Written Answers Nos. 62-81
62. Deputy Alan Kelly asked the Tánaiste and Minister for Justice and Equality if she or her Department was consulted regarding the creation of the Charleton liaison committee that was set up by An Garda Síochána in respect of the disclosures tribunal. [26517/17]
View answerAs the Deputy will be aware, I established the Disclosures Tribunal following the passing of Resolutions by Dáil Éireann and Seanad Éireann on 16 February 2017.
My Department was consulted by the Garda Commissioner in relation to the need to ensure that the Tribunal was appropriately serviced by An Garda Síochána, with the least disruption to on-going operations. The Commissioner subsequently sought formal sanction to retain the services of a small number of individuals and this was granted by my Department, with the approval of the Department of Public Expenditure and Reform. Approval was also given to engage, in accordance with normal public procurement procedures, the services of a solicitor.
63. Deputy Pearse Doherty asked the Minister for Finance the expenses incurred by his Department relating to insurance of all types of in each of the past five years; the cost of each insurance policy held by his Department over the same time period per annum; the equivalent data for all bodies under the aegis of his Department; and if he will make a statement on the matter. [26286/17]
View answerI wish to advise the Deputy that my Department operates under State Indemnity, a self-insurance model whereby the State bears the financial risk associated with the cost of claims. The National Treasury Management Agency (NTMA) is designated as the State Claims Agency (SCA) when performing the claims and risk management functions delegated to it under the National Treasury Management Agency (Amendment) Act 2000.
Since the establishment of the SCA, the management of claims functions has been delegated to the Agency. It currently manages claims and risks on behalf of 139 delegated State Authorities.
I also wish to advise the Deputy that of the 18 bodies under the Aegis of my Department, 5 are designated State Authorities covered under State Indemnity managed by the SCA. These are the Comptroller and Auditor General, the Credit Union Advisory Committee, the Credit Union Restructuring Board, The Disabled Drivers Medical Board of Appeal and the Tax Appeals Commission. The Credit Review Office (CRO) incurs no direct insurance costs as Enterprise Ireland provides full business services to the CRO. It was not possible for the NTMA and NAMA to provide the information sought in the time available and therefore I will make arrangements to provide the outstanding information in line with Standing Orders. The remaining 10 bodies have provided the information sought and this is set out in the following table:
|
Body |
Expenses Incurred in relation to insurance of all types in each of the past five years (2012-to date) |
Cost of each Insurance Policy for each of the past 5 years. (2012-to date per annum) |
|
Central Bank |
2011/2012 - €206,860 2012/2013 - €152,657.00 2013/2014 - €167,425.00 2014/2015 - €171,208.00 2015/2016 - €169,816.00 2016/2017 - €219,426.00 2017/2018 - €249,027.68 Short Period Policy – Period 14/04/2015 to 31/05/2017 Owner Controlled Insurance Programme (insured location North Wall Quay) €511,701.00 |
2011/12 Combined Liability €108,799 Commercial Combined €55,327 Excess E/ers Liability €4,017 Computer €5,643 Engineering €10,593 Motor Fleet €4,977 Travel Insurance €5,304 Cargo €2,200 Money €10,000 2012/13 Combined Liability €53,585 Commercial Combined €58,000 Excess E/ers Liability €6,150 Computer €4,933 Engineering €9,262 Motor Fleet €4,300 Travel Insurance €4,677 Cargo €1,750 Money €10,000 2013/14 Combined Liability €58,000 Commercial Combined €65,600 Excess E/ers Liability €6,150 Computer €4,193 Engineering €10,887 Motor Fleet €4,300 Travel Insurance €5,395 Cargo €2,900 Money €10,000 2014/15 Combined Liability €55,356 Commercial Combined €64,657 Excess E/ers Liability €6,150 Computer €2,870 Engineering €11,956 Motor Fleet €12,688 Travel Insurance €5,381 Cargo €2,900 Money €9,250 Short Period Policy – Period 14/04/2015 to 31/05/2017 Owner Controlled Insurance Programme (insured location North Wall Quay) €511,701.00 2015/16 Combined Liability €59,683 Commercial Combined €55,681 Excess E/ers Liability €6,150 Computer €2,726 Engineering Inspection €14,638 Motor Fleet €11,738 Travel Insurance €5,650 Cargo €2,750 Money €10,800 2016/17 Combined Liability €90,000 Commercial Combined €72,783 Excess E/ers Liability €6,150 Computer €2,590 Engineering €2,804 Engineering Inspection €15,000 Motor Fleet €13,635 Travel Insurance €6,295 Cargo €2,300 Money €7,869.32 2017/2018 Combined Liability €90,000.00 Commercial Combined €89,736.00 Excess Employers Liability €6,150.00 Computer €11,964.68 Engineering €3,820.00 Engineering Inspection €18,450.00 Motor Fleet €16,000.00 Travel Insurance €6,295.00 Cargo €1,612.00 Money €5,000.00 |
|
Financial Services Ombudsman Bureau Financial Services Ombudsman Council |
