Dáil Éireann díospóireacht -
Tuesday, 21 Nov 2000

Vol. 526 No. 3

National Pensions Reserve Fund Bill, 2000: Report and Final Stages.

An Ceann Comhairle

Before the Dáil proceeds to consider the amendments tabled to the Bill on Report Stage, I propose to explain the Chair's position in relation to amendment No. 22 tabled by Deputy McDowell. Amendment No. 22 is similar to amendment No. 21 in Committee, which was disallowed as involving a potential charge on the Exchequer. The current amendment differs from amendment No. 21 in Committee in that the phrase "if and only if he or she is satisfied that to do so would not involve an actual or potential charge on public funds" has been added. My concern in relation to the amendment is that it can be reasonably regarded as no more than a device to circumvent the provisions of Standing Order 142(2). I expressed similar concerns in relation to amendments tabled to the Social Welfare Bill, 1999, indicating that the allowance of amendments of this kind will have to be reviewed in the future. I have decided to allow amendment No. 22 at this point in time and the amendment will be discussed with amendment No. 17 when that amendment is reached. If, however, in the course of debate, it appears there is a basis to the concerns I have outlined, the Chair has the authority to rule the amendment out of order. Members should, therefore, be very careful and bear this in mind in contributing to the debate on the amendments.

We will dispose of the amendments as per the brief. Amendments Nos. 1, 4 and 5 will be taken together by agreement. Is Deputy McDowell moving amendment No. 1?

Mr. McDowell

I am satisfied that the Minister's amendment deals with this point adequately.

Amendment No. 1 not moved.

An Ceann Comhairle

Amendment No. 2 is consequential on amendment No. 25 and they are to be taken together.

Minister for Finance (Mr. McCreevy)

I move amendment No. 2:

In page 5, between lines 25 and 26, to insert the following:

"‘Committee of Public Accounts' means the Committee of Dáil Éireann established under the Standing Orders of Dáil Éireann to examine and report to Dáil Éireann on the appropriate accounts and reports of the Comptroller and Auditor General;".

These are technical amendments regarding the designation of a chief executive officer of the manager as the accounting officer for the fund. Section 26 as it stands designates the chief executive officer of the manager as the accounting officer of the fund for the purposes of the Comptroller and Auditor General Acts, 1866 to 1998. However, these provisions define an accounting officer in terms of functions in respect of the appropriation accounts. The manner in which accounting officers are answerable to the Committee of Public Accounts is set out in section 19 of the Comptroller and Auditor General (Amendment) Act, 1993. As the chief executive officer of the manager is not an accounting officer within the meaning of the Comptroller and Auditor General Acts – that is, he does not have a function in respect of the appropriation accounts – the section needs to be amended.

The approach in amendment No. 25 is to apply the substance of the provisions of section 19 of the Comptroller and Auditor General (Amendment) Act, 1993, specifically to the manager in relation to the fund. This approach has been previously taken in similar legislation such as the Employment Equality Act, 1998 and the Food Safety Authority of Ireland Act, 1998, where the respective chief executive officers were made accountable to the Committee of Public Accounts for the bodies established under those Acts.

Amendment No. 2 is simply a formal definition of the Committee of Public Accounts in terms of its functions which ensures that references to the Committee of Public Accounts will always be construed as references to the Committee of Dáil Éireann appointed to perform those functions.

Amendment agreed to.

Amendments Nos. 3 and 4 not moved.

Mr. McCreevy

I move amendment No. 5:

In page 7, lines 11 and 12, after "Commission" to insert "or in the Irish language Coimisiún an Chúlchiste Náisiúnta Pinsean,".

Amendment No. 5 confers the National Pension Reserve Fund Commission with a statutory Irish language title and is being made on foot of the two amendments put down by Deputy McDowell which were also put down on Committee Stage. On Committee Stage I signalled that I had no problem in principle with the aim of the Deputy's proposed amendments but that there were some issues of detail that needed to be considered further and I undertook to consult the Chief Parliamentary Counsel with a view to bringing forward an appropriate amendment on Report Stage. Amendment No. 5 addresses these issues of detail.

First, the National Pension Reserve Fund Commission will be a body that operates internationally and it is important that its title be easily recognised. In such cases it is the practice to place the English version of the name first and then to provide an Irish translation. Second, it is not necessary to amend the Long Title of the Act as is provided for in amendment No. 4. The Deputy has withdrawn the other amendments.

Amendment agreed to.

Mr. McDowell

I move amendment No. 6:

In page 8, between lines 38 and 39, to insert the following:

"7.–The Freedom of Information Act, 1997, shall apply to the Commission.".

This is similar to an amendment I put down on Committee Stage to extend the Freedom of Information Act, 1997, to the body being set up under this Bill. In fairness to the Government, I was one of those who approached this with a little cynicism and I expected that once the Freedom of Information Act was extended to Departments of State they might very well grind to a halt. In fairness to the Minister and his Minister of State, it has been extended in the intervening years to quite a few statutory bodies including local authorities and health boards. That is an altogether good thing and the principle is now well nigh established that State or semi-State bodies should be subject to that Act. It goes without saying that the many exemptions in the Act would take away much of the relevance of the Act to some of the workings of this commission. Clearly the deliberative process exemption would come into play, as would the commercial activity exemption. In terms of the administrative process and the decision-making process, once decisions are made that apply to the commission, as a matter of principle the Act should be extended to the com mission at this stage. The Minister indicated on Committee Stage that he would consider this at some future point and as a matter of principle, as we set up State bodies of any kind we should apply the Act automatically to them.

Mr. McCreevy

The Freedom of Information Act, 1997, commenced for central Government and related bodies on 21 April 1998. It was extended to health boards and local authorities six months later and to voluntary hospitals and certain publicly funded voluntary bodies providing services for people with an intellectual disability in October 1999. In December last year the Government decided to extend the Act incrementally between May 2000 and no later than July 2001 to a range of other bodies in the enterprise, electricity, telecommunications regulation, cultural and broadcasting, universities, health services, environmental and social services sectors.

Freedom of information will be extended incrementally across the wider public sector as experience is gained in its application. Its application to the commission will be decided in the context of extensions of the Act generally. In drafting this Bill room was made for the possible application of the Freedom of Information Act at a later date. I refer specifically to section 13, prohibiting the disclosure of confidential information about the fund by the commissioner, a member of the staff, a member of a committee, an investment manager, a custodian or a consultant or adviser engaged by the commission except where such disclosure is authorised by the commission or where the disclosure is otherwise provided for by law. This latter exception caters, inter alia, for the requirement to disclose information in a court of law or where disclosure is required under some other statute, for example, the Freedom of Information Act.

