Joan Burton
Question:151. Deputy Joan Burton asked the Minister for Finance the status of the process for appointing State nominees to sit on the boards of the banks; and if he will make a statement on the matter. [4157/18]
View answerPublic Interest Directors
Questions (151)
Written answers
As the Deputy will be aware, the programme for partnership Government includes a commitment to cease the appointment of new public interest directors, PIDS, in the banks and reform the process by which State nominees are appointed to the board of the banks. Future appointments will be made on foot of my rights as shareholder in each of the banks and not using the powers contained in the Credit Institutions Financial Support (CIFS) Act as was the case with public interest directors.
Pursuant to these rights I, as Minister for Finance, can appoint up to two directors to the boards of both AIB and PTSB and one director to the board of Bank of Ireland.
It is important to note that any company director, regardless of whether or not they are a State nominated director, is subject to the requirements of company law to act in what he or she believes to be the interests of the company to which they are appointed. These are the director’s fiduciary duties which are owed to the company rather than to the appointing shareholder. However under the Companies Act 2014 (as amended) there is a provision allowing a nominee director to have regard to the interests of the appointing shareholder.
I would also note that the new appointment procedure for bank directors needs to have due regard to the distinct differences which exist relative to appointments to State boards. These include the requirements of the central SSM ‘Fitness and Probity’ regime and the requirement to have a broad set of expertise relevant to large regulated entities in an ever more complex banking regulatory environment.
My Department and the Public Appointment Service, PAS, have established a transparent process to identify appropriately skilled candidates for nomination to the three banks in which the State holds a shareholding. I expected that these processes will commence in the coming months and that a separate process will be conducted for each institution. I also intend that each competition will be posted on the PAS website and extensively advertised.
An independent assessment panel will compile a list of suitable applicants following which a preferred candidate(s) will be selected by myself, as Minister for Finance. This preferred candidate would then be proposed as the Ministerial nominee to the individual institutions, who in turn will conduct the required governance and submit the candidate for SSM approval in line with their regulatory requirements.
Property Tax
Questions (152)
Joan Burton
Question:152. Deputy Joan Burton asked the Minister for Finance the status of his Department’s review of the local property tax; and if he will make a statement on the matter. [4158/18]
View answerWritten answers
I recently announced a review of the local property tax, LPT, which will look in particular at the impact on LPT liabilities of property price developments. It will include an examination of the outstanding recommendations of the 2015 Thornhill review of the local property tax. It is expected that the review will be completed at the end of August and that the review report will provide a number of policy choices for consideration. The review will be informed by the desirability of achieving relative stability, both over the short and longer terms, in LPT payments of liable persons. It will also include a consultation process to enable all interested parties and individuals to submit their views on the future of the LPT.
My Department will advance work on this matter in conjunction with the Departments of Housing, Planning and Local Government, Public Expenditure and Reform and the Revenue Commissioners. The purpose of the review will be to inform me in relation to any actions I may recommend to Government concerning the overall yield from LPT and its contribution to total tax revenue. This will enable me to revert to Government with proposals for change to the LPT in a timely way. Any such change would need to be legislated for in the first quarter of 2019 so that the Revenue Commissioners can be in a position to have the necessary administrative and technical arrangements in place in time in respect of the 2020 LPT year.
Strategic Banking Corporation of Ireland
Questions (153)
Joan Burton
Question:153. Deputy Joan Burton asked the Minister for Finance his plans to review the operations of the Strategic Banking Corporation of Ireland, SBCI, and diversify the range of on lenders by SBCI; and if he will make a statement on the matter. [4159/18]
View answerWritten answers
The Strategic Banking Corporation of Ireland’s, SBCI, mission is to deliver effective financial supports to Irish SMEs and, in time, other sectors that address failures in the Irish credit market, while driving competition and innovation and ensuring the efficient and effective use of available EU resources. The SBCI uses an on-lending model, meaning it does not lend directly. Rather, it channels its funds through lending partners known as on-lenders. The SBCI currently has three bank and four non-bank on-lending partners.
