Leaders' Questions

The Tánaiste's Government has been bedevilled by crisis after crisis in the health services.

Good man, Seán. That is a good one.

Those crises have had a real impact on patients the length and breadth of the country. The Minister, Deputy Rabbitte, may think it is a matter for hilarity, but for the people who have had negative experiences within the health services it has not been fun. Last year the Government decided to cut nurses' and midwives' pay by a further 20%. Today, graduates who have completed a four-year degree course are working alongside other graduates for 20% less than their colleagues who took up employment in 2011 and 2012. They are expected to do exactly the same work and carry the same responsibilities. The Government sought to justify that cut by introducing a graduate nurse programme. The scheme, which might be described by some as a scam, is totally unfair to the newly qualified nurses and midwives. We find as a result that they are emigrating to the UK and other places around the world while the HSE is out there trying to recruit nurses on the international stage to take up positions in this country. The suggestion that teachers would have a similar 20% pay cut inflicted on them was removed by the Government, but that did not happen for the nursing profession.

Does the Tánaiste believe the way nurses and midwives have been treated in this country is fair? Is it acceptable that they have to work alongside their colleagues for €22,000 per year? The Minister for Social Protection, Deputy Burton, spoke about creating a situation in which we could have a living wage, but the reality is that the Government is imposing a fundamental unfairness on one section of Irish society, namely nurses and midwives. The Irish public has great respect for this profession. Will the Tánaiste reverse that Government policy and ensure that young, fully qualified graduate nurses are paid the same as their colleagues?

The hypocrisy of Fianna Fáil knows no bounds. Twice when Fianna Fáil was in government it unilaterally cut the pay of people who work in our public services without a by your leave or agreement from anybody. This Government, by contrast, engaged in negotiations with the trade unions representing staff who work in our public services, including those who work in our health services, and agreed with the trade unions a formula for the management of public service pay over the coming years. All those trade unions in the public services, including those in the health services and the nursing unions, have agreed to that arrangement and to the way pay is to be managed in the public service.

We have a pay regime in our health services which is agreed with the trade unions, covered by the Haddington Road agreement. That covers all aspects of the management of pay within the public services. This year we have recruited an additional 260 people for primary care teams, including 52 speech and language therapists, 72 public health nurses, and a number of general nurses, occupational therapists and physiotherapists. Even within the limitations of very difficult financial circumstances the HSE has again begun the recruitment of staff to support our health services and deliver the health services we need in this country.

The Tánaiste may use all the pejorative terms he likes. It is true that his predecessor in government cut public pay rates across the board, and there was an equality in how that was approached.


Here we are talking about an additional cut on top of those initial cuts. We are talking about young nurses and midwives being singled out for particular attention by the Government.

They were delighted.

Will the Tánaiste go outside the gate this afternoon and talk to those nurses and midwives who are protesting about the circumstances in which they find themselves?

Will he go out there and tell them they have agreed to this situation? If he does, he will get his answer and it will be unambiguous. In January 2013 the Government advertised 1,000 posts for these "yellow pack" nurses. From responses to parliamentary questions I understand that in January this year only 600 of those 1,000 places had been filled. Why have the positions on offer not been taken up? Why have only a little over half of the positions been availed of by graduate nurses?

As I said, nurses' pay was the subject of negotiation and agreement with the trade unions representing nurses. The number of nursing staff increased by 100 in the first month of 2014, reflecting the take-up of posts under the graduate initiative. Nearly 500 nurses and midwives have commenced employment in recent months on that graduate scheme. More than 200 others are going through the recruitment process and more than 1,000 applications have been received for that scheme.

In fairness, we need to take on board a number of points. The first is that the issue of pay has been the subject of agreement, which is to be welcomed. Second, we are recruiting. There was a time when we saw quite significant declines in the numbers of nurses employed in the system and I remind the Deputy that in 2010, 2,500 nurses were taken from the system, with another 3,000 going in 2011. We are now seeing recruitment of nurses in the health service, which is good, and it is being done subject to the agreements reached, which is also good.

The Rehab Group is in receipt of in excess of €83 million of public funds, and the group and its enterprise enjoys the benefits of charitable status in the State. Last week, Ms Angela Kerins, the current chief executive officer of Rehab, appeared before the Committee of Public Accounts. At the meeting she refused to reveal details of the pay levels of senior executives within Rehab, and when pressed, she made a commitment that within the days following the meeting she would put the information on the public record. A week on, Ms Kerins and Rehab have failed to make the information public.