In any event, the Bill contains significant provisions to ensure transparency and accountability. These include section 25, which requires the chairperson of the commission to appear before the Committee of Public Accounts; section 26(3), which provides for the preparation of annual accounts for the audit of accounts by the Comptroller and Auditor General and for the laying of such audited accounts by the Minister before each House of the Oireachtas; section 26(4), which requires the chief executive of the agency, as accounting officer for the fund, to appear before the Committee of Public Accounts to give evidence on matters relating to the accounts; section 27(1), which requires the commission to make an annual report to the Minister on its activities, after which a report will be laid before each House of the Oireachtas; and section 27(4), which enables the Minister for Finance to have an examination carried out from time to time into various aspects of the operation of the fund.

These provisions will ensure that detailed information regarding the management of the fund will be in the public arena. As I have said already, the question of making the commission subject to the provisions of the Freedom of Information Act will be considered at a later date in the context of the general extension of that Act. Therefore I do not propose to accept the amendment.

Mr. McDowell

The Minister has set out the laudable record of his Department in implementing the Act. He has set out the various accountability provisions of this Bill and he has also said the Bill allows for the possibility of an extension of the Freedom of Information Act to the commission at some stage in the future. However, he has not given one reason it cannot be extended to the commission now.

Amendment put and declared lost.

Mr. McDowell

I move amendment No. 7:

In page 8, line 44, after "Minister" to insert "following consultation with such committee of either or both Houses of the Oireachtas as may be appointed in that behalf by resolution of either or both such Houses".

This amendment relates to the appointment of the commissioners. I commend the Minister on having taken the innovative step of setting out conditions which the commissioners must meet – that they must have certain qualifications which are set out in broad detail in the Act. That is a step forward and has not been normal practice in the past.

The Minister, in his typically disarming fashion, said on Committee Stage that he thought something along these lines was a thoroughly good idea and was being considered by Government but that he was not going to set a precedent at this stage. We have since heard a little about the Government's intentions in the area of standards in public life and I am interested in hearing from the Minister whether movement along the lines suggested by this amendment is likely to be part of Government proposals in the near future. If it is – or even if it is not – the Minister should apply his pioneering zeal to the provisions in this Bill, set a precedent and the standard to which his colleagues can be required to adhere in the future. It is a good idea and is in the interests of all concerned that the committee of the Dáil relevant to this case, the finance committee, should at least have the names of appointees flagged to it. I have deliberately phrased the amendment loosely. It does not require that the committee should sanction or vote upon the appointment of particular commissioners; it merely requires that there should be consultation with the committee so that information can be provided and committee members given an opportunity to express their view, if they have a view, on the appointment of particular commissioners. In that sense it is not looking to break down the barriers excessively. It is simply looking to establish a principle or a precedent.

Mr. McCreevy

The main function of the National Pensions Reserve Fund Commission are to control, manage and invest the assets of the fund. By investing control and management of the fund in the commission, the Bill gives the commission full independence and responsibility for the investment, management and operational decisions in connection with the fund.

In view of the considerable discretionary authority and responsibility to be given to the commission, it will be important to ensure that persons selected to serve as commissioners have the capability, judgment and stature to make a constructive contribution to the work of the commission. Accordingly, section 7(4) requires the Minister to appoint persons on the basis of their experience and expertise at senior level in specified areas such as investment, management, actuarial practice, the pensions industry etc. Thus the Bill, as it stands, contains measures which will go a long way towards ensuring that only persons of the higher calibre may be appointed commissioners.

This amendment appears to contain wider issues which would need to be considered in the context of ministerial appointments generally. To accept the principle that the Minister for Finance should consult an Oireachtas committee with regard to the appointment of this commission raises the issue of whether Ministers should consult the Oireachtas before making appointments to boards, committees and bodies generally. This is an issue which needs to be considered on its own merits. If the Oireachtas were to decide that Ministers should be consulted before making appointments generally, I would have no problem with such a requirement applying in respect of appointments to the National Pensions Reserve Fund Commission. I have difficulty, however, with such a requirement being applied to an appointment of the commission which could be interpreted as setting a precedent with regard to other ministerial appointments. Therefore, I have to reject the amendment. As I said on Committee Stage, this area deserves wider consideration and the Government will give it due consideration. My pioneering zeal in some areas is not greatly appreciated by everybody all the time.

Mr. Noonan

Is the Minister still under house arrest?

Mr. McCreevy

One has to wait.

Mr. McDowell

I thought that on this one occasion we might be able to find consensus in the exercise of the Minister's zeal, but clearly that is not the case.

Amendment put and declared lost.

Mr. McCreevy

I move amendment No. 8:

In page 9, line 2, to delete ", in his or her opinion,".

As I set out in the debate on the previous amendment, it is important, in view of the considerable discretionary authority and responsibility to be given to the commission, to ensure that persons selected to serve as commissioners have the capability, judgment and stature to make a constructive contribution to the work of the commission. Accordingly, section 7(4) limits the Minister to choosing as commissioners persons who have acquired substantial experience and expertise at senior level in specified areas such as investment management, actuarial practice, the pensions industry etc.

The section as it stands leaves the decision as to what constitutes substantial expertise to the Minister's opinion. On Committee Stage, Deputy Noonan suggested that deleting the phrase "in his or her opinion" would remove the possibility that the Minister could appoint a patently unsuitable person but could argue that it was his or her opinion that the person possessed suitable qualifications. The amendment gives effect to his suggestion.

Mr. Noonan

I thank the Minister for taking this suggestion on board and bringing forward a Report Stage amendment. It is well worthwhile that the Minister has a section in the Bill, which will act as precedent for similar sections in the future, whereby persons appointed to be commissioners or, in future, to boards, agencies or State organisations, will objectively have expertise in the area to which they are appointed. If that is the policy decision, the opinion of the Minister should not enter into it. The curriculum vitae of the appointee should be a test and it should be possible to illustrate objectively that the person appointed had expertise in the areas referred to in the section. I thank the Minister for the amendment.

Amendment agreed to.

An Ceann Comhairle

Amendment No. 9 is in the name of the Minister. Amendment No. 10 is related so it is proposed to discuss Nos. 9 and 10 together, by agreement.