The SBCI began lending in March 2015. To the end of December 2017, €925 million of SBCI supported lending has been provided to 22,928 Irish SMEs, operating across all sectors of the Irish economy, including agriculture, food, retail, healthcare, transport and manufacturing.
The SBCI is actively engaging with a range of potential on-lenders, in particular, non-bank finance providers, to broaden its distribution capability and market coverage. This is subject to robust due diligence processes. The SBCI has an independent board and risk management committee responsible for making the decision to enter into an on-lending agreement. The SBCI's on-lender criteria are designed to mitigate risks to Irish taxpayers and European funding and to SME borrowers. They aim to ensure that all lending partners have the necessary financial strength and capability to provide the required level of service to SMEs along with sufficient protections for the taxpayer.
The SBCI is working to develop more innovative products, such as the Agricultural Cashflow Support Loan Scheme and the Brexit Loan Scheme I announced in Budget 2017 and Budget 2018 respectively. Additionally, the SBCI is also continuing to work on a number of initiatives, including the continued use of guarantees and risk sharing schemes to support lending by finance providers. These aim to address recognised market failures as well as the collateral limitations or SMEs and collateral obligations of banks.
The Deputy can rest assured that the SBCI is supporting the provision of appropriately priced, flexible funding to SMEs through a diverse range of finance providers, both bank and non-bank, thereby supporting a competitive and sustainable SME finance market.
Strategic Banking Corporation of Ireland
Questions (154)
Joan Burton
Question:154. Deputy Joan Burton asked the Minister for Finance the work his Department has carried out with the Strategic Banking Corporation of Ireland, SBCI to develop loan products targeting agribusiness and SMEs seeking finance to tackle Brexit-related challenges; and if he will make a statement on the matter. [4160/18]
View answerWritten answers
The purpose of the Strategic Banking Corporation of Ireland, SBCI, is to deliver effective financial supports to Irish SMEs as well as other sectors, in time, that address failures in the Irish SME finance market, while driving competition and innovation and ensuring the efficient and optimal use of available EU resources. The SBCI has a vital role to play in meeting the evolving finance needs of the SME finance market, across all sectors and regions, to ensure its sustainable development.
Additionally, the SBCI has been developing risk sharing guarantee products to enhance access to finance during the course of 2017. As announced in Budget 2017, the SBCI in conjunction with Department of Agriculture, Food and the Marine, DAFM, rolled out a €150 million Agriculture Cashflow Support Loan scheme to provide working capital support to farmers to deal with price and income volatility.
The SBCI is also tasked with delivering the €300 million Brexit Loan scheme, as I announced in Budget 2018. The Scheme has been developed by the Department of Business, Enterprise and Innovation, the Department of Finance, the Department of Agriculture, Food and the Marine, and Enterprise Ireland. The SBCI engaged with the European Investment Fund, EIF, to utilise an Innovfin counter guarantee facility to support the Brexit Loan Scheme. The purpose of the Scheme is to assist Irish SMEs and Small Midcap firms - less than 499 employees - affected by Brexit with their working capital needs to allow them to diversify and restructure their businesses and adapt and innovate in response to Brexit.
The SBCI is continuing to work on a number of risk sharing initiatives, particularly the continued use of guarantees with European counter-guarantees to support lending by finance providers. These aim to address sectorial market failures as well as the collateral limitations of SMEs and collateral obligations of banks. It is particularly welcome to note that these risk-sharing initiatives are open to banks and non-bank lenders.
My colleague, the Minister for Agriculture, Food and the Marine, secured funding of €25 million for his Department in Budget 2018 to facilitate the development of potential Brexit response loan schemes for farmers, fishermen and for longer-term capital financing for food businesses. I understand that these are currently under active consideration and more details will be announced as they become available.
