Written Answers Nos. 128-147
128. Deputy Pearse Doherty asked the Minister for Finance the nature of his being Minister for two Departments including by reference to the role of the Houses of the Oireachtas in holding him to account (details supplied); and if he will make a statement on the matter. [35885/17]
View answerIn response to the Deputy, I can advise that while I was recently appointed as Minister for Finance and Public Expenditure and Reform for both the Department of Finance and the Department of Public Expenditure and Reform, I am in effect running two separate Departments as separate legal entities.
129. Deputy Mick Wallace asked the Minister for Finance his views on the merits of a ban on surcharges on credit and debit cards in view of the decision by the Treasury in the United Kingdom regarding same; and if he will make a statement on the matter. [35935/17]
View answerA new EU Directive, the revised EU Payment Services Directive, is currently being transposed and will enter into effect in all EU Member States on 13 January 2018.
This Directive prohibits surcharging on payment cards covered by the EU Interchange Fee Regulation, meaning that surcharging will be prohibited on the vast majority of credit and debit cards held by consumers.
Once the Directive takes effect early next year merchants will be permitted only to surcharge on cards not covered by the EU Interchange Fee Regulation, such as commercial cards or cards issued by three party payment card schemes. Where this occurs, the revised EU Payment Services Directive specifies that any surcharge must not exceed the direct costs borne by the merchant to accept the card.
130. Deputy Mick Wallace asked the Minister for Finance the law firms currently working for or that have worked for NAMA; and the fees paid to each in each of the years 2011 to 2016 and to date in 2017, in tabular form. [35936/17]
View answer199. Deputy Richard Boyd Barrett asked the Minister for Finance the amount NAMA has paid out in legal fees since its inception, by year. [36343/17]
View answerI propose to take Questions Nos. 130 and 199 together.
The information sought by the Deputy, with regard to legal fees paid by NAMA, is set out in the following table for the period from 2010 to date.
I am advised by NAMA that the figures do not include recoverable fees, i.e. legal fees that NAMA has incurred on behalf of debtors that are added to debtor loan balances. Having regard to the time period in question, I am advised it is not possible within the time available to provide information on recoverable fees. This supplementary information is being compiled and I will arrange for a further reply to be provided in line with Standing Orders.
|
Legal Fees |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
Q1 2017 |
Grand Total |
|
Arthur Cox Solicitors |
863,592 |
648,877 |
472,707 |
310,532 |
283,272 |
258,401 |
430,015 |
15,500 |
3,282,895 |
|
EUGENE F COLLINS |
271,958 |
1,888,120 |
244,892 |
343,853 |
100,442 |
124,705 |
2,973,969 |
||
|
McCann Fitzgerald |
53,249 |
579,883 |
273,377 |
634,216 |
581,671 |
471,688 |
110,484 |
9,773 |
2,714,340 |
|
A&L Goodbody Solicitors |
192,288 |
610,220 |
300,976 |
29,734 |
115,935 |
487,113 |
198,599 |
33,542 |
1,968,408 |
|
Matheson |
68,290 |
457,713 |
402,647 |
95,907 |
128,734 |
417,853 |
14,931 |
12,895 |
1,598,971 |
|
ALLEN & OVERY LLP |
502,827 |
380,248 |
46,078 |
571,358 |
19,458 |
0 |
0 |
0 |
1,519,968 |
|
DLA PIPER UK LLP |
104,192 |
2,451 |
183,328 |
739,915 |
202,129 |
18,632 |
13,525 |
1,264,172 |
|
|
BEAUCHAMPS SOLICITORS |
101,473 |
9,111 |
308,791 |
240,417 |
209,299 |
206,869 |
182,770 |
1,258,730 |
|
|
McCarter & English LLP |
835,058 |
276,367 |
8,796 |
79,048 |
0 |
1,199,269 |
|||
|