Mr. McCreevy

I move amendment No. 9:

In page 9, line 13, to delete "industry." and substitute the following:

"industry,

(i) consumer protection.”.

As I have already set out, section 7(4) requires the Minister to appoint persons to the commission on the basis of their experience and expertise at senior level in specified areas such as investment practice, actuarial practice, the pensions industry etc.

On Committee Stage, Deputy Noonan suggested, in discussing the amendment he has tabled here again on Report Stage, that there is room on the commission for a non-expert with a common-sense approach whose primary function would not be to use his or her expertise to enable the commission to make appropriate decisions but to bear in mind at all times the primacy of the beneficiaries of the fund.

While I would stress that the commission will be an expert rather than a representative body, and appointments will not necessarily be made from all the categories set out in section 7(4), I take Deputy Noonan's point and I have brought forward amendment No. 9 to give effect to it. In that context, I ask Deputy Noonan to withdraw his amendment and to support my amendment on the basis that it gives effect to the principle of his amendment but is drafted in somewhat wider terms and would thus give more flexibility in appointing a suitable person with the background suggested by Deputy Noonan.

Mr. Noonan

Again I thank the Minister for bringing forward this amendment. I do not think we have an Irish Ralph Nader but there are people who would have some expertise in dealing with the affairs of consumers. In a narrower sense, a former ombudsman might be an appropriate appointee or a person who had acted as ombudsman to the banking or the insurance industries.

Mr. McCreevy

Yes.

Mr. Noonan

These are posts now and there are persons who would be familiar with the consumer interests in these areas. The Minister has taken it on himself in amendment No. 9 to include industry. I am not too sure where industry fits into the amendment because it does not have an initial in front of it. Is the Minister suggesting persons with—

Mr. McCreevy

No, it is not industry. That is a drafting change to reflect pensions industry. It is only technical.

Mr. Noonan

That makes sense. When I saw it first I thought the Minister was introducing another category where persons with experience in industry could be appointed, but then there is no initial in front of it. I understand the Minister. I will not move my amendment because the Minister has met my views.

Amendment agreed to.

Amendment No. 10 not moved.

Mr. Noonan

I move amendment No. 11:

In page 9, to delete lines 34 to 36.

I would like to hear the speaking note on this amendment.

Mr. McCreevy

I have underlined the import ance of ensuring that persons selected to serve as commissioners have the capability, judgment and stature to make a significant contribution to the work of the commission. Section 7 details that any prospective commissioner must have substantial experience at a senior level in relevant fields. Frankly, I expect the commissioners to be leaders in their fields.

The extensive functions and responsibilities of the commission are set out in section 6. It is normal practice for members of semi-State boards, committees and commissions to be paid fees and expenses. Section 7(10) makes it possible for such remuneration to be provided to the commissioners. As I stated on Committee Stage, commissioners will have a considerable amount of work to do and I envisage that they will have to devote a part of their working week to the service of the fund. They should be recompensed accordingly for that commitment. Acceptance of this amendment would, by failing to even repay expenses, impose monetary costs on commissioners for a time-consuming and important job which they are performing in the service of the State. I, therefore, cannot accept the amendment.

Mr. Noonan

Will the Minister give some order of magnitude of the level of remuneration he intends paying, or the range of remuneration within which the honorarium might fall? I am not sure whether he intends it to be analogous to a director's fee of a semi-State company or he envisages it to be salary for committing oneself for half the working week to the work of the commission.

Mr. McCreevy

I do not have with me the range of directors' fees paid to semi-State bodies but there are three categories. From the lowest to the highest category they are very small, in the region of £4,000 to £7,500 for an ordinary director of a semi-State company. On the other hand, the full-time responsibility of a person of this calibre would be many multiples of £7,500. Given that commissioners will have to devote part of their work to this fund, I see the figure as being in excess of that level. However, it would not be in the region of that received by the Secretary General of a Department. I have not worked out this yet—

Mr. Noonan

The Minister is giving himself a fairly wide range.

Mr. McCreevy

I just put it from one extreme to the other. It was my intention to revise the fees given to directors of semi-State companies. This proposal has been around for some time and was considered by the previous Administration. The last Buckley report recommended new governance procedures and an updating of fees in this regard. I intended to introduce some changes but some months ago I decided to await the new Buckley report to see the categories in which it placed semi-State bodies.

When I consulted Government colleagues they all naturally thought semi-State companies under their remit should go to a higher category. That is why I decided the best course of action was to wait for the Buckley report and have another stab at this issue. I am signalling my general intention to increase the level of fees paid to directors of semi-State companies but not to an extraordinary extent. I see the level of such fees as higher than those currently paid but not as high as those paid at the highest levels in the public service. I will consider this issue further to decide on the levels.

Amendment, by leave, withdrawn.

An Ceann Comhairle

Amendments Nos. 12 and 13 are related and may be taken together.

Mr. McCreevy

I move amendment No. 12:

In page 12, lines 19 and 20, to delete "the board of a health board or the Eastern Regional Health Authority,".

These amendments stem from a point made by Deputy Noonan on Committee Stage. The purpose of section 11 is to exclude public representatives from membership of the commission. Members of local authorities, health boards and the Eastern Regional Health Authority are among the categories of persons excluded from serving as commissioners. However, as the Deputy pointed out, persons who are not public representatives may be appointed to health boards and the ERHA. The amendment is designed to ensure such persons are not excluded from serving as commissioners.

Mr. Noonan

I thank the Minister.

Amendment agreed to.

Mr. McCreevy

I move amendment No. 13:

In page 12, lines 27 and 28, to delete ", who is a member of a local authority or the board of a health board or the Eastern Regional Health Authority," and substitute "who is a member of a local authority".

Amendment agreed to.

Mr. McCreevy

I move amendment No. 14:

In page 13, line 7, after "recorded" to insert "and the Commission may, at its discretion, refer to the disclosure in its report to the Minister under section 27".

Section 12(1) requires the commission, a member of a committee established by the commission, a member of staff or the manager to disclose any material interest in respect of matters to be considered by the commission, a committee or the manager. The person must disclose the nature of his or her interest to the commission, the manager or the committee and this must be done in advance of consideration of the matter. The section also obliges the person not to become involved in any consideration of or decision on the matter in question.

Section 12(2) requires disclosures of interest to be recorded in the minutes of the relevant meeting or otherwise duly recorded. This amendment, which was suggested by Deputy Noonan on Committee Stage, will enable the commission, at its discretion, to refer to any such disclosures of interest in its annual report. The amendment will increase the transparency of the operation of the commission. The amendment refers to the "commission" rather than the "chairman" as the chairman of the commission might have a conflict of interest.