Common Consolidated Corporate Tax Base Negotiations
Questions (155)
Joan Burton
Question:155. Deputy Joan Burton asked the Minister for Finance the efforts he has undertaken to oppose harmonisation of the EU corporate tax base; and if he will make a statement on the matter. [4161/18]
View answerWritten answers
Any tax directive at EU level brings convergence to some aspect of tax. Ireland has supported the EU anti-tax avoidance directives that standardise anti-avoidance measures across the EU in line with the OECD BEPS recommendations.
However, taxation remains within the competence of individual member states. Unanimity is needed before any tax changes can be agreed at EU level. Proposals for tax harmonisation at EU level are not new. The Common Consolidated Corporate Tax Base has been discussed for years and was first formally proposed in 2011.
Ireland's position has always been clear - we do not support tax harmonisation that undermines a member state's ability to set its own tax rate and to determine its own tax base. We have however shown we are willing to agree EU tax directives that seek to implement agreed international best practice in a consistent manner across the EU. This remains Ireland's position.
As always, in line with the programme for partnership Government, Ireland is constructively engaging in the debate on the CCCTB proposal while critically analysing the extent to which the proposal impacts Ireland's interests.
Ireland is by no means alone in having concerns about tax harmonisation. These views are shared by many other member states across the EU.
European Council Meetings
Questions (156)
Joan Burton
Question:156. Deputy Joan Burton asked the Minister for Finance the status of ECOFIN’s work in respect of the completion of the European banking and capital markets union; and if he will make a statement on the matter. [4162/18]
View answerWritten answers
Finance ministers met on 22 and 23 January and to discuss the completion of banking union and capital markets union, amongst other things.
In November 2016, the European Commission proposed a comprehensive package of reforms to further strengthen the resilience of European banks. This package, collectively known as risk reduction measures, aims to complete reforms implemented in the wake of the financial crisis by tackling remaining weaknesses as well as implementing some outstanding elements of internationally agreed standards. The Risk Reduction Measures propose amendments to the capital requirements regulation, the capital requirements directive, the bank recovery and resolution directive and the single resolution mechanism regulation as well as a number of other elements. Negotiations have also continued on the European deposit insurance scheme which seeks to introduce a mutualised deposit guarantee scheme for members of the banking Union.
Ireland has always been supportive on the completion of banking union, with appropriate risk reduction and risk sharing. Good progress has been made on risk reduction but there are still some issues to be resolved.
The Capital Markets Union, CMU, aims to establish the building blocks of an integrated capital market in the EU by 2019 through supporting the development of alternative sources of finance, complementary to bank-financing – including venture capital, crowdfunding and market-based finance. In addition to building resilience in the financial system by diversifying available funding sources and enabling more robust forms of risk sharing, the CMU seeks to make it easier for companies to finance investment through capital markets and for investors to invest their funds across borders.
The Capital Markets Union project has the potential to provide for alternative sources of financing for Irish businesses and the creation of larger and deeper capital markets in Europe will be of benefit to our financial services industry as well. The CMU mid-term review, published by the European Commission on 8 June 2017, detailed the progress made so far in implementing the action plan with 20 out of 33 measures already implemented to date.
Housing Issues
Questions (157)
Donnchadh Ó Laoghaire
Question:157. Deputy Donnchadh Ó Laoghaire asked the Minister for Finance if there are provisions in place for persons who previously have entered into a rent to buy scheme and who now want to purchase their home but the property is now with NAMA; and the protections in place to guarantee tenancy on the previous agreement or a new agreement. [4193/18]
View answerWritten answers
The Deputy will appreciate that NAMA does not own or manage properties. NAMA has acquired loans. The properties securing those loans continue to be managed by their legal owners or, in the case of enforcement, by duly appointed insolvency practitioners. Insolvency practitioners such as receivers and administrators act as agents of the original owners of the properties, not as agents of NAMA.
