Written Answers Nos. 1 - 23
1. Deputy Gerry Adams asked the Tánaiste and Minister for Social Protection if she will provide details of areas in which a co-operative system has been established between the local authorities and community welfare officers to intervene where families, in particular, are in danger of homelessness, and to address the issues they face; her plans to extend this system to other areas; and if she will make a statement on the matter. [7900/16]
View answerThe Department, including through its Homeless Persons Unit and Asylum Seekers and New Communities Unit in Dublin, works collaboratively with local authorities, Government agencies and the voluntary sector in assisting homeless persons to access private rented accommodation. This ensures that, where possible, people are diverted away from homeless services and towards community-based supports. Department officials throughout the country are actively engaged at a local level with the Homeless Action Teams (HATs) and Non-Government Organisations working in the area of homelessness and its prevention.
The Department’s rent supplement scheme plays a vital role in housing families and individuals, with the scheme supporting approximately 57,600 people for which the Government has provided approximately €267 million for 2016. There were over 20,100 rent supplement tenancies awarded during 2015 and over 3,000 during the first three months of 2016 showing that significant numbers of individuals and families are being accommodated under the scheme.
The Department has implemented a national targeted policy approach that allows for flexibility where landlords seek rents in excess of the limits for both existing customers and new applicants to the rent supplement scheme. The circumstances of tenants are considered on a case-by-case basis and rents are being increased above prescribed limits, as appropriate. In addition, the Department, in conjunction with Threshold, operates a special protocol in the Dublin and Cork areas where supply issues are particularly acute, with plans underway to extend this arrangement to commuter areas over the coming weeks. This flexible and targeted approach has assisted over 7,570 rent supplement households nationwide to retain or acquire rented accommodation through increased rental payments. A county breakdown of these cases is provided in the table for information.
The strategic policy direction of the Department is to return rent supplement to its original purpose of being a short-term income support scheme. Under the Housing Assistance Payment (HAP), responsibility for the provision of rental assistance to those with a long-term housing need transfers to the local authorities. The Department is fully engaged in the roll out of this scheme which is operational in 19 local authority areas and officials continue to work closely with colleagues in the local authorities and the Department of the Environment, Community and Local Government.
I believe these measures and the recent legislative reforms announced to the private rental sector provide a level of stability for those who require support in what has become a highly volatile rental market.
Tabular Statement - Increased Rental Payments by County as at 18/04/2016
|
County |
Awards under National Tenancy Sustainment Framework |
Awards under protocol with Threshold |
Total no. of increased payments by County |
|
CARLOW |
35 |
35 |
|
|
CAVAN |
22 |
22 |
|
|
CLARE |
60 |
60 |
|
|
CORK |
349 |
73 |
422 |
|
DONEGAL |
- |
- |
|
|
DUBLIN |
3,003 |
1,958 |
4,961 |
|
GALWAY |
155 |
155 |
|
|
KERRY |
51 |
51 |
|
|
KILDARE |
353 |
353 |
|
|
KILKENNY |
127 |
127 |
|
|
LAOIS |
112 |
112 |
|
|
LEITRIM |
64 |
64 |
|
|
LIMERICK |
7 |
7 |
|
|
LONGFORD |
128 |
128 |
|
|
LOUTH |
122 |
122 |
|
|
MAYO |
3 |
3 |
|
|
MEATH |
294 |
294 |
|
|
MONAGHAN |
1 |
1 |
|
|
OFFALY |
60 |
60 |
|
|
ROSCOMMON |
24 |
24 |
|
|
SLIGO |
- |
- |
|
|
TIPPERARY |
165 |
165 |
|
|
WATERFORD |
39 |
39 |
|
|
WESTMEATH |
173 |
173 |
|
|
WEXFORD |
15 |
15 |
|
|
WICKLOW |
177 |
177 |
|
|
Overall Total |
5,539 |
2,031 |
7,570 |
3. Deputy Peter Fitzpatrick asked the Tánaiste and Minister for Social Protection the reason an application under the carer's allowance scheme by a person (details supplied) in County Louth has been refused in view of the medical evidence supplied; and if she will make a statement on the matter. [7840/16]
View answerI confirm that the department received an application for Carer’s Allowance (CA) from the person concerned on 4 December 2015. It is a condition for receipt of a CA that the person being cared for must have a disability whose effect is that they require full-time care and attention.