WILLIAM FRY SOLICITORS |
381,645 |
536,766 |
7,309 |
77,716 |
41,155 |
90,729 |
48,907 |
0 |
1,184,227 |
|
MAPLES AND CALDER |
800,711 |
59,948 |
100,897 |
132,166 |
66,459 |
0 |
1,160,181 |
||
|
BYRNE WALLACE |
319,205 |
116,311 |
62,144 |
130,478 |
326,399 |
74,698 |
37,649 |
1,066,884 |
|
|
RONAN DALY JERMYN SOLICITORS |
126,795 |
107,076 |
410,111 |
153,392 |
81,555 |
8,633 |
887,561 |
||
|
EVERSHEDS O'DONNELL SWEENEY |
44,149 |
337,596 |
48,221 |
170,847 |
112,216 |
94,127 |
0 |
0 |
807,156 |
|
SERVULO & ASSOCIADOS |
41,526 |
321,619 |
12,423 |
394,936 |
0 |
770,503 |
|||
|
SIMMONS & SIMMONS LLP |
20,703 |
109,444 |
319,531 |
138,024 |
57,186 |
35,651 |
3,039 |
0 |
683,578 |
|
HAYES SOLICITORS |
34,405 |
25,196 |
36,116 |
188,494 |
161,357 |
153,870 |
45,343 |
644,782 |
|
|
HOGAN LOVELLS INTERNATIONAL LLP |
917,654 |
1,243 |
7,990 |
408,395 |
26,563 |
12,350 |
49,739 |
607,143 |
|
|
MASON HAYES + CURRAN |
10,285 |
37,717 |
208,431 |
84,791 |
203,950 |
419 |
545,593 |
||
|
TAYLOR WESSING LLP |
228,903 |
19,048 |
13,284 |
138,809 |
39,064 |
12,519 |
22,609 |
474,235 |
|
|
Quarles & Brady LLP |
18,479 |
66,752 |
39,574 |
65,477 |
201,700 |
0 |
391,982 |
||
|
LK SHIELDS SOLICITORS |
23,000 |
23,556 |
32,956 |
200,784 |
49,382 |
9,696 |
0 |
339,374 |
|
|
PAUL SREENAN |
3,061 |
117,418 |
169,282 |
40,590 |
0 |
0 |
0 |
330,352 |
|
|
Vroninks & Ricker |
303,918 |
0 |
0 |
0 |
303,918 |
||||
|
Gartlan Furey Solicitors |
224,741 |
23,157 |
36,745 |
9,336 |
0 |
0 |
293,979 |
||
|
Bayern LB |
113,454 |
178,775 |
0 |
0 |
0 |
292,230 |
|||
|
Lavelle Solicitors |
150,762 |
119,727 |
0 |
0 |
270,489 |
||||
|
Wragge Lawrence Graham & Co |
98,174 |
151,483 |
0 |
0 |
249,657 |
||||
|
ARTHUR COX NORTHERN IRELAND |
3,663 |
17,373 |
38,204 |
34,471 |
97,878 |
10,980 |
1,719 |
0 |
204,289 |
|
Hogan Lovells International LLP (Madrid) |
0 |
0 |
0 |
- |
142,819 |
41,880 |
0 |
184,699 |
|
|
Dillon Eustace |
0 |
48,046 |
0 |
0 |
16,336 |
46,853 |
5,848 |
64,245 |
181,328 |
|
Graf von Westphalen |
109,764 |
65,615 |
0 |
0 |
0 |
175,379 |
|||
|
Cian Ferriter |
128,904 |
33,518 |
- |
0 |
0 |
0 |
162,422 |
||
|
Burges Salmon LLP |
0 |
153,511 |
0 |
153,511 |
|||||
|
Uria Menedez |
95,715 |
14,194 |
21,618 |
0 |
131,527 |
||||
|
Alfred Thornton & Company |
9,050 |
5,931 |
12,243 |
50,050 |
12,300 |
34,363 |
0 |
123,936 |
|
|
McCann Fitzgerald London Solicitors |
123,663 |
0 |
0 |
0 |
123,663 |
||||
|
Taylor Wessing LLP (Munchen) |
69,259 |
52,846 |
0 |
0 |
122,105 |
||||
|
OLSWANG LLP |
0 |
77,858 |
43,694 |
- |
0 |
0 |
0 |
121,552 |
|
|
Parker, Hudson, Rainer & Dobbs LLP |
4,988 |
45,704 |
62,357 |
- |
0 |
0 |
0 |
113,049 |
|
|
Wierzbowski Eversheds |
85,638 |
24,956 |
0 |
110,594 |
|||||
|
ADDLESHAW GODDARD LLP |
26,554 |
75,118 |
- |
0 |
0 |
0 |
101,672 |
||
|
Various suppliers - cumulative < 100k |
114,651 |
713,611 |
426,512 |
745,851 |
1,449,555 |
120,058 |
275,262 |
181,836 |
4,027,336 |
|
Accruals, VAT recoveries & other expenses |
1,063,247 |
1,869,612 |
1,357,622 |
(3,842,595) |
1,624,944 |
1,221,114 |
502,144 |
130,817 |
3,926,906 |
|
Grand Total € |
3,311,367 |
9,478,148 |
4,634,000 |
2,975,001 |
8,574,000 |
5,658,000 |
3,484,000 |
934,000 |
39,048,516 |
131. Deputy Thomas P. Broughan asked the Minister for Finance the estimated amount of additional revenue that would be generated if the betting tax was increased from 1% to 3% and 5% respectively; and if he will make a statement on the matter. [35956/17]
View answerI am advised by the Revenue Commissioners that estimates of the amount of additional duty that would be generated if the rate of betting tax was increased from 1% to 3% is available in the pre-Budget 2018 Ready Reckoner at: http://www.revenue.ie/en/about/statistics/ready-reckoners.pdf.