As the Deputy will be aware, rent to buy schemes are private contractual agreements entered into between a vendor and a purchaser of residential property with an option to purchase at the end of an initial letting period. In light of the private contractual nature of these schemes, it is a matter for the tenant/purchaser to take their own legal advice on the terms of the contractual arrangements entered into with the landlord/vendor and engage with them in the first instance.
Tax Rebates
Questions (158)
Seán Sherlock
Question:158. Deputy Sean Sherlock asked the Minister for Finance if a person (details supplied) in County Kildare is due a tax refund for the past number of years. [4197/18]
View answerWritten answers
I am advised by Revenue that the person concerned did not pay tax in the years 2014, 2015 and 2016 and therefore is not due a tax refund for those years.
As regards 2017, when the person concerned receives a P60 from their employer for the year, they can request a review by using Revenue's online service ‘myAccount’.
Motor Insurance
Questions (159)
Michael McGrath
Question:159. Deputy Michael McGrath asked the Minister for Finance if insurance companies are permitted to remove a no claims bonus from a person's motor insurance policy in situations in which an incident has been reported by the policy holder but no claim has been made against them; and if he will make a statement on the matter. [4224/18]
View answerWritten answers
At the outset the Deputy should note that there is no statutory basis underpinning how individual insurers operate their No Claims Bonus system. This is a commercial matter for such companies and the level of the bonus varies between them but may be as high as a 70% discount. In addition, I understand that insurers have different approaches and policies where an incident has been reported by the policy holder but no claim has been made against them.
While neither I nor the Central Bank can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature, and are determined by insurers based on the risks they are willing to accept, my officials contacted Insurance Ireland in relation to the specific issue outlined in the Deputy’s question and they responded as follows:
“If a claim is reported to the insurance provider and the issue of liability is pending and overlapping the renewal date, the No Claims Bonus Discount will be removed or partially removed, subject to the discount scale noted in the terms and conditions of the insurance contract.”
It may be of interest to you that Insurance Ireland operates a free Insurance Information Service for those who have queries, complaints or difficulties in relation to obtaining insurance. Insurance Ireland can be contacted at feedback@insuranceireland.eu or 01-6761914.
VAT Payments
Questions (160)
Michael McGrath
Question:160. Deputy Michael McGrath asked the Minister for Finance if persons who are registered for VAT and pay their VAT to the Revenue Commissioners by credit card should now not incur a surcharge for this payment; and if the Revenue Commissioners, therefore, should not be passing on such a charge to persons, in view of the new EU payment services directive now in force; and if he will make a statement on the matter. [4225/18]
View answerWritten answers
Section 960EA of the Taxes Consolidation Act 1997 provides that transaction costs incurred in respect of the necessary service providers for credit card transactions, i.e. merchant acquirer services and technical connection support can be passed to the taxpayer.
The Revenue Commissioners has advised me that the biggest portion of the current 1.1% charge applied to credit card transactions relates to the costs imposed, on Revenue, by these service providers, which are not covered by the EU payment services directive. It is also important to note that the new EU legislation only relates to domestic or intra-EU consumer credit cards. It does not include any commercial or international credit cards, which are often used for tax payment.
Revenue has confirmed that it reviews the transaction charge in February each year, to ensure it is reduced to the greatest extent possible. Over the last number of years the charge has been reduced from 1.69% to 1.49% and to its current rate of 1.1%. The charge will be reviewed in the coming weeks and any possible reductions, including in the context of the EU payment services directive, will be passed on to taxpayers.
Finally, Revenue has confirmed that it does not charge any fees in respect of debit cards, which are by far the most popular card payment option.