In the course of the same week I received much correspondence. One piece came from a young woman on an rehabilitative training programme from Rehab, and she had no difficulty sending me her payslip, which I have in the Chamber. This young person receives an income of €31.80 per week and has travel expenses of €15 deducted, meaning the net income as reflected by the payslip is €16.80. This person has no difficulty with her income being known publicly. Will the Tánaiste join me and the Committee of Public Accounts in insisting that Rehab and Ms Kerins make public the full information on payments to senior executives?

Mr. Frank Flannery, a former chief executive and acting member of the board at Rehab, was invited to attend last week's meeting but he did not show up. Mr. Flannery will be invited again before the committee and to make himself available to give the information in response to questions that we have. Will the Tánaiste join me, the Committee of Public Accounts and the Taoiseach in saying to Mr. Flannery that he should attend the committee at the earliest possible opportunity?

He was too busy in the Oireachtas restaurant.

I have no hesitation at all in saying that the pay of senior executives in Rehab and any organisation funded by the State through the HSE should be made public. We are discussing this issue, in a fashion, because the Government took an initiative in this regard. The Minister for Health is conscious that a large number of organisations receive substantial amounts of State funding for the delivery of services and the Government has pursued a general policy in respect of public service pay that included an audit of section 38 and 39 organisations. That put the issue on the agenda in the first place. The pay of senior executives in organisations such as Rehab should be publicly available. If a body is in receipt of public funding, why should that not be the case? With respect to the invitation to Mr. Flannery, he should attend the Committee of Public Accounts and I encourage him to do so.

I thank the Tánaiste for those responses, and it is very clear at this stage that Members of the Oireachtas are of one mind on this issue, whether on the Government or the Opposition benches. We are all absolutely insistent at this stage that full details in respect of payments to Rehab executives must be made public without any further delay. I welcome that the Tánaiste, along with members of our committee, is sending that message on behalf of the Oireachtas and Government to the current chief executive, the former chief executive and the entire Rehab organisation. I hope those parties will respond in kind. We have been faced with a case in which an organisation in receipt of very substantial public moneys and enjoying charitable status has thumbed its nose at the general public, volunteers and donors. I very much hope the same people will not show disregard to the Government of this State and elected Members of this House. I hope Ms Kerins and her colleagues in Rehab will speedily, finally and fully disclose the pay rates of senior executives.

We are over time.

The Tánaiste has made his position on Mr. Flannery clear and we are of one mind on the issue. He must appear before the Committee of Public Accounts and has an absolute obligation to do so. Will the Tánaiste make that known to the Taoiseach and Cabinet colleagues, and if necessary will he make direct contact with Mr. Flannery? I hope that will not be necessary but if it is, given the seriousness of the issue and the track record of this organisation in disregarding any form of public accountability, neither the Taoiseach nor the Tánaiste should shy away from having that conversation in correspondence with Mr. Flannery.

There are two issues. The first is the obligation of organisations in receipt of substantial sums of taxpayers' money from the State for the delivery of services to be fully transparent and accountable. That should be the case. There is also the issue of the very good work that organisations such as Rehab do, along with many of the other charities that have been in the public domain in respect of issues with regard to salaries, etc., in the past months. There is an obligation to the volunteers working for the organisations and the people relying on them for services, as well as the many people who contribute very generously to the charities concerned, that there be full information on where money goes. There should be details of levels of payment and so on, so the information should be made available.

The Taoiseach has already expressed his view on Mr. Flannery's attendance at the Committee of Public Accounts and it is a matter for the committee to pursue the issue with Mr. Flannery. My view is clear that he should attend, so I encourage him to do so.

On Tuesday Wilbur Ross and Fairfax sold some of their shares in Bank of Ireland. They bought the shares for €600 million and they are now worth just over €1.9 billion, leaving a gain of approximately €1.3 billion. There is no issue as such with this profit, as these investors saw an opportunity and took it to make a killing. What is of issue is the action of Bank of Ireland on the ground every day that is driving up the share price. When it comes to the issue of resolving the mortgage crisis, Bank of Ireland is squeezing Irish families harder than any other bank.

Every Deputy in the Dáil is trying to help families who are struggling to repay mortgages. One of the first questions we always ask in such cases is the name of the bank, as we know that if the bank is Bank of Ireland, the chance of the family having a successful outcome is much less. I will relate some of the responses of Bank of Ireland to the finance committee regarding sustainable solutions.

Deferred interest, payment moratorium and permanent interest rate reduction are not Bank of Ireland solutions. Bank of Ireland is the only bank that charges interest on the shelved portion of the split mortgage, and Richie Boucher admitted to the Oireachtas Joint Committee on Finance, Public Expenditure and Reform that in over 90% of the offers it makes, the family will end up paying more money back to the bank. To join the dots, Bank of Ireland is squeezing struggling Irish families harder than any other bank. The result for shareholders is profit but the result for many Irish families is disaster. For many families struggling to pay their mortgage the difference between financial recovery and ruin is whether they bank with Bank of Ireland.