This is defined as requiring from another person, continual supervision and frequent assistance throughout the day in connection with normal bodily functions or continuous supervision in order to avoid danger to him or herself and likely to require that level of care for at least twelve months.
All the evidence submitted in support of this application, including the information attached to your question which previously had been received in the department, was examined and the deciding officer decided that this evidence did not indicate that the requirement for full-time care was satisfied.
The person concerned was notified on 14 April 2016 of this decision, the reason for it and of her right of review and appeal.
4. Deputy Maureen O'Sullivan asked the Tánaiste and Minister for Social Protection the reason persons must work 48 years to qualify for a full pension; her views on whether this is a particularity long period and that the tier system is insufficient; and if her attention has been drawn to the fact that some women, in particular, feel this is unfair as many choose to work part-time after giving birth to children. [7876/16]
View answerThe State pension (contributory) is one of the State pension schemes, and its rate of payment is related to contributions made over years into the Social Insurance Fund. As such, those with a stronger attachment to the workforce, who have paid more into that fund, are more likely to be paid under that scheme. There are a number of criteria which must be satisfied in order to qualify for a State pension contributory. These include that the person must be aged 66 or over, and that they have at least 520 paid contributions, i.e., a minimum of 10 years of paid contributions. Since 1961, when contributory pensions were first introduced, the ‘yearly average’ contributions test has been used in calculating the level of pension entitlement, where the total contributions paid or credited are divided by the number of years of the working life (from their entry into insurable employment up to the year prior to their reaching State pension age). Payment rates are banded. For example, someone with a yearly average of 48 contributions will qualify for a full pension, whereas someone with a yearly average of 20 will qualify for a pension at the 85% rate.
Working part-time does not generally reduce entitlement, as part-time workers also pay weekly PRSI contributions, and these will generally be of equal value to the more expensive contributions paid by full-time workers.
However absences from the labour force - when contributions were neither deducted from pay nor credited in respect of a social welfare payment, and where voluntary contributions were not made – may impact upon the rate of a person’s pension. This can be mitigated by the homemaker’s scheme, which makes qualification for State pension (contributory) easier for some people who take time out of the workforce for caring duties. The scheme, which was introduced in 1994 and took effect for such homemaking periods from that date, allows up to 20 years spent caring for children under 12 years of age (or caring for incapacitated people over that age) to be disregarded when a person’s social insurance record is being averaged for pension purposes. It should be noted however that the scheme will not, of itself, qualify a person for a pension. The standard qualifying conditions must also be satisfied.
If someone does not qualify for a full rate contributory pension as a result of an intermittent PRSI record, the social protection system provides alternative methods of supporting such people in old age. For example, if their spouse has a contributory pension, they may qualify for an Increase for a Qualified Adult amounting up to 90% of a full rate pension, which by default is paid directly to them. Alternatively, they may qualify for a means-tested State Pension (non-contributory), amounting up to 95% of the maximum contributory pension rate.
5. Deputy Pat Deering asked the Tánaiste and Minister for Social Protection when a person (details supplied) will have a decision on an appeal for supplementary welfare allowance. [7882/16]
View answerThe person in question applied for assistance under the Supplementary Welfare Allowance (SWA) scheme for repairs to reading glasses. Her application was refused by the Designated Officer on the grounds that the need in question is not provided for under the scheme. She appealed this decision to the SWA Review Officer. The original decision was upheld and written confirmation issued on 15 April, 2016.
