Written Answers Nos. 91-100
91. Deputy Michael McGrath asked the Minister for Finance his plans to commission an up-to-date review similar to the Coffey report on the sustainability of the corporate tax receipts in view of the most recent data on corporation tax released by the Revenue Commissioners; and if he will make a statement on the matter. [21001/19]
View answerI recognise that there has been a substantial increase in corporation tax receipts in recent years and, while in many ways this is a positive reflection of our economic recovery and improved trading conditions, I am also aware that there are risks associated with this increase. In particular it is important to ensure that longer-term spending commitments are not entered into on the basis of a potentially short term upswing in corporate tax revenues.
The recently published Revenue data in respect of Corporation Tax (CT) payments for the year 2018 show that the share of CT receipts from the top 10 companies increased to 45% in 2018. However the report also notes that this increase was partially driven by a one-off change in accounting standards (IFRS 15) leading to additional tax receipts in 2018. If these were excluded, the share of net receipts from the top 10 companies would have been 43%.
Revenue data show that the proportion of receipts contributed by the top ten taxpayers in any given year has been relatively stable over time – for example it has ranged between 36% and 41% over the preceding five years 2013 to 2017. Revenue data also indicates that there is a level of ‘churn’ in the top-10 payers, i.e. the composition of the top 10 taxpayer companies changes from year to year. As Ireland has been consistently successful in attracting leading multi-nationals to base here, and given our level of integration with the global economy, this concentration is not altogether surprising.
Nonetheless, my Department has, together with Revenue, highlighted this as a risk in Budget and Stability Programme Update risk statements and in the Annual Taxation Report 2018. I am also aware of the risks associated with developing a reliance on potentially cyclical upturns in receipts, and the Government has taken a number of actions to address these risks, including:
- Establishing the Rainy Day Fund;
- Using the 2018 revenue over-performance to run an Exchequer surplus and prioritising the reduction of debt;
- Continuing to broaden the tax base; and
- Ensuring that receipts arising from identified one-off factors are not carried forward into the tax base for future years – for this reason €0.7 billion of the 2018 over-performance was not carried forward into the 2019 tax base on foot of the advice of the Revenue Commissioners.
With regard to the Deputy’s proposal for an assessment of the sustainability of corporation tax receipts, forecasts are inherently subjective and often rely on reference to long-term averages as a component factor. In the case of corporation tax, this subjectivity would be further compounded by the ongoing process of international tax reform. Implementation of the agreed BEPS Actions is under way and further work has commenced at the OECD to agree further changes at a global level that address the tax challenges that arise from the digitalisation of the economy. This work is at a relatively early stage and will continue over the next two years with a view to reaching consensus by the end of 2020.
I would however note that my officials are currently conducting an examination of potential policy options to mitigate against the risk of over-reliance on CT receipts and a fiscal framework to reduce reliance on CT will be published by this Department at the time of the publication of the Summer Economic Statement, 2019.
Finally, it should also be noted that a tax forecasting methodology group has been established and is currently undertaking work to review the existing tax forecasting methodology with a focus on the four largest tax heads (excise duties, income tax, corporation tax and VAT). Where appropriate, this work will make recommendations for changes to the tax forecast methodology.
Having regard to the work already under way within my Department, and the other considerations referred to in this answer, I do not intend to establish a separate review of the nature suggested by the Deputy.
92. Deputy Thomas P. Broughan asked the Minister for Finance the position regarding enabling the credit unions to provide affordable mortgages, especially for young first-time buyers; and if he will make a statement on the matter. [21018/19]
View answerCredit Unions are already allowed to offer mortgages to their members and indeed a number of Credit Unions do. As of March 2019 there were €175 million of mortgages outstanding across the sector.
The amount of mortgage lending Credit Unions can engage in, however, is limited by the Central Bank’s lending regulations for Credit Unions which allow only a certain proportion of a Credit Union’s loans to be long term loans due to lending maturity limits.
These lending regulations have been under review since October 2018 when the Central Bank commenced a public consultation.
Reviewing these Lending Regulations is a very important matter and one for which I have previously outlined my strong support – including in a letter I wrote to Governor Lane in late 2017.
The proposed revisions to the Lending Regulations from the Central Bank contain many positive elements. The proposals change the basis of calculation for the limits from a percentage of loans to a percentage of assets, which is something that the sector has been calling for. The proposals would also allow larger and capable credit unions to do significantly more mortgage lending than is currently the case.
Based on the data supplied in the Consultation Paper, the proposals would allow in the first instance a sectoral capacity of €861 million for mortgages, which should be seen in the context of the €175 million of mortgages outstanding across the sector as of March 2019.