Amendment agreed to.

An Ceann Comhairle

Amendments Nos. 15 and 16 are related and may be taken together.

Mr. McCreevy

I move amendment No. 15:

In page 13, line 35, after "£1,500" to insert "or to imprisonment for a term not exceeding 6 months or to both".

Section 13 of the Bill restricts persons involved in the operation of the fund from divulging confidential information regarding the fund, unless authorised by the commission. It also provides for sanctions for contraventions of this provision. Given the sums of money involved and the likely sensitivity of investment strategies, it is desirable to protect against unauthorised disclosure of confidential information.

These amendments increase the penalties for persons who disclose confidential information obtained by them in the performance of duties with regard to the fund. They provide for imprisonment for up to six months and two years on summary conviction and conviction on indictment, respectively.

Amendment No. 16 removes the ceiling of £20,000 on the fine which can be levied on a person on conviction on indictment. I removed this ceiling as it was suggested on Committee Stage that the type of confidential information which might be disclosed could be worth considerably more than £20,000 to the recipient.

Amendment agreed to.

Mr. McCreevy

I move amendment No. 16:

In page 13, line 36, to delete "not exceeding £20,000" and substitute "or to imprisonment for a term not exceeding 2 years or to both".

Amendment agreed to.

An Ceann Comhairle

Amendments Nos. 17 and 22 are related and may be taken together.

Amendment No. 17 not moved.

An Ceann Comhairle

Amendment No. 18 is out of order.

Amendment No. 18 not moved.

Mr. McDowell

I move amendment No. 19:

In page 15, between lines 38 and 39, to insert the following:

"The Commission shall, with the consent of the Minister, prepare and publish an ethical investment policy which the Commission shall apply in holding or investing monies standing to the credit of the Fund and which shall inter alia prohibit investment in enterprises involved in the armaments industry and the tobacco industry.”.

This amendment would oblige the commission, with the consent of the Minister, to prepare and publish an ethical investment policy. In recent months the Minister repeatedly stated his intention to distance himself and his successors from the operation of the fund. While I have no difficulty with this in principle, there are some major exceptions which we need to make. Primary among these exceptions is the need to ensure that investments of taxpayers' money is consistent with the rest of Government policy. It makes no sense for Government to seek to discourage the use of tobacco or, through the Department of Foreign Affairs, to oppose the armaments industry or the proliferation of arms if taxpayers' money is being applied to the opposite end. This amendment seeks to oblige the commission to prepare a policy which would give effect to an investment policy which is consistent with the gamut of Government policy and not with the singular aim of making more money.

Mr. McCreevy

In determining the investment policy of the fund, I considered whether the policy should be strictly commercial or whether it should be qualified by ethical, environmental and other public policy criteria. A major difficulty in deciding on an ethical investment policy is where to draw the line, given there will be different opinions and intense debate on what constitutes ethical and socially responsible investments. In short, there is unlikely to be broad consensus on any ethical investment policy.

Furthermore, the list of what might be considered as unacceptable investments is likely to continually change in light of developments in the political, social and scientific spheres. If one was to attempt to delineate appropriate investments for the fund there is a great danger of dragging the commission into a quagmire of public controversy and paralysing the fund's investment procedures.

Notwithstanding these considerations, I examined a number of approaches which might be taken to implement an ethical investment policy. One could copy the UK precedent whereby from July of this year the annual report of pension funds will have to contain a statement of the approach to ethical investments adopted by a fund. There will be no requirement on funds to invest in this manner but merely to state their policy.

A fund can use its voting rights to put pressure on companies to pursue ethical policies. It appears this approach can be accommodated within a commercial mandate, though its effectiveness is somewhat debatable, particularly as the shareholding in a fund of any one company will be relatively small. Some funds put aside a small portion of their assets into a separate fund which is invested according to ethical criteria. The drawback with this approach is that it is largely tokenism with the majority of the fund being invested in the normal manner.

Screening is an approach being used by some funds. This involves hiring analysts to examine all companies on an index. The analysts identify those companies with assets of the class to which the investor objects or, alternatively, companies adopting best practice. Having done so, the investment managers of the fund in question are given the target of beating the adjusted index, that is the index excluding the forbidden sectors or companies by a set percentage.

However, there are a number of drawbacks to this approach. For example, major costs are involved in hiring analysts and tracking the performance of the adjusted index. These costs would be multiplied for a large fund where a number of indices will be tracked. In addition, as the list of forbidden investments lengthens, there will be an increased risk of the portfolio becoming less diversified.

There would also be other operational difficulties. For example, with a customised portfolio it would not be possible to use equity futures to hedge against market exposure as such futures contracts are linked to broad market indices. In addition, there would be less opportunity to undertake crossing transactions whereby equities are traded directly with other funds, thereby cutting out brokers and reducing fees.

Clearly there would be significant difficulties in incorporating an ethical policy into the investment mandate, no matter what approach is taken in pursuing such a policy. Accordingly, the investment mandate included in the legislation is modelled on the standard commercial mandate for private pension funds, namely, maximise returns subject to prudent risk management. Indeed, any explicit reference to ethical investment would politicise the investment mandate and would give rise to significant difficulties both in its interpretation and in its implementation. I cannot, therefore, accept the amendment.

Mr. Noonan

What the Minister has effectively argued is that because it is very difficult to give any kind of ethical mandate to fund managers, he has decided to opt out completely. I do not think he should have opted out simply because it is a very difficult area to regulate. I would not like future pension funds to be invested in the arma ments industry. Other people might have no objection to that. There are aspects of the pharmaceutical industry to which some people might object, although I would have little enough objection to that. One man's ethic might be another man's neutral position. Situation ethics are becoming more common than ethics deriving from any particular religion or set of beliefs.

There is, however, an issue which Deputy McDowell's amendment addresses. I think the Minister is shirking it because of the difficulty of it. I cannot see why, in general terms, the commission should not be directed to be conscious of the ethical feelings of the public. While as was said, it is difficult to decide what particular investments would be ruled out, what might be ruled in or what the mechanism may be, there would be a general view about some aspects of investment in Ireland. A non-specific direction to commission might be of benefit.

