose different social housing obligations on developers, based purely on their sources of development finance. To impose on a NAMA debtor a higher obligation to deliver social housing than is imposed, for instance, on a developer who is funded by a bank or who has access to other sources of finance, would be arbitrary and discriminatory. From the perspective of a NAMA debtor, their capacity to redeem their debt is a primary consideration and imposing additional obligations over and above the obligations that are imposed on a debtor outside NAMA would reduce their capacity to repay their debt.
As I recently pointed out in Parliamentary Question 171 of 8 December 2015, NAMA cannot subvent the supply of social housing. Section 10 of the NAMA Act requires NAMA to act in a commercial manner to obtain the best financial return for taxpayers. In line with NAMA's obligations under Section 10, all residential projects will be required to pass a stringent commercial viability threshold before NAMA approves funding and funding will only be made available if it is expected to increase the overall recovery for NAMA from the security being funded. NAMA must act akin to a private sector commercial entity.
Furthermore, NAMA has already played a very important role in facilitating, on a commercial basis, the supply of houses and apartments for social housing from within its existing portfolio. By the end of this year, NAMA will have facilitated the supply of 2,000 houses and apartments for social housing through its debtors and receivers. This equates to more than one-third of total social housing provision under Part V (Social Housing) legislation in the years between 2002 and 2011. It should also be noted that NAMA originally made over 6,500 houses and apartments available for social housing under this commercial initiative but local authorities confirmed demand for just over 2,500 of these.
The core housing issue we face is that of insufficient supply of housing generally, which impacts the supply of social housing, starter homes and all other categories of housing, particularly in the greater Dublin area. Any contribution to the overall supply of housing will therefore have a positive impact for housing across all categories. Therefore, NAMA's contribution to the housing market and by association social housing is timely and welcome.
NAMA's commercial funding programme, being an independent and commercial initiative, does not contradict or lessen the Government's commitment to deliver on our Social Housing 2020 strategy. We are also combining these long term measures with interim solutions to deal with the immediate issues that families currently face. This is why Budget 2016 increased the current allocation for social housing by €69 million to €414 million. This will enable local authorities to secure accommodation for an additional 14,000 households.
Under the Government's 6 year capital investment framework, "Building on Recovery: Infrastructure and Capital Investment 2016-2021", which was recently announced by Minister Howlin, the current allocation for emergency accommodation for the homeless, has been increased by €17 million. This increase will bring Exchequer support to €70 million, which amounts to a 56% increase since last year. This injection of funding will help the homeless transition to long term sustainable housing.
The Government also recently agreed on a package of measures designed to give certainty to tenants in relation to their rent, to better protect tenants in their homes and to provide clarity to both tenants and landlords as regards their rights and obligations. The primary measure in this package is the amendment of the Residential Tenancies Act so that rent reviews for all tenancies will take place every 24 months, rather than every 12 months as currently is the case. This will provide tenants with a longer period of predictable rent.
Therefore, addressing the issues facing the housing market generally, social housing, and homelessness, particularly among families, are clearly key priorities for this Government and I can assure the Deputy that NAMA's residential funding programme are complementary to, rather than in lieu of, the Government's commitments.
67. Deputy Lucinda Creighton asked the Minister for Finance the estimated annual cost to the Exchequer of extending the existing PAYE tax credit of €1,650 to all individuals who currently pay income tax as self-employed persons. [44462/15]
View answerAs the Deputy's question refers to the payment of tax as a self-employed person, it is assumed that the Deputy is interested in the additional cost of increasing the Earned Income Credit (EIC) introduced in Budget 2016, from the €550 to €1,650, the level of the existing PAYE tax credit. The Earned Income Credit is available to taxpayers with active self-employed trading or professional income, and to business owner/managers who do not have access to the PAYE credit on salary income from their business. On this basis I am informed by the Revenue Commissioners that the estimated total first and full year costs of such proposals would be in the order of €37 million and €123 million respectively.
These figures are estimates using data for 2013, the latest year for which data are available. It should also be noted that this estimate does not take into account the fact that very low taxable incomes may not be able to fully utilise the tax credit. It also assumes that the maximum Earned Income and PAYE credit value claimable by a taxpayer with both employment and self-employment income would be €1,650.