2012/2013 €30,527 2013/2014 €30,477 2014/2015 €30,591 2015/2016 €30,823 2016/2017 €30,806 |
2012/2013 Management Liability €17,200 Crime €2,800 Employment Practices Liability €3,000 Data Guard €2,100 PA/Travel €1,000 Office Combined €3,276.72 Motor Contingency €900 Computer €250 2013/2014 Management Liability €17,200 Crime €2,800 Employment Practices Liability €3,000 Data Guard €2,050 PA/Travel €1,000 Office Combined €3,276.72 Motor Contingency €900 Computer €250 2014/2015 Management Liability €17,200 Crime €2,800 Employment Practices Liability €3,000 Data Guard €2,050 PA/Travel €950 Office Combined €3,441 Motor Contingency €900 Computer €250 2015/2016 Management Liability €17,200 Crime €2,800 Employment Practices Liability €3,000 Data Guard €2,050 PA/Travel €950 Office Combined €3,673 Motor Contingency €900 Computer €250 2016/2017 Management Liability €17,200 Crime €2,800 Employment Practices Liability €3,000 Data Guard €2,050 PA/Travel €903 Office Combined €2,700 Motor Contingency €963 Computer €250 Excess Employers Liability €940 |
|
Investor Compensation Company |
2012/2013 €458,750 2013/2014 €458,750 2014/2015 €458,750 2015/2016 €762,765 2016/2017 €701,562 |
2012 – Specie Excess of Loss Investor Compensation Scheme Insurance for €60m-€458,750 2013 - Specie Excess of Loss Investor Compensation Scheme Insurance for €60m-€458,750 2014 - Specie Excess of Loss Investor Compensation Scheme Insurance for €60m-€458,750 2015 - Specie Excess of Loss Investor Compensation Scheme Insurance for €110m-€762,765 2016 - Specie Excess of Loss Investor Compensation Scheme Insurance for €110m -€701,562 |
|
Irish Bank Resolution Corporation |
Note: The information provided is for the period from 2013 to date. Information prior to the appointment of the Special Liquidator in 2013 is not readily available and the compilation of this information would incur a significant expense given that all legacy systems are no longer operational. 2013 €6,006,932.80 2014 €2,001,000.50 2015 €904,365 2016 €783,075 2017 to date €452,550 |
2013 Crime/Professional Indemnity €1,210,000 Directors & Officers €4,117,313.80 (includes run off cover once off premium of €2,196,751.30) Property €32,378 Employers/Public €64,739 Repossessed/Encumbered Property €500,354 Other €82,148 2014 Crime/Professional Indemnity €1,061,775 Directors & Officers €446,512.50 Property €12,638 Employers/Public €25,988 Repossessed/Encumbered Property €383,685 Other €70,402 2015 Crime/Professional Indemnity €546,000 Directors & Officers €252,000 Combined Property, Employers/Public, Repossessed/Encumbered Property €50,925 Other €55,440 2016 Crime/Professional Indemnity €453,200 Directors & Officers €223,510 Combined Property, Employers/Public, Repossessed/Encumbered Property €50,925 Other €55,440 2017 to date Crime/Professional Indemnity €225,750 Directors €226,800 |
|
Irish Financial Services Appeals Tribunal |
Prior to 2016, IFSAT was provided with accommodation by the Office of Public Works (OPW). As OPW is a State Authority covered under State indemnity by the State Claims Agency, no insurance costs were incurred for that period. IFSAT moved premises in December 2016 and obtained its own insurance cover. December 2016 – December 2017 €591.00 |
December 2016 – December 2017 Public Liability, Buildings, Employer Liability: €591.00 |
|
Irish Fiscal Advisory Council |
2012: €1,1750 2013: €1,1750 2014: €819.55 2015: €860.52 2016: €900.51 2017: €1,035.58 IFAC was delegated to the SCA in April 2014 for the purposes of all-in insurance, save for Travel Insurance. |
2012: All-in insurance (ESRI provided all-in insurance for IFAC as part of their administration charge): €1,1750 2013: All-in insurance (ESRI provided all-in insurance for IFAC as part of their administration charge): €1,1750 2014: Travel insurance: €819.55 2015: Travel insurance: €860.52 2016 : Travel insurance: €900.51 2017: Travel insurance: €1,035.58 |
|
Office of the Revenue Commissioners |
2012 €39,241 2013 €40,117 2014 €38,000 2015 €40,500 2016 €35,800 2017 to date €3,000 |
Revenue is a State authority covered under State indemnity managed by the SCA, save for the provisions below. 2012: Hull & Machinery (Revenue Cutters) €24,625 Protection & Indemnity (Revenue Cutters) €14,616 2013: Hull & Machinery (Revenue Cutters) €24,625 Protection & Indemnity (Revenue Cutters) €15,492 2014: Hull & Machinery (Revenue Cutters) €21,000 Protection & Indemnity (Revenue Cutters) €11,000 Hull & Machinery on Seized Vessels €6,000 2015: Hull & Machinery (Revenue Cutters) €21,000 Protection & Indemnity (Revenue Cutters) €8,500 Hull & Machinery on Seized Vessels €11,000 2016: Hull & Machinery (Revenue Cutters) €20,200 Protection & Indemnity (Revenue Cutters) €3,600 Hull & Machinery on Seized Vessels €12,000 |
|
Social Finance Foundation |
2012 €2635.13 2013 €2658.47 2014 €2684.47 2015 €2718.50 2016 €2807.93 2017 to date €2158.80 |
2012 Public Liability €2152.50 Buildings Cover €482.63 2013 Public Liability €2152.50 Buildings Cover €505.97 2014 Public Liability €2152.50 Buildings Cover €531.97 2015 Public Liability €2152.50 Buildings Cover €566.00 2016 Public Liability €2158.80 Buildings Cover €649.13 2017 Public Liability €2158.80 |