This capacity would increase if applicable Credit Unions are approved for the higher limits. In the case where all Credit Unions with assets greater than €100 million were approved for the higher limit, sectoral capacity could increase to a maximum of around €1.8 billion.
As I mentioned the Consultation Paper containing these proposals was published in October 2018, with the consultation period open until the 9th January of this year. This gave credit unions, their representative bodies, and other stakeholders the opportunity to analyse the proposals put forward in the Consultation Paper and engage in the consultation by submitting their views to the Central Bank. One of the matters being consulted on is the definition of a mortgage, which the Central Bank would propose to exclude commercial or Buy-to-Let mortgages, as is the current practice.
The Central Bank is currently in the process of reviewing the submissions received and expects to publish a feedback statement and draft regulations in the second half of 2019.
Officials from my Department have liaised with the Central Bank regarding the proposals in the Consultation Paper and I will input into the statutory consultation process when it arises.
93. Deputy Róisín Shortall asked the Minister for Finance the action he is taking to address the high level of public liability insurance faced by business and community groups; and the way in which he plans to improve competition in the market. [21113/19]
View answerBoth I and the Minister of State for Financial Services and Insurance, Mr. Michael D’Arcy T.D., are very conscious of the difficulties that the cost and availability of insurance are having on many businesses and community groups in this country. The Deputy should note that there is no policy or legislative ‘silver bullet’ to decrease the cost of insurance. This was also recognised by the Joint Oireachtas Committee on Finance and Public Reform, who reported on the issue in late 2016. This is a complex issue because for constitutional reasons the Government cannot direct the courts as to the award levels that should be applied and for legal reasons it cannot direct insurance companies as to the pricing level which they should apply in respect of businesses seeking insurance, as these matters are of a commercial nature, and are determined by insurance companies based on the risks they are willing to accept.
Having said this, I wish to re-emphasise how important this issue is for the Government. Consequently, following the publication of its Report on the Cost of Motor Insurance in 2017, the Cost of Insurance Working Group undertook an examination of the employer liability and public liability insurance sectors. This second phase of the Group's work culminated in the publication in January 2018 of the Report on the Cost of Employer and Public Liability Insurance. Much work has been done to date through the implementation of both reports of the Cost of Insurance Working Group and achievements to date include:
- the establishment of the Personal Injuries Commission, and its subsequent recommendations relating to addressing award levels for soft tissue injuries;
- the Law Reform Commission (LRC) has commenced its work to undertake a detailed analysis of the possibility of developing constitutionally sound legislation to delimit or cap the amounts of damages which a court may award in respect of some or all categories of personal injuries, as part of its Fifth Programme of Law Reform;
- increasing transparency around the cost of private motor insurance through the establishment of the National Claims Information Database in the Central Bank;
- reforms to the Personal Injuries Assessment Board through the Personal Injuries Assessment Board (Amendment) Act 2019;
- amendments to Sections 8 and 14 of the Civil Liability and Courts Act 2004 to make it easier for businesses and insurers to challenge cases where fraud or exaggeration is suspected;
- the reform of the Insurance Compensation Fund to provide certainty to policyholders and insurers;
- various reforms of how fraud is reported to and dealt with by An Garda Síochána, including increased co-ordination with the insurance industry, collections of statistics under the new “insurance fraud” category which has been added to the PULSE system; as well as the launch recently of Operation Coatee, a co-ordinated operation to tackle insurance fraud; and,
- the Courts Service has confirmed that it will publish a more detailed breakdown of awards in personal injury cases in its Annual Reports.
I believe that these reforms are having a significant impact with regard to private motor insurance (CSO figures from April 2019 show that the price of motor insurance is now 24.4% lower than the July 2016 peak). The Government is determined to continue working to ensure that these positive pricing trends can be extended to other forms of insurance, including those relevant to businesses.
Undoubtedly the single most essential challenge which must be overcome if there is to be a sustainable reduction in insurance costs is to bring the levels of personal injury damages awarded in this country more in line with those awarded in other jurisdictions. In this regard, the Personal Injuries Commission has highlighted the significant differential between award levels in this country and other jurisdictions, and has made a number of recommendations to address this issue, in particular the establishment of a Judicial Council to compile guidelines for appropriate general damages for various types of personal injury. Both I and Minister of State D’Arcy believe that this awards gap needs to be significantly closed and we are working with the Minister for Justice and Equality, Mr Charlie Flanagan TD, to ensure that this happens at the earliest opportunity.