6. Deputy Willie O'Dea asked the Tánaiste and Minister for Social Protection when arrears will issue under the carer's allowance scheme to a person (details supplied) in County Limerick; and if she will make a statement on the matter. [7909/16]
View answerFollowing a successful appeal, the person concerned was awarded carer’s allowance (CA) for a second care recipient from 14 May 2015.
The person concerned was notified on 9 March 2016 of this decision.
The first increased payment was made to the person on 3 March 2016.
Any arrears of allowance due from 14 May 2015 to 2 March 2016 will issue shortly by cheque to the person in question.
7. Deputy John McGuinness asked the Tánaiste and Minister for Social Protection if an appeal in respect of an invalidity pension by a person (details supplied) in County Kilkenny will be expedited and approved. [7912/16]
View answerThe person concerned has been awarded invalidity pension with effect from the 14 January 2016. Payment will issue to his nominated bank account on 5 May 2016. Any arrears due from 14 January 2016 to 4 May 2016 (less any overlapping social welfare payment and/or outstanding overpayment) will issue in due course. The person in question was notified of this decision on the 19 April 2016.
8. Deputy Ruth Coppinger asked the Tánaiste and Minister for Social Protection if she will change the manner in which term-time workers in the education sector on low working hours receive jobseekers' payments when school holidays are taking place (details supplied) given the low level of payment many receive at Easter time; and if she will make a statement on the matter. [7913/16]
View answer9. Deputy Ruth Coppinger asked the Tánaiste and Minister for Social Protection to report on the time it takes for jobseekers' payments for term-time workers in education to have their applications processed and payments made (details supplied); and if she will make a statement on the matter. [7914/16]
View answerI propose to take Questions Nos. 8 and 9 together.
A jobseeker’s payment is paid for days of unemployment where the person is not in receipt of holiday pay for those days and where they also satisfy the conditions of the scheme.
School educational sector workers, who are employed on a temporary basis and who have previously been in contact with the Department, are issued with a repeat jobseeker’s application form and holiday form in advance of the school holiday periods. This advance process facilitates an efficient service to these customers and allows for speedy processing of their claim when the period of unemployment actually arises. However, it is important to note that educational sector workers are still required to sign on for each period of unemployment.
Initially, when a person makes an application for jobseeker’s benefit, 3 waiting days apply and payment is made from the 4th day of the claim where there is no accrued holiday entitlement. If, however, a person makes a repeat claim for jobseeker’s benefit within 26 weeks of their previous claim, the repeat claim links to the earlier claim and no waiting days apply.
In general, there is no delay in processing jobseeker benefit claims in Intreo Centres if the relevant claim application forms and supporting documentation are completed, as required by the customer in a timely manner. On average, a jobseeker’s benefit claim is decided within one week of application.
Regarding the person referred to by the Deputy, the period of her unemployment was from 17 March 2016 to 5 April 2016. She had 3 waiting days applied at the start of her claim and was paid for 2 days holidays. She received €250.67 and is due an additional €125.33 which will issue to her shortly.
10. Deputy John Brassil asked the Tánaiste and Minister for Social Protection in view of recent commitments made to support the post office network, the reason her Department is encouraging social welfare recipients to transfer their jobseeker's payment to their financial institution via electronic transfer; and if she will make a statement on the matter. [7919/16]
View answerThe Government is committed to the maintenance of the Post Office network and to the development of a Standard Bank Account by An Post. Mindful of the current and ongoing discussions on Government formation any further development of policy will be a matter for the incoming Government.
The current position is that the department has a cohort of jobseeker customers who are classified as casual jobseekers. These are in-work customers who can claim a jobseekers payment for 2 to 3 days per week or who work week on/week-off. These customers are paid by cheque each week. Not all customers will be paid every week due to their changeable work patterns.
