Thursday, 8 Nov 2018

Written Answers Nos. 30-54

Defence Forces Data

Questions (30, 31, 32)

Jack Chambers

Question:

30. Deputy Jack Chambers asked the Taoiseach and Minister for Defence the number serving in each rank in the Army in tabular form. [46235/18]

Jack Chambers

Question:

31. Deputy Jack Chambers asked the Taoiseach and Minister for Defence the number serving in each rank in the Air Corps in tabular form. [46236/18]

Jack Chambers

Question:

32. Deputy Jack Chambers asked the Taoiseach and Minister for Defence the number serving in each rank in the Naval Service in tabular form. [46237/18]

Written answers

Minister of State at the Department of Defence

I propose to take Questions Nos. 30, 31 and 32 together.

The whole time equivalent strength of the Army, Naval Service and Air Corps (as of 30 September 2018, the latest date for which figures are available) across each rank is set out in the following table:

Rank	Army	Naval Service	Air Corps
Lieutenant General	1	0	0
Major General	2	0	0
Brigadier General	6	1	1
Colonel	34	2	2
Lieutenant Colonel	104	14	12
Commandant	252	51	38
Captain	268	47	42
Lieutenant	150	51	27
Sergeant Major	27	6	6
Battalion Quartermaster Sergeant	31	7	4
Company Sergeant	106	70	51
Company Quartermaster Sergeant	152	11	14
Sergeant	824	161	99
Corporal	1,169	140	122
Private	3,972	439	266
Cadet	149	22	36
Total	7,247	1,022	720

There is ongoing recruitment to the Defence Forces.

Human Rights

Questions (33)

Niall Collins

Question:

33. Deputy Niall Collins asked the Tánaiste and Minister for Foreign Affairs and Trade the steps he will take in view of reports that the LGBT community are being targeted in Tanzania; and if he will make a statement on the matter. [46309/18]

Written answers

Minister of State at the Department of Foreign Affairs and Trade

Ireland’s Foreign Policy, as outlined in the “Global Island”, is clear on this issue stating that: “We are committed to promoting the rights of lesbian, gay, bisexual, transgender, and intersex (LGBTI) individuals, who continue to suffer disproportionate levels of violence and face systemic discrimination in many countries.” This sets a context for the Government’s deep concern arising from statements by the Dar es Salaam Regional Commissioner last week, which targeted members of the LGBTI+ community. There is no situation in which a person’s fundamental human rights should be prejudiced because of their sexual orientation.

The Tánaiste wrote immediately to the Foreign Minister of Tanzania, Mr. Augustine Mahiga, calling on the Tanzanian government to disown the Regional Commissioner’s actions and ensure the protection of LGBTI+ people in line with Tanzania’s national and international human rights commitments.

Minister Mahiga has since issued a formal statement, distancing his government from the Regional Commissioner’s comments and reiterating Tanzania’s commitment to uphold its international human rights obligations.

The Embassy of Ireland to Tanzania is actively monitoring and reporting on the situation of the LBGTI+ community. Together with other EU missions, the Embassy of Ireland continues to play an active role in the promotion of human rights in Tanzania.

Foreign Policy

Questions (34)

Niall Collins

Question:

34. Deputy Niall Collins asked the Tánaiste and Minister for Foreign Affairs and Trade if he will report on the current political situation in Brazil; and if he will make a statement on the matter. [46310/18]

Written answers

Tánaiste and Minister for Foreign Affairs and Trade

I am aware of the current political situation in Brazil, including the recent election of Jair Bolsonaro as the next President of Brazil. Officials in my Department in Dublin, at our Embassy in Brasília, and at our Consulate-General in São Paulo have been monitoring political developments closely, as well as engaging with civil society organisations and EU colleagues. Brazil is Latin America’s largest democracy and I note that, according to the head of the OAS election observation mission, former Costa Rican President Laura Chinchilla, the election took place in a peaceful manner and citizens were able to exercise their democratic right to vote. Ireland takes a keen interest in the region, and Ireland and Brazil have a longstanding and important relationship. There are growing numbers of our citizens living in each other’s countries, Irish companies are increasingly entering the Brazilian market, and Brazil is an important partner in trade, education and on multilateral issues.

Brazil is currently in a period of transition, before President-elect Bolsonaro and his administration assumes office on 1 January 2019. I welcome early indications from the President-elect that he will govern in strict accordance with the Brazilian constitution.

Ireland looks forward to maintaining our strong relationship with Brazil in the future and will continue efforts to advance our interests and values in our engagement with the new government. In the meantime, Ireland will continue to monitor developments closely, engaging with the outgoing and incoming administrations, our EU and other partners in Brazil and civil society organisations on the ground.