|
Strategic Banking Corporation of Ireland |
2016 €91,718 |
2016: Professional Liability €78,750 (AIG) Public Liability & Employer's Liability €12,968 (Aviva & Chubb Insurance) |
64. Deputy Kevin O'Keeffe asked the Minister for Finance the tendering process his Department has undertaken and the criteria needed to enable stockbrokers to obtain the initial public offering for the sale of shares at a bank (details supplied). [26311/17]
View answerAs the Deputy will be aware, on Tuesday evening I released an 'Intention to Float' (ITF) announcement, indicating that my Department is preparing for the sale of around 25% of the State's shareholding in AIB. This offering will include an opportunity for retail investors to participate on the same terms as institutional investors. The structure of the retail element is informed by previous privatisations and the changes in the regulatory environment for retail investors in recent years. As such, there will be no active marketing of the shares and the minimum required order size will be €10,000. Prospective retail investors will need to be a client of a participating intermediary broker. Further details are available on the AIB website here: https://aib.ie/investorrelations/private-investor.
I would strongly encourage any prospective retail investors to take appropriate independent financial advice before making any investment decision given the risks associated with investing in an equity instrument.
The criteria required of Participating Intermediaries include the requisite regulatory authority to (i) provide advice to retail customers; (ii) accept client funds; and (iii) accept client orders. They are required to adhere to the terms of participation as set by the Department of Finance, AIB and the underwriting syndicate. These terms include restrictions on commission charges, compliance with anti-money laundering regulations, limitations on marketing activities and other obligations to ensure the smooth operation of the IPO process. The Participating Intermediaries are required to have a physical office in Ireland to facilitate those who wish to open a new account with whichever such intermediary they so choose.
Further details on the participating intermediaries can be found here: https://aib.ie/investorrelations/protected/appointed-intermediaries.
65. Deputy James Lawless asked the Minister for Finance his plans to review the situation in which litigants involved in family law matters have to pay 23% on their legal fees; and if he will make a statement on the matter. [26313/17]
View answerThe VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In accordance with the EU VAT Directive 2006, Irish legislation applies the standard rate of VAT, currently 23%, to the supply of legal services; the type of legal service being provided has no impact on the application of VAT to the legal fees charged.
Under the Directive there is no discretion to apply a different rate to the service in question and therefore the question of a review does not arise.
66. Deputy James Lawless asked the Minister for Finance his plans to review the situation whereby persons purchasing a house following a separation are not exempt from stamp duty; and if he will make a statement on the matter. [26317/17]
View answerI have been advised by Revenue that, following the dissolution of a marriage or a civil partnership, transfers of property between the spouses or civil partners are exempt from stamp duty where they are made on foot of a court order made under the relevant provisions of the Family Law Act 1995, the Family Law (Divorce) Act 1996 or the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010. This exemption also applies to transfers of property made on foot of a foreign court order if the particular dissolution is recognised as valid in this State. The relevant provisions are contained in section 97 of the Stamp Duties Consolidation Act (SDCA) 1999. Section 97A of this Act provides for a stamp duty exemption in the case of a property transfer between cohabitants on foot of an order made under the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010.
These exemptions do not apply if any part of the property is being transferred other than on foot of a specified court order or is being transferred to a party other than one of the spouses, civil partners or cohabitants covered by the particular court order.
Section 92B SDCA 1999 previously provided for a stamp duty exemption for first-time buyers that was ended with effect from 8 December 2010. This exemption was available to former spouses in a legally-ended marriage. A spouse who bought another house could avail of the first-time buyer exemption on that house provided that he/she had not retained an interest in the former marital home, which home continued to be occupied by the other spouse following the ending of the marriage. A stamp duty exemption is not currently available to any first-time buyer, whatever his/her marital situation is.