I want to emphasise that these customers have been paid by cheque due to the changing nature of their work/claiming patterns and the short turn-around time to issue payments. It is important to note that they are not paid via post offices under the department’s existing cash payments contract with An Post.
In line with the National Payments Plan, my department is seeking to reduce its usage of cheques as a payment method; this is not only a matter of decreasing the significant costs associated with cheques in the department and wider economy but also of moving to a more secure method of payment and enhancing customer convenience.
When paid by cheque, customers have the option of lodging them direct to their accounts or negotiating them at banks or the Post Office. The evidence available to the department is that the vast majority of the department’s customers paid by cheque choose to lodge them direct to their accounts.
The department has developed its payment capacity in respect of changing work and claiming patterns and is able to offer payments direct to accounts in financial institutions for casual Jobseeker customers thereby increasing customer convenience. This is in line with wider departmental policy where the focus is on ensuring that in-work customers are paid by the most convenient method possible.
Consequently the department has written to its casual Jobseeker customers asking them to provide their account details to enable direct payments to financial institutions.
I want to emphasise that the department does not issue these cheque payments to Post Offices, they are issued directly to the department’s customers. This process does not reduce the number of existing cash payments through Post Offices under the current contract between the department and An Post.
I want to reiterate that what the department is doing is moving customers from cheque payments to the much more secure, customer convenient and cost effective payment method of payment directly into accounts in financial institutions. This is entirely consistent with the National Payments Plan and in line with payment methods that now prevail across the economy. The department must consider the most efficient payment method for our customers who are in employment most of whom get their salary payment into bank accounts. To have weekly income (work + welfare) payable in two different ways is a highly inappropriate and costly way of dealing with people in employment. The department’s focus must be on our customers.
Customer choice will be maintained. Customers, if they wish, may continue to receive cheque payments in the medium term.
11. Deputy Pearse Doherty asked the Tánaiste and Minister for Social Protection when a person (details supplied) in County Donegal will have a decision on an application under the carer’s allowance scheme; and if she will make a statement on the matter. [7950/16]
View answerI confirm that the department received an application for carer’s allowance (CA) from the person concerned on 25 January 2016. Unfortunately, the average time taken at present to decide a new application is running at 19 weeks. Additional resources have been provided to the CA section in order to improve the waiting times for new applications and they are working hard to make this happen.
Frequently, delays are outside the control of the Department and are caused by the customer failing to fully complete the claim form or failing to attach the supporting documentation that is requested on the application form.
This application will be processed as quickly as possible and the person concerned will be notified directly of the outcome. In the meantime, both the person concerned and her spouse are in receipt of weekly social welfare payments.
12. Deputy Richard Boyd Barrett asked the Tánaiste and Minister for Social Protection to restore disability allowance to a person (details supplied). [7954/16]
View answerThe person concerned submitted an application for disability allowance on 18 January 2016.
The application, based upon the evidence submitted, was refused on medical grounds and the person in question was notified in writing of this decision on 4 April 2016 and of his rights of review and appeal within 21 days. No appeal has been received to date.
It is open to the person in question to provide additional information in relation to his substantial restriction for work due to disability and the Department will review the decision on his eligibility for DA.
In the meantime, he should apply for jobseeker’s allowance from his local Intreo centre.
13. Deputy Richard Boyd Barrett asked the Tánaiste and Minister for Social Protection to extend the fuel allowance period due to uncharacteristically low temperatures in early April. [7955/16]
View answerThe fuel allowance is a payment of €22.50 per week for 26 weeks from October to April, to 391,000 low income households, at an estimated cost of €224 million in 2016. The purpose of this payment is to assist these households with their energy costs. The allowance represents a contribution towards the energy costs of a household. It is not intended to meet those costs in full. Only one allowance is paid per household. My Department also pays an electricity or gas allowance as part of the household benefits package to approximately 415,000 customers, at an estimated cost of €228 million in 2016. I am not in a position to extend the criteria for these schemes or the current value of the allowances.