Foreign Conflicts

Questions (35)

Niall Collins

Question:

35. Deputy Niall Collins asked the Tánaiste and Minister for Foreign Affairs and Trade the status of the situation in Yemen; and if he will make a statement on the matter. [46311/18]

Written answers

Tánaiste and Minister for Foreign Affairs and Trade

The crisis in Yemen is a source of grave concern, and reports of the imminent threat of famine, of violations of basic human rights, and of significant public health challenges are incredibly worrying. Yemen has experienced over three years of armed conflict which has been the driving force in a devastating, protracted humanitarian crisis. The UN reports that 17.8 million people are currently food insecure, including 8.4 million severely so – 24% more than in 2017. Critical public services in education, water and sanitation are increasingly limited, and the public healthcare system has collapsed. The UN’s Humanitarian Coordinator in Yemen, Lise Grande, has warned that as many as 13 million civilians are at risk if the fighting continues. Ireland joins our EU partners in urging all parties to cooperate in order to achieve a political resolution, respect international humanitarian law, and ensure unrestricted humanitarian access and the free flow of commercial goods. However, it is crucial that we also push for a resolution of the conflict which is the ultimate cause of the suffering of so many civilians. This has been one of my consistent messages to all parties to the conflict. Officers from my Department consistently convey the Government’s strong concerns to the Saudi, United Arab Emirates and Iranian Embassies in Dublin. And I myself met with the Saudi Ambassador last month and stressed the importance that Ireland puts on this issue. Ireland and its EU partners are in agreement on the need to continue our strong support for the efforts of the UN Special Envoy, Mr. Martin Griffiths, to re-start negotiations so as to bring about a political resolution of the conflict. I welcome the US statements last month in favour of a cessation of hostilities, and I believe that this should act as an impetus for the resumption of negotiations. The UN Special Envoy is working to bring the parties together for a new round of peace talks which may take place as early as later this month. Alarmingly, however, on the ground recent days have seen an escalation in fighting, particularly around the critical port of Hodeidah, which is the entry point for an estimated 70% of goods imported into Yemen.

Ireland is doing what we can to address the devastating humanitarian situation and try and help alleviate the suffering of the Yemeni people. Since 2015, Ireland has provided almost €16.5 million in humanitarian assistance to Yemen. This includes a contribution of €4 million made to the UN Yemen Humanitarian Fund this year, which provides assistance in the areas of education, logistics, food security, nutrition and health.

Ireland also provides humanitarian support to Yemen through our contributions to EU funds. Since the beginning of the conflict in 2015, the EU has contributed a total of €438.2 million to Yemen, which includes humanitarian, development, stabilisation and resilience support.

Ireland is using our leverage in other multilateral fora to focus on the situation in Yemen. At the Human Rights Council in September 2017 Ireland was part of a core group of countries which ensured the establishment of a Group of Eminent Experts on Yemen to investigate alleged violations of human rights and contraventions of international humanitarian law by all parties to the conflict. In September of this year, Ireland worked to ensure the extension of the mandate of the Group of Eminent Experts for another year.

British-Irish Intergovernmental Conference

Questions (36)

Niall Collins

Question:

36. Deputy Niall Collins asked the Tánaiste and Minister for Foreign Affairs and Trade if he will report on the recent British-Irish Intergovernmental Conference; and if he will make a statement on the matter. [46312/18]

Written answers

Tánaiste and Minister for Foreign Affairs and Trade

A meeting of the British-Irish Intergovernmental Conference (BIIGC) took place in Dublin on 2 November. The Minister for Justice and Equality, Charles Flanagan TD, and I represented the Government. The UK Government was represented by the Chancellor of the Duchy of Lancaster, David Lidington MP, and the Secretary of State for Northern Ireland, Karen Bradley MP. Set up under the Good Friday Agreement, the Conference brings together the Irish and UK Governments to promote bilateral co-operation at all levels on all matters of mutual interest within the competence of both Governments. Following on from the most recent meeting of the BIIGC, in London on 25 July, last week’s meeting provided the opportunity to continue our discussions on legacy issues, security co-operation, East-West matters, and political stability in Northern Ireland. At the meeting, we reaffirmed our commitment to implementing the framework established in the 2014 Stormont House Agreement to comprehensively address the legacy of Northern Ireland’s past, taking account of the UK Government’s public consultation on establishing the legacy institutions.

On security-cooperation, both Governments recalled the commitments made in the 2015 Fresh Start Agreement to ending paramilitarism and welcomed the first report of the Independent Reporting Commission (IRC) established under that Agreement. In considering the findings and recommendations contained in the report, the Conference noted in particular the IRC’s view that the full operation of the institutions of the Good Friday Agreement is essential to ending paramilitarism and achieving community transformation.