The additional revenue generated if the betting tax was increased to 5% would be €250 million on a straight line basis and assuming nothing else changes.
132. Deputy Thomas P. Broughan asked the Minister for Finance the estimated yield through the implementation of a vacant property tax of 2.5%, 5%, 7.5% and 10% respectively; and if he will make a statement on the matter. [35963/17]
View answerI am informed that no distinction is made in the Tax Code between vacant and occupied properties. It is not possible therefore to derive estimates from Revenue statistics in relation to the Deputy's question.
The Urban Regeneration and Housing Act 2015 includes a new measure, the vacant site levy, which is aimed at incentivising the development of vacant, underutilised sites in urban areas. The Deputy may wish to seek further information on this levy from my colleague, the Minister for Housing, Planning, Community and Local Government.
134. Deputy Sean Fleming asked the Minister for Finance the details of the national debt on the national balance sheet; the debt that is listed under the National Treasury Management Agency; the detail of all other debts classified within the Government sector for national debt by Department adding up to the overall debt; and if he will make a statement on the matter. [35987/17]
View answerGeneral Government Gross Debt (GGD) is a measure of the total gross consolidated debt of the State compiled by the Central Statistics Office (CSO) and is the measure used for comparative purposes across the European Union. National Debt is effectively a domestic measure as it is the net debt incurred by the Exchequer after taking account of cash balances and other financial assets.
Gross National Debt is the principal component of GGD. There is no Departmental break-down of debt as each Department is funded via the Exchequer and/or appropriations in aid. However it should be noted that, as well as National Debt, GGD also includes the debt of central and local government bodies. GGD is reported on a gross basis and does not net off outstanding cash balances and other related assets.
The most recent figures reported for GGD for 2016 was published by the Central Statistics Office in the Government Finance Statistics Quarterly Results (Quarter 1 2017) and was reported at €200.6bn.
Turning to the National Debt the most recent figure reported for 2016 can be found on the NTMA website (available here) and was €185.6bn.
135. Deputy Sean Fleming asked the Minister for Finance if he will expedite an appointment for a person (details supplied) to assist them in obtaining a primary medical certificate; and if he will make a statement on the matter. [35998/17]
View answerThe Disabled Drivers and Disabled Passengers (Tax Concessions) Scheme provides relief from VAT and Vehicle Registration Tax (up to a certain limit), an exemption from motor tax and a grant in respect of fuel, on the purchase of an adapted car for transport of a person with specific severe and permanent physical disabilities. To qualify for the Scheme an applicant must be in possession of a Primary Medical Certificate.
The Senior Medical Officer for the relevant local Health Service Executive administrative area makes a professional clinical determination as to whether an individual applicant satisfies the medical criteria. A successful applicant is provided with a Primary Medical Certificate, which is required under the Regulations to claim the reliefs provided for in the Scheme.
An unsuccessful applicant can appeal the decision of the Senior Medical Officer to the Disabled Drivers Medical Board of Appeal (DDMBA), which makes a new clinical determination in respect of the individual. The Regulations mandate that the DDMBA is independent in the exercise of its functions to ensure the integrity of its clinical determinations.
With regard to the DDMBA, there has been a recent upsurge in the number of appeals resulting in longer waiting times for an appointment. The DDBMA, within its functions, has the facility to deal with waiting lists by holding extra hearings. I am aware that extra hearings were held in 2016 and already in 2017, in this regard.