Under the supplementary welfare allowance scheme, exceptional needs payments may be made to help meet an essential, once-off cost which customers are unable to meet out of their own resources – this may include exceptional heating costs.
The best way to tackle fuel poverty in the long term is to improve the energy efficiency of the dwelling. My Department works closely with the Department of Communications, Energy and Natural Resources on these issues and in moving forward the actions agreed in the Energy Affordability Strategy. In that regard, the Better Energy Homes scheme provides support towards the installation of attic and wall insulation, and heating system upgrades.
14. Deputy Richard Boyd Barrett asked the Tánaiste and Minister for Social Protection the number of investigations carried out by her Department's Scope section between 1 January 2006 to date in 2016, providing figures for each year, into the misclassification of building workers as self-employed; the number of persons investigated; and the number found to be misclassified. [7958/16]
View answer15. Deputy Richard Boyd Barrett asked the Tánaiste and Minister for Social Protection where there are cases of the misclassification of workers as self-employed that is bogus self-employment, the penalties imposed on the contractors involved. [7959/16]
View answer16. Deputy Richard Boyd Barrett asked the Tánaiste and Minister for Social Protection the average length of time involved in investigations into the misclassification of workers as self-employed. [7960/16]
View answer17. Deputy Richard Boyd Barrett asked the Tánaiste and Minister for Social Protection the outcome of the visits of the joint investigations unit to sites (details supplied). [7962/16]
View answerI propose to take Questions Nos. 14 to 17, inclusive, together.
Details on the average length of time involved in investigations into the misclassification of workers as self-employed are not held and depend on the nature and circumstances of each case investigation. However, I can advise the Deputy that the great majority of Scope decisions are made on foot of a request from the employed person or an employer, rather than arising from an investigation by the Department. These decisions involve mainly company directors, partnership cases, public sector employees and family employments.
The following table shows the total number of decisions made in each of the years from 2006 to date.
|
Year |
Number of Decisions |
|
2006 |
1397 |
|
2007 |
1367 |
|
2008 |
1672 |
|
2009 |
1835 |
|
2010 |
1622 |
|
2011 |
1143 |
|
2012 |
823 |
|
2013 |
1517 |
|
2014 |
1275 |
|
2015 |
1071 |
|
2016 (to date) |
253 |
With regard to the issue of disguised employment, the Deputy should note that a working group comprising officials from the Department of Social Protection and the Revenue Commissioners has been examining the issue. In this context, a public consultation process on the use of intermediary type employment structures and self-employment arrangements, and their impact on tax and PRSI is underway. The closing date for receipt of submissions was 31 March 2016 and over 20 submissions were received which are now being examined.
Where incidences of misclassification of workers as self-employed are detected, then arrears of PRSI are calculated and collected. Where an employee has been misclassified as self-employed, their social insurance record will be updated to reflect the correct rate of social insurance. Under the provisions of the Social Welfare Consolidation Act, there are specific offences in relation to employment contributions, their remittance and the maintenance of prescribed wages and employment records. On conviction, fines and or imprisonment can ultimately be imposed.
Departmental inspectors carry out visits to a wide range of businesses, as part of their on-going compliance operations. In certain instances, inspections are undertaken jointly with other State agencies such as the Revenue Commissioners and the Workplace Relations Commission. Such inspections are fact-finding visits wherein evidence of compliance or non-compliance may be detected. Where evidence of non-compliance or misclassification of employment status is detected, this will be pursued. Where details of specific cases are supplied to the Department, they are investigated and the insurability of the person(s) concerned is determined. A person’s or company’s employment status or compliance is confidential to that individual or entity. In the circumstances, the Deputy will appreciate that the Department cannot give specific details on the outcome of operations as that would contravene confidentiality and data protection requirements.