68. Deputy Lucinda Creighton asked the Minister for Finance the number of instances and transactions in which capital acquisitions tax and in which inheritance tax was payable and the value to the Exchequer of each of these taxes in 2014; and the yearly cost to the Exchequer of increasing the threshold above which inheritance tax applies from €280,000 to €500,000. [44463/15]
View answerI am advised by the Revenue Commissioners that the number of instances in which Capital Acquisitions Tax was payable in 2014 was 12,752. Of these, 11,370 were for Inheritance Tax, while the numbers paying other Capital Acquisitions Tax (primarily gift tax and discretionary trust tax) was 1,382. These figures are provisional.
General information pertaining to Capital Acquisitions tax net receipts is available on the Revenue statistical web page at http://www.revenue.ie/en/about/statistics/index.html. In particular, in relation to the Deputy's Question, a breakdown showing annual net receipts for Capital Acquisitions Tax including 2014 is available at http://www.revenue.ie/en/about/statistics/cat-receipts.pdf. Future updates will be provided in due course.
The cost in a full year of increasing the category A threshold from €280,000 to €500,000, without changes to the other thresholds, would be approximately €74 million.
69. Deputy Lucinda Creighton asked the Minister for Finance the tax reliefs relating to property, the number of persons availing of each relief and the total cost to the Exchequer of each relief in the most recent tax year. [44467/15]
View answerI am advised by the Revenue Commissioners that within the tax code there are a significant range of tax reliefs associated with property. All reliefs, including property related reliefs, are a cost to the Exchequer. I propose to provide an analysis of the property reliefs under each Tax and Duty heading. Unless otherwise stated the figures relate to the year 2013.
Income Tax/Corporation Tax Reliefs
The following table is a list of the property based incentive schemes qualifying for capital allowances. It should be noted some of these figures are provisional. While the majority of these schemes have been terminated (capital allowances have been retained for expenditure on hotels, holiday camps, holiday hostels, guest house and registered caravan and camping sites at a rate of 4% per annum over 25 years), tax relief may continue to be claimed on expenditure incurred prior to the termination date in question.
|
Scheme |
Number of Claimants |
Tax Cost - €m |
|
Urban Renewal |
2,664 |
46.0 |
|
Town Renewal |
749 |
10.9 |
|
Seaside Resort |
286 |
2.3 |
|
Rural Renewal |
2,198 |
18.5 |
|
Multi-storey car parks |
57 |
3.0 |
|
Living Over the Shop |
41 |
0.6 |
|
Student Accommodation |
537 |
11.9 |
|
Enterprise Areas |
105 |
1.9 |
|
Park and Ride |
17 |
0.7 |
|
Hotels |
1,017 |
35.5 |
|
Holiday Cottages |
574 |
11.0 |
|
Holiday Hostels |
* |
* |
|
Guest Houses |
* |
* |
|
Nursing Homes |
418 |
10.9 |
|
Housing for the Elderly/Infirm |
100 |
1.4 |
|
Convalescent Homes |
12 |
0.5 |
|
Qualifying Hospitals |
357 |
9.2 |
|
Qualifying Mental Health Centres |
* |
* |
|
Qualifying Sports Injury Clinics |
82 |
1.4 |
|
Buildings used for certain Childcare Purposes |
304 |
4.4 |
|
Buildings or structures in registered Caravan camp; Camping sites |
* |
* |
|
Mid-Shannon Corridor Tourism Infrastructure Investment Scheme |
* |
* |
* indicates that the number of claimants is low (usually less than 10) and cannot be provided to protect taxpayer confidentiality.
As statistics were not captured separately for Third Level Educational Buildings and the Countrywide Refurbishment Scheme (both now terminated) these have not been included. Also not included are the ordinary industrial buildings (e.g., mill/factory and airport runways/buildings) as statistics are not captured separately for these either.
The Living City Initiative and incentives for certain Aviation Services Facilities were commenced in 2015. The earliest point at which statistics for the number of persons availing of these reliefs and the total cost to the Exchequer may become available is when tax returns for 2015 have been filed.
Home Renovation Incentive (HRI)
This scheme provides a tax relief by way of an income tax credit on repair, renovation or improvement works on principal private residences or rental property carried out by tax compliant contractors. In addition to providing an income tax relief, the HRI also aims to support tax compliance in the building industry by moving activity out of the shadow economy into the legitimate economy.
The year 2014 was the first full year in which the incentive operated. The incentive came into operation on 25 October 2013 and will run until 31 December 2016. Rental properties were brought within the scheme from 15 October 2014.