67. Deputy Charlie McConalogue asked the Minister for Finance the measures he is taking to combat the rising cost of home insurance; and if he will make a statement on the matter. [26325/17]
View answerAs Minister for Finance, I am responsible for the development of the legal framework governing financial regulation. Neither I nor the Central Bank of Ireland can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature, and are determined by insurance companies based on an assessment of the risks they are willing to accept. This position is reinforced by the EU framework for insurance which expressly prohibits Member States from adopting rules which require insurance companies to obtain prior approval of the pricing or terms and conditions of insurance products.
The Deputy will note that, according to the official data from the Central Statistics Office, the cost of insurance connected with dwellings has remained largely stable since December 2011. It has increased and decreased at various times and fluctuated by less than 15% in total from its lowest to highest levels during the five years from December 2011 to December 2016. At the end of 2016 it was 5.7% higher than it had been at the end of 2011. For the first four months of 2017, the month-on-month increases of insurance connected with dwellings have been 2.4%, 2.5%, 0% and 0%, respectively.
Comparably, the cost of motor insurance was 51.7% higher in December 2016 than it had been in December 2011, and at times early last year had been as much as 60% higher. Although official or reliable data in respect of the cost of employer liability insurance and public liability insurance is difficult to source, increases in the prices of these types of insurance have apparently risen at a significantly higher rate than that of home insurance. Therefore, on the basis that there is a need to prioritise the implementation of the cost of insurance report and also complete the public liability and employer liability review, I do not propose to look at the issue of the cost of home insurance at this point in time within the context of the Cost of Insurance Working Group's ongoing review of the insurance sector. Nevertheless, my Department will monitor the cost of home insurance as part of its ongoing policy work in the insurance sector.
68. Deputy Michael McGrath asked the Minister for Finance if the Revenue Commissioners has a record of income tax paid by a person (details supplied) in County Cork regarding their employment during a certain period. [26328/17]
View answerI am advised by Revenue that they require further details to establish whether they have the relevant information in respect of the person concerned. Revenue will make direct contact with the person concerned with a view to providing whatever assistance is possible.
69. Deputy Darragh O'Brien asked the Minister for Finance if he has formally raised at EU level the need for an EU fund to be established to assist countries and particular sectors most exposed to the negative impacts of Brexit; and if he will make a statement on the matter. [25700/17]
View answerThe Government has published a comprehensive document on ‘Ireland and the negotiations on the UK’s withdrawal from the European Union under Article 50 of the Treaty on European Union’ on 2 May 2017. Our priorities are clear: minimising the impact on trade and the economy, protecting the Northern Ireland Peace Process, maintaining the Common Travel Area and influencing the future of the European Union.
The Government is clear and determined that all possible preparations will be made ahead of the UK leaving the EU. The Government is focused on protecting and advancing Ireland's interests before, during and after these negotiations.
A critical part of this work is to ensure that these priorities are heard and understood across Europe and, therefore, engagement with our EU partners and with the EU institutions is critical. The EU negotiating guidelines, approved by the special European Council (at 27 level) on 29 April 2017, include very strong acknowledgement of our unique circumstances. This is a positive outcome showing that the Government’s extensive political, diplomatic and official campaign of recent months has been effective in ensuring understanding and recognition of our unique circumstances and specific issues.
Our Brexit preparations include detailed engagement with the European Commission, where we have made them aware that Brexit is already having an impact on the Irish economy, and of the disproportionate consequences posed by Brexit to the Irish economy overall in comparison to other Member States. In the context of Brexit, it is more important than ever that the EU continues to support economic growth and employment, and those Irish businesses most affected by Brexit.
The Government document sets out Ireland’s approach to the EU-UK negotiations including the economic implications. As stated therein, the Government will explore existing and possible future EU measures that could potentially assist in mitigating the effects of the UK’s withdrawal on specific Irish businesses and economic sectors while also, in the light of developments, making a strong case at EU level, that Brexit represents a serious disturbance to the Irish economy overall and that we will require support. (The annex to the document details Government actions taken to date to support business and the economy). The Deputy should also be aware that the issue of investment funding, in the context of the Brexit challenges facing the Irish economy, is the subject of ongoing discussions with the European Investment Bank (EIB).
The Government will continue to engage with EU partners to ensure that Ireland’s concerns and priorities continue to be reflected In the EU’s negotiating position as it evolves.
70. Deputy Michael McGrath asked the Minister for Finance the number of persons leaving the Central Bank that were put on gardening leave in each of the years 2010 to 2016, and to date in 2017; the rules regarding placing a person on gardening leave; the period of gardening leave time assigned in each case; the cost to the Central Bank of placing each person on gardening leave; and if he will make a statement on the matter. [26397/17]
View answerI am informed by the Central Bank that one employee was placed on garden leave in 2017 for a duration of 4.75 months. Arising from the seniority of the post, the cost of the garden leave is €122,000 inclusive of payment for untaken annual leave which was due and is being taken during this period.