The Conference discussed a joint paper by Irish and British officials which outlined a number of possible models to maintain and strengthen the high level of bilateral co-operation between the UK and Ireland post-Brexit. Both Governments agreed that these new structures for systemic bilateral co-operation should demonstrate the strength and depth of the relationship, provide opportunities for ministers and officials to continue to engage with each other, and provide an overall architecture for cooperation that is both meaningful and sustainable in the future. As announced following the Conference, this model would include top level summits involving Heads of Government and senior ministers and would alternate between Ireland and the UK. These summits would be supported by close bilateral work by ministers. Officials on both sides have been asked to turn these ideas into a detailed practical plan of work with a view to presenting a fully worked through proposal for future East-West cooperation for consideration at the next meeting of the Conference.

The Conference provided both Governments the opportunity to reaffirm our strong support for the Good Friday and subsequent Agreements. It was recognised that the institutions of the Good Friday Agreement have been essential for the progress made in Northern Ireland over the past two decades and that they remain the indispensable framework for the political process in Northern Ireland. Both Governments reiterated their shared commitment to securing the operation of the devolved power-sharing Northern Ireland Executive and Assembly and the consequent resumption of meetings of the North-South Ministerial Council at the earliest opportunity.

It was agreed that the BIIGC would reconvene in spring 2019.

Foreign Conflicts

Questions (37)

Niall Collins

Question:

37. Deputy Niall Collins asked the Tánaiste and Minister for Foreign Affairs and Trade his views on a deal agreed between Myanmar and Bangladesh to start repatriating Rohingya refugees; and if he will make a statement on the matter. [46313/18]

Written answers

Tánaiste and Minister for Foreign Affairs and Trade

In the months since military security operations began in Rakhine State, Myanmar in August 2017, approximately 720,000 refugees, mostly Rohingya, have fled to Bangladesh. The people and government of Bangladesh have demonstrated extraordinary generosity in receiving such a large influx of refugees. I remain very concerned at the ongoing situation in Myanmar and the plight of these refugees who are living in extremely precarious conditions in overcrowded refugee camps. Ireland remains unwavering in its wish to see conditions that will enable the voluntary, safe, dignified and sustainable return of these Rohingya refugees to their places of origin in Myanmar in compliance with international human rights norms and the principle of non-refoulement. I note that the signing of Memoranda of Understanding on the repatriation of the Rohingya between Myanmar and Bangladesh and between Myanmar and the UNDP and UNHCR are important first steps on this path of return. I hope that they will be followed by constructive dialogue between international partners and the government of Myanmar, while also allowing the voices of the refugee community to play a key role in determining their future.

However, I do not believe that current conditions on the ground in Myanmar are conducive to allow for the voluntary, safe, dignified and sustainable repatriation of members of the Rohingya community.

In that regard, recent reports of an arrangement between Myanmar and Bangladesh for the return of up to 5,000 refugees in the near future are of concern. UNHCR have stated that the conditions in Rakhine state are not yet conducive for a return to Myanmar and I am also concerned that UN agencies have not been included in the discussions leading to this reported arrangement.

Therefore, I call on Myanmar to take the critically necessary steps to create such conditions before taking any further or premature steps towards repatriation.

In this regard, I echo the calls of international partners, including the EU, for the full implementation of the findings of the Advisory Commission on Rakhine State (The Annan Commission) which provides a roadmap for sustainable and community-led peacebuilding in Rakhine State.

Foreign Policy

Questions (38)

Niall Collins

Question:

38. Deputy Niall Collins asked the Tánaiste and Minister for Foreign Affairs and Trade the status of the political situation in Sri Lanka; and if he will make a statement on the matter. [46314/18]

Written answers

Tánaiste and Minister for Foreign Affairs and Trade

As it stands, the political situation in Sri Lanka remains uncertain. President Maithripala Sirisena's decision to replace Prime Minister Ranil Wickremesinghe with a new appointee, Mahinda Rajapaksa, and to suspend the parliament has led to protests across the country. I have been closely monitoring these recent political developments in Sri Lanka, which have received extensive international media coverage. I fully support the EU position which seeks a solution respectful of the country’s constitution and stresses the importance of avoiding violence and provocation.

Officials in my Department, including at the Embassy of Ireland in New Delhi, which is also accredited to Sri Lanka, will also continue to closely monitor the situation as it develops. I have asked that Ireland’s Ambassador in New Delhi keep me updated on the situation.

Bank Codes of Conduct

Questions (39)

Thomas P. Broughan

Question:

39. Deputy Thomas P. Broughan asked the Minister for Finance the progress that has been made in establishing a banking culture board; and if he will make a statement on the matter. [46246/18]

Written answers

Minister for Finance

As I have already stated previously and to clarify for the Deputy, the Irish Banking Culture Board is a private initiative from the banking industry in Ireland aimed at rebuilding trust and confidence in the industry following the tracker mortgage scandal, and as such it is not within the remit of my Department nor the Central Bank as regulator.