I would not like if an Irish pension fund had a heavy portfolio of South African investment when the struggle was at its most difficult in South Africa and when the rest of the world was treating the South African supremacist administration as a pariah. There was a general policy of not investing there. Issues will arise and while the Minister has recited what is being done in other jurisdictions and generally came to the conclusion that none of them is effective, we should at least indicate somewhere in the relationship between the Minister and the commission that there may be considerations other than strictly commercial ones and that the commission should be aware that there are considerations other than commercial ones in certain circumstances even if these are not specified.

I do not think the Minister has met the views expressed on Second Stage. I know why the Minister is following this line – it is the easiest line to follow. It is certainly the most clearcut line to follow but I do not think it meets the foreseeable circumstances when the commission comes to invest. Without some indication from the Minister, it seems it cannot take ethical considerations into account. If a fund is being managed by a fund manager from Germany, the commission will have no say if the fund is invested in what the generality of Irish people might regard as an unethical company.

We should maintain some control – the commission should have some control. Somebody should have some say. It is like a couple of parallels in history. If we do not make an exception, the opposite applies. By having no reference to considerations other than commercial ones, we are mandating the agency and the commission to act on commercial grounds only. That is the problem with it. It is not that it would act on commercial grounds, but commercial grounds is the only valid interpretation. The Minister is preventing it, in its discussions, from considering anything of an ethical or political nature or whatever words one would like to use. The Minister might think about this again on his way to the Seanad.

Mr. McDowell

The amendment does not seek to set out an ethical investment policy, it merely requires that the commission should prepare an ethical investment policy with the consent of the Minister. There are just two requirements specifically set out in this amendment, that is, that there should be no investment in the armaments or the tobacco industries. Beyond that, substantial discretion would be available to the Minister and the commission in developing an ethical investment policy. That is the major point I would make.

The Minister accuses me of politicising the issue or suggests that decisions of the commission would be politicised and, of course, he is right. That is precisely what I seek to do here because the investment of money is not just a purely business matter. The investment of taxpayers' money is a political matter and has a significant political and ethical side to it.

The Minister, by side-stepping it and basically saying that the use of taxpayers' money is not a political matter, is himself making a moral and political judgment in relation to the use of taxpayers' money. He is effectively saying: "This is only business, keep politics, values and ethics out of it and let us get on with the business of generating more money." I do not think that would be acceptable to the majority of Irish people. I am not asking the Minister to set out an ethical investment policy now, I am merely asking that he amend the Bill to allow the commission to develop such a policy, with his consent, in the future.

Mr. McCreevy

I am aware the Deputies raised this on Second and Committee Stages. It is a matter that I considered in preparation of this Bill and, as I explained on Second and Committee Stages, I decided for the reasons I have outlined that this was the best way to go. Deputy Noonan said we would have no say over what a German fund manager would do. The commission will set the policy for the German fund manager.

Mr. Noonan

It cannot say anything about ethical standards because the Minister is preventing it from doing so.

Mr. McCreevy

The best way to deal with this is through the transparency mechanism I have included in the Bill, that is, that there will be a report and it will be debated in the Dáil and by an appropriate committee. The report will set out the list of investments every year. I do not want the Minister for Finance to direct in this area, and if we stray over into the area, I will be doing that.

If there was a change of Ministers and Deputy Gormley was in this position – it could happen, a member of the Green Party could be Minister for Finance in a number of years' time – I am sure his ideas of ethical investment would be different from mine, Deputy Noonan's or maybe Deputy McDowell's.

Mr. McDowell

I am sure we could accommodate him.

Mr. McCreevy

I am just saying he has a different view. I am not saying this to denigrate Deputy Gormley, but I am thinking of a Deputy who is a member of a party which could possibly be in Government and in this position.

Mr. Noonan

Martin McGuinness.

Mr. McCreevy

I had better not give my views on that or I will be in more trouble. Perhaps the Deputy's aside was not taken up by the parliamentary reporter.

An example of a difficulty would be a ban on the arms industry. A ban on the arms industry would involve a ban on investing, for example, in computer chip manufacturers because chips are included in weapons systems. The more I looked at this area before we produced this Bill, the more I concluded that this would be a nightmare. I decided that the most simple and straightforward way was to apply the rules that apply to normal private pension funds. That was my decision on the matter and I will not be revisiting it. I gave it long and careful thought and we looked at it in depth before we brought the Bill to Government. This, I concluded, was the best way to proceed.

Amendment put and declared lost.

An Ceann Comhairle

Amendments Nos. 20 and 21 are related and both may be discussed together. Is that agreed? Agreed.

Mr. McDowell

I move amendment No. 20:

In page 15, after line 47, to insert the following:

"(2) Notwithstanding subsection (1), the Minister may by order give directions to the Commission to require it to hold or invest monies standing to the credit of the Fund in a manner specified in the order and otherwise than in a manner which secures the optimum total financial return thereon, where the Minister is satisfied that such requirement is conducive to the common good.”.

Amendments Nos. 20 and 21 are also related to amendment No. 19 and Deputy Noonan referred to the central point. As formulated, the Bill requires the commission to get optimal benefit from the investment of funds. This effectively requires it to make the most possible money irrespective of any other consideration. As formulated, it requires it to disregard any other consideration and this is where the difficulty arises.

In the amendments, I have tried to develop a mechanism under which the Minister can indicate and, if necessary, give a direction to the commission in relation to a particular type of investment. The type of investment I envisage is similar to the type referred to in relation to the previous amendment. It would enable the Minister, if he chose to do so, to give a direction that, for example, investment in South Africa should be terminated if that was his and the Government's view at the time.

At it stands, the Bill does not provide such a mechanism for the Minister. By setting out the requirement that there must be optimal return, it prevents the commission from taking that view on its own. The Minister's comments in relation to the earlier amendment appear to suggest that not only does the Bill not contain an ethical policy and the Minister does not intend to set such a policy, but it prohibits the commission from doing any of the various things he described, such as screening, dealing with futures, etc. This is wrong. The commission should at least have the discretion to make these decisions and to follow those policies with the consent of the Minister. I suspect that, in rare circumstances, the Minister may have the power to direct the commission to make or discontinue a particular type of investment.

Mr. McCreevy

In discussing the amendments, it would be useful to set out the key principles I enshrined in the legislation establishing the fund. I am extremely conscious that the people's money is being invested in the fund and I have, therefore, constructed the fund to enable it to match the returns achieved by private pension funds. To this end, the fund will operate like a private pension fund. Its investment strategy cannot be influenced by other policy considerations and the fund moneys cannot be used by future Governments for other purposes. These aims are reflected in two key features of the Bill.