18. Deputy John McGuinness asked the Tánaiste and Minister for Social Protection if an appeal in respect of an application for invalidity pension by a person (details supplied) in County Kilkenny will be expedited and approved as they applied on 29 June 2015 and lodged their appeal on 25 August 2015. [7986/16]
View answerThe Social Welfare Appeals Office has advised me that an appeal by the person concerned was registered in that office on 3 March 2016. It is a statutory requirement of the appeals process that the relevant Departmental papers and comments by the Deciding Officer on the grounds of appeal be sought. When these papers have been received from the Department, the case in question will be referred to an Appeals Officer who will make a summary decision on the appeal based on the documentary evidence presented or, if required, hold an oral appeal hearing.
The Social Welfare Appeals Office functions independently of the Minister for Social Protection and of the Department and is responsible for determining appeals against decisions in relation to social welfare entitlements.
19. Deputy Pearse Doherty asked the Minister for Finance the cost of no longer explicitly excluding seafarers aboard fishing vessels from the entitlement to the seafarer's allowance. [7831/16]
View answerI am advised by the Revenue Commissioners that the data available to them from tax returns does not provide a sufficient basis to identify the number of additional cases who would additionally qualify for the Seafarer's Allowance under the Deputy's suggestion. It is not possible therefore to provide a definitive estimate of the cost for such a change.
The Deputy may wish to note that state aid approval for the seafarer's allowance was given on the basis of the EU Guidelines on State Aid to the Maritime Transport sector, which provides exemptions for certain categories of shipping, and not for any other sector, including the fishing industry.
However on the basis of employments in the fishing industry cited in the Bord Iascaigh Mhara Strategy 2013 -2017 and making certain assumptions in relation to the eligibility for and usage of the allowance, it is tentatively estimated that the cost to the Exchequer of extending the seafarers allowance to seafarers aboard fishing vessels could be in the order of €11 million per annum.
20. Deputy Charlie McConalogue asked the Minister for Finance the reason it is possible for bus companies to claim the value added tax back on new coaches that they purchase but not possible to claim the value added tax back when they purchase low floored service buses with disability access; his plans to extend the value added tax reclamation to service buses; and if he will make a statement on the matter. [7848/16]
View answerI am advised by the Revenue Commissioners that Irish VAT legislation, which is in compliance with the EU VAT Directive, provides that the transport of passengers and their accompanying baggage is exempt from VAT under paragraph 14(3) of Schedule 1 to the VAT Consolidation Act 2010. In this respect, services provided by the coach and bus sector are exempt from VAT. This means that a person who provides a bus or coach service does not register for VAT and does not charge VAT on the supply of their services. Persons who are exempt from VAT cannot recover VAT incurred on goods and services incurred in relation to their business, such as bus purchases and fuel, tyre and garage expenses, used for the purposes of the person's coach and bus service.
Section 103 of the Value-Added Tax Act 2010 provides that the Minister for Finance may by order provide for a refund of VAT in certain circumstances. The VAT (Refund of Tax) (Touring Coaches) Order 2012 [SI 266/2012] provides for the refund to VAT-exempt coach operators, subject to certain conditions, of VAT paid on touring coaches of a certain age and dimension. The conditions include that the coach operator is engaged in the business of the carriage for reward of tourists by road under contracts for group transport and that the vehicle meets the criteria set out for a qualifying vehicle as defined in the Order. Where a bus operator and/or vehicle do not meet the criteria in the Refund Order there is no entitlement to claim back VAT incurred on the purchase of buses or coaches. Further details are available on the Revenue website at the following link http://www.revenue.ie/en/tax/vat/refunds/repayments-unregistered-persons.html#section14.
I should also advise you that under the Disabled Drivers and Passengers (Tax Concessions) Scheme, organisations are entitled to claim a repayment of Vehicle Registration Tax (VRT) and Value Added Tax (VAT) paid on specially constructed or adapted vehicles, which are used for the transport of Persons with Disabilities. In order to qualify an organisation must be a charitable organisation within the meaning of the Charities Act 2009 and be entered in the register of charitable organisations pursuant to Part 3 of that Act. It must also be chiefly engaged in the care and transport of severely and permanently disabled persons. Full details of this scheme and how to apply are available on the Revenue website: http://www.revenue.ie/en/tax/vrt/leaflets/drivers-passengers-with-disabilities-tax-relief-scheme.pdf.