136. Deputy Brendan Howlin asked the Minister for Finance the gross national income impact on gross and net debt, current, past and future, in tabular form; his plans to use this statistical method for budget statements; and if he will make a statement on the matter. [36003/17]
View answer140. Deputy Brendan Howlin asked the Minister for Finance the gross debt to gross national income star ratio for each of the past five years; and if he will make a statement on the matter. [36009/17]
View answerI propose to take Questions Nos. 136 and 140 together.
I am assuming the Deputy is referring to the ratio using the new national indicator published by the Central Statistics Office (CSO), so-called modified Gross National Income (GNI*).
This new measure of economic activity in Ireland is defined as GNI less the impact of re-domiciled companies and the depreciation attributable to relocated capital assets. Thus, it excludes many of the factors which have distorted Irish GDP in recent years.
My Department recently published its first Annual Report on Public Debt in Ireland; this publication highlighted that because of the distortions to Irish GDP, a wider suite of metrics is needed to assess the burden of public debt in Ireland (debt-to-revenue, debt interest-to-revenue, etc.). In addition, the report highlighted that future updates of this report would present debt as a fraction of GNI*.
Data for the debt relevant debt ratios are presented the following table covering the period 2012 (the peak of the debt-to-GDP ratio) to 2016, the latest year for which data are available.
My Department intends to publish figures for debt-to-GNI* in the budgetary documentation. However, I would point out that our legal obligations (such as EU Budget contribution, Stability and Growth Pact) will continue to be assessed on the existing measures (rather than on the basis of GNI*).
|
Period |
General Government Gross debt % of GDP |
General Government Gross debt % of GNI* |
General Government Net debt % of GDP |
General Government Net debt % of GNI* |
|
2012 |
120 |
158 |
87 |
114 |
|
2013 |
119 |
151 |
90 |
113 |
|
2014 |
105 |
132 |
86 |
108 |
|
2015 |
77 |
117 |
66 |
100 |
|
2016 |
73 |
106 |
64 |
93 |
Source: CSO
137. Deputy Brendan Howlin asked the Minister for Finance the gross and net debt positions as a percentage of GDP and GNI following the publication of the 2016 national accounts update in July 2017; and if he will make a statement on the matter. [36006/17]
View answerAs a result of the recently released National Income and Expenditure (NIE) results the 2016 GDP and GNI have undergone upward revisions compared to the estimates available at the time of compiling the 2017 Stability Programme Update (SPU).
The updated ratios of Gross General Government Debt and Net General Government Debt are presented in the following table. In addition the ratios are expressed as a percentage of the new metric produced by the CSO, so-called GNI*. This latter ratio clearly demonstrates that public debt remains high in Ireland and underlines the need for sensible budgetary policies.
|
- |
2016 |
|
Gross General Government Debt (as a % of GDP) |
72.8 |
|
Net General Government Debt (as a % of GDP) |
63.7 |
|
Gross General Government Debt (as a % of GNI) |
88.1 |
|
Net General Government Debt (as a % of GNI) |
77.0 |
|
Gross General Government Debt (as a % of GNI*) |
106.0 |
|
Net General Government Debt (as a % of GNI*) |
92.8 |
Source: CSO
138. Deputy Brendan Howlin asked the Minister for Finance the factors influencing the difference between gross and net debt including an arithmetical reconciliation for 2016; and if he will make a statement on the matter. [36007/17]
View answerGeneral Government Gross Debt is the gross debt liabilities of the consolidated General Government (GG) sector, at nominal value. It excludes liabilities in derivatives, equity liabilities, pension and insurance liabilities and accounts payable.
General Government Net Debt is a measure produced in accordance with the methodology of the IMF/World Bank Public Sector Debt Statistics Guide, by subtracting from the GG Gross Debt figure the value of the financial assets corresponding to the categories of financial liabilities which comprise GG Gross Debt, i.e. currency and deposits; short and long-term debt securities; and short and long-term loans.