Garden leave is provided for in contracts of employment for key roles to enable the creation of a ‘cooling off’ period where appropriate. A decision to place an employee on garden leave is determined by the circumstances, typically where there is a potential or perceived potential conflict of interest arising between the employee’s current role and the post-employment activity they have communicated they intend to undertake.
In the case of two other employees in 2016 and one employee in 2013, who were leaving their employment to take up roles in financial services, ‘cooling off’ periods were put in place. These included a combination of restricting their duties in their role and assigning them to other duties for the duration of their notice periods. The costs are more difficult to calculate in these cases, as they spent time carrying out other duties which eliminated or minimised the risk of potential or perceived post-employment conflicts.
71. Deputy Michael McGrath asked the Minister for Finance if the Central Bank or other State entity will be represented in the liquidation process of a company (details supplied); and if he will make a statement on the matter. [26400/17]
View answerThe Supreme Court delivered its judgment on 25 May 2017 overturning the previous decisions of the High Court and the Court of Appeal, finding that the Motor Insurers’ Bureau of Ireland (MIBI) is liable in respect of third party motor insurance claims made against the policyholders of Setanta Insurance. Therefore, the Insurance Compensation Fund (ICF) has been deemed responsible for the payment of third party claims.
Setanta Insurance was placed into liquidation by the Malta Financial Services Authority in April 2014 and this liquidation is being carried out under Maltese law. The Central Bank of Ireland will not be represented in the liquidation process.
In relation to any other state entities, the decision to deem the ICF liable clarifies that the Office of the Accountant of the Courts of Justice will be responsible for organising, with the assistance of the State Claims Agency, the payment of 65% of the amount due from each outstanding third party claim, or €825,000, whichever is the lesser.
Department of Finance officials had discussions with Office of the Accountant of the Courts of Justice and the State Claims Agency and they indicated that they had broad plans in place to deal with this issue. Our understanding is that both agencies are working with the Liquidator to plan out the process of validation and presentation of claims. Once the Liquidator has the claims ready for examination, the State Claims Agency will step in to commence the validation process. The State Claims Agency has assured the Department that it will act swiftly so that there will be no unnecessary delay caused by this validation process.
72. Deputy Michael McGrath asked the Minister for Finance if he has made formal proposals to the European Commission to revise the fiscal rules under the Stability and Growth Pact in favour of more flexibility around capital investment; and if he will make a statement on the matter. [26401/17]
View answerThe fiscal rules - formally known as the Stability and Growth Pact (SGP) - have direct application through a number of EU regulations and domestically via the Fiscal Responsibility Act. Changes to these regulations would have to follow the normal EU approach starting with a proposal from the Commission before consideration by Member States and the European Parliament.
However, there are matters within the SGP subject to the discretion of the European Commission. The Commission regularly issues updated guidance on how it will implement the SGP. It is in this context that I sought and secured a major change from the Commission in achieving an annual update of the reference rate used in the expenditure benchmark. The former practice had been to fix the reference rates for three years at a time. This new approach significantly increases the permitted room for expenditure growth, which would not have been possible under the former practice. In line with the principle of equal treatment for all Member States, the annual update of reference rates applied to all Member States.
There are already in place specific provisions within the SGP designed to promote capital investment. For instance, within the expenditure benchmark, capital formation increases are smoothed over four years with the result that only one quarter of the increase in public investment must be funded in the first year from within the fiscal space. This provision, which means increases in capital spending for housing and other purposes can be front-loaded within the EU rules, has been utilised in Ireland's budgetary plans. It should also be noted that the investment clause and the structural reform clause allow for temporary deviations from the required structural budgetary adjustment if spending on capital investment can be shown to qualify for either of these clauses, which are subject to strict conditions.
My approach to promoting additional investment has mainly involved securing additional EIB investment (off-balance sheet) and in this context, the Minister for Public Expenditure and Reform met with the EIB President last week to discuss, among other issues, how this could be moved forward.
The fiscal rules are designed to promote budgetary discipline and underpin sustainable economic growth. While Ireland's economy is growing and debt is on a downward trajectory, the debt level is still comparably high and caution must be exercised due to the potential of rollover risk should interest rates increase. We are a small and very open economy in a world that has more risks than usual. Compliance with the fiscal rules underpins the Government’s objective of maintaining sound public finances. The answer, therefore, is not simply about spending more; it is about getting more from each euro of taxpayers' money that is spent.