21. Deputy Richard Boyd Barrett asked the Minister for Finance the rationale for his Department's changes to the single parent tax credit which only allows one parent to receive it. [7903/16]
View answerThe One-Parent Family Tax Credit (OPFTC) was replaced with a new Single Person Child Carer Credit (SPCCC) from 1 January 2014. The restructured credit is of the same value as the OPFTC, €1,650 per annum, and also includes the same entitlement to the additional €4,000 extended standard rate band, which increases to €37,800 per annum, the point of entry to the higher rate of income tax. However, the new credit is more targeted in that it is, in the first instance, only available to the principal carer of the child.
I would point out that it is essential to review all tax reliefs, credits and incentives in order to ensure that they are properly targeted and, if necessary, re-focused in order that they can achieve the socio-economic objectives that are set for them. A system which allowed, under the OPFTC, multiple claims in respect of the same child was unsustainable.
The SPCCC is allowed in the first instance to an individual, referred to as the primary claimant, who proves that a qualifying child is resident with him or her for the whole or greater part of the year of assessment. This targets the credit towards the parent or care giver that is providing the majority of the child care.
If the primary claimant does not wish to claim the SPCCC (for example if they do not have sufficient taxable income to use it fully), he or she may relinquish it in favour of a secondary claimant, provided the child resides with the secondary claimant for a period of not less than 100 days during the year of claim.
The Deputy may also recall that during Report Stage of Finance Bill 2014, an amendment was tabled proposing to allow for the partial transfer of the SPCCC to the non-principal carer parent, in cases where it is not utilised in full by the principal carer. A review of the proposal was undertaken by my officials in 2015 and published in the Report on Taxation Expenditures available online at: http://budget.gov.ie/Budgets/2016/Documents/Tax_Expenditures_Report_pub.pdf.
This review identified that a transferable credit could only be effectively administered by Revenue with the full co-operation of the primary claimant, as it would require the primary claimant to file a tax return, provide information on the other parent (or secondary claimant) and consent to the release of personal information to the other parent (or secondary claimant).
As the SPCCC currently allows for the credit to be transferred in full to a qualifying secondary claimant with the consent of the primary claimant, I am satisfied that the SPCCC provides for an appropriate level of transferability to secondary claimants, taking into account the various issues identified in the published review. I am also satisfied that the SPCCC is targeting limited resources to where they are most needed.
22. Deputy Sean Fleming asked the Minister for Finance if he will consider some mechanism to give a tax break for low paid workers who have to pay annual rail commuter tickets to get to and from work (details supplied); if he will correct this unfair situation; and if he will make a statement on the matter. [7916/16]
View answerI understand the Deputy to be referring to the Travel Pass (Taxsaver) scheme. I am advised by the Revenue Commissioners that this scheme operates on the basis that an employer pays for the Travel Pass on behalf of an employee at the start of the year and the payment is deducted from the employee's emoluments over the course of the year. This repayment arrangement is referred to as a "salary sacrifice". In these circumstances, section 118B of the Taxes Consolidation Act 1997 (the Act) provides that the remuneration foregone shall be exempt from tax. This has the effect of reducing the cost of the Travel Pass to the employee by the amount of tax that would have been paid on the "sacrificed" income at the employee's marginal (i.e. highest) rate of tax.
Where an employer provides a Travel Pass without charge to an employee, section 118(5A) of the Act provides that there is no benefit-in-kind charge on the employee in relation to cost of the Travel Pass.
