Adjournment Debate.

Financial Markets.

Deputy Joan Burton

I apologise for being a little late. I was confused about the timing as a result of all the votes.

With the current turmoil in the financial markets, it is now a matter of urgency that a reformed compensation scheme for depositors and savers with banks should be put in place. We have seen a number of banks experiencing severe financial difficulties in recent weeks and people would have witnessed depositors and savers in Northern Rock queuing outside the bank's headquarters. In Ireland, if the bank was to fail utterly, the maximum compensation currently available to savers and depositors is extremely low. It equates to 90% of savings, with a maximum limit of €20,000.

Despite the introduction of the Irish Financial Services Regulatory Authority, this particular area has yet to be reformed. The British Chancellor of the Exchequer recently announced that the UK system was to be reformed, with the Bank of England and the UK Treasury offering high levels of guarantees to savers and depositors. Northern Rock is an on-line bank without a bank structure here, so it became very difficult for customers to make phone and e-mail contact with the bank in the early days of the panic.

The Minister for Finance must put in place appropriate structures that will protect the integrity of the banking system and bank customers. The integrity of the banking system is fundamental to our economic well-being. Problems in the global credit market will, in turn, impact on those who wish to purchase houses, start businesses or simply ensure that their savings are secure. To date, the Minister for Finance has been astonishingly silent in respect of these issues. There has been no opportunity for any form of Dáil debate, not even at the Joint Committee on Finance and the Public Service, which the Government has not bothered to re-establish since the general election.

The people have a right to know if the Minister for Finance has his eye on the ball in respect of these key issues. He simply cannot hide behind the Financial Regulator. I want the Minister to make an honest statement, setting out clearly the likely impact of the turmoil in the financial markets on the banking sector, in particular, and the economy in general. What response, if any, does he propose to make as regards the clear risks involved for Irish savers and businesses as a result of recent events? Financial services have been a key component of growth in the economy during the past decade. Any difficulties experienced by this sector will, therefore, have a knock-on effect elsewhere.

The Financial Regulator must clearly outline the protections that are in place or indicate the structures that need to be revised in order to protect the customers of banks and credit unions. A full analysis must be made of the sub-prime market in Ireland, both in terms of investments by Irish banks and credit unions in financial derivatives and other new financial products. In addition, there is a need to produce a profile of the lending activities of sub-prime lenders in the economy. I am concerned that a number of such lenders are taking unacceptable risks as regards some of the lending in which they are engaged. The Joint Committee on Finance and the Public Service should be immediately re-established to examine these issues in public.

I want to be assured that the Minister is sending out a clear message that cowboys and unacceptable lending practices on the part of financial institutions in Ireland will not be tolerated. On previous occasions I raised with the Minister of State, Deputy Noel Ahern, the fact that the representatives of sub-prime lenders are calling door to door in local authority housing estates and in areas where people have purchased affordable housing and are offering to roll-up all their debts, including car and holiday loans. They are also placing inflated values on these people's homes and giving some of them more than 100% mortgages. Mr. Des Geraghty, chairman of the affordable housing partnership, recently and correctly stated that this type of behaviour, as it relates to lending, is insane. If the individuals involved default on their new loans, the level of charges and penalties imposed by sub-prime lenders means that many of them stand to lose their homes.

Minister of State at the Department of Finance (Deputy Noel Ahern)

The first and most important point I wish to make on behalf of the Tánaiste in responding to these issues is to highlight the importance of a well capitalised and soundly regulated banking system in underpinning the safety and security of savings, particularly in situations of financial uncertainty. Ireland has an excellent regulatory regime and a very solid banking system. The recently published IMF report on the Irish economy concluded that the Irish banking system is well capitalised, profitable and liquid. It also noted that the Central Bank is satisfied that major lenders here have adequate resources to cover a range of potential shocks.

