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Dáil Éireann díospóireacht -
Wednesday, 26 Mar 2014

Vol. 835 No. 2

Topical Issue Debate

Mortgage Arrears Proposals

I thank the Leas-Ceann Comhairle for allowing me to address this serious issue. There has been news that there have recently been a number of debt write-downs for mortgage holders with AIB. While this is a positive and welcome step, no real detail seems to have been given as to how these write-downs were achieved. In highlighting this issue I do not want in any way to jeopardise any possible deal being done or that may be struck for individuals, as I understand the situation is extremely stressful. However, there is a need for clarity on how these deals are negotiated. The lender has chosen to remain silent on some of them which has caused resentment and angst among those who cannot obtain a similar deal and among taxpayers who are required to finance the deals through their taxes. I understand negotiations can never take place in public. However, it is important that deals are struck, but it is also important that they be as transparent as possible. I have constituents who are at a loss to understand how some individuals have been able to attain deals and they cannot, even though they consider themselves to be in an equally serious position. It seems some of the deals have been leaked to the media, but I do not understand how that helps the situation.

AIB is 99.8% owned by the taxpayer. Therefore, it has a duty to the State and the taxpayer to be fair and transparent. There has been selective leaking of deals to the media, which is not acceptable. We do not know the specific criteria used.

We have information from some sources which seem to be in the employment of AIB but I could be incorrect about this. The danger in reporting these deals to the media without relevant information as to how they were negotiated is that it leads to a false expectation among other borrowers. On this basis there is an urgent need for clarification. It is like a game of "Deal or No Deal". The debtor simply fills out the standard financial statement, AIB examines it through its own process and determines whether it will give the person a deal. I have been informed it applies the minimum standards as determined by the Insolvency Service of Ireland plus 20%. It then writes off the proportion over 130% of the current market value. The Insolvency Service of Ireland was established for a reason, which is in the interest of the debtor. It is fair, open and transparent. Could AIB's present approach impact negatively on the Insolvency Service of Ireland and on the personal insolvency service as a whole?

Is it the case the banks apply guidelines and criteria to benefit themselves and not the debtor or taxpayer? It is clear the banks do not want to engage with the regulated solutions as set down by the Personal Insolvency Act as they stand to lose out. I call for these details to be clarified and for transparency in respect of all deals. Consistency needs to be applied across the board.

I thank Deputy Phelan for raising this very important issue. As the Deputy will be aware the relationship framework with the bank provides the State cannot intervene in the day-to-day operations of the bank or its management decisions. These frameworks are published on the Department of Finance's website. The Minister for Finance must ensure AIB is run on a commercial, cost effective and independent basis to ensure the value of the bank as an asset to the State.

I understand AIB is acutely aware of its fiduciary duty to protect taxpayers' money and can only write down residual debt if there is no prospect of that debt being paid back or no affordability to pay it back. From the bank's perspective, it is not possible or practical to set out absolutely strict guidelines on applicable levels of write-down as each case is different and circumstances vary from customer to customer. However, once it has been determined a customer's level of net disposable income does not allow for a standard forbearance solution, it is sometimes necessary and economically sensible to involve debt compromise as part of the overall resolution. This debt flexibility usually arises in the application of a split mortgage or a voluntary sale for loss arrangement. All resolutions offered to customers in difficulty are assessed on the basis of the borrower's maximum affordability in respect of his or her mortgage.

The approach of the Government on this issue has been clear, and it is that mortgage holders and other borrowers who can meet their loan obligations should continue to do so and that appropriate assistance should only be afforded to those mortgage holders, or other borrowers, who experience real and genuine difficulty in meeting their commitments. This approach was recommended by the Keane report, which recommended against blanket debt write-off on affordability and distributional grounds. It is clear the vast majority of mortgage holders can and will continue to meet their mortgage commitments.

The Government's strategy to assist those in genuine and significant mortgage difficulty is built around measures in four distinct areas. These are personal insolvency, which the Deputy mentioned, a mortgage advisory service, the mortgage to rent scheme, and engagement with the banks. Considerable progress has been achieved across this strategy. This strategy is being managed across several Departments and reflects the fact there is no single solution to the mortgage arrears problem.

The Central Bank's code of conduct on mortgage arrears, the CCMA, also provides a strong consumer protection framework to ensure borrowers struggling to keep up their mortgage repayments are treated in a fair and transparent manner by their lender, and that long-term solutions are sought by lenders with each of their borrowers. The CCMA provides an integrated package of consumer protection measures for borrowers facing or in mortgage arrears. It seeks to deliver on the following principles: to ensure appropriate resolution of each borrower's arrears situation, to ensure lenders deal with borrowers in a fair way, to support and facilitate meaningful engagement between lenders and borrowers and to ensure borrower awareness of the benefits of co-operating with the lender and the consequences of not co-operating.

In its mortgage arrears resolution targets, or MART process, the Central Bank has set clear targets to require the main mortgage lenders to propose and conclude sustainable solutions to mortgages which are more than 90 days in arrears. However, the appropriate solution in each individual case is one for the bank and lender to conclude having regard to the particular circumstances involved. So far, lenders have reported to the Central Bank they have met the quarter two and quarter three targets for 2013.

I accept the comprehensive answer the Minister of State has given. Very varied situations exist and I accept wholeheartedly we cannot have a one size fits all solution. Does the Minister of State accept that in some cases, which have been reported widely in the media, people have received debt write-down while other people cannot obtain this? Does he accept this causes resentment not only among debtors but in society in general?

I accept the bank will have to do individual deals with people but we must level the playing field. I have constituents who have been trying to deal with a bank other than AIB who cannot get anywhere. Their phone calls are not returned. They keep a diary of how they try to contact the bank. The bank will not engage with them and has told them to surrender their home. We then have reports in the media of people receiving debt write-down on half their mortgage so one can see why people are getting very upset.

I accept a bank must be commercial and such activities must be taken into consideration, but this involves people and it is not only an economic situation. I have been in a home where the mortgage difficulties are such the fire cannot be lit until after 7 p.m. The mortgage must continue to be paid and the people cannot afford to buy coal to light the fire. These are the situations I am dealing with and the people who need debt write-down. I hope the Minister of State will take what I am saying on board.

Not only do I take on board the very relevant points made by the Deputy, and she is absolutely right to highlight this matter to the House, I very much hope AIB take them on board. It would be very useful if AIB clarified the matter on foot of the very constructive remarks made by Deputy Phelan in the House