Tracker Mortgage Examination
Questions (161)
Catherine Connolly
Question:161. Deputy Catherine Connolly asked the Minister for Finance the nature and status of the enforcement proceedings under way against the main banks in the tracker mortgage scandal; the date on which the enforcement proceedings began; the specific banks against which proceedings have been taken; and if he will make a statement on the matter. [4319/18]
View answerWritten answers
The Central Bank has advised that it has utilised its enforcement powers and continues to pursue enforcement actions in response to tracker mortgage issues that have been identified at certain lenders. The Bank has already concluded an enforcement investigation in respect of tracker mortgage-related failures identified at Springboard Mortgages Limited in November 2016. In that instance the Bank imposed a monetary penalty of €4.5 million on Springboard in respect of the failures.
The Central Bank is currently pursuing enforcement investigations in relation to tracker mortgage-related issues arising in Permanent TSB plc and Ulster Bank Ireland DAC. Two further enforcement investigations into other lenders are in train and it is expected that all of the main lenders will face enforcement investigations.
The Central Bank has advised that these enforcement investigations will be informed by evidence obtained and gathered as part of the Central Bank’s on-going tracker mortgage examination and by other means. Enforcement investigations are detailed and forensic and involve the scrutiny of large volumes of documentation and interviews with relevant individuals as part of the investigative process in order to establish the exact circumstances of matters under investigation. In the enforcement investigations, the Central Bank will consider all possible angles, including potential individual culpability, and will thoroughly investigate and analyse matters in the context of the applicable legal framework.
It is important to note that in relation to its on-going enforcement investigations, the Central Bank is bound by strict confidentiality and professional secrecy rules both at national level, section 33AK of the Central Bank Act, 1942, and at EU level, namely, the Rome Treaty, the ECSB Statute and in this case, the Capital Requirements Directive IV. As a result, the Central Bank cannot publicly disclose further details of its on-going supervisory and enforcement engagement with individual firms. In general, the Central Bank is only permitted to disclose aggregate information such that an individual firm cannot be identified from that disclosure or where information, such as for example where a firm itself publicly discloses that it is the subject of enforcement investigations, is already in the public domain.
Tracker Mortgage Examination
Questions (162)
Catherine Connolly
Question:162. Deputy Catherine Connolly asked the Minister for Finance the most recent value of the payment to affected persons at the behest of the Central Bank in the tracker mortgage scandal; the number of persons involved, by bank in tabular form; and if he will make a statement on the matter. [4320/18]
View answerWritten answers
The Central Bank has advised that, due to statutory confidentiality requirements, the Bank may not publicly disclose much of its supervisory engagement with individual firms. In particular, the Central Bank can, generally speaking, only disclose such information in summary or aggregate form so that individual firms cannot be identified.
However, the Central Bank has advised that pursuant to their industry wide examination, as at end-December approximately 26,600 impacted tracker mortgage customers have been identified and the most recent information is that circa. €269 million has been provided in redress and compensation to around 13,600 of these accounts. This is in addition to the 7,100 impacted customers that were identified prior to the industry wide examination who received €47 million in redress and compensation owing to tracker related failings by their lenders. This brings the total number of impacted customers identified as at end-December to 33,700 and the total amount of redress and compensation provided so far to €316 million. However, the Deputy may also wish to note that the main lenders are currently in the process of providing evidence and information to the Joint Oireachtas Committee on Finance, Public Expenditure and Reform, and Taoiseach, including an update on their progress to date on the tracker examination.
While the Central Bank’s view is that the vast majority of impacted customers have now been identified and that known issues around disputed groups in respect of lenders have now been resolved, the Bank will continue to review, challenge and verify the work undertaken by the lenders and complete their intrusive on-site inspection programme.
The Government will continue to support the Central Bank in its efforts to complete the tracker examination as quickly as possible, and I look forward to receiving a further update report from the Central Bank in due course on the basis of end-March 2018 data.
Protected Disclosures
Questions (163)
Pearse Doherty
Question:163. Deputy Pearse Doherty asked the Minister for Finance his plans to amend whistleblower legislation to allow whistleblowers in financial institutions to benefit financially from their whistleblowing; and if he will make a statement on the matter. [53264/17]
View answerWritten answers
Whistleblowers who are employees in financial institutions would fall within the definition of “Workers” in the Protected Disclosures Act 2014 and therefore would most likely be considered under the 2014 Act as opposed to under the whistleblowing protections of the Central Bank (Supervision and Enforcement) Act 2013.