As far as the effectiveness of the Irish regulatory system is concerned, the House will be aware that financial regulation here is based on a comprehensive and detailed EU template and conforms to international standards of best practice. The IMF report to which I refer explicitly acknowledged the strengthening of the financial regulatory and supervisory system in Ireland in recent years. In terms of the response to the change in financial market conditions, the Financial Regulator has said on a number of occasions that it has increased its ongoing dialogue focusing on recent financial market developments with other regulators and regulated entities in Ireland.

Major progress has been made in strengthening consumer protection in the financial area. The consumer director of the Financial Regulator has an explicit mandate to protect the interests of consumers. The introduction of the consumer protection code represents significant progress in that regard. The Tánaiste has already announced his intention to bring forward legislative proposals during the current Dáil session to ensure that all consumer lending, including what is described as sub-prime lending, will be subject to the consumer protection code. The debate on that legislation will present an opportunity to discuss this matter and to reign in those cowboys, if they exist, to which the Deputy refers.

In reviewing recent events affecting Northern Rock, it is important to state that the branch structure under which it operates in Ireland places responsibility for the overall prudential supervision of the bank with the UK authorities under EU law.

Deputy Joan Burton

It is not regulated in Ireland.

Deputy Noel Ahern

The UK authorities have made it clear that Northern Rock is solvent, exceeds its regulatory capital requirement and has a good quality loan book. The UK Chancellor's statement that all deposits are safe was obviously welcome and was successful in reassuring savers in Northern Rock, including those in Ireland. The Tánaiste would note that the Central Bank and Financial Services Authority of Ireland, CBFSAI, operates within the overall context of the euro system and the European Central Bank.

It is obvious that there are important lessons to be learned from all of this, including the effectiveness of deposit protection arrangements across the EU. The European Commission recently concluded a review of the deposit protection schemes directive, which sets the framework for national schemes in the EU. It will be necessary to re-examine this work and, in light of recent developments, to ensure that deposit guarantees strike the right balance between protecting depositors and seeing to it that banks are not encouraged to take inappropriate risks. If the system provides total protection, banks will not be encouraged to play ball and be responsible.

The performance of the global economy will be an important factor in restoring confidence among investors and in financial markets. In that regard, growth internationally remains relatively robust despite continued uncertainty in financial markets. As far as the national picture is concerned, prospects for the economy are very favourable by international standards. A clear focus on our competitiveness and on a prudent and responsible approach in respect of the public finances will contribute in that regard.

I assure the Deputy that the Tánaiste has his eye on the ball. The proposed legislation to which I refer will provide us with the opportunity to debate this matter. When I held my previous portfolio, I spoke on many occasions about financial institutions, one to two years ago, being over-generous as regards mortgages. At the time, I did not receive a great deal of support. Some people in the media and elsewhere rubbished what I had to say. Many individuals could see that a problem was coming down the tracks. It is fine to give a 100% mortgage to someone who has major potential and who has left college to take up an extremely lucrative career. However, some people were handing out leaflets relating to lending on Grafton Street as if they were advertising pizzas for lunch. Some irresponsible lending activities were engaged in. The Tánaiste's proposed legislation will provide us with ample opportunity to discuss this matter.

Health Services.

Deputy James Reilly

I wish to share time with Deputy Terence Flanagan.

Cystic fibrosis is a serious illness and one in 19 people are carriers of the cystic fibrosis gene. Where two parents with the gene marry, there is a one in four chance that their child will be born with the condition. Each year, 40 to 50 children are born with cystic fibrosis and there are currently in the region of 1,200 people who suffer with it. The disturbing aspect of this matter is that, on average, people in this country with cystic fibrosis live ten years less than those who reside in the UK or Northern Ireland. This is because we do not have proper neonatal screening so we can detect people with this problem early on and prevent infections, we do not have proper home care supports and, most importantly, we do not have any isolation units in our hospitals. Neither Temple Street Children's Hospital nor Beaumont Hospital on the north of the city have these facilities for children or adults. A total of 80% of adult sufferers are treated in either St. Vincent's Hospital or Cork University Hospital, neither of which has isolation facilities.