Finally, I would like to assure the Deputy that the Cost of Insurance Working Group will continue to focus on implementing the recommendations of the Report on the Cost of Employer and Public Liability Insurance in parallel with implementing those from the Report on the Cost of Motor Insurance. I am hopeful that the cumulative effects of the completion of the two Reports’ recommendations will include increased stability in the pricing of insurance for businesses and a more competitive insurance market.
94. Deputy Micheál Martin asked the Minister for Public Expenditure and Reform the number of clerical and executive officers, respectively, granted transfers under the Civil Service mobility and principal officer mobility schemes since it commenced in September 2018; the number still on the waiting list for same; and if he will make a statement on the matter. [21030/19]
View answer95. Deputy Micheál Martin asked the Minister for Public Expenditure and Reform the number of principal officer posts granted transfers under the Civil Service mobility and PO mobility schemes since it commenced in September 2018; the number still on the waiting list for same; and if he will make a statement on the matter. [21031/19]
View answerI propose to take Questions Nos. 94 and 95 together.
As the Deputy is aware, the Civil Service Mobility scheme which comes under the remit of my department, and is administered through HR Shared Services, National Shared Services Office, offers an opportunity for staff members to apply for mobility through an open and transparent system. The scheme will support the needs of the business, increase career development opportunities and facilitate relocation for staff members. The establishment of the scheme fulfils one of the requirements of Action 15 of the Civil Service Renewal Plan; and Action 14 of the People Strategy for the Civil Service, which calls for the further expansion of a coherent mobility policy to facilitate staff development and strategic alignment with other HR policies, builds upon this.
The scheme is being introduced on a phased basis as follows:
Phase 1A of the scheme is for the general Civil Service grades of Clerical Officer (CO) and Executive Officer (EO) to apply for mobility between and within 46 zones - excluding mobility within Zone 46 (Dublin) which will be included in Phase 1B. The application stage of this phase launched in November 2017 with c. 3,500 staff members (1 in 5 of the 17,000 participating staff members - 60% CO : 40% EO) applying for mobility and making an average of 8 organisational choices .
The location choices in the scheme are divided into mobility zones rather than county or province. An applicant may express a preference for mobility for a maximum of 3 zones from the list of 46 zones with a choice of any or all organisations in each zone (a full list of zones and organisations per zone can be viewed at www.hr.per.gov.ie). Staff members can apply for mobility within their current zone (excluding Phase 1B, Zone 46 Dublin) as well as other zones. A number of mobility zones also have an option to include or exclude a choice of satellite towns.
The offer stage of this phase launched in September 2018. To date over 200 moves have been accepted, and are either complete or in progress (129 COs and 76 EOs).
Phase 1B (CO's and EO's - Dublin) is on track to launch in the coming months.
Phase 2 of the scheme will include the general Civil Service grades of Higher Executive Officer, and Assistant Principal. Officials from my Department have commenced discussions with stakeholders on the development of this phase and it is anticipated that Phase 2 will be introduced in 2020.
Principal Officer (PO) Mobility - this scheme was introduced in September 2015 as part of Action 15 of the Civil Service Renewal Plan. It is designed “to expand career and mobility opportunities for staff across geographic, organisational and sectoral boundaries.” To date 46 PO positions have been filled through mobility and a number are currently ongoing.
96. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform the way in which he will provide for the extra €1.5 billion needed over the course of the national development plan on the national broadband plan. [21099/19]
View answerAs I have already indicated, I intend to provide the additional capital required to fund the cost of proceeding with the National Broadband Plan from future revenues. This will be done in the context of updating the overall multi-annual capital ceilings set out in Project Ireland 2040.
97. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform further to Parliamentary Question No. 54 of 9 May 2019, if he will provide the same tables for each ministerial Vote; and if he will make a statement on the matter. [21135/19]
View answerThe attached spreadsheet (Attachment 1) sets out gross voted current, capital and total expenditure ceilings for each Vote group, as published in each Expenditure Report for Budgets 2014 to 2019.
The expenditure ceilings are presented here exactly as they were published in each Expenditure Report from 2014 to 2019. As such, they do not reflect any transfers of functions or technical adjustments which have occurred within the period. As a result, ceilings may not be directly comparable for all Vote groups across the period. Attachment 2 sets out all of the transfers of functions that have taken place between 2014 and 2019.