The main objective of the Protected Disclosures Act 2014 is the protection of workers in all sectors of the economy – both public and private – against reprisals in circumstances where they make a disclosure of information relating to wrongdoing in the workplace.
It provides for a “stepped” disclosure regime in which a number of distinct disclosure channels are available – internal, “regulatory” and external – which the worker can access to acquire important employment protections but which require different evidential thresholds.
The Act seeks to safeguard the broadest possible range of workers from being subject to occupational detriment for having made a protected disclosure and also provides for immunity against civil liability. Disclosures made under existing sectorial legislation are given “protected disclosure” status to ensure a uniform standard of protection to all workers.
Three forms of protection are available under the Act:
1. Protection from the retributive actions of an employer
2. Protection from civil liability
3. Protection from victimisation by a third party
The Act provides an impetus for employers to mitigate against the risk of whistleblowing in the first instance through the introduction of risk management strategies which allow workers to report perceived wrongdoing so that corrective action is taken before significant threats to the business arise. The encouragement of workers to report perceived wrongdoing on a no-fault basis will mitigate against the potential for external whistleblowing and consequent reputational damage.
The legal framework in some countries, most notably the United States, provides monetary rewards in certain circumstances for whistle-blowers. In so far as this is intended to compensate for the likely financial losses that whistle-blowers face because of their disclosures, our legislation has a different emphasis. In the Protected Disclosures Act 2014, we have provided a range of robust protections against any penalisation, financial or otherwise, suffered as a result of having disclosed wrongdoing observed in the workplace. Our approach has been to create a supportive environment to allow for disclosures of wrongdoing to be made in the public interest rather than providing financial incentives for whistle-blowing, which may lead to moral or other hazards such as, for example, malicious reporting, entrapment and conflicts of interest in court proceedings.
The Protected Disclosures Act 2014 does not make any provision for rewarding workers who speak up about an alleged wrongdoing.
There is no specific prohibition on rewarding a whistleblower who raises a concern using the channels provided under Sections 6, 7 and 8 of the Act.* Section 10 of the Act, which concerns disclosure of information to an external party, e.g. a journalist, member of the Oireachtas etc., expressly forbids the disclosure of information for personal gain unless a reward is provided for in another enactment.
Section 2 of the Protected Disclosures Act 2014 provides that a review of the Act must commence three years following the Act coming into force and that said review be completed within 12 months. The Statutory Review of the Act is being carried out by the Department of Public Expenditure & Reform and commenced in summer 2017. In accordance with Section 2 of the Act, it must be completed and published by 8 July 2018.
In order to inform the review of the Act, the Department of Public Expenditure & Reform opened a public consultation on the operation of Act in August 2017. The consultation closed on 10 October 2017. Some 25 submissions have been received from a range of organisations and individuals.
Rewarding workers who make protected disclosures has not emerged as a significant issue in the submissions made to the public consultation, with only one of the 25 submissions received suggesting it would be a good idea.
The Department is in the process of evaluating the submissions it has received, which will feed into the review of the Act and any recommendations arising. When completed the review will be submitted to Government for consideration in advance of publication. It would not be appropriate, at this stage, to pre-empt what findings and recommendations may or may not come out of the review.
*The disclosure channels under these sections are as follows:
Section 6 – disclosure to the worker’s employer
Section 7 – disclosure to a prescribed person/organisation (usually a regulator – e.g. the Central Bank)
Section 8 – disclosure by a worker in a public body to a Minister
Tax Code
Questions (164)
Alan Kelly
Question:164. Deputy Alan Kelly asked the Minister for Finance if his attention has been drawn to the comments by An Taoiseach at a meeting of an organisation (details supplied) regarding changes to the tax regime for high earners; the proposals his Department has on foot of this policy objective; and if he will make a statement on the matter. [4307/18]
View answerWritten answers
The Government's approach to income tax policy, and my approach to the issue as Minister for Finance, is informed by a number of principles including fairness, competitiveness and the need to improve the reward for work.