First, the fund will be managed by commissioners who will be independent of Government and will control and manage the fund with discretionary authority to determine and implement an investment strategy for the fund. The independence of the commissioners is the cornerstone of the legislation. To prevent the fund being politicised, a development which would seriously compromise the investment return, I have deliberately ensured that the Minister for Finance does not have any right to give directions to the commissioners or set the criteria to which they must adhere.

Second, this investment strategy will be based on a commercial investment mandate with the objective of securing the optimum return over the long term, subject to prudent risk management. I do not consider it appropriate to ask the commissioners to take other national or social objectives into account when determining an investment mandate for the fund. Any dilution of the commercial nature of the investment mandate, for example, by requiring the commissioners to support particular projects in Ireland, could seriously compromise the returns achieved by the fund.

The purpose of the fund and the justification for asking the taxpayer to make a contribution to it of 1% of gross national product each year is to provide, as far as possible, for the costs of future pensions. The State has a solemn duty to do everything it can, in accordance with prudence, to maximise the return on this investment. The use of fund moneys for any other objective, no matter how laudable, should not be countenanced. Such objectives are worth considering and if they are worth achieving, they can be obtained in other ways. The amendments could affect these key features of the fund and I, therefore, cannot accept them.

Mr. McDowell

An analogy would be the position of regulators – the Department of Public Enterprise in particular has dealt with this matter at great length – where the Government sets the policy and the regulators administer it and deal with it on a day to day basis. There is an overlap and this is acknowledged, but the primary responsibility in the first instance falls on the Minister or the Government.

The Minister appears to suggest that he is divesting himself of the policy making role. He is satisfied that one section in the Bill will set the policy for the next 25 years and that, after that time, it will be up to the commission to do the business. This is not sufficient in terms of the policy making role of the Government and the Minister. He must at least retain a discretion on occasion to intervene and to set the policy in the future.

Mr. McCreevy

As I explained on previous Stages, I do not agree with that contention. I readily accept there are other viewpoints but, as officials in my Department will testify, I am certain about the way I want the fund to be established and that it should not be under the control, either directly or indirectly, of the Minister for Finance.

In that regard, I was amused after the Bill was published that an editorial comment in one of the national newspapers stated that it was obvious the fund would be under the control of the Department of Finance. However, an article in relation to the press conference about the Bill gave the correct detail that this was the last thing the Minister wanted. Any cursory reading of the Bill would indicate that, if I should be criticised at all, it should be because the opposite is the case and control has been given away, as Deputy McDowell said. People working for the same newspaper do not necessarily read a Bill with the same intensity or they misinterpret it. It was amusing because if I am to be criticised, it should be because of the point made by Deputy McDowell.

Mr. McDowell

Privatising the use of taxpayers' money.

Mr. Noonan

The Minister gave the same answers to these amendments as he did to the previous amendment, but the point is different.

Mr. McCreevy

Yes.

Mr. Noonan

The difficulty is that, even if one agreed with the Minister that a regulatory regime or ethical mandate should not be laid down for the investments, by having only one criterion, the commercial return, the Minister is preventing the commission from using its discretion on investments. No consideration other than the commercial return can be taken into account.

Historically, one could name cases where international companies were involved in scandals. I will not name companies, but if one looks back over the past ten years, there have been scandals involving the manner in which international companies treated their workers and the environment and about how certain countries treated their citizens. Investment in their businesses or industries would have been deemed improper by many Irish citizens.

What will happen in the future if the pension fund is invested in a company about which an enormous scandal emerges? For example, what would happen if it had an international operation in central Africa and there was clear evidence of a total degradation of workers, an abuse of fundamental human rights and the total exploitation of people, but the rate of return was very good? It appears the Minister has refined the mandate to the point where the commission could not pull the equity stake out of such a company unless it was sure it could invest that equity stake for a greater return elsewhere. This creates a difficulty because by not giving any wider mandate other than the commercial, the Minister is instructing the commission not to use its good sense.

An Ceann Comhairle

The Minister has already spoken so he cannot speak again. Does Deputy McDowell wish to reply to the points made?

Mr. McDowell

I do not think there will be any meeting of minds on the matter.

Amendment put and declared lost.

Amendment No. 21 not moved.

An Ceann Comhairle

I ask Deputy McDowell to move amendment No. 22 and to bear in mind the note.

Mr. McDowell

I move amendment No. 22:

In page 16, line 10, after "pensions" to insert ", but in any year, up to one quarter of the amount paid into the Fund in respect of that year may be paid by the Commission from the Fund to the Exchequer at the request of the Minister in respect of services other than future social welfare pensions and public service pensions, if and only if he or she is satisfied that to do so would not involve an actual or potential charge on public funds.".

I am not sure I understood the strictures the Ceann Comhairle set out at the start of the debate. I presume that if I wander into certain territory, I risk the amendments collapsing into disorder or being ruled out of order.

The Minister is aware of my view on this matter and a similar view was articulated by Deputy Noonan. We must simply take into account the possibility that at some point in the next 25 years economic circumstances will change and that we may wish to make a smaller contribution to the fund, in any given year, than the 1% set out in the Bill. What we are seeking is a small measure of flexibility.

The Minister often complains about his views being distorted by the media. I have had a similar experience in recent weeks with the assistance of some of the Minister's colleagues. I admit that the Minister was not involved but a number of his colleagues have been quick to accuse me of arguing in favour of raiding the fund. As the Minister is aware, I am merely seeking to provide that a relatively small measure of flexibility would be introduced to allow account to be taken of both the prevailing economic circumstances in any given year and the demographic projections to hand at any given time.

In the past three or four years, during the debate on this matter, we have had the opportunity to consider changing demographic projections. I spoke to the Minister in private a few days ago in respect of a supplement that appeared in the Financial Times, which sets out in stark terms the contrast between the projected liability for Ireland and the liabilities for other European countries. Regardless of the demographic changes that occur and the burden that will evolve in this country during the next 25 years, it is clear that, in terms of GNP and relative affordability, we will still be faced with a much smaller pensions bill than any other EU or OECD country, irrespective of whether it is pegged to prices or earnings. All Deputy Noonan and I have been saying is that in order to take into account the need for flexibility, there should be a possibility to reduce the contribution in any given year to 0.75%.