We know we need a 34-bed unit, which we hope will be built in St. Vincent's Hospital, but when will it be built? The Taoiseach, the Minister and the Department of Health and Children met with the Cystic Fibrosis Association of Ireland, which has received assurances. However, it is still no further down the line. Even though €4.78 million was allocated, I understand that many people have not been employed due to contractual difficulties. We still have the glaring problem of the lack of isolation beds in our system. It cannot be that expensive to build these beds on to existing hospital structures. This cannot be yet another situation where we are asked to live horse and eat hay. People need these facilities now. People in our country are dying ten years sooner than they need to purely because of the lack of this simple measure which a Government should put in place immediately. I ask the Government to do so.

Deputy Terence Flanagan

I thank Deputy Reilly for the opportunity to speak about cystic fibrosis and the lack of services for sufferers in Ireland. As a Deputy representing Dublin North-East, I am very aware of this issue. During the general election campaign, many members of the Cystic Fibrosis Association of Ireland actively campaigned on this issue and brought it to my attention. I thank those people and commend them for their good work.

As Deputy Reilly noted, with 1,200 or so patients in Ireland, we have the highest proportion of people with cystic fibrosis in the world. This is totally unacceptable. Life expectancy for sufferers is significantly lower in Ireland than in Northern Ireland and the UK. One might ask this Minister why this should be the case. As Deputy Reilly noted, there is a severe lack of neonatal screening, home care and supports for sufferers and families, and isolation beds for sufferers of the disease. Medical cards are not available to young sufferers of the disease who deserve them.

All this could be changed overnight if the Minister for Health and Children had the political will to deliver proper cystic fibrosis services. Fine Gael recognises the serious deficiencies in services for cystic fibrosis sufferers in Ireland and the difficulties they are faced with on a daily basis. We deplore the fact that the life expectancy of cystic fibrosis patients in the Republic of Ireland is lower than in the North of Ireland.

At a time of unprecedented economic success, Fianna Fáil and the Progressive Democrats failed to implement the recommendations of the Pollock report. Funding was set aside in the 2006 budget for the recruitment of 57 additional specialist staff. Can the Minister confirm if they have been recruited? Are they another victim of the Minister's cutbacks, recruitment ban and other barriers? Have more nurses been appointed?

Fine Gael is acutely aware of the dangers posed to sufferers of cystic fibrosis by waiting in overcrowded accident and emergency departments, the spread of hospital acquired infections and the lack of isolation facilities. We on this side of the House are tired of Fianna Fáil inaction which continues to put people's lives at risk. Fine Gael's main priority, which should also be that of the Minister, is to see that cystic fibrosis sufferers benefit from world class treatment so they can lead more productive, active and healthy lifestyles.

Minister of State at the Department of Health and Children (Deputy Jimmy Devins)

I thank the Deputies for raising this issue. I will be taking the Adjournment debate on behalf of my colleague, Deputy Harney, the Minister for Health and Children. The Minister has identified the enhancement of services to persons with cystic fibrosis as a key priority. Indeed, the Minister, along with the Taoiseach, met with the Cystic Fibrosis Association of Ireland earlier this month to review the progress that has been made in improving services for persons with cystic fibrosis over the past two years and to discuss the need in particular to improve the infrastructure within which these services are provided.

Additional revenue funding of nearly €7 million was provided over the past two years to develop services for persons with cystic fibrosis. This funding was provided to facilitate the recruitment of additional consultant, nursing and allied health professional staff and to improve services nationally. The HSE has advised me that each of its networks was given notification of the specific funding available for their areas and the specific posts associated with the funding. The HSE has informed the Department that 39 additional posts are now in place.

The HSE was also asked to address, in particular, the identified infrastructural and service deficits at the national adult referral centre at St. Vincent's Hospital in Dublin. In this context, additional revenue funding of €300,000 was provided to the hospital in 2005 and an additional €1 million was provided in 2006 to facilitate the recruitment of additional medical, nursing and allied health professional staff.