The Central Statistics Office (CSO) recently published the Government Finance Statistics Quarterly Results. The reconciliation between Gross GG Debt and Net GG Debt can be found in Table 7 General Government Gross and Net Debt.
|
- |
2016 €millions |
|
Gross General Government Debt (face value) |
200,595 |
|
Less EDP debt instrument assets by category: |
|
|
Currency and deposits |
14,286 |
|
Debt securities |
|
|
Short-term |
143 |
|
Long-term |
2,019 |
|
Loans |
|
|
Short-term |
939 |
|
Long-term |
7,588 |
|
Net General Government Debt (face value) |
175,620 |
Source: CSO
139. Deputy Brendan Howlin asked the Minister for Finance the assessed value of the State’s remaining banking investments by institution; and if he will make a statement on the matter. [36008/17]
View answerThe market value of the State's remaining equity stakes in the banks, as at 19 July 2017, was:
|
Bank |
Value of our stake – ISE close, 19th July 2017 |
|
AIB |
€9.6bn |
|
BOI |
€1.0bn |
|
PTSB |
€0.8bn |
|
Total |
€11.4bn |
The State also holds warrants in AIB that are exercisable for a number of shares equivalent to 9.99% of the issued share capital of the bank, at a price of €8.80 and have a life of 10 years. However as these have just been issued and are not quoted on any exchange, no value has yet been attributed to them.
141. Deputy Brendan Howlin asked the Minister for Finance the percentage share of voted and non-voted expenditure of GDP and GNI for each of the past five years; and if he will make a statement on the matter. [36010/17]
View answerNon-voted expenditure, which is generally non-discretionary in nature, is paid out of the Central Fund under specific legislation. It consists of items such as the service of the National Debt, contributions to the European Union Budget, the Houses of the Oireachtas Commission, judicial salaries and pensions and the salaries and pensions of the President and Comptroller and Auditor General.
In addition to GDP and GNI, for completeness, the following table also contains the ratio for voted and non-voted expenditure as a percentage of modified gross national income (GNI*).
|
- |
2012 |
2013 |
2014 |
2015 |
2016 |
|
Gross voted expenditure (€bn) |
54.9 |
53.4 |
53.1 |
54.6 |
56.1 |
|
% of GDP |
31.2% |
29.6% |
27.3% |
20.8% |
20.4% |
|
% of GNI |
38.3% |
34.8% |
32.0% |
26.3% |
24.6% |
|
% of GNI* |
41.2% |
37.3% |
34.4% |
31.6% |
29.6% |
|
Non-voted expenditure (€bn) |
11.7 |
13.1 |
16.4 |
15.8 |
12.1 |
|
% of GDP |
6.7% |
7.3% |
8.4% |
6.0% |
4.4% |
|
% of GNI |
8.1% |
8.6% |
9.9% |
7.6% |
5.3% |
|
% of GNI* |
8.8% |
9.2% |
10.6% |
9.1% |
6.4% |
142. Deputy Brendan Howlin asked the Minister for Finance the cost of interest repayments on the national debt for each of the years from 2012 and to date in 2017, in monetary terms, as a percentage of GDP, as a percentage of GNI and as a percentage of both voted and non-voted expenditure, in tabular form; and if he will make a statement on the matter. [36012/17]
View answerGeneral Government Debt (GGD) is a measure of the total gross consolidated debt of the State compiled by the Central Statistics Office (CSO) and is the measure used for comparative purposes across the European Union.
National Debt is effectively a domestic measure as it is the net debt incurred by the Exchequer after taking account of cash balances and other financial assets.
Gross National Debt is the principal component of GGD. The most recent estimates of interest on National Debt for the years 2012-2016 are available on the NTMA’s website while the most recent figure for interest on National Debt for 2017 was published in the 2017 Stability Programme Update (Table A3, page 51) and is reproduced for the Deputy’s convenience as follows.
|
- |
Interest on National Debt (€ billions) |
Interest on National Debt (as a % of GDP) |
Interest on National Debt (as a % of GNI) |
Interest on National Debt (as a % of voted expenditure) |
Interest on National Debt (as a % non-voted expenditure) |
|
2012 |
5.7 |
3.2 |
4.0 |
10.4 |
48.6 |
|
2013 |
7.3 |
4.1 |
4.8 |
13.7 |
55.8 |
|
2014 |
7.5 |
3.8 |
4.5 |
14.1 |
45.6 |
|
2015 |
7.0 |
2.7 |
3.4 |
12.8 |
44.2 |
|
2016 |
6.7 |
2.4 |
3.0 |
12.0 |
55.8 |
|
2017 |
6.2 |
2.1* |
2.7* |
10.7 |
59.0 |
Source: CSO, NTMA, Department of Finance
*The 2017 figures for GDP and GNI apply the Summer Economic Statement nominal growth rate forecasts to the revised level of GDP and GNI published in the 2016 National Income and Expenditure Results.