73. Deputy Michael McGrath asked the Minister for Finance the number of whole life insurance policies in existence here; the average premium on such products; the average change in premiums at each review; and if he will make a statement on the matter. [26402/17]
View answerIt is not possible to provide the details sought by the Deputy. The Central Statistics Office does not produce statistics on the price or price variance of whole-of-life insurance. Similarly, the Central Bank of Ireland does not collate any industry statistics on whole-of-life policies specifically, and neither does it collect any data in relation to average premium and average increase at each review.
I am advised by the Central Bank that this type of plan is designed to provide consumers with life cover for their whole life. As long as the policy holder makes regular payments and the payments are sufficient to maintain the chosen benefits, this type of cover will pay a lump sum on the death of the policy holder.
The regular payment into the plan covers the cost of providing the benefits chosen on the plan. In the early years the payments are higher than the cost of the policy holder’s benefits. The extra money paid goes into the plan fund. Protection benefits get more expensive as policy holders get older; usually as the plan progresses the payments begin to equal the cost of the chosen benefits. In the later years of reviewable protection plans, the cost of the benefits increases significantly. In order to keep the level of benefits at the current level of payments, the difference is made up from the plan fund.
The insurance company carries out regular reviews (the period in which these are completed can be 5 years, 6 years, 10 or 12 years depending on the product) to see if the consumers regular payment plus any fund that has been built up is enough to cover their chosen benefits for their reviewable protection plan. During a policy review the insurance company may find that the consumer’s current level of payments is enough to maintain the level of cover that the consumer wants. The insurance company may also find that the current level of payments is not enough to maintain the level of cover desired by the consumer.
Finally, I might conclude as Minister for Finance, I am responsible for the development of the legal framework governing financial regulation. Neither I nor the Central Bank of Ireland can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature, and are determined by insurance companies based on an assessment of the risks they are willing to accept. This position is reinforced by the EU framework for insurance which expressly prohibits Member States from adopting rules which require insurance companies to obtain prior approval of the pricing or terms and conditions of insurance products.
Consequently there is no role for my Department or the Central Bank in any post-sale reviews on whole-of-life policies. These are an individual matter for each insurance company and may differ from policy to policy.
74. Deputy Michael McGrath asked the Minister for Finance if the Central Bank is currently considering an application for a licence by a financial service provider hoping to enter the residential mortgage lending market here; and if he will make a statement on the matter. [26433/17]
View answerThe Central Bank (or where appropriate the ECB) has responsibility for the authorisation of regulated financial service providers in Ireland. However, the Central Bank has advised that, due to confidentiality reasons, it does not comment on applications for authorisation. A full list of authorised firms is available on the Central Bank's website at http://registers.centralbank.ie/.
75. Deputy Michael McGrath asked the Minister for Finance the number and value of business loans that are now owned by unregulated non-bank lenders; and if he will make a statement on the matter. [26434/17]
View answerI have been informed by the Central Bank that it does not routinely publish specific data on entities who are not regulated by the Central Bank and it is therefore not possible to provide the number and value requested by the Deputy.
I would however refer the Deputy to the Report on Mortgage Arrears which the Central Bank provided to the Minister for Finance in June 2016(http://www.finance.gov.ie/what-we-do/banking-financial-services/publications/reports-research/report-mortgage-arrears-2016) which provides details of the total number of loans/value of loans owned by unregulated entities as at the end of June 2016.
Loans can be sold by regulated entities to entities that are not regulated by the Central Bank. In July 2015, the Consumer Protection (Regulation of Credit Servicing) Act 2015 (“the 2015 Act”) was introduced to fill the consumer protection gap where loans are sold by the original lender to an unregulated firm.
Under the 2015 Act, if the firm which bought loans from the original lender is an unregulated firm, then the loans must be serviced by a ‘credit servicing firm’ (Credit Servicing Firms are typically firms that manage or administer credit agreements such as mortgages or other loans on behalf of unregulated entities). Credit Servicing Firms are required to obtain authorisation from the Central Bank in order to conduct credit servicing activities as defined in the 2015 Act. A register of those firms which have notified the Central Bank that they wish to avail of the transitional provisions provided for in the legislation (whereby, by virtue of the 2015 Act, they are taken to be authorised to carry on the business of a credit servicing firm pending a decision on their application by the Central Bank) and those firms that have been authorised to carry on the business of a credit servicing firm is available on the Central Bank website.
Credit servicing firms must act in accordance with the requirements of Irish financial services law that applies to ‘regulated financial service providers’. This ensures that consumers, whose loans are sold to another firm, maintain the same regulatory protections that they had prior to the sale, including under the various statutory Codes of Conduct issued by the Central Bank.
Additionally, the SME Credit Demand Survey, conducted on behalf of the Department of Finance, monitors the credit requirements of SMEs. The latest survey indicates that non-bank finance for SMEs is considerably lower than bank finance. For the period April to September 2016, the survey indicates that 8% of SMEs sought non-bank finance, which represented an increase of 1% on the previous period.