The new ambulatory day care centre, which is part of a €203 million investment at the hospital, includes specialist clinic facilities for cystic fibrosis patients. In addition, the new emergency department allows for increased isolation capacity at the hospital. This is frequently utilised by persons with cystic fibrosis.

Interim refurbishment of facilities for cystic fibrosis patients has recently been completed at the hospital and comprises the re-designation of 15 beds as respiratory-cystic fibrosis beds, bringing the total number of respiratory-cystic fibrosis beds to 44.

A project team has been appointed to progress the next phase of development at St. Vincent's University Hospital. This team includes representatives of both the hospital and the HSE. It is intended that this development will include the provision of dedicated facilities for patients with cystic fibrosis. These facilities will provide, in particular, private single room accommodation with en-suite bathrooms for inpatients, together with appropriate isolation facilities for patients who require it. In addition, the project team is giving consideration to such issues as the need for separate access routes to the unit.

In addition to the infrastructural developments to be carried out at St. Vincent's University Hospital, the HSE is also considering the need for additional infrastructural improvements at Cork and Galway university hospitals.

In respect of cystic fibrosis services for children, a new outpatient clinic called the Medical Tower opened at Our Lady's Hospital for Sick Children, Crumlin, in 2005. This has considerably improved the facilities available to treat the large number of children with cystic fibrosis attending the hospital.

Job Losses.

Deputy Fergus O’Dowd

Coca-Cola has operated in Drogheda for over 30 years. It employs 256 people in the manufacturing process and also has a very significant service industry employing approximately 120 people. So it is a critical industry. It provides the best standard of employment anywhere in the country. Coca-Cola is the best employer with a very dedicated workforce that has had a tremendous relationship with the town of Drogheda, the community and the workers.

All of this is changing with the proposal by the company to close the manufacturing facility with the loss of 256 jobs. I want to address this issue from the perspective of the workers and how the effect of this appalling closure on their lives and the entire community can be mitigated. What steps will the Minister take? The workers believe that parts of the operation can be saved and that manufacturing jobs in some sections can continue.

The workers are willing to look at current work practices. Will the Minister facilitate an effort to save these jobs and, if so, how? In particular, will he ask the IDA in the north east and the US to work with the unions and workers to progress this issue? Such a commitment is required immediately. I welcome the planned meeting between the trade unions and the Minister on 11 October but I fear it may be too late. We must act now.

The loss of these jobs in Drogheda, coupled with other job losses in the local manufacturing and industrial sector, will be significant. While I welcome the establishment of a task force, a strategic plan to acquire more manufacturing bases in counties Louth and Meath is needed. Drogheda has a population of 35,000 people, but the area will have about 70,000 people in ten years. Will the Minister raise with the Minister for Finance the introduction of tax incentives for the planned development of the dockland area in Drogheda?

Coca-Cola is a welcome employer in Drogheda and all concerned wish to see it continue in the town. We need to see action from the Minister and others, including the Minister for Foreign Affairs, Deputy Dermot Ahern, to ensure further job creation in Drogheda.

Minister of State at the Department of Enterprise, Trade and Employment (Deputy Billy Kelleher)

On 29 August last, the company in question announced all manufacturing and distribution operations in Drogheda, County Louth would close in September 2008. The company had decided it no longer needed three operations in Ireland. The reason given for closing the Drogheda plant was that the high-capacity plant in Ballina, County Mayo and the specialised plant in Athy, County Kildare had sufficient capacity to meet future demand. A number of employees affected will have the option of moving to either Athy or Ballina, where job numbers will be increased by 90 between the two plants, thereby reducing the overall number of job losses.

Shared services jobs will remain in Drogheda where the company will continue to employ 112 people. The company has been keen to stress it is committed to supporting its employees through a generous redundancy package, re-training and business start-up assistance where appropriate. The services of the Government training agency, FÁS, are also available to those workers who wish to avail of the agency's services.