A number of technical adjustments also impact on analysis of the 2014 to 2019 period. Significant among these are changes made in 2017 to funding for Irish Water. Following the enactment of the Water Services Act 2017, all Motor Tax receipts are paid into the Exchequer, rather than the Local Government Fund, and all State funding for domestic water services is provided through the Department of Housing, Planning and Local Government. This resulted in an increase in gross voted expenditure in the Revised Estimates Volume (REV) 2018 for the Department of Housing, Planning and Local Government of €792 million. This increase had no impact on overall General Government expenditure. Conversely, REV 2015 reflected the disestablishment of the HSE Vote with expenditure of the HSE now met by way of a grant from the Department of Health Vote. As a consequence, certain income previously recognised as appropriations-in-aid on the HSE Vote is now retained by the HSE and is no longer reflected in gross expenditure ceilings or outturns from 2015 on. On the Defence Vote, from 2015 onwards, the purchase of military equipment was reclassified as capital expenditure rather than current expenditure. This accounts for the apparent rise in Defence capital expenditure that occurs between Budget 2015 and Budget 2016.
98. Deputy Louise O'Reilly asked the Minister for Education and Skills if prefabs will not be needed for a school (details supplied) and the structural defects amended before the start of the new school year in September 2019. [20970/19]
View answerThe Deputy will be will be aware that last October and November my Department carried out initial investigations into 42 schools where structural defects had been identified. 22 required precautionary measures to enable continued safe occupation.
Following on from the initial investigations, which were based on sample opening up works, my Department initiated a second phase of detailed investigations for the schools on the 18th of January last. This next phase of the programme is focusing initially on the 22 schools that have precautionary measures in place and also at the school to which the Deputy refers, which remains closed in part.
The purpose of these investigations is to determine the type and extent of structural issues in each individual school and, from the technical information gathered by the appointed structural engineers, to design permanent remediation solutions for delivery where these are needed.
In line with the update published by my Department in January, detailed structural investigations have now been completed in 21 of the 22 schools with precautionary measures in place and at the school in question. The investigations into the remaining school with precautionary measures in place will be completed by the middle of May.
The school referred to is different from the schools with precautionary measures in place in that the nature and extent of the issues there are such that the building under investigation was required to close. The school remains operational in another building on site.
Detailed investigations have concluded in the closed building and engineers are working to design solutions. When these are known, a programme of works to remediate the building will be put in place for implementation. This is an Education and Training Board (ETB) school. Pending the delivery of the remediation work, my Department will ensure, in continued consultation with the ETB, that any interim accommodation needs at the school are met. In this regard, 2 additional temporary classrooms, a woodwork room and prep area together with a disabled access toilet have been approved for September 2019.
99. Deputy Eamon Scanlon asked the Minister for Education and Skills if he will reinstate a school transport service (details supplied) in County Leitrim; and if he will make a statement on the matter. [20947/19]
View answer118. Deputy Eamon Scanlon asked the Minister for Education and Skills if an existing school transport service will be extended to serve a route (details supplied) previously served by its own bus in order to provide transport to a number of national schoolchildren, including a child with special needs; and if he will make a statement on the matter. [21076/19]
View answerI propose to take Questions Nos. 99 and 118.
School transport is a significant operation managed by Bus Éireann on behalf of my Department.
There are currently over 117,500 children, including over 13,000 children with special educational needs, transported in over 5,000 vehicles on a daily basis to primary and post-primary schools throughout the country covering over 100 million kilometres annually.
The purpose of the School Transport Scheme is, having regard to available resources, to support the transport to and from school of children who reside remote from their nearest school.
Children are generally eligible for school transport if they satisfy the distance criteria and are attending their nearest school.
Children who are eligible for school transport and who complete the application process on time will be accommodated on school transport services where such services are in operation for the 2019/20 school year.
Bus Éireann is currently considering applications for the 2019/20 school year. The number and size of buses operating for the 2019/20 school year will be determined by the number of children who apply and are deemed eligible for school transport.
The terms of the School Transport Schemes are applied equitably on a national basis.
100. Deputy Dara Calleary asked the Minister for Education and Skills the supports available to a school planning to refurbish outdoor play areas on the school grounds to incorporate play equipment in the interests of promoting physical activity within the school community. [20948/19]
View answerI wish to advise the Deputy that the Summer Works Scheme (SWS) is designed to allow schools, on a devolved funding basis, to carry out necessary improvement and refurbishment works that will upgrade existing school facilities including the upgrading of outdoor play areas. The SWS is currently open for applications and will remain open until 30th June 2019.
As Primary School Authorities now have more certainty on when they will receive their minor works they may use their discretion in relation to the use of this grant which, depending on other priorities in the school, may include purchase of playground equipment.