It is intended that the Irish Banking Culture Board will be an independently led entity to ensure that the industry is focused on the best interests of the customer and leads to a sustainable banking industry that promotes the highest standards of behaviour and professionalism.

I have been informed by representatives of the five main lenders that over the next 6-12 months, the search for an independent Chairperson will be concluded, the wider Board will be appointed, and there will be an initial culture survey and a stakeholder consultation process.

The initiative does not seek to replace or diminish existing regulation and will be run out of a separate entity to the Banking and Payments Federation of Ireland (BPFI) and the banks. The establishment costs and annual running costs will be funded by the retail banks themselves. The Board will not act as a lobbying or representative organisation. It will not act as a regulatory body nor duplicate the work of individual banks or the regulator.

Again I will reiterate that I welcome this initiative by the banks to regain the trust of customers, but it is no substitute for regulation. To that end, my officials have been working with the Central Bank over the past year on policies to be addressed in a forthcoming Central Bank (Amendment) Bill.

Bank Codes of Conduct

Questions (40)

Thomas P. Broughan

Question:

40. Deputy Thomas P. Broughan asked the Minister for Finance his plans to introduce legislation to make senior bankers accountable for their banking decisions; if this legislation will contain sanctions comparable to UK financial accountability rules introduced in 2013 and 2016; if not, if the legislation will contain criminal sanctions; and if he will make a statement on the matter. [46247/18]

Written answers

Minister for Finance

As the Deputy will be aware, I have long been on the record as stating that there are cultural failings in the banking sector that must be addressed. I and my colleagues in Government are supportive of measures to change behaviour, operations and organisational culture within the financial sector, in order to keep the customer at the heart of its operations.

The Central Bank's proposals to enhance individual accountability by way of Conduct Standards for all regulated financial services providers and the individuals working within them; a Senior Executive Accountability Regime (similar to the Senior Managers Regime in the UK); and, enhancements to the current Fitness and Probity Regime, are being considered as part of the work of the Government's forthcoming Central Bank (Amendment) Bill.

As I have already stated these proposals are set out in the Central Bank Section 6A Report on the culture and behaviour of the main retail banks that was drafted by the Central Bank in response to my request in November 2017, on foot of the serious cultural failings in banks brought to light in the Tracker Mortgage Examination.

My Department’s analysis of the report found that it is a detailed, qualitative and considered analysis of culture within the banking sector. The report’s recommendations are intended to drive positive changes in terms of wider banking culture, greater delegation of responsibilities, and enhanced accountability. The report importantly focuses on simplifying the taking of sanctions against individuals who fail in their financial sector roles.

Officials in my Department are engaging with the Central Bank and other stakeholders in order to identify the legislative changes that are required to implement such a customer centric culture and to enhance individual accountability. Policy matters with regard to how proposals may be implemented are currently being examined including an appraisal of international best practice. I intend to bring forward heads of a Bill for approval in Q1 2019.

EU Issues

Questions (41, 45)

Thomas P. Broughan

Question:

41. Deputy Thomas P. Broughan asked the Minister for Finance if he will report on the proposed introduction of an EU wide digital tax; the estimated annual impact of such a tax on State finances; and if he will make a statement on the matter. [46256/18]

Michael McGrath

Question:

45. Deputy Michael McGrath asked the Minister for Finance his plans to veto the EU digital tax proposal as it is currently proposed; and if he will make a statement on the matter. [46345/18]

Written answers

Minister for Finance

I propose to take Questions Nos. 41 and 45 together.

The Deputy will be aware that the Commission proposal for an interim Digital Services Tax, which imposes a 3% levy on the turnover of certain companies’ digital activities, is currently being debated among Member States – both at a technical and political level.

The Revenue carried out an analysis of the impact of introducing a Digital Services Tax on corporation tax receipts and estimated that they would be reduced by around €160 million per annum. These findings were presented to the Committee on Finance, Public Expenditure and the Taoiseach in May of this year.

I recently reiterated Ireland's opposition to the proposal at ECOFIN on 6 November where I highlighted particular concerns I have regarding the negative consequences for Europe as a predominantly exporting bloc from creating a precedent of taxation at point of consumption rather than where value is created. I also pointed out that taxing revenue rather than profits would undermine European competitiveness and could intensify already heightened trade tensions.

While Ireland is among a number of Member States which object to the fundamental nature of the proposal, we are joined by a wider group which share our concerns on a series of technical issues yet to be resolved. Unanimity is required before the proposal could be agreed.