Since the introduction of the incentive, works on 31,719 properties have been notified to Revenue's HRI online system (as of 30 November 2015). This represents more than €695 million worth of works involving some 6,705 contractors. The potential total cost to the Exchequer in respect of these properties is approximately €47m. As a claim for the HRI credit can only be made in the year after works have been paid for, there was no cost to the Exchequer in 2014 (works paid for in the period from 25 October 2013 to 31 December 2013 were deemed to have been paid for in 2014).
Additional Income Tax Reliefs
Other property based reliefs include interest relief on loans to acquire a principal private residence (PPR) (terminated for any new cases after 31 December 2012 interest relief for PPRs purchased between 2004 and 2012 will continue until end 2017), relief for rental payments on private tenancies (terminated for any new cases after 7 December 2010 - Individuals who were in receipt of the relief at 7 December 2010 may continue to claim it until 2017) the rent-a-room relief and relief for expenditure on significant buildings or gardens. The cost of the reliefs and the number claiming the relief are set out on the following table:
|
Year |
No. |
Amount |
|
Year 2014 |
Number of claimants |
Cost - €m |
|
Mortgage interest relief for PPRs |
495,000 |
266.0 |
|
Year 2013 |
Number of claimants |
Cost - €m |
|
Rent-a-room relief |
4,370 |
5.9 |
|
Expenditure on significant buildings or gardens |
120 |
2.1 |
Capital Gains Tax Reliefs
For the purpose of capital gains tax there are three significant property based reliefs, the property purchase incentive, the Principal Private Residence relief and the farm restructuring relief.
The property purchase incentive relief was introduced in the Finance Act 2012. The relief applies to properties purchased between 7 December 2011 and 31 December 2014. For the relief to apply, the property must be owned for a period of at least 7 years. The rationale for the relief was to encourage investment in Irish property at a time when the property market was at a low ebb.
The Principal Private Residence Relief is available for individuals disposing of a house which was occupied by them as their only or main residence. The rationale for the relief is to ensure that the sale of a house, which will generally be replaced with another house, can be done on a tax-neutral basis.
Farm restructuring relief was introduced in the Finance Act 2013. The rationale for the relief is to facilitate the consolidation of land holdings, thereby increasing the productivity of those land holdings.
There is no statistical information available to the numbers availing of the Principal Private Residence relief and the farm restructuring relief or their cost to the Exchequer. The property purchase incentive had no cost to the Exchequer in the past full year since the entitlement to avail of the relief will not arise until a future point in time.
Capital Acquisitions Tax
The property based reliefs available for the purposes of capital acquisitions tax are set out on the following table. Costs and numbers availing relate to 2014.
|
Relief |
Rationale for relief |
|
Reduction of 90% in market value of agricultural property |
To encourage entrepreneurial activity and the inter-generational transfer of business. |
|
Reduction of 90% in market value of business property |
To encourage entrepreneurial activity and the inter-generational transfer of business. |
|
Exemption from CAT on the inheritance or gift of a residential property where the beneficiary has lived in the property as a sole or main residence for a specified period both before and after the inheritance/gift. |
To prevent hardship for home-sharers. |
|
Spouses and civil partners |
Gifts and inheritances of property between spouses and civil partners are exempt from CAT. |
|
Public or charitable purposes |
To exempt from CAT gifts/inheritances of property where the property is applied for purposes that are public or charitable. |
|
Heritage properties |
To exempt from CAT gifts/inheritances of houses/gardens that are of national, historic or artistic interest and where there are reasonable viewing facilities offered to the public. |
N/A indicates that the figures are not available.
Valued Added Tax
The VAT Consolidation Act 2010 provides for the making of Orders whereby VAT that has been paid may be refunded in certain circumstances. Three Refund Orders provide for the possibility of recovering VAT associated with property.
- VAT Refund Order (No. 15) of 1981 allows for certain construction costs incurred in the adaptation of a house for certain qualifying disabled persons. The Order does not allow for the initial construction cost of a house.
- Refund Order (No. 29) of 1996 allows for VAT refunds/remission for qualifying accredited diplomatic personnel who purchase property for use as embassies/consulates and also for use as their principal private residences.
- SI 201 of 2012 provides for refunds of VAT for farmers on the construction, extension, alteration or reconstruction of farm buildings which are used solely or mainly in the farming business.
Each of the Refund Orders provides for relief for a number of areas of expenditure, including the property costs, so it is not possible to provide the cost to the Exchequer that relates solely to the property costs.