In his speech on Tuesday the Tánaiste laid out four principles by which we should act - sustainable prosperity, shared prosperity, a threshold of decency, and openness and transparency. I wholeheartedly agree with all four principles. By standing idly by and allowing Bank of Ireland do what it continues to do, the Tánaiste is violating his own principles. The Government could solve this problem very simply by providing a standardised set of solutions to be used by all banks. Will the Tánaiste continue to allow Bank of Ireland go on squeezing Irish families, or will he stand by those excellent principles and insist on a standard set of solutions for all families seeking to resolve their mortgages and apply fairness and consistency?

I thank Deputy Donnelly for agreeing with the four principles I set out in my speech on Tuesday, for what I believe is the way forward, now that we have come out of the bailout, jobs are being created and the economy is growing again. Over the next couple of years we have to ask for whom is this recovery. As far as I and the Government are concerned, recovery is not just a matter of getting the numbers right but of making sure it becomes real for people.

We have to cast our minds back to where we were three years ago when the Bank of Ireland shares were bought. The banks were at the point of collapse. Nobody wanted to buy shares in an Irish bank. As part of the recapitalisation of the banks the State invested €4.8 billion in Bank of Ireland. That investment has performed well from the State’s point of view, and €6 billion has been returned to the State through sales and guarantee fees. In addition, the State’s ownership of 14% of Bank of Ireland shares is valued at €1.5 billion.

The Government expects all banks to deal fairly with mortgage holders and those in distress. The most recent Central Statistics Office, CSO, figures show, for the first time in five years, a drop in the number of people in arrears of more than 90 days. That is a welcome turn and I would like to see it continue. Approximately 86,000 mortgages have been restructured. Just short of 80% of those restructures are holding. We expect the Bank of Ireland, like every other institution, to deal on a case-by-case basis, and fairly, with people in mortgage arrears and difficulty. The Government will continue to pursue that policy with the banks and through the Central Bank.

The problem is that policy is not working. Anyone on the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, and any Deputy will tell the Tánaiste that. Bank of Ireland is acting in a completely different way. As an example, I am dealing with a family in Wicklow, which cannot make full capital and interest payments. They can make partial capital payments with full interest and their business is beginning to grow again. Bank of Ireland has written to them saying it is not offering any sustainable solution. It is taking them out of the mortgage arrears resolution process, MARP. They must make full capital and interest payments, which they know they cannot do, or the bank will repossess their house. I have gone through the detail of this case. If this family was with AIB it would offer them a split mortgage, reduce the capital payments, and if the payments were not fully covered when they retired it would offer them a debt for equity swap. The family would stay in the house, get on with raising their kids and growing their business. That is what should happen and would happen if they had borrowed from AIB but they did not. They borrowed from Bank of Ireland, which will evict them and pursue them for the residual debt so that it can continue to drive up its share price, and its shareholders can continue to cash in. That is the reality on the ground and it has to stop.

Richie Boucher made it crystal clear to the Oireachtas Joint Committee on Finance, Public Expenditure and Reform that he will not play nice in the way the Government wants him to. The Government could stop this in a heartbeat. All it has to do is say it has solutions that AIB and various other institutions are using, and tell Bank of Ireland it must use them too.

I urge the Tánaiste to answer my question, which is so important for the many families Bank of Ireland is destroying. Will the Government not ask Bank of Ireland to play nice but insist it apply the same level of debt solution as other banks? It is a huge potential win for the Government but much more important, for thousands of families around the country.

The debt solutions Deputy Donnelly refers to are solutions the Government promoted. Over the past couple of years we have given priority to dealing with the mortgage crisis many are experiencing. We have introduced and discussed with the banks a range of measures which can be taken to address these problems, including the introduction of the personal insolvency service, the arrangements for split mortgages and a variety of approaches institutions can take to avoid putting people out of their homes.

The question was about Bank of Ireland.

We made it clear from the beginning of this crisis we wanted to avoid people losing their homes. I said several times that during the recession people’s biggest fear was losing their homes, not their jobs or businesses. That is why we put in place a range of options and measures, which all financial institutions can use to deal with the mortgage problems.

Bank of Ireland is not using them.

When I answered questions here about mortgage issues and put these options forward very often they were derided. I am glad to see Deputy Donnelly advocating that banks use the instruments-----

The Tánaiste is not answering the question. It was about Bank of Ireland.

-----and methods the Government advocated in the first place. Bank of Ireland should use those options, like every other financial institution.

The Government needs to tell it do that. It should haul it in.

The Government should make it do that.