143. Deputy Brendan Howlin asked the Minister for Finance the details of non-voted expenditure in 2016 and to date in 2017; his plans to introduce additional transparency into the deployment of non-voted expenditure; and if he will make a statement on the matter. [36013/17]
View answerTotal non-voted expenditure in 2016 was €12,090 million, comprising €9,581 million and €2,508 million of current and capital expenditure respectively. The monthly Exchequer statement provides a further breakdown of current and capital non-voted expenditure under a number of different headings. The main items under non-voted current and capital expenditure for 2016 are set out in the following tables.
Main items under 2016 non-voted current expenditure
|
- |
End December 2016 (€m) |
% share of Current non-voted Expenditure |
|
Debt Servicing |
€6,845 |
71.4 % |
|
Contribution to EU Budget |
€2,023 |
21.2 % |
|
Transfer of LPT receipts to Local Government Fund |
€463 |
4.8% |
|
Oireachtas Commission |
€114 |
1.2% |
Main items under 2016 non-voted capital expenditure
|
- |
End December 2016 (€m) |
% share of Capital non-voted Expenditure |
|
Loans to Social Insurance Fund |
€1,370 |
54.6 % |
|
Feoga (Guarantee) Agriculture |
€770 |
30.7 % |
|
Capital Contribution to Irish Water |
€184 |
7.3% |
|
Advances to the Supply Account |
€181 |
7.2% |
Turning to 2017, the Fiscal Monitor, published monthly on my Department’s website, indicates that non-voted expenditure amounts to €5,256 million in the year-to-date, all of which, except €5.7 million, was accounted for by non-voted current expenditure.
In relation to enhancing transparency around non-voted expenditure developments the Exchequer Statement, on pages 13 and 14 within the Fiscal Monitor, provide a further breakdown of non-voted expenditure under a number of different headings. This is augmented by the Analytical Exchequer statement on pages 15 and 16 of the Fiscal Monitor which shows the main items under both current and capital non-voted expenditure, the nominal and percentage variance from the Budget consistent profile and year-on-year changes. This profile is published during the first quarter of each year and includes details of the main non-voted expenditure items on a monthly basis. It is worth noting that my Department has also published the cumulative monthly profiles for all main Exchequer items for the last three years to further improve overall fiscal transparency.
In addition, in response to a recommendation contained in the IMF fiscal transparency report, the Analytical Exchequer Statement, as part of the Fiscal Monitor, further separates non-voted expenditure into those transactions that have an impact in general government terms from those with none.
144. Deputy Sean Fleming asked the Minister for Finance the rules in place for the utilisation of the expected surplus that NAMA will transfer to the Exchequer in or before 2020; if there are rules in place requiring this to be offset against the national debt or if it can be used for capital investment or other purposes; if there are specific EUROSTAT rules in place to cover an organisation like NAMA requiring that the NAMA surplus be specifically used for debt reduction; and if he will make a statement on the matter. [36138/17]
View answerCurrently NAMA expects to redeem 100% of its guaranteed senior debt by the end of 2017 and expects to redeem its subordinated debt in March 2020. NAMA will focus on completing its ongoing deleveraging, its Dublin Docklands SDZ and residential funding programmes in the interim period to 2020. NAMA's 2016 Annual Report, which provides further insight into the Agency's expectations regarding these activities, was laid before the Oireachtas on the 1st June 2017 and is also available on NAMA's website via: https://www.nama.ie/about-us/publications/annual-reports/. As the Deputy will be aware, it is through the successful completion of these objectives that NAMA currently projects a surplus in the region of €3bn to be returned to the State once it completes it work.
Section 60(2) of the NAMA Act 2009 states that NAMA may use surplus funds to redeem and cancel its debt. Surplus funds may only be returned to the Central Fund once NAMA's debt has been redeemed in full.
As has been discussed with Eurostat, from an accounting perspective, once the senior debt, subordinated debt, and private investors have been repaid then NAMA (the Agency), which is in Government, would be the sole shareholder and, as such, NAMA (the SPV) would then become classified into the Government sector, having no effect on the General Government Balance. This is expected to occur in 2020, no later than the time at which the private shareholders have been fully compensated. At this point in time NAMA will have no debt.
It will be a decision for the Government as to how any surplus returned by NAMA will be utilised within the fiscal rules. It should further be noted that at this point, according to most recent estimates, there will be in the order of €3.4bn net fiscal space available to the Government.