Local Property Tax
In relation to LPT the following table sets out the exemptions and reliefs available.
|
LPT exemptions |
Rationale for exemption |
|
Properties fully subject to commercial rates |
To provide relief for owners of properties that may be fully liable for both LPT and commercial rates charged by a local authority. |
|
Long term mental or physical infirmity |
To provide relief for owners of properties who are unable to continue living in their property because of a long-term mental or physical infirmity and where those properties are vacant. An exemption is also available for nursing homes that are used exclusively for the care of such persons. |
|
Owned and sold by builders and developers |
To provide relief for builders and developers who have built properties with the intention of selling them but that were not yet sold or rented out or occupied as a residence at the time of the first liability date of 1 May 2013. In the event of a sale before the next liability date of 1 November 2016, the exemption continues to be available for the purchasers of such properties. |
|
Special needs accommodation |
To provide relief for charitable and social housing bodies who own properties that are made available to persons who require special accommodation and support to enable them to live in the community because of old age, physical or mental infirmity or other reason. |
|
Recreational activities |
To provide relief for charitable bodies who own properties that are used solely as residential accommodation to facilitate recreational activities in the course of carrying out the body's main purpose. |
|
Purchases in 2013 |
To provide relief, following the termination of mortgage interest relief, for persons who purchased properties during 2013 and who occupy the properties as their sole or main residence. |
|
Unfinished housing estates |
To provide relief, as had been done in relation to the Household Charge, to owners of properties that were located in housing estates that were certified as 'unfinished' by the Minister for the Environment, Community and Local Government. |
|
Pyrite damage |
To provide relief to owners of properties that have been appropriately certified as having been damaged to a significant extent by pyrite. |
|
Incapacitated persons |
To provide relief for owners of properties that have been acquired or adapted because of their suitability, or to make them suitable, for occupation by persons who are totally and permanently incapacitated from maintaining themselves by earning a living from working and whose condition dictates the type of property they can live in. |
|
Reduced chargeable value of property |
Rationale for reduction in chargeable value |
|
Property adapted for occupation by certain disabled persons |
To provide relief for owners of properties who have had to incur expenditure on construction or adaptation work to make the properties suitable for occupation by certain disabled persons where the work has the effect of increasing the value of the properties so that they move into a higher LPT valuation band with a higher tax liability. |
|
Deferral of payment of LPT |
Rationale for deferral |
|
Income threshold |
To provide relief for persons whose annual income does not exceed a specified threshold by allowing them to defer payment of either the full or partial LPT liability until their circumstances improve or their property ceases to be owned by them. |
|
Estate of deceased person |
To provide relief for executors and administrators of a deceased person's estate to give them an opportunity to transfer ownership of any residential property to a beneficiary or to sell the property and distribute the proceeds of sale. |
|
Insolvency |
To provide relief for persons who have entered into certain formalised insolvency arrangements for the management of their debts until such time as the arrangements cease to have effect. |
|
Hardship |
To provide relief for persons who suffer a significant financial loss or incur a significant expense that is unexpected and unavoidable and as a result of which are unable to pay their LPT liability. |
In relation to the LPT exemptions, I am advised by the Revenue Commissioners that the cost to the Exchequer for 2014, the most recent year available, is estimated to be €12 million in total. Exemptions have been claimed for around 41,000 properties. LPT deferrals have resulted in delayed LPT receipts estimated at €7 million in 2014. Claims for deferral have been made in respect of around 27,000 properties for 2014. I am further advised that costs for individual exemptions or deferrals are not available at this time.
Stamp Duty
Finally, the following table sets out the relief or exemption from stamp duty for transactions associated with property. Costs and numbers refer to 2014 data.
