Christopher O'Sullivan
Question:58. Deputy Christopher O'Sullivan asked the Minister for Finance the main policy initiatives undertaken by his Department since 27 June 2020; and his main priorities for 2021. [2084/21]
View answerThursday, 14 January 2021
Questions (58)
Written answers
Since 27 June 2020, my Department has undertaken a broad range of important policy initiatives, many of which will remain a priority in 2021.
The main policy initiatives in 2020 included production of Budget 2021 and publication of Finance Bill 2020, as well as preparation of the July Stimulus Bill. Policy options were developed to improve efficiency of tax administration (amendments to encashment tax and Professional Services Withholding Tax regime) and a feedback statement on the EU Anti-Tax Avoidance Directive (ATAD) Interest Limitation Rule was prepared. Tax Strategy Group papers across all tax heads were prepared, and a review of Stamp Duty measures such as farm consolidation relief, Consanguinity relief and the residential stamp duty refund scheme was carried out.
On banking matters, a key focus in 2020 was on responding to the Covid-19 pandemic. This consisted of engaging with industry to ensure that loan payment breaks were provided to customers who were facing difficulties making repayments as a consequence of Covid-19. It also consisted of the finalisation and launch of loan schemes to support SMEs, including the €2bn Covid-19 Credit Guarantee Scheme and the expansion of the Future Growth Loan Scheme in conjunction with the Department of Enterprise, Trade and Employment, the Department of Agriculture, Food and the Marine and the SBCI. A number of EU files were progressed and the transposition of both the Bank Resolution and Recovery Directive (BRRD 2) and the 5th Capital Requirements Directive (CRDV) was completed at the end of 2020.
A review of the Policy Framework for Credit Unions and a review of Resolution and Stabilisation Levies for Credit Unions both commenced in 2020 and will continue in 2021. Legislation to allow for credit unions to convene virtual AGMs was implemented. A Section 24 review of Home Building Finance Ireland commenced in 2020 and will be progressed this year.
My Department worked with the Department of Justice and the Office of the Attorney General to complete the transposition of the Fifth EU Anti-Money Laundering Directive, and the Investment Limited Partnerships (Amendment) Act 2020 was progressed through the Houses of the Oireachtas.
Advancing the new Government’s insurance reform agenda as set out in the Programme for Government is a priority. The Action Plan for Insurance Reform was published in December. Delivery of the Government’s insurance reform agenda, including implementation of the elements of the Action Plan relevant to my Department, will continue to be prioritised in 2021.
My Department is responsible for representing Ireland’s interests in the EU budget process. A comprehensive financial package of €1.82tn was agreed by EU leaders in July 2020, which combines the 2021-2027 Multi-annual Financial Framework (MFF) of €1.074tn, and the €750bn temporary Next Generation EU recovery instrument. The Recovery and Resilience Facility is the key element of the €750bn Next Generation EU plan agreed by the European Council in July.
In my role as President of the Eurogroup, significant agreement was reached at Eurogroup in November 2020 on progressing reform of the European Stability Mechanism and the early introduction of the Common Backstop to the Single Resolution Fund. Into 2021, delivery on the Eurogroup Work Programme and Euro Summit commitments, in particular a time bound work plan on banking union and discussions on the appropriate fiscal stance, will be amongst my main priorities.
In order to protect jobs and workers in the context of Covid-19, my Department managed Ireland’s participation in the European instrument for temporary Support to mitigate Unemployment Risks in an Emergency (SURE) loan scheme. In the second half of 2020, necessary legislative provisions were put in place at national level and Ireland’s SURE loan application was submitted and approved by the EU. Continued management of Ireland’s participation in the SURE scheme, including finalising the loan drawdown, will remain a priority in 2021.
To protect Ireland’s economic and financial interests in the context of Brexit, my Department was closely involved in the whole-of-government preparation on relevant issues in the EU-UK future relationship, and will continue to strategically engage in international and EU outreach and alliance building to advance our national objectives, including with the UK in the context of the EU-UK Cooperation and Trade Agreement.
As I have already indicated, many of the policy initiatives in 2020 will remain a priority in 2021. As well as Budget 2022 and publication of Finance Bill 2021, production of the Stability Programme Update and the Summer Economic Statement are priorities.
Preparation for reform of the Local Property Tax is on the tax agenda in 2021. In line with the Programme for Government, a Commission on Taxation and Welfare will be established. Implementation of measures will be published in the forthcoming update on Ireland’s Corporation Tax Roadmap, including engagement on EU and OECD proposals in relation to the international taxation framework and the continued transposition of the Anti-Tax Avoidance Directive.
Legislation on banking issues will include progressing the drafting of the Consumer Protection (Regulation of Retail Credit Firms) Bill 2020, the transposition of the Regulations on European crowdfunding service providers for business, the transposition of the Covered Bonds Directive EU 2019/2162, and a Central Bank (Amendment) Bill to introduce the Senior Executive Accountability Regime (SEAR).
Priorities in the area of Financial Services will include satisfactory completion of the Industry migration project regarding the Irish settlement system (Central Securities Depository) and development of an Action Plan for 2021 in relation to the Government’s multi-year strategy for the development of Ireland’s international financial services sector to 2025, Ireland for Finance.
From an international perspective, my Department will put in place the necessary provisions to facilitate Ireland’s participation in the IMF’s New Arrangement to Borrow (NAB) including enabling legislation (subject to Oireachtas approval).
In relation to climate change, my Department will continue to ensure that economic, taxation and financial sector policy interventions support the Government’s climate action agenda including in the implementation of Departmental actions under the Climate Action Plan 2019 and in the drafting of the new Climate Action Plan for 2021. My Department will continue to engage at EU level in the development of sustainable finance and international climate finance in accordance with our policy objectives and will participate in relevant work streams of the Coalition of Finance Ministers for Climate Action on an ongoing basis throughout 2021.