The Government is determined to provide every assistance possible to the redundant workers so they can seek alternative employment. The company identified that future concentrate requirements can be met by consolidating its current number of plants. However, the company will continue to employ over 500 people in Ireland. Over the years, the company has enjoyed a warm relationship with the people of Drogheda and other businesses in the town and the company will continue to play an active role in the community.

While the Minister for Enterprise, Trade and Employment, Deputy Martin, is abroad on an Enterprise Ireland trade mission, he has already agreed to meet with Drogheda Borough Council on 11 October. The industrial development agencies have been promoting Drogheda and County Louth for industrial development as per Government policy. There have been several significant developments recently both in the town and the county. In January 2007, Daiwa Securities Global Asset Services opened a hedge fund administration operation for Daiwa Securities Group Inc. in Dundalk. The Dundalk operation will create 300 high calibre financial services jobs. In April 2006, it was announced that Becton, Dickinson and Company will invest €52 million, with the support of Government funding through IDA Ireland, in the development and expansion of its medical devices global manufacturing centre in Drogheda. This is expected to create an additional 125 new jobs over and above the current employment in Drogheda of 95 people.

In March 2006, it was announced that Pillar Data Systems Inc., of San Jose, California, supported by IDA Ireland, is to establish its European, Middle East and Africa headquarters in Drogheda. Pillar Data Systems designs and builds computer data storage systems. The new operation for Drogheda will have sole management responsibility for sales and marketing, technical support, finance, operations, IT management and business analysis in the European, Middle East and Africa regions. It will create 200 high calibre jobs across these business areas. In February 2006, it was announced the Vesta Corporation, a leader in virtual commerce solutions, is to establish a European operations centre in Dundalk. This centre will create 350 high quality jobs over three years.

IDA Ireland recently completed the €6 million site development programme at its Drogheda business park. The first building on the park comprising 23,000 square feet has been occupied by International Funds Services which employs 125 people. In addition to these recent positive developments which I have outlined, the industrial development agencies will continue to promote Drogheda and the surrounding area for further industrial development.

Legal Aid Service.

Deputy Chris Andrews

I propose that in future Adjournment matters, speakers should be taken in alphabetical order.

Acting Chairman (Deputy Kathleen Lynch)

The Deputy may do so but he has eaten into 50 seconds of his speaking time.

Deputy Chris Andrews

On 1 August 2007, Derek Cumiskey was killed in Lanzarote. He had turned 18 years of age two weeks prior to his murder. He was a well-liked student at St. Augustine's in Blackrock, County Dublin and lived nearby in Townsend Street. He had just completed his junior certificate and had been selected as student of the year at his school. He celebrated this achievement by going on holiday to Puerto del Carmen with friends and his sister, Joanne.

Since his murder on 1 August, the Cumiskey family has received consular assistance from the consulate in Lanzarote but no legal aid or representation. As a result, they feel like intruders in the investigative process instead of being kept up-to-date with the investigation. In September, the investigating judge indicated the process would be kept confidential for a further month and any objections would have to be lodged within three days. However, the Cumiskey family was not made aware of this development until ten days afterwards. It should not be beyond us to provide more assistance to families when a loved one dies abroad.

According to the CSO the number of trips abroad by Irish citizens between April and June 2007 was 2,048,000, an increase of 12% on the corresponding period in 2006. People who used to travel once a year are now going abroad two or three times. The increased incidence of travel has also seen an increase in the number of fatalities of citizens abroad, which puts pressure on the Department of Foreign Affairs to provide assistance in such cases. When the recent airplane crash in Thailand occurred, it was inevitable Irish holidaymakers would be involved. I extend my sympathies to the family of Aaron Toland, a young man from Derry.