Stamp Duties Consolidation Act 1999 Exemptions and reliefs from stamp duty:
|
Section |
Relief |
Rationale for relief |
|
Section 79 |
Associated companies |
Exemption from stamp duty is available where property is transferred between companies with a significant degree of common ownership |
|
Section 81AA |
Young trained farmers |
Exemption from stamp duty is available to encourage the early transfer of farmland to young farmers with approved educational qualifications. |
|
Section 82 |
Charitable bodies |
Exemption from stamp duty is available where property is transferred or leased to a charitable body. |
|
Section 82B |
Approved sports bodies |
Exemption from stamp duty is available where land is transferred to an approved sports body where the land is used for the sole purpose of promoting athletic or amateur games or sports. |
|
Section 82C |
Pension schemes and charitable bodies |
Exemption from stamp duty is available where property is transferred by pension schemes and charitable bodies |
|
Section 93 |
Industrial and provident societies |
Exemption from stamp duty is available where a house is transferred or leased by a registered industrial and provident society to a member of the society for the purpose of providing housing for members of the society. |
|
Section 93A |
Approved voluntary body |
Exemption from stamp duty is available where land is transferred or leased to a voluntary body for the purpose of providing social housing. |
|
Section 94 |
Land Commission |
Exemption from stamp duty is available where land is purchased from the Land Commission |
|
Section 95 |
Commercial woodlands |
Partial relief from stamp duty is available to encourage the sale or lease of land on which trees have been planted as a commercial undertaking. |
|
Section 96 |
Spouses and civil partners |
Exemption from stamp duty is available where property is transferred between spouses and civil partners. |
|
Section 97 |
Dissolution of a marriage |
Exemption from stamp duty is available where property is transferred on foot of a court order between divorced spouses and between civil partners where the civil partnership has been dissolved or annulled |
|
Section 97A |
Cohabitants |
Exemption from stamp duty is available where property is transferred on foot of a court order from one cohabitant to his or her cohabitant. |
|
Section 98 |
Foreign property |
Exemption from stamp duty is available in respect of transfers of property that is situated outside the State. |
|
Section 99 |
Dublin Docklands Development Authority |
To encourage development in the docklands area of Dublin, exemption from stamp duty is available where land is acquired by the Dublin Docklands Development Authority |
|
Section 99A |
Courts service |
Exemption from stamp duty is available where land is acquired by the Courts Service. |
|
Section 100 |
Temple Bar Properties Limited |
To encourage development in the Temple Bar area of Dublin, exemption from stamp duty is available where land is acquired or leased by Temple Bar Properties |
|
Section 103 |
Shared ownership leases |
Exemption from stamp duty is available to assist those on low incomes to purchase their own homes under a shared ownership lease. |
|
Section 106A |
National Building Agency Limited |
Exemption from stamp duty is available where land is transferred or leased to the National Building Agency Limited for social housing purposes |
|
Section 106B |
Housing authorities and Affordable Homes Partnership |
The stamp duty charge is capped at €100 where property is transferred or leased to certain social housing bodies. |
|
Section 106C |
Grangegorman Development Agency |
To encourage development at Grangegorman, exemption from stamp duty is available where land is acquired or leased by the Grangegorman Development Agency |
|
Section 108AA |
Strategic Banking Corporation of Ireland |
Exemption from stamp duty is available where property is transferred or leased to the Strategic Banking Corporation of Ireland which was established by the Minister for Finance to improve the supply of funds to SME's. |
|
Section 108B |
National Asset Management Agency |
Exemption from stamp duty is available where property is transferred or leased to the National Asset Management Agency |
|
Section 108C |
Ireland Strategic Investment Fund |
Exemption from stamp duty is available where property is transferred or leased to a Fund Investment Vehicle under the control of the NTMA |
|
Schedule 1 |
Consanguinity relief |
A 50% reduction in the rate of stamp duty encourages early transfers of farmland to certain relatives who will actively carry on farming activities. |
N/A indicates that the figures are not available.
* indicates that the number of claimants is low (usually less than 10) and cannot be provided to protect taxpayer confidentiality.
70. Deputy Jack Wall asked the Minister for Finance if a person (details supplied) in County Kildare is due a refund on tax paid; and if he will make a statement on the matter. [44508/15]
View answerI am informed by Revenue that based on the information available, the person concerned is not due a refund of tax. However Revenue will make arrangements to contact the individual to confirm this information is fully reflective of their circumstances.
71. Deputy Seamus Kirk asked the Minister for Finance the amount of property tax paid in County Louth for each of the years 2014 to date; the proportion that was spent in County Louth; and if he will make a statement on the matter. [44526/15]
View answerI am advised by the Revenue Commissioners that statistics relating to Local Property Tax (LPT) can be found on the statistics web page of the Revenue website at http://www.revenue.ie/en/about/statistics/index.html.
Specifically, the available LPT information, including amount collected by Local Authority, is available at http://www.revenue.ie/en/about/statistics/lpt-compliance.html. Updates will be published in due course.