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. Furthermore, any additional expenditure outside of the limits set by the expenditure benchmark could result in a deviation under the fiscal rules which, if the State does not take effective action within a relevant deadline, could result in the European Commission applying an interest bearing deposit. Additionally, aside from financial penalties there could be a potential for adverse debt market outcomes and reduced confidence in the Irish economy.
It has always been the Government's intention to use such receipts from the resolution of the financial sector crisis to pay down our debt and help reduce our debt servicing costs. Given the uncertainty around the specific timing of or the amount that will be realised, such an estimate has not been included our debt forecasts.
Debt reduction, underpinned by the Government's lower gross general government debt target of 55% of GDP, will increase the resilience of the public finances to deal with any potential shocks which may emerge.
145. Deputy Sean Fleming asked the Minister for Finance the planning that has taken place to date regarding the potential use of the expected NAMA surplus that will be transferred to the State, in view of the substantial amount of funding involved; the time taken to prepare for the best use of these funds; if some of it can be used for infrastructure, capital or other purposes, in view of the fact that NAMA may complete its work early and this surplus may be available sooner than 2020; and if he will make a statement on the matter. [36139/17]
View answerThe Deputy will be aware that NAMA outlined in its 2016 Annual Report that the Agency expects to return a surplus to the State in the region of €3bn, subject to prevailing market conditions, when it completes its work. It is important to recognise that this is a projected surplus - it will only materialise after NAMA’s debt is fully repaid and NAMA’s ongoing work is completed. NAMA held cash reserves of circa €1.6 billion at the end of 2016 and requires these reserves to fund its ongoing operating costs and to progress its ongoing deleveraging, Dublin Docklands SDZ and residential funding programmes in the interim period to 2020. It is only through the successful completion of these objectives that NAMA anticipates that the estimated surplus will be available for return to the State by 2020.
NAMA currently has €500m (2%) of its original €30.2bn senior debt and €1.6bn of subordinated debt remaining outstanding. NAMA is structured in such a way that the debt it issued to purchase the acquired loans was not treated as part of Ireland’s General Government Debt under European accounting rules. NAMA Group entities are therefore 51% privately owned and operate to return dividends to its shareholders. The return to the private investors is an annual dividend linked to the Irish Government Bond yield at the time of dividend declaration, with the potential of an additional 10% (capped) of the contributed capital sum. As per section 60(2) of the NAMA Act 2009, NAMA may, following consultation with the Minister for Finance, use surplus funds to redeem and cancel its debt and “transfer any surplus funds remaining after that redemption to the Central Fund”. In practice, this means that surplus funds may only be returned to the Central Fund once all NAMA's obligations have been repaid in full and in order of seniority:
1. Government guaranteed senior bonds
2. Subordinated debt
3. Private investors
NAMA currently expects to redeem the remaining government guaranteed senior debt by the end of 2017, its subordinated debt of €1.6bn at its call date of March 2020 and repay its private investors thereafter. NAMA have also advised that the Residential and Docklands SDZ funding programmes are unlikely to be completed before 2020. Thus, I do not currently envisage a situation where NAMA will complete its work early as the Deputy suggests.
As has been discussed with Eurostat, from an accounting perspective, once the senior debt, subordinated debt, and private investors have been repaid then NAMA (the Agency), which is in Government, would be the sole shareholder and, as such, NAMA (the SPV) would then become classified into the Government sector, having no effect on the General Government Balance. This is expected to occur in 2020, no later than the time at which the private shareholders have been fully compensated. At this point in time NAMA will have no debt.
It will be a decision for the Government as to how any surplus returned by NAMA will be utilised or distributed within the fiscal rules once it is available. It has always been the current Government's intention to utilise receipts from the resolution of the financial sector crisis to pay down our debt and help reduce the cost of the banking stabilisation measures and reduce our debt servicing costs. 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.
146. Deputy Sean Fleming asked the Minister for Finance the details of each body or organisation that is scheduled to receive in excess of €1 million from his Department's Vote of expenditure or the group of Votes of expenditure connected with his Department in 2017 for the provision of services by the body or the organisation concerned; the amount involved in each case; if there is a signed service level agreement in place in respect of the services to be carried out by these bodies or organisations; and if he will make a statement on the matter. [36157/17]
View answerThe expenditure disclosed in the table relates to signed contracts for the provision of goods or services. In some cases, the amount shown is a cumulative figure based on a number of separate contracts. All of these contracts are actively managed.