Mr. McCreevy

The budget strategy group that was established by my Department to consider the budgetary issues posed by ageing estimated that approximately 3.5% of gross national product would have to be set aside annually to equalise the Exchequer burden of health and pension costs during the next 50 years. However, given the magnitude of the prospective costs involved and the many other competing demands on the State's finances, the group concluded that a more feasible sum to set aside would be 1% of GNP, which it was estimated would meet approximately 30% of these costs. In making this recommendation, the group acknowledged that it was making no provision for the post-2056 situation.

The Bill gives discretion to future Governments to extend the life of the fund beyond 2055. While our demographic projections do not go beyond 2056, when we estimate there will be one retired person for every two persons of working age, it would be quite unrealistic to expect a quick decline in the ratio. The ageing problem will continue for some years at least and perhaps some decades after mid-century.

In establishing a single reserve fund which is not designed to meet a defined liability but to part fund social welfare and public service pension costs to a year potentially beyond 2055, I decided to adhere to the recommendation of a contribution of 1% of GNP. This is at a level which will make a significant contribution to future pension costs and it is a sustainable commitment. Once built into the multi-annual budgetary structure, it should not cause undue difficulty.

As stated on Second Stage, the contribution is slightly less than our annual contribution to the EU budget and less than one third of the interest payment on the national debt in 1999. If our economic circumstances make contributions over and above the 1% of GNP feasible, the Bill allows additional contributions to be made to the fund by way of resolution of Dáil Éireann. In effect, the 1% of gross national product is a minimum annual contribution to the fund and it is open to Governments to make an increased contribution in any particular year.

Given the size of the pensions liability that is awaiting us and a projected increase of 7.7% of GNP on current levels by 2055 and in light of the fact that the fund will meet only part of this liability, I would be firmly opposed to any measure which lessened the 1% contribution to the fund. I do not accept that in earmarking 1% of gross national product for the fund the Government is in any way neglecting the current needs of our society. Contributions to the fund are not being made at the expense of other goals and commitments.

As a result of our economic success, we are in the happy position of being able to pre-fund, within a sustainable budgetary strategy, which will also allow for substantial infrastructural and other capital investment under the national development plan, continuing implementation of the Programme for Prosperity and Fairness, further improvements in public services and ongoing reduction in the national debt. In short, the economic success we have worked so hard to achieve and the demographic bonus we are currently enjoying allows us to make provision for future pension liabilities without compromising on our more immediate economic and societal goals.

To allow discretion in the making of the 1% contribution in the manner envisaged by the amendment would significantly reduce the capacity of the fund to meet future pension liabilities. I need not remind the House of the straits in which prioritising short-term interests over the longer-term sustainability of the public finances has left us in the past. A contribution of 1% of GNP is a prudent and sustainable commitment and I cannot, therefore, accept the amendment.

Mr. Noonan

I withdrew a similar amendment in my name because we had an intensive debate on this matter on Committee Stage. However, it is interesting to look forward and try to project what might happen to the national finances. Obviously, one must base one's consideration of future developments on some assumptions. However, if we assume that growth rates will continue at between 5% and 6% in the future, it is possible to put 1% aside, continue to run budget surpluses, provide tax relief and spend the level of money on services which Members on all sides have been calling for in recent times. It does not take a great deal to go wrong before one's arithmetic is upset. One does not need to be an expert on econometrics to calculate what will happen to the national finances – one could do one's sums on the back of an envelope and one's answer would not be far wrong.

If there was an isometric shock in the United States, if current trends on Wall Street and in the Nasdaq index were to continue, if the US economy entered a period of negative growth and interest rates were reduced to combat this and if the American business cycle entered an 18 month or two year period of bottoming out before beginning a slow climb, it is possible that growth in this country would not be maintained at between 5% and 6%. The Minister is aware that there is a risk of a wage explosion in the country at present. If I was in his shoes, that would be my primary fear.

In light of tomorrow's rail strike, the six different industrial relations disputes in Aer Lingus and the fact that teachers will again go on strike this week, it is clear that the PPF is under pressure. If a public sector wage explosion occurred in this country and there was a downward trend towards the bottom of the business cycle in the United States, without any recession occurring here or in America and even with growth rates of 2% and 3%, one's projections for the future would turn out differently.

It is against that background that Deputy McDowell and I are asking if it is prudent for the Minister to tie the hands of his successors. Would it not be appropriate to allow for discretion on the part of the Administration of the day in order that the amount to be dedicated to a pension fund would fall within a certain range?

I know the Minister is concerned that he will be replaced by an imprudent successor who, when times get bad, instead of raising taxes or cutting public expenditure will raid the fund or reduce the contribution to it. However, he made the point that any of his successors with a majority in the House will be able to introduce amending legislation if they do not want to invest money in the fund. There is a risk that this will happen in periods of great recession when there will be a shortage of funds for basic services. If, for example, one of the Minister's successors was faced with closing several hospitals, a great deal of pressure would be exerted to reduce the 1% contribution if it became clear that people would suffer. There might be a consensus at that point to introduce amending legislation which would prevent money being invested in the fund for a number of years. If the discretion is put in place now, it is more likely that the 1% contribution will remain intact in the future.

We debated this matter at length on Committee Stage and I will not delay the House. However, there is validity in the point Deputy McDowell and I made on Second and Committee Stages. We believe the Minister is taking a very rigid stand on this matter and that may not be the most prudent or wisest course of action.

Mr. McDowell

While listening to the Minister I was reminded of how blasé we have become about relatively large sums of money. For many years we were told by, among others, the Minister and his Department that the notion of contributing 0.7% of GNP to overseas development aid was unthinkable, that to aim for such an imprecise amount of money was completely inconsistent with any notion of prudent budgeting in the future. Yet suddenly when things changed the notion of setting aside 1% of GNP for liabilities which will not arise for a quarter of a century—

Mr. McCreevy

We are aiming to achieve a figure of 0.75%—

Mr. McDowell

I put a few quid with the Minister that this will not be achieved even if he is still in office.

Mr. McCreevy

I will do it this year.

Mr. McDowell

The figure is 0.35% and the Minister has to reach a figure of 0.45% before this time next year, which he will be lucky to achieve. However, that is another issue.

The commitment made in terms of GNP is an imprecise amount and is much money. The Minister said that this does not have to be done at the expense of anything else. Given the budgetary circumstances, of course he is right – he can spend as much as he wants, cut taxes by a huge amount, set aside money for the national debt and future pension liabilities and probably buy up most of the land in north County Kildare. However, nobody thinks the budgetary situation will continue, and it certainly cannot continue into the indefinite future.