72. Deputy Barry Cowen asked the Minister for Finance the arrangements under which the National Asset Residential Property Services Limited, the National Asset Management Agency social housing special purpose vehicle, will directly lease properties to local authorities in order to fulfil its Part V obligation, associated with its construction of the private housing units announcement; if, in the leasing of these units, the National Asset Residential Property Services Limited will have a commercial mandate to lease the units at market rates or if the units will be leased at below market rates; whether the National Asset Management Agency has any statutory duty to fulfil a Part V obligation, when constructing housing developments; and whether the National Management Asset Management Agency's construction of social housing units is based on agreement with the Departments involved. [44546/15]
View answer73. Deputy Barry Cowen asked the Minister for Finance the arrangements under which National Asset Residential Property Services Limited, the National Asset Management Agency's social housing special purpose vehicle, will retain ownership of the housing units to be leased to local authorities for social housing provision; whether the National Asset Residential Property Services Ltd vehicle will have to remain in operation and existence indefinitely, as the lease-holder on these social housing units, or whether it is due to cease existence at the same time as the National Asset Management Agency; if it is to be wound up with the National Asset Management Agency, the arrangements in place for disposing of its social housing units; if it is to dispose of the units, if it will have to sell them at market rates; and if these units will have to be sold to local authorities or if they can be put on the open market. [44548/15]
View answerI propose to take Questions Nos. 72 and 73 together.
The Deputy rightly identifies increased social housing provision as a priority for the Government. That priority is reflected in the housing package announced recently by Minister Alan Kelly and in the substantial increases in direct Exchequer funding for social housing over the lifetime of this Government.
I welcome the announcement by NAMA that, subject to commercial viability, it expects to be in a position to fund the construction of up to 20,000 new residential units, predominantly located in Dublin and the neighbouring counties of Wicklow, Kildare and Meath, over the next five years. NAMA will in this way make an important contribution, on a strictly commercial basis, to increased supply over the coming years. Section 10 of the NAMA Act requires NAMA to in all instances act in a commercial manner to obtain the best financial return for taxpayers. In line with NAMA's obligations under Section 10, all residential projects will be required to pass a stringent commercial viability threshold before NAMA approves funding. NAMA must act akin to a private sector commercial entity in this respect.
NAMA is not a property developer. NAMA's role in relation to new housing output is, like a bank, that of a secured lender which makes a commercial decision to advance funding to maximise its return. As a secured lender, NAMA provides funding to its debtors and receivers where it is shown that this will increase the overall recovery for NAMA from the security being funded. Residential projects funded by NAMA are delivered by NAMA's debtors and receivers who are subject to the same planning requirements as all other applicants in the planning process, including Part V legislation which requires the provision of 10% of their housing units for social housing.
Government recently amended Part V to remove the ability of developers to account for their social housing commitments through cash payments to local authorities and furthermore to ensure that the social housing will be located predominantly on the site of the original developments, not off-site as had been a feature of Part V since its introduction. NAMA debtors and receivers will fulfil their Part V obligation to deliver 10% of residential units in the form of on-site social housing units.
NAMA has stated publicly its intention to facilitate, where feasible, the provision by its debtors and receivers of future Part V housing on NAMA-funded developments through its social housing SPV, NARPS. This is a very important initiative, which means that NAMA, as opposed to the relevant local authority, will, in many cases, bear the up-front capital cost of delivering Part V housing on estates it funds and that such housing will, in line with Government policy be aimed at ensuring greater integration in housing, be delivered on-site.
Any delivery via NARPS, through Part V or otherwise, must be on a commercial basis in line with Section 10 of the NAMA Act. In this regard, NARPS leases properties to either local authorities or approved housing bodies on the basis of commercial long-term lease arrangements which include an option for the local authority or approved housing body to buy the leased unit.
Part V agreements are facilitated through the Planning Process and the design and planning specification of new houses and apartments are determined in the planning consent by reference to national and local policy and standards. NAMA does not own properties, is not a developer and NAMA is not a planning applicant in any instance so NAMA is not a direct party in the planning process, so while it may facilitate development, NAMA does not negotiate housing specification with local authorities as this is a reserved function of the planning process.
NAMA has already played a very important role in facilitating on a commercial basis the supply of houses and apartments from within its existing portfolio for social housing. By the end of this year, NAMA will have facilitated the supply of 2,000 houses and apartments for social housing through its debtors and receivers under this initiative and NARPS, alongside the direct leasing or sale by NAMA debtors and receivers, is an important mechanism in ensuring this supply. Properties are leased by NARPS to approved housing bodies on the basis of long-term leasing arrangements. The NARPS lease provides, typically, for up to an average 20% discount to market rents, with the rent fixed for the first six years, and reviewed every three years thereafter, and includes an option for the approved housing body to purchase the property outright after a number of years at market value. The discount reflects the fact that the local authority and\or approved housing body take full responsibility for property maintenance and repairs over the lifetime of the lease. NAMA expects to have delivered close to 800 units out of end-2015 figure of 2,000 through the NARPS mechanism.