To date in 2017, my Department has not made any payments to any agency, organisation, or body in excess of €1,000,000. However, it has made payments totalling €943,413.63 to William Fry for legal advice.
William Fry were appointed by the Department of Finance as legal advisors in relation to the potential capital restructuring actions and other related matters with respect to the State's investments in AIB, including the recently completed IPO; the Commission of Investigation into certain transactions of IBRC; the implementation of a holding company in the Bank of Ireland group structure, and the escrow arrangements that will provide for the recovery of the alleged State Aid in the Apple case.
William Fry is one of seven law firms on the Department’s legal panel. The panel was appointed in 2014 following a tender process pursuant to relevant EU legislation. Each firm has entered into a service agreement with the Department for an initial 3 year term, which was extended for a further 12 month period in accordance with procurement guidelines and which will expire on 28 April 2018.
With respect to the Finance Vote Group:
Payments made from the Revenue vote (for which Revenue will be accountable to the Public Accounts Committee) are set out in the table.
|
Supplier Name |
2017 Funding Scheduled |
|
ACCENTURE IRELAND LTD |
€10.8m |
|
DELOITTE |
€10.6m |
|
AN POST |
€6.9m |
|
EIR |
€5.9m |
|
VERSION 1 SOFTWARE |
€5.4m |
|
APPLUS |
€4.5m |
|
ESB |
€3.4m |
|
ABTRAN |
€2.8m |
|
CDW LTD |
€2.0m |
|
NOONAN SERVICES GROUP LTD |
€1.6m |
|
FUJITSU IRELAND LTD |
€1.4m |
|
NOONAN SECURITY GROUP LTD |
€1.3m |
|
ATOS IT SOLUTIONS AND SERVICES |
€1.2m |
|
PLANNET 21 COMMUNICATIONS |
€1.1m |
|
THORNTONS RECYCLING |
€1.0m |
The Office of the Comptroller and Auditor General and the Tax Appeals Commission have confirmed a nil response.
147. Deputy Catherine Connolly asked the Minister for Finance if his attention has been drawn to the practice by motor insurance companies here of refusing to supply a motor insurance quotation to returning persons on whose licences there are no endorsements; and if he will make a statement on the matter. [36243/17]
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. Consequently, I am not in a position to direct insurance companies in relation to the pricing or provision of insurance to particular categories of individuals, such as returning emigrants.
Notwithstanding the above, I am aware of the particular issues facing returning emigrants in respect of motor insurance and in this regard the Deputy should note that such issues were considered by the Cost of Insurance Working Group which published its Report on the Cost of Motor Insurance in January 2017.
Recommendation 6 of the Report, in particular, aims to address the problems faced by returning emigrants to ensure a greater consistency of treatment for this category of drivers. Pursuant to this recommendation, a protocol has been agreed between my Department and Insurance Ireland under which insurance companies have committed to accepting the driving experience returning emigrants gained while abroad, when the driver has previous driving experience in Ireland. The guiding principle of the protocol to ensure that a returning emigrant is not treated any differently to any other driver subject to their ability to demonstrate, and the insurance company to verify, their continued driving experience and the normal acceptance criteria of the company. This is of particular relevance to the issue of the recognition of claims-free driving experience in another jurisdiction.
In addition, insurance companies have agreed to provide relevant and helpful information on their websites to make it easier for consumers to understand the implications of their move abroad from a motor insurance perspective. As part of this exercise they will outline what people need to do under a number of different circumstances, depending on the length of time they intend being away from Ireland.
The one outstanding future action related to Recommendation 6 is the submission of a report by Insurance Ireland to my Department before the end of Q4 2017 which will provide an update as to how the recommendation has been rolled-out amongst Insurance Ireland members in practice. This will greatly assist my Department in monitoring the implementation of the relevant actions.
Finally, if a consumer is unable to secure a quotation on the open market, he or she may be in a position to avail of the Declined Cases Agreement (DCA) process. Under the terms of the DCA, the insurance market will not refuse to provide insurance to an individual seeking insurance if the person has approached at least three insurers and has not been able to obtain cover from them. In this regard, there are further details available on the Insurance Ireland website while Insurance Ireland also operates a free Insurance Information Service for those who have queries, complaints or difficulties in relation to obtaining insurance. The relevant contact details are: feedback@insuranceireland.eu or declined@insuranceireland.eu or 01-6761914.