76. Deputy Michael McGrath asked the Minister for Finance if the Revenue Commissioners have launched a review of tax opinions issued to multinationals; the number of tax opinions which have been provided to the European Commission's State Aid Directorate in recent years; the period covered by those opinions; and if he will make a statement on the matter. [26435/17]
View answerI am informed by Revenue that it is their policy that all opinions issued to taxpayers, including multinational companies and other taxpayers, have a maximum validity period of 5 years. Giving effect to this policy, Revenue published guidance in January of this year (eBrief No. 8 of 2017) confirming that any opinion issued more than 5 years ago, and on which a taxpayer wishes to continue to rely, is subject to review.
A taxpayer who wishes to rely on an opinion issued before 1 January 2012, in respect of any transaction, period or part of a period after 1 January 2017, has until 30 June 2017 to make an application to Revenue for the renewal or extension of the opinion. The application must be made to the taxpayer’s local tax district and must comply with the requirements set out in Revenue’s published guidelines on obtaining an opinion. The guidelines are available on the Revenue website (www.revenue.ie) and are contained in Tax and Duty Manual 37.00.40 for cases dealt with by Revenue’s Large Cases Division and in Tax and Duty Manual 37.00.40 for cases submitted for opinion through the Revenue Technical Service.
In response to requests for information from the European Commission, in the context of its State Aid enquiries into ruling practices in different Member States, Ireland has provided the Commission with details of over 500 opinions given to companies, most of which were issued in the years 2010-2013 and addressed the application of direct tax legislation to the companies concerned for those, or subsequent, years.
77. Deputy Michael McGrath asked the Minister for Finance the number of the vacancies in each functional area of the Central Bank; the percentage that vacancy rate represents of the staffing allocation for that function in tabular form; and if he will make a statement on the matter. [26436/17]
View answerI am informed by the Central Bank that the Central Bank Commission has approved a staffing level of 1,801 FTEs for 2017. This is split across the three Pillars of Financial Regulation, Central Banking, and Operations (including FTEs for the Bank wide graduate programme).
The Central Bank has provided the table below which outlines the level of actual FTEs versus approved FTEs across the three Pillars as at the end of April:
|
Pillar |
FTEs at April |
Approved FTEs for 2017 |
Variance |
|
Financial Regulation |
759.3 |
873 |
113.7 |
|
Central Banking |
336.1 |
376 |
39.9 |
|
Operations |
502.3 |
552 |
49.7 |
This represents a vacancy rate of 11% across the Bank; 13% in Financial Regulation, 11% in Central Banking and 9% in Operations.
The Bank is actively engaged in recruitment on an on-going basis and the Governor has previously indicated that the Bank has the ability to effectively re-prioritise where it needs to.
I am satisfied that the Bank has the necessary resources to fulfil its mandate.
78. Deputy Michael McGrath asked the Minister for Finance the amount he expects the State to receive from the liquidation of IBRC; when he expects the State will receive it; the use the proceeds will be put to; and if he will make a statement on the matter. [26437/17]
View answerAs set out in the most recent progress update of 5 May 2017 (which is available on the Department of Finance website http://www.finance.gov.ie/sites/default/files/170505%20IBRC%20Progress%20update%20report%20report_31%20Dec%2016.pdf), the Special Liquidators have cash receipts of €1.9bn on hand as at 6 February 2017.
In December 2016, the Special Liquidators commenced the payment of an interim dividend of 25% to all admitted unsecured creditors of the liquidation, including the State who is the largest creditor. Department of Finance related claims in the region of €1.12bn were submitted to the Special Liquidators of IBRC which has resulted in an interim dividend of €280m being paid thus far. I am also aware that other State entities have submitted claims but these are a matter for those entities.
As per the most recent progress update report of 5 May 2017, the Special Liquidators have advised that it is their expectation, based on current information, that the eventual unsecured creditor dividend will be in the range of 75%-100% of all eligible claims. This eventual dividend range is subject to change depending on future events which are outside the control of the Special Liquidators. The ultimate level of dividend paid to each creditor, and timing of same, cannot be known until such time as all loan assets are sold, the total level of adjudicated creditors is finalised and other contingent creditor claims which may crystallise, including those from litigation, are known.
As a result of the European System of National and Regional Accounts (ESA 2010), IBRC is classified in government. Any payment from the Special Liquidators of IBRC to the State is considered an intra-government payment with no impact on the deficit. Such payments do however improve the exchequer borrowing requirement as the cash received increases the cash balances in the Central Fund and thereby reduce the required level of borrowing.