The 2,000 units that will be delivered by NAMA from within its existing portfolio by the end of this year for social housing equates to more than one-third of total social housing provision under Part V in the years between 2002 and 2011. This underlines the important contribution that NAMA has already made in this area. It should also be noted that NAMA originally made over 6,500 houses and apartments from within its existing portfolio available for social housing under this commercial initiative but local authorities confirmed demand for just over 2,500 of these.
Decisions relating to the disposal of the social housing portfolio leased by NARPS or to the possible dissolution of NARPS will be a matter for the NAMA Board to make at the appropriate time in the future. However, possible options could include selling the SPV at market value as part of NAMA's ongoing de-leveraging, in which case a market participant would keep the long term lease arrangements with local authorities in place, or allowing local authorities to buy the properties from NAMA.
While there may be commercially attractive opportunities in the social housing sector, any such opportunities are based upon the current social housing delivery model of direct Exchequer subvention. As previously stated, NAMA cannot provide that subvention.
It is clear however that the social housing supply problem is a subset of the wider supply problem in the property market and NAMA's funding commitment in terms of commercially viable residential output will be part of the overall housing solution, although it can only be part of the solution.
Looking at the private market, NAMA debtors and receivers control only about 30% of zoned residential sites in the Dublin area and accordingly, market participants who control the other 70% of the sites also have a major role to play if the supply/demand imbalance is to be addressed in the years ahead.
The Government is examining what role it can play in supporting increased output by the wider development sector and in particular is examining how to address infrastructure deficits that are holding up the supply of commercially viable new housing in the main urban growth centres.
74. Deputy Finian McGrath asked the Minister for Finance the number of applications for re-instatement, following retirement on grounds of ill health, with prior notice granted since 2004; the legislation and rules or procedures under which they were granted; and if he will make a statement on the matter. [44558/15]
View answerAs the Deputy is aware there is no provision in the legislation to allow for the reinstatement to the Civil Service of a former civil servant other than by way of competition.
I wish to advise the Deputy, therefore, that no applications for re-instatement, following retirement on grounds of ill-health, with prior notice, have been granted by my Department since 2004.
Where an officer retires on grounds of ill-health the procedures are set out in Circular 22/07, titled, Ill-Health Retirement from the Civil Service. There is no provision under Circular 22/07 whereby a person who has retired with prior notification on ill health grounds may initiate an application for reinstatement.
Persons wishing to re-join the Civil Service must compete in the normal recruitment process i.e. through an open recruitment competition run by the Public Appointments Service or the Top Level Appointments Committee, or via such other competitions that may be run, under licence, by individual Civil Service Departments or Offices.
75. Deputy Bernard J. Durkan asked the Minister for Finance the basis on which it is concluded that a person (details supplied) in County Longford is a property owner, given that the person is not; and if he will make a statement on the matter. [44599/15]
View answerI am advised by Revenue that the person to whom the Deputy refers is not listed as the 'liable person' for the property in question or for any other property in respect of Local Property Tax (LPT).
Revenue has also confirmed to me that the person was never issued with any correspondence or compliance/payment notifications in regard to LPT.
It may be that the person misunderstood a general reference to LPT that was included in a recent customer service letter that issued to him in regard to 'MyAccount', which is Revenue's new secure online service.
76. Deputy Michael McGrath asked the Minister for Finance the salary band of each of the four members of the staff of the National Treasury Management Agency who received retention payments in 2014 and in 2015 as follows: €50,000 to €100,000, €100,001 to €150,000, €150,001 to €200,000, €200,001 to €250,000, €250,001 to €300,000, €300,000 plus; and if he will make a statement on the matter. [44646/15]
View answer77. Deputy Michael McGrath asked the Minister for Finance the number of agreements the National Treasury Management Agency has entered into with staff to make retention payments, in addition to the four payments already disclosed by him; the cost to the agency in entering into those agreements; and if he will make a statement on the matter. [44647/15]
View answerI propose to take Questions Nos. 76 and 77 together.