Ireland remains committed to global tax reform and believes that global solutions are needed to ensure tax is paid by companies where value is created. That is why Ireland has been a committed participant in, and strong supporter of, tax reform efforts led by the OECD through the BEPS process. Ireland will continue to actively engage with work in the area of the digital economy at both OECD and EU level.

European Central Bank

Questions (42)

Thomas P. Broughan

Question:

42. Deputy Thomas P. Broughan asked the Minister for Finance his strategy and views on the impact on Ireland of the cessation of asset purchases by the European Central Bank and winding down of the quantitative easing programme; and if he will make a statement on the matter. [46257/18]

Written answers

Minister for Finance

At its most recent meeting on 25 October 2018, the Governing Council of the European Central Bank (ECB) confirmed that it will continue to make net purchases under the Asset Purchase Programme (APP), also known as Quantitative Easing (QE), at the new pace of €15 billion per month until the end of 2018.

Subject to incoming data regarding the medium-term inflation outlook, the Governing Council expects that net purchases will then end.

However, the Governing Council intends to reinvest the principal payments from maturing securities purchased under the APP for an extended period of time post end-December 2018. The Governing Council also expects that key ECB interest rates will remain at their present levels at least through the summer of 2019.

While it is not possible to predict the future path of ECB monetary policy or interest rates, guidance from the Governing Council suggests that monetary policy is likely to remain accommodative for some time yet.

As part of its role the NTMA has been contemplating the end of QE since it commenced in March 2015. The strategy of the NTMA in recent years has been to take advantage of the favourable market conditions for sovereign issuers wherever possible. Since the start of 2015, it has issued €55 billion of Government bonds at a weighted average yield of 1.1% and with a weighted average maturity of over 13 years.

Through taking pre-emptive action – including the early repayment of IMF and Swedish and Danish bilateral loans, together with the early buyback and switching of near-term maturing bonds for longer maturity bonds – the NTMA has significantly improved our debt redemption profile and lowered our interest bill.

In addition, the accelerated buy-back and replacement of Floating Rate Notes from the Central Bank of Ireland also locks in current interest rates.

Furthermore, the NTMA continues to pre-fund ahead of larger bond redemptions in the coming years. It expects to end this year with over €13 billion in cash balances. Relative to other sovereigns, Ireland has been particularly pro-active in taking advantage of the highly accommodative interest rate environment of recent years in order to pre-fund.

These actions reduce refinancing risk for the Exchequer and offer insurance against the possibility of interest rate increases in the coming years.

Financial Services Sector

Questions (43)

Thomas P. Broughan

Question:

43. Deputy Thomas P. Broughan asked the Minister for Finance his views on the impact of block chain technology on the financial services industry here; and if he will make a statement on the matter. [46258/18]

Written answers

Minister for Finance

There has been much discussion in recent years about Blockchain and the potential impact it may have on many sectors, such as the financial services industry. Blockchain technology, or Distributed Ledger Technology (DLT), is still in the early stages of development. Proof of concepts so far have shown the potential to deliver significant benefits in financial services and other sectors (supply chain, energy, even public services).

I am of the opinion that we must continue to monitor developments in this new technology, understand its possibilities, investigate how we can apply it to improve current business processes and products and in turn, how it can be used to strengthen the global competitiveness of the financial services sector in Ireland.

There have been a number of Blockchain related developments this year. In March 2018, the Department of Finance published its "Virtual Currencies and Blockchain Technology" discussion paper following extensive research into virtual currencies and the Blockchain ecosystem. The document aims to raise awareness in Ireland on the key risks and opportunities of Blockchain technology and virtual currencies, while also summarising the actions taken by other countries in this regard.

The "Irish Blockchain Expert Group", led by IDA Ireland, earlier this year launched "Blockchain Ireland", an online platform that serves as the go-to source of information on the Irish Blockchain ecosystem, assisting the promotion of Ireland as a Blockchain centre of excellence. Recently we have seen the establishment of firms in Ireland using Blockchain technology or offering Blockchain solutions to the financial services sector and other sectors.

As part of their Fintech Action Plan, published in March of this year, the European Commission announced that they are working on a comprehensive strategy for distributed ledger technology and Blockchain addressing all sectors of the economy.

From the beginning of IFS2020, the 2015 Government Strategy for the development of the international financial services sector, we recognised the increasing opportunities for Fintech and have had a number of target measures to support the development and growth of Fintech. Blockchain would be a sub-set of Fintech.

Since 2016, Enterprise Ireland has provided dedicated seed-funding for enterprises in the Fintech sector, through its Competitive Start Fund, to stimulate greater activity in enabling technology. The 2018 Fintech CSF was opened in June 2018 to early stage companies active in Fintech and Deep Tech (including Blockchain, Internet of Things, Artificial Intelligence/Machine Learning, Data Intelligence, Cloud, AR/VR, and Quantum Computing).