The relief is available to any employee where the employer elects to operate the scheme. It should be noted that where an individual's employer does not participate in the Travel Pass scheme, any benefits that could arise under the scheme will not be available to any employees of that employer. Additionally, where an employee's income is exempt from income tax, no benefit will arise.
I am satisfied that the scheme is working well and while all such initiatives are periodically reviewed I have no plans at present to modify it.
23. Deputy Richard Boyd Barrett asked the Minister for Finance further to Parliamentary Question No. 111 of 14 April 2016, the estimates and sources on the fiscal space for the years 2016 to 2018 that form the basis of his pre-election statements on the fiscal space available. [7957/16]
View answerEstimates of the gross and net fiscal space for the period 2016 to 2018 can be found in Tables A8 and A9 on pages C.50 and C.51 of the Budget 2016 book - http://www.budget.gov.ie/Budgets/2016/Documents/Economic%20and%20Fiscal%20Outlook%202016.pdf.
In the Spring Economic Statement 2015, the Government indicated that the available fiscal space for Budget 2016 was in the range of €1.2 billion to €1.5 billion. As the Deputy is aware this was fully allocated in 2016. For the convenience of the Deputy the gross and net fiscal space for the period 2017 to 2018 is set out in the following table.
|
€ billions |
2017 |
2018 |
Total |
|
Gross fiscal space |
1.3 |
1.5 |
2.8 |
|
Net fiscal space |
0.5 |
1.1 |
1.6 |
Table A9 in Budget 2016 shows the walk from gross fiscal space to net fiscal space. The former is simply the permitted fiscal space arising from applying the currently forecast benchmark growth rates to the projected expenditure aggregate for each year. These amounts are not final and are based on my Department's projections for the GDP deflators, reference rates and convergence margins for each of the relevant years as set out in Budget 2016 (see Table A.8). The actual GDP deflators, reference rates and convergence margins values used by the Commission to assess compliance with the rules each year beyond 2016 will be based on Commission estimates compiled in their Spring forecast, and in relation to the GDP deflator, the Autumn forecasts as well, each year.
A further source of variance arises from the fact that the various factors are applied to the general government expenditure outturn, excluding some items such as interest and the level of cyclical unemployment expenditure. With regard to cyclical unemployment, the Commission's estimates are based on their own data. Therefore, outturn variances from the levels forecast in Budget 2016, which are likely in the course of implementation and due to the allocation of fiscal space to expenditure, is another source of uncertainty, albeit with a relatively limited impact.
The net fiscal space is the additional room available beyond spending assumptions included in the Budget's baseline spending projections set out in Table 10 on page C.22 whilst still complying with the upper limit under the Expenditure Benchmark. These assumptions, which are set out in Table A9, include the annual cost of providing for demographic spending pressures together with a number of other anticipated elements such as the Public Capital Plan, the cost of the Lansdowne Road Agreement and a number of other calls on the Central Fund. The annual cost of indexing the tax system at an annual full year cost of c. €400m per annum is included in the baseline tax revenue figures in Table 10. For illustrative purposes, the additional revenue generated from a political decision not to proceed with indexation is included in the discretionary revenue measures set out in Table A9. Decisions on whether to proceed with indexation or introduce other tax measures each year will be a matter for decision by the Government.
A document outlining the 'Forthcoming Revisions to the Medium Term Budgetary Objective' was published on my Department's website on the 21 January 2016. This explained that the European Commission was in the process of updating the minimum Medium-Term Objectives (MTOs) of Member States in line with the three-year evaluation cycle. This process is now complete and, as anticipated by my Department, Ireland's minimum MTO is now -0.5 per cent of GDP instead of 0.0 per cent of GDP. The change is due to the improvement in Ireland's debt ratio and other factors. Should the MTO be readjusted to such a level in the forthcoming Stability Programme Update, it more likely that the MTO will be achieved earlier than projected in Budget 2016. This in turn would result in additional fiscal space in the region of €1-1.5 billion in the year after the MTO is achieved.