As this Bill deals with long-term liabilities, we have an obligation to cast ourselves ten years into the future when there may be an isometric shock or some other difficulty in the economy. As the Bill is currently drafted, we could find ourselves in the bizarre situation where we have borrowed money at one rate of interest and put it into a fund where it is invested to earn a lower rate of interest. In straight economic terms this makes absolutely no sense, and the simple purpose of the amendment is to provide for a relatively small amount of flexibility in circumstances which are different from the ones we find ourselves in today.

Amendment put and declared lost.

Mr. McCreevy

I move amendment No. 23:

In page 17, line 27, after "his" to insert "or her".

This amendment corrects a drafting error in the Bill.

Amendment agreed to.

Mr. McDowell

I move amendment No. 24:

In page 19, to delete lines 6 to 9.

The Minister's amendment No. 25 meets some of the points covered by this amendment in that it sets out the nature of the accountability. I, therefore, withdraw my amendment.

Amendment, by leave, withdrawn.

Mr. McCreevy

I move amendment No. 25:

In page 19, to delete lines 27 to 29, and substitute the following:

"(4) The chief executive officer of the Manager shall, whenever required by the Committee of Public Accounts, give evidence to that committee on–

(f2>a) the regularity and propriety of the transactions recorded or required to be recorded in any book or other record of account subject to audit by the Comptroller and Auditor General which the Commission is required by or under statute to prepare,

(f2>b) the economy and efficiency of the Commission and the Manager in the use of the resources made available to them under sections 17 and 23, respectively,

(f2>c) the systems, procedures and practices employed by the Commission for the purposes of evaluating the effectiveness of its operations, and

(f2>d) any matter affecting the Commission referred to in a special report of the Comptroller and Auditor General under section 11(2) of the Comptroller and Auditor General (Amendment) Act, 1993, or in any other report of the Comptroller and Auditor General (in so far as it relates to a matter specified in paragraph (a), (b) or (c) that is laid before Dáil Éireann.

(5) The chief executive officer of the Manager if required under subsection (4) to give evidence, shall not question or express an opinion on the merits of any policy of the Commission or the objective of such a policy.”.

Amendment agreed to.

Mr. Noonan

I move amendment No. 26:

In page 19, line 34, after "Oireachtas" to insert "and the Minister will be accountable to Dáil Éireann for any matter in the report or arising from the report".

It is not clear that the Minister will be accountable to the Dáil for the policy decisions made by the agency or the commission. I have retabled a Committee Stage amendment which would require the Minister to be accountable to the Dáil for any matters in the annual report. The Minister thought this was too widely cast, but gave a limited commitment which I would like to be put on the record.

Mr. McCreevy

As I outlined during the debate on amendments Nos. 20 and 21, the independence of the commission is a cornerstone of the legislation. This is to enable the fund to generate returns in line with those achieved by private pension funds and to ensure that its investment strategy cannot be influenced by other policy considerations. Thus, I have deliberately ensured that the Minister for Finance does not have any right to give directions to the commissioners on the set of criteria to which they must adhere. The proposed amendment is not consistent with this approach. By making the Minister accountable to the Dáil for the matters set out in the report of the commission, it disturbs the arm's length relationships between the Minister and the commission. In this scenario the Minister would be forced to exercise much closer control over the activities of the commission than is provided for in the Bill and much of the discretion awarded to the commission under the Bill would be compromised.

If the approach proposed in the amendment was adopted it would be necessary to further amend the Bill to enable the Minister to give directions and guidelines to the commission regarding its activities. Otherwise, the Minister would be accountable for activities over which he had no control. Such an approach runs counter to the basic philosophy underpinning the Bill and I must, therefore, reject it.

During the debate on Committee Stage, Deputy Noonan asked whether the Minister could answer parliamentary questions on the fund. I said that I would answer questions on the overall performance of the fund. However, the accountability arrangements being put in place in the Bill provide that the chairperson of the commission is accountable to the Committee of Public Accounts in respect of policy matters, while the chief executive or manager is accountable to the committee in respect of the accounts of the fund and other operational matters. Hence, it would not be appropriate for the Minister to answer questions on these issues.

On Committee Stage Deputy Noonan asked if I would consider the possibility of bringing for ward an amendment on Report Stage enshrining in statute the responsibility of the Minister to answer parliamentary questions on the overall performance of the fund. I considered this approach but do not think it would be an appropriate way to proceed. If one were to set out in the Bill the instances in which the Minister would answer parliamentary questions it would raise the question of why such an approach should not be adopted in legislation generally. I am satisfied that the accountability provisions outlined, the publication of the annual report of the commission and the commitments I have given that the Minister, as the owner of the fund under section 18(7), will answer questions on the overall performance of the fund are more than adequate to ensure that the management of the fund is conducted, and is seen to be conducted, in an accountable and transparent manner.

Mr. McDowell

I agree there is a consistency in the Minister's responses but I do not agree with it. He is, in effect, privatising the use of a huge chunk of taxpayers' funds. He is saying that he is not responsible for the administration of the fund, which I understand, or for policy, other than the one or two sentence provision set out in the Bill. This is not politically acceptable and I suspect it may be a legally doubtful way of dealing with taxpayers' money. I disagree fundamentally with the Minister on this point.

Mr. Noonan

As indicated on Committee Stage, if the first question is ruled out of order, questions will not be taken in future. However, if it is not ruled out of order a precedent will be established for the taking of questions. I take it the Minister's assurance on the record is that he will answer questions on general policy.

Mr. McCreevy

On the overall performance of the fund.

Mr. Noonan

I also take it that when such a question is tabled by Members of the Opposition the Minister's officials will not argue the case on the telephone with the Ceann Comhairle's office that it is out of order and the Minister will agree to take it.

Mr. McCreevy

I will answer questions on the overall performance of the fund, but I will not answer specific questions on policy and other matters relating to the operation of the fund as they are matters for the commissioners who will be answerable to the appropriate committees.

Amendment, by leave, withdrawn.

Mr. McCreevy

I move amendment No. 27:

In page 20, line 34, to delete "paragraph" and substitute "subparagraph".

This is a drafting amendment which corrects a reference to provisions of the Taxes Consolidation Act, 1997.

Amendment agreed to.

Bill reported with amendments.

Acting Chairman (Mr. O'Malley)

When is it proposed to take Fifth Stage?

Mr. McCreevy

Now.

Acting Chairman

Is that agreed? Agreed.

Question, "That the Bill do now pass", put and agreed to.