The National Treasury Management Agency has now advised me that they made an additional retention payment of €10,000 which they had erroneously classified as a contract completion payment and was omitted from their response to PQ No. 94 of 3 December 2015. This means that performance-related payments and retention payments made in 2014 and in 2015 amounted to €136,500 and €199,200 respectively. I have arranged for the Dáil record to be amended accordingly.
The relevant salary band in respect of the retention payments is €50,000 to €100,000 (one employee) and €150,000 to €200,000 (three employees, one of whom received a retention payment in 2014 and 2015).
In respect of the retention payments disclosed, a total of €210,000 potentially remains to be paid if the employees in question remain in employment until specific dates in 2016 and 2017.
As previously set out in a response to Parliamentary Question 212 of 23 April 2013, in a limited number of cases where the NTMA employs staff with very marketable skills (particularly in the area of IT) on fixed-term contracts as opposed to permanent contracts, contract completion payments were made upon the expiry of the fixed-term contract in question. In 2014, a total of €53,208 was paid to 10 employees upon expiry of their fixed-term contracts while in 2015 a total of €81,956 was paid to 15 employees upon expiry of their fixed-term contracts. There are three such contract completion arrangements outstanding and a total of €196,250 potentially remains to be paid to the employees in question upon completion of their fixed-term contracts. No contract completion payments will be made to any of the three employees in question if they become a permanent employee.
The practice of entering into employment contracts providing for retention payments or contract completion payments has been discontinued. No retention arrangement has been entered into since mid 2014. None of the arrangements described above extend beyond 2017.
78. Deputy Michael McGrath asked the Minister for Finance the number of staff in the financial institutions covered by the bank guarantee that have received so-called retention payments in 2014 and 2015 and the amount paid in retention payments at each bank in 2014 and 2015, in tabular form; if prior approval was required or sought from him; and if he will make a statement on the matter. [44648/15]
View answerThe 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) per individual and no form of bonus remuneration, whether performance based or retention, is allowed.
Officials in my Department have asked each of the banks to comment on the question asked by the Deputy and have received the following responses:
1) Allied Irish Banks:"AIB operates within the provisions of the State Agreements and retention payments are not a feature of our Remuneration Policy."
2) Bank of Ireland:"Publicly available information in relation to staffing remuneration is available in Bank of Ireland's Annual Reports and Pillar 3 Disclosures, all available on the Bank's website.
"3) Permanent TSB:"Permanent TSB does not pay retention payments to staff."
79. Deputy Michael McGrath asked the Minister for Finance his views on the payment of bonuses or other retention payments at Permanent TSB; and if he will make a statement on the matter. [44650/15]
View answerThis 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 no form of remuneration with any variable pay component(s), whether performance based or otherwise or bonus payments are awarded or paid.
Since July 2011 Permanent TSB has had to comply with these restrictions on remuneration. I have been informed by Permanent TSB that it continues to abide by the terms of that agreement and does not pay bonuses or retention payments to staff.
The bank also confirms that a freeze on general pay increases has been in place since 2010. However, in a limited number of cases, it has agreed to match current market pay rates for individual staff members where it is clear that they are being paid below current market rates or they had taken on changed/new responsibilities and the bank will have to match current market rates to attract a replacement employee if the current employee decides to leave the bank.
Irish banks in which the State has a majority ownership position publish remuneration information on their websites. The figures provided for PTSB relate to the status at year end 2014 and are available at the following link: http://www.permanenttsbgroup.ie/investors/reports-and-presentations/other-documents/2015.aspx
80. Deputy Michael McGrath asked the Minister for Finance the valuation placed on the State's banking assets; and if he will make a statement on the matter. [44651/15]
View answerAs requested by the Deputy, the current valuation of the State's remaining investments in the banks is set out in the following table:
|
Bank/investment |
€bn |
Source of valuation |
|
AIB - Equity/preference shares
|
€13.4bn |
Equity valuation of €11.7bn as agreed between the Minister and AIB as part of the bank's capital reorganisation. In addition, the valuation includes €1.7bn representing the redemption of the remaining preference shares due to complete in the coming weeks. |
|
AIB - CoCo |
€1.6bn |
At par |
|
BOI - Equity |
€1.5bn |
Based on the Irish Stock Exchange closing price on 4 December 2015 |
|
PTSB |
€1.5bn |
Based on the Irish Stock Exchange closing price on 4 December 2015 |
|
Total current valuations |
€18.0bn |