79. Deputy Michael McGrath asked the Minister for Finance when he expects to publish the phase 2 report from the working group on the cost of insurance dealing with employer and public liability; and if he will make a statement on the matter. [26494/17]
View answerThe Cost of Insurance Working Group is now in its second phase and is examining issues around the cost of insurance for businesses, specifically Employer Liability (EL) Insurance and Public Liability (PL) Insurance. It is envisaged that the final results of this second phase will take the form of an addendum to the existing Report. As with the first phase, the aim is for all relevant bodies and stakeholders to work together in order to deliver fairer premiums for businesses without unnecessary delay. It is hoped that there can be clarity around the potential new measures in July, with a final report following in September.
The Working Group is chaired by the Minister of State at the Department of Finance, Mr Eoghan Murphy T.D. and is comprised of representatives from the Department of Finance, the Department of Jobs, Enterprise and Innovation, the Department of Justice and Equality, the Central Bank of Ireland, the State Claims Agency, and the Personal Injuries Assessment Board.
The Working Group is building upon the previous work done in the motor phase in order to determine how it can be applied in the employer liability and public liability insurance claims areas particularly in relation to:
- Personal Injury data and information
- Effects of legal costs and litigation processes on insurance costs
- Current claims compensation arrangements and cost of claims
- Impact of unlawful activity on insurance sector
The Working Group is also considering the impact of the cost of insurance on the competitiveness of particular business sectors, the impact of health and safety issues on the cost of insurance and other market issues.
The Working Group has met seven times this year and has held extensive consultations with a range of stakeholders including the Hotels Federation of Ireland, IBEC, ISME, the Vintners’ Federation of Ireland (VFI), the Licensed Vintners’ Association (LVA), the Retail Grocery Dairy & Allied Trades Association (RGDATA), Chambers Ireland, the Law Society of Ireland and the Health and Safety Authority. Further consultations are also planned and I would invite further submissions from interested parties to insurance@finance.gov.ie.
80. Deputy Michael McGrath asked the Minister for Finance the position regarding resolving the outstanding claims associated with a company (details supplied) in view of the recent Supreme Court judgment; his plans to ensure that 100% of the cost of outstanding claims are met; and if he will make a statement on the matter. [26495/17]
View answer81. Deputy Michael McGrath asked the Minister for Finance when he expects payments will start to issue in respect of the outstanding claims associated with a company (details supplied) in view of the recent Supreme Court judgment; and if he will make a statement on the matter. [26496/17]
View answer82. Deputy Michael McGrath asked the Minister for Finance the latest estimate from the liquidator of the value of outstanding claims he expects to be able to meet from the proceeds of the liquidation of a company (details supplied); and if he will make a statement on the matter. [26497/17]
View answerI propose to take Questions Nos. 80 to 82, inclusive, together.
The Supreme Court in delivering its judgment on 25 May 2017 overturned the previous decisions of the High Court and the Court of Appeal that the Motor Insurers’ Bureau of Ireland (MIBI) is liable in respect of third party motor insurance claims made against the policyholders of Setanta Insurance. The consequence of this is that the Insurance Compensation Fund (ICF) has been deemed responsible for the payment of such third party claims.
Setanta Insurance was placed into liquidation by the Malta Financial Services Authority in April 2014 and this liquidation is being carried out under Maltese law. The Liquidator has informed the Department that, as of 30 April 2017, the number of open claims was 1,639. It is now possible to begin the process of making payments of up to 65% (or €825,000, whichever is the lesser) due to relevant third party claimants from the ICF.
It is expected that a proportion of the balance of claims will be met from the proceeds of the distribution of Setanta’s assets on completion of the liquidation process. However, it is not possible to say definitively at this stage what proportion of the claims this will amount to, but current indications are that this is unlikely to be sufficient to cover all of the 35% gap.
In 2014, a preliminary assessment was carried out by Towers Watson who indicated that the Liquidator would not be in a position to meet more than 30% of claims out of the assets of the liquidation. The Liquidator has informed the Department that as the Supreme Court has now made its judgement, it will be necessary for a new report to be commissioned to provide updated figures. This is expected to commence shortly.
The extent of the shortfall (i.e. the difference between the full amount due and the combined total of the ICF payment plus the Setanta distribution) is unlikely to become fully clear until the liquidator has determined the remaining monies in Setanta that he has to distribute to policyholders.
Finally, in relation to the issue as to when payments can be expected to commence, it should be noted that Department of Finance officials have had discussions with the Office of the Accountant of the Courts of Justice and the State Claims Agency and they have indicated that they have plans in place to deal with this issue. Our understanding is that both agencies are working with the Liquidator to plan out the process of validation and presentation of claims. Once the liquidator has the claims ready for examination, the State Claims Agency will step in to commence the validation process. The State Claims Agency has assured the Department that it will act swiftly so that there will be no unnecessary delay caused by this validation process. I hope to have greater clarity on the timescale shortly.
As the Deputy is aware the forthcoming legislation based on the recommendations of the Review of the Framework for Motor Insurance Compensation in Ireland will amend the relevant Insurance Acts to ensure 100% of third party motor claims will be covered in future by the ICF.