The Deputy will be aware of the commitment in the programme for Government to a medium-term income tax reform plan that keeps the tax base broad, reduces excessive tax rates for middle income earners, and limits the benefit for high earners. At the same time, as a small open economy, we need to remain competitive in attracting and retaining highly skilled individuals to work in Ireland. High marginal rates of taxation are one aspect that we need to keep in mind in balancing competitiveness against other desirable objectives of the tax system.
I am on record as stating that it is right that in Ireland we have a tax system where those on lower incomes pay less and those who earn more, pay more and that this position must be sustained. However, I have also stated that an income tax system that starts taking nearly half of every euro earned by the time someone is earning an average wage is not fair, is not economically efficient and is not sustainable. This is a cap on aspiration and places a ceiling on the ambitions of our people. And while the economy is now doing well, we cannot rest on our laurels, thinking that we do not compete for investment and jobs in a global marketplace.
As resources become available, it is my intention to continue the process of reducing the overall taxation burden on work in a way that is affordable and sustainable.
As part of this process, an objective will be to reduce the marginal rate of tax, to reward work and to make Ireland more attractive both for indigenous workers, returning emigrants and others.
Therefore in Budget 2018, for the fourth year in succession, the Government continued to make steady, sustainable progress in reducing the income tax burden. The top marginal tax rate for income up to €70,044 has now been reduced to 48.75%. It should be remembered that, as recently as December 2014, the marginal rate of tax for a single individual on all income over €32,800 was 52%.
The impact that the income tax burden has on the creation of employment has also been recognised, and I have introduced targeted measures to support Irish SMEs in this regard. For example, as mentioned by An Taoiseach at the event to which the Deputy refers, a new Key Employee Engagement Programme (KEEP) was introduced in Budget 2018 with the aim of assisting SMEs competing with larger, more established businesses to recruit and retain the key staff needed to support business growth.
Common Consolidated Corporate Tax Base Proposals
Questions (165)
Alan Kelly
Question:165. Deputy Alan Kelly asked the Minister for Finance the efforts he has undertaken to oppose harmonisation of the EU corporate tax base; and if he will make a statement on the matter. [4308/18]
View answerWritten answers
Taxation remains within the sovereignty of individual member states. Unanimity is needed before any tax changes can be agreed at EU level. Proposals for tax harmonisation at EU level are not new. The common consolidated corporate tax base has been discussed for years and was first formally proposed in 2011.
Ireland's position has always been clear - we do not support tax harmonisation that undermines a member state's ability to set its own tax rate and to determine its own tax base. We have however shown we are willing to agree EU tax directives that seek to implement agreed international best practice in a consistent manner across the EU. This remains Ireland's position.
As always, in line with the programme for partnership Government, Ireland is constructively engaging in the debate on the CCCTB proposal while critically analysing the extent to which the proposal impacts Ireland's interests.
Ireland are by no means alone in having concerns about tax harmonisation. These views are shared by many other member states across the EU.
Question No. 166 answered with Question No. 149.
Question No. 167 answered with Question No. 104.
Question No. 168 answered with Question No. 149.
Housing Issues
Questions (169)
Richard Boyd Barrett
Question:169. Deputy Richard Boyd Barrett asked the Minister for Finance the criteria he plans to establish regarding affordability in HBFI funded developments; and if he will make a statement on the matter. [52267/17]
View answerWritten answers
In my Budget speech on 10 October 2017, I announced a proposal to establish a new dedicated fund, Home Building Finance Ireland (HBFI) to provide funding on market terms to viable residential development projects whose owners are experiencing difficulty in obtaining debt funding. Up to €750 million of ISIF funds will be allocated to HBFI to provide funding on market terms and the fund is estimated to have capacity to finance about 6,000 homes in the coming years.