The international financial services strategy from 2015 (IFS2020) is approaching the end of its lifetime and Government approval has been secured to begin work on a successor strategy for IFS. My Department is currently engaging with the public and key private sector stakeholders in the IFS industry to start the process of drafting a future strategy for international financial services in Ireland, and a public consultation has recently been completed. The role of Blockchain, and many other innovations and initiatives, will be considered in the context of this work.

While the Government has a significant role to play in providing support for technological adoption, the implementation of innovation solutions such as Blockchain will be industry-driven.

Fiscal Policy

Questions (44)

Michael McGrath

Question:

44. Deputy Michael McGrath asked the Minister for Finance the gross and net fiscal space for each year up to 2023 if the expenditure benchmark and the medium term objective is met accounting for contributions to the rainy day fund, pre-committed expenditure and the non-indexation of tax system irrespective of the economy's position on the business cycle; and if he will make a statement on the matter. [46343/18]

Written answers

Minister for Finance

As I have previously outlined, the concept of ‘fiscal space’ is no longer an appropriate one. This is because a myopic focus on what is technically permissible under the fiscal rules would lead to pro-cyclical budgetary policies that jeopardise the sustainability of our public finances.

As such, in formulating budgetary policy the Government is instead guided by the fiscal stance – the position that is right for the economy at this point in time and that will support steady and sustainable improvements in public services and living standards.

Whereas ‘fiscal space’ was calculated based on the structural balance and expenditure benchmark rules, the correct fiscal stance can only be determined when accounting for the position in the economic cycle – when there is spare capacity in the economy it may be appropriate to use fiscal policy to help absorb this spare capacity, while when the economy is operating at full capacity adopting an expansionary fiscal policy would be imprudent.

Question No. 45 answered with Question No. 41.

State Claims Agency

Questions (46, 47)

Michael McGrath

Question:

46. Deputy Michael McGrath asked the Minister for Finance when he expects the State Claims Agency to make an application to the High Court to seek authorisation to pay compensation to claimants involved in the liquidation of a company (details supplied); and if he will make a statement on the matter. [46346/18]

Michael McGrath

Question:

47. Deputy Michael McGrath asked the Minister for Finance the time it takes on average for the State Claims Agency to make payments from the insurance compensation fund following a High Court approval; and if he will make a statement on the matter. [46347/18]

Written answers

Minister for Finance

I propose to take Questions Nos. 46 and 47 together.

Setanta Insurance was placed into liquidation by the Malta Financial Services Authority on 30 April 2014. As it was a Maltese incorporated company, the liquidation is being carried out under Maltese law.

The Deputy will be aware that the Insurance (Amendment) Act 2018 (Act 21 of 2018) was signed into law in July this year. The Act inter alia provides for revised arrangements for the on-going administration of the Insurance Compensation Fund, including for the relevant applications to the President of the High Court. These revised arrangements have now been put in place.

The State Claims Agency has now completed the necessary preparatory work in relation to the next tranche of Setanta claims, and have this week informed me that a High Court date has been agreed for 19 November. The Agency anticipates that payments to claimants will issue within 10 working days of release of the funds from the Insurance Compensation Fund on foot of the High Court order. Therefore, on the basis of this information, I anticipate that the next tranche of payments can be made to claimants in the late November/early December period.

It is expected that next tranche of claims will comprise in the region of 1,500 separate payments with a value of approximately €21 million, and will comprise of (a) newly settled claims requiring 100% payment, (b) all those cases where 65% was previously paid and where the balance of 35% is due and (c) a number of third party legal costs payments.

As you will appreciate with 1,500 separate payments, there is a considerable amount of detailed work attached to this process. Once these details are worked through for this first application, the process should work more efficiently for subsequent applications. You can rest assured however that every effort is being made to process all payments described as quickly as possible.

Finally, it should be noted that the process of settling claims is still ongoing and is subject in some cases to court procedures. The liquidator of Setanta estimates that the process of settling the vast majority of these outstanding claims should be completed by end-2019.

Brexit Negotiations

Questions (48)

Michael McGrath

Question:

48. Deputy Michael McGrath asked the Minister for Finance if support for Ireland's position in Brexit negotiations will not be conditional on Ireland's position on corporation tax, CCCTB, the digital tax or otherwise; and if he will make a statement on the matter. [46348/18]

Written answers

Minister for Finance

Ireland's Brexit priorities are well known and include protecting the Northern Ireland Peace Process, minimising the impact on trade and the economy, maintaining the Common Travel Area and working to influencing the future of the European Union.

We are now in the final stages of Article 50 negotiations and there is a need to conclude work on the Irish Protocol to ensure that all elements of the Withdrawal Agreement and the framework for the future relationship are wrapped up. EU27 solidarity and support for Ireland has been unwavering. This was confirmed again by leaders at the October European Council.