The number of Irish people travelling to the Canary Islands is now higher than the number travelling to the United States. It is imperative that consular and legal assistance should be improved. The Cumiskeys would have legal aid if the event had occurred in Ireland but because it took place in another jurisdiction, the family has received no legal briefing other than information from the consulate. The tragic case of Derek Cumiskey brings into focus the issues faced by those whose family members are murdered abroad. I understand the number of such cases is small. My office requested the figures for the number of citizens murdered abroad each year from the Department of Foreign Affairs but I am still awaiting the figures.

A reciprocal aid system is already in place in EU member states. Council directive 2002/8 to improve access to justice in cross-border disputes establishes minimum common rules relating to legal aid. The issue of legal aid and how Irish citizens access it abroad appears to be very unclear. Issues need to be addressed as regards two measures by the Department of Foreign Affairs and the Department of Justice, Equality and Law Reform. It is not clear which Department is ultimately responsible. First, if there is a reciprocal arrangement between Ireland and other countries to provide legal supports for those Irish citizens who require it, why did the Cumiskeys and families in similar positions not have this information made available automatically? Second, if arrangements are not in place to ensure that families of murder victims have the information they need, then clearly a facility or fund needs to be put in place to allow such families access to legal aid when it is required.

Deputy Jimmy Devins

On behalf of the Minister for Justice, Equality and Law Reform, Deputy Brian Lenihan, I thank Deputy Chris Andrews for raising this very important issue. In addition to addressing the issue in general terms here today, the Minister has recently responded to the Deputy's correspondence regarding the specific case of the family of Mr. Derek Cumiskey who died tragically in Lanzarote last month. As the Deputy will be aware, Deputy Brian Lenihan, in his capacity as Minister for Justice, Equality and Law Reform, has no role as such in assisting Irish nationals who encounter difficulties while abroad. The Department of Foreign Affairs provides this assistance through its network of embassies and consulates overseas.

There are now millions of instances of Irish citizens travelling abroad every year and as this number grows, so also does the need for consular assistance and support. The Department of Foreign Affairs has responded well to this challenge and I understand that the overwhelming feedback it receives is positive. Often the difficulty encountered will be temporary or minor, but we all appreciate that Irish citizens can also find themselves in serious difficulty. The most tragic of the circumstances where consular assistance is called upon is, of course, where an Irish citizen dies suddenly, whether accidentally or in suspicious circumstances. In such cases, and in all deaths of Irish citizens abroad, the Department of Foreign Affairs provides extensive assistance and support including, where necessary, assistance with autopsies, death certificates and liaison with undertakers and airlines.

Embassies can provide general information with respect to the national legal system of the country in question, the procedures followed in investigating crime and any arrangements that apply for the next-of-kin of victims in a particular legal system. Lists of local lawyers are also available but embassies do not provide or pay for legal advice.

In so far as support from Irish legal aid arrangements is concerned, such aid in Ireland is primarily delivered via the civil and criminal legal aid schemes. Both schemes are established under their respective legislation setting out the eligibility criteria for aid under the particular scheme. Neither scheme provides for representation for the next-of-kin of victims during the course of an investigation or prosecution or for representation to Irish nationals involved in legal proceedings taking place wholly outside the State.

The Minister has great sympathy for the Cumiskey family, as I do, and on foot of representations from their solicitor and from Deputy Andrews, he has considered carefully the possibility of making some type of ex gratia legal aid payment to the family. He has, however, concluded that to provide aid in these circumstances would go too far beyond what is envisaged under Irish legal aid arrangements and lead to an expectation on the part of the many other Irish nationals who become involved in legal proceedings while abroad that their cases should also be covered by the Irish legal aid schemes. This was never the intention of those schemes.

The Department is, however, making inquiries regarding Spanish legal aid arrangements and will pass on any information it receives. The Department of Foreign Affairs will continue, of course, to provide all possible consular assistance to the family.

The Dáil adjourned at 5.25 p.m. until 2.30 p.m. on Tuesday, 2 October 2007.

Dáil Éireann díospóireacht - Thursday, 27 Sep 2007