HBFI will not be directly involved in development – its role would be solely as a commercial lender and therefore will not have any role in designing the housing mix contained in the schemes it funds. HBFI will provide lending on commercial, market-equivalent terms and conditions. This approach would be akin to a bank or private equity investor. As such HBFI will not have targets in relation to social or affordable housing but will provide a significant contribution to supporting the delivery of additional supply of all types of residential housing in the coming years.
While no specific criteria regarding the pricing of HBFI funded developments are envisaged, provided they are commercially viable, increasing the level of housing output will increase the affordability of housing more generally, which in turn also will have a positive effect on our ability to provide social housing. For example, any residential developments funded by HBFI will be subject to the same planning and regulatory requirements as all other developments. This includes policies relating to Part V of the Planning and Development Act 2000 and as such, it is expected that a minimum of 10% of the anticipated output of this investment by HBFI will become available for social housing through this statutory mechanism over this period.
Though HBFI is intended to be a debt funder for private residential projects, I can assure the Deputy that this Government is equally determined to tackle the issue of housing affordability. Earlier this month the Minister for Housing, Planning and Local Government made a number of additional announcements in this regard including the launch of the Rebuilding Ireland Home Loan and a new Affordable Purchase Scheme each of which should make a contribution to delivering homes that are more affordable for potential buyers.
Public Private Partnerships Data
Questions (170)
Pearse Doherty
Question:170. Deputy Pearse Doherty asked the Minister for Finance the public private partnerships his Department is currently engaged in; the name, cost and timeframe of each; the names of all private parties involved; the nature of each project in terms of design, build, maintain and so on, in tabular form; and if he will make a statement on the matter. [4435/18]
View answerWritten answers
The Department of Finance has no public private partnership projects.
European Council Meetings
Questions (171)
Bernard Durkan
Question:171. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which he has had discussions with his counterparts at EU level with a view to preventing an economic crash in the future. [4631/18]
View answerWritten answers
As Minister for Finance, I attend the monthly Economic and Financial Affairs Council of the European Union (ECOFIN) meetings; ECOFIN is responsible for EU policy in areas including economic policy. I also attend meetings of the Eurogroup, where the Ministers of the euro area member states discuss matters concerning their shared responsibilities related to the euro. The Eurogroup’s main task is to ensure close coordination of economic policies among the euro area member states and to promote conditions for stronger economic growth.
At both the ECOFIN and Eurogroup meetings, Ministers of the member states work alongside the European Commission and the European Central Bank, ECB, to take stock of the latest economic situation in the EU and euro area, including on the risks to the European economy’s growth prospects.
In relation to future economic prospects, I would point out that considerable progress has been made in reforming the architecture of the euro and in the wider EU. More co-ordinated economic governance, better fiscal rules, the advent of the European Semester, the development of a capital markets union and significant progress towards a banking union are just some of the measures which will enhance the economic resilience of the euro area and the wider EU. Having said that, further progress is needed in some areas.
The European economy is performing well at present with growth exceeding expectations in 2017 and growth of 2.1% is projected for 2018. The upturn is increasingly broad-based across EU countries. The recovery has been supported by a number of factors including sound macroeconomic policies, strong business and consumer confidence and a gradual improvement in world trade.
The European Commission’s Autumn Economic Forecast 2017 highlights risks to the European economy being broadly balanced. Downside risks relate to the process of the UK leaving the EU, global geopolitical instability and potentially tighter global financial conditions. While bank fragilities in the euro area have eased, low profitability and legacy issues, i.e. non-performing loans, remain a concern. On the upside, uncertainties have diminished, economic sentiment has improved and with the rebound outside Europe potentially leading to a stronger, more durable expansion in Europe.
Given the still high levels of unemployment and public and private debt across the EU, there are clearly no grounds for complacency.