Ireland's sovereignty on tax matters is not affected by Brexit. Taxation is a sovereign Member State competence, this sovereignty is guaranteed by the EU Treaties.

Credit Union Lending

Questions (49)

Michael McGrath

Question:

49. Deputy Michael McGrath asked the Minister for Finance his plans to amend the Credit Union Act 1997 to enable credit unions to lend to approved housing bodies rather than invest subject to protections for members' deposits; and if he will make a statement on the matter. [46349/18]

Written answers

Minister for Finance

As the Deputy is aware, new Investment Regulations for Credit Unions have only recently come into effect which have enabled the sector for the first time to invest in Tier 3 Approved Housing Bodies (AHBs).

The introduction of this new Investment Framework was the result of extensive engagement between officials from my Department, the Department of Housing, Planning and Local Government, the credit union representative bodies and the Central Bank on how credit unions can assist in the area of social housing, as well as a detailed review of the investment framework for credit unions by the Central Bank. This included a public consultation whereby the introduction of Tier 3 AHBs as a new investment class for credit unions was supported by the sector, as was the mechanism for facilitating such investments via a regulated entity.

The new Investment Regulations came into effect on 1 March 2018. Since this date, credit unions are permitted to provide funding to Tier 3 AHBs for the provision of social housing via a regulated entity. The maximum permitted investment amount per credit union is 50% of a credit union's regulatory reserves where a credit union has total assets of at least €100 million and 25% of a credit union's regulatory reserves for all other credit unions. These limits may facilitate a combined sector investment in Tier 3 AHBs of close to €700 million. To put this figure in context, at end 2017 total lending from the Housing Finance Agency (HFA) to AHBs was c. €356.5m.

The Programme for a Partnership Government recognises the potential role that credit unions can play in housing finance, and to that end I am supportive of the enabling regulations that have been put in place to allow credit unions to provide funding to Tier 3 AHBs for the provision of social housing. Given these Regulations only came into effect in March of this year following a consultation process which received 74 submissions (58 from individual credit unions and 3 from their representative bodies) and given the Regulations provide scope for a combined sector investment of almost twice the amount of loans received by AHBs from the HFA (as of end 2017), I currently have no plans to amend the Credit Union Act 1997 to enable credit unions to lend to Approved Housing Bodies rather than to invest in them.

Mortgage Data

Questions (50)

Michael McGrath

Question:

50. Deputy Michael McGrath asked the Minister for Finance if the Central Bank holds data on the number of mortgage drawdowns each year before an organisation (details supplied) began collecting such data; the number of mortgage drawdowns for first-time buyers in each year since 1993; and if he will make a statement on the matter. [46350/18]

Written answers

Minister for Finance

The Central Bank has advised that, apart from periodic data published by the Bank on mortgage lending (including for first time buyers) since the commencement of the Central Bank’s Macro Prudential Mortgage Lending Rules in 2015 (the most recent such publication which is for H1 2018 is attached:

www.centralbank.ie/docs/default-source/publications/financial-stability-notes/no-8.-macroprudential-measures-and-irish-mortgage-lending-insights-from-h1-2018-(kinghan).pdf?sfvrsn=4).

It does not publish data on new mortgage drawdowns.

However, in its statistical release on Residential Mortgage Arrears and Repossessions, the Central Bank has published data on the outstanding number of mortgage accounts and the amount of mortgage credit for each quarter since September 2009 (the most recent publication which is for end June 2018 is attached:

www.centralbank.ie/docs/default-source/statistics/data-and-analysis/credit-and-banking-statistics/mortgage-arrears/2018q2_ie_mortgage_arrears_statistics.pdf?sfvrsn=6).

The Bank also publishes data on the outstanding amount of credit, including credit for house purchase, by credit institutions to Irish residents since 2003 (this is contained in Table A.6 of the Central Bank Money and Banking Tables which includes securitised loans and is attached:

www.centralbank.ie/docs/default-source/statistics/data-and-analysis/credit-and-banking-statistics/bank-balance-sheets/money-and-banking-statistics-august-2018.pdf.

Tax Credits

Questions (51)

Bernard Durkan

Question:

51. Deputy Bernard J. Durkan asked the Minister for Finance when the details of the appropriate tax free credit and or allowances will be furnished in the case of a person (details supplied); and if he will make a statement on the matter. [46423/18]

Written answers

Minister for Finance

I am advised by Revenue that a Tax Credit Certificate in respect of the person in question issued to her employer on 2 November 2018. A copy of the Certificate also issued to the person at her home address.

The Certificate issued on a ‘Week 1 basis’ as Revenue records did not include full information in respect of the person’s employment in 2018 to enable it to be issued on a cumulative basis. The effect of the ‘Week 1 basis’ is that the employer applies the revised tax credits and rate band from the date the Certificate is received rather than backdating it to the start of the year.

Revenue has confirmed that it has been in direct contact with the person in question to clarify certain information and a new Tax Credit Certificate, to be applied on a cumulative basis will issue shortly.

Tax Reliefs Application

Questions (52)

Charlie McConalogue

Question:

52. Deputy Charlie McConalogue asked the Minister for Finance his views on the issues raised by a farming organisation (details supplied) regarding the cumulative lifetime cap of €70,000 on the amount of tax relief that can be availed by young farmers as proposed in the Finance Bill 2018. [46453/18]

Written answers

Minister for Finance

Finance Bill 2018 (as published) provides in sections 19 and 46 for a cumulative €70,000 lifetime cap on the benefit any one farmer can receive under three farming related tax reliefs (the young trained farmer stamp duty relief, stock relief for young trained farmers and succession farm partnerships).

I am aware of the concerns raised by the farming bodies that have contacted me or my Department on this matter.

The origin of the €70,000 cap lies in EU law.

The following tax or stamp duty relief schemes come within article 18 of Commission Regulation (EU) No 702/2014 of 25 June 2014 "declaring certain categories of aid in the agricultural and forestry sectors and in rural areas compatible with the internal market in application of Articles 107 and 108 of the Treaty on the Functioning of the European Union ":

- section 81AA of the Stamp Duty Consolidation Act 1999 (which provides a stamp duty exemption for transfers of land to young trained farmers);

- section 667B of the Taxes Consolidation Act 1997 (which provides an income tax relief in respect of increases in the value of farm trading stock).

- section 667D TCA 1997 (which provides an annual tax credit of up to €5,000 for succession farm partnerships where an approved partnership culminates in the transfer of at least 80% of the farm assets from the original farmer to the successor).

The EU Regulation came into effect on 1 July 2014. Article 18 applies the state aid rules in relation to start-up aid for young farmers and the development of farms. Paragraph (7) of the article provides that “the aid amount per young farmer shall be based on the socioeconomic situation of the Member State concerned and shall be limited to EUR 70 000”. This means that the maximum aid amount allowed under the three schemes is €70,000 per each farmer who qualifies for the relief.

EU state aid regulations are legal acts that have direct effect in all EU countries and can be enforced directly by the European Commission regardless of domestic Irish law. Ireland does not, therefore, have the power to vary the limit. Introducing the cumulative €70,000 limit in national legislation is designed to provide clarity on how the limit applies in relation to the three reliefs.

The €70,000 limit has therefore been included in the relevant tax and stamp duty sections in Finance Bill 2018. Queries on the application of the cap should be directed to Revenue who are best placed to provide any operational information that may be required.

Departmental Contracts

Questions (53)

Richard Boyd Barrett

Question:

53. Deputy Richard Boyd Barrett asked the Minister for Public Expenditure and Reform the completed design and build projects commissioned by his Department; and if he will make a statement on the matter. [46160/18]

Written answers

Minister for Public Expenditure and Reform

My Department has not commissioned any projects of this nature.

Office of Public Works Expenditure

Questions (54)

Richard Boyd Barrett

Question:

54. Deputy Richard Boyd Barrett asked the Minister for Public Expenditure and Reform the cost to date of remedial works to buildings commissioned by the OPW as design and build projects; and if he will make a statement on the matter. [46169/18]

Written answers

Minister for Public Expenditure and Reform

There were two Design and Build Contracts, within the last 10 years to which the OPW was a party, involving remedial works.

1. Government Offices, Carricklawn, Wexford

A contract was placed in June 2007, in the sum of €20.9 million (including VAT) with Pierse Contracting Ltd (PCL) for the Department of Environment Decentralisation Building Project in Wexford. Practical Completion was achieved in March 2010 after protracted delays by PCL. PCL went into liquidation later that year.

A number of issues became known after practical completion and the OPW made a claim against the PCL Bond. The Bond is an insurance instrument required from the contractor by the OPW. The OPW settled the claim and the monies awarded were used to complete the remedial works programme.

The cost of the remedial works programme amounted to €1,583,286 of which €998,442 was funded by the PCL Bond award, the balance of €584,844 was paid by the OPW.

2. Department of Defence Offices, Station Road, Newbridge, Co. Kildare

The Contract was entered into with P. Elliott & Company Limited (PECL) in May 2008. The Contract Sum was €24.8 million (including VAT). Partial Practical Completion was achieved in September 2010.

A number of issues were apparent at practical completion and PECL carried out some remedial works as was their obligations under the design and build contract. PECL went into Receivership in May 2011. The OPW incurred costs of €597,157 of which €370,000 was met from retentions held by the OPW on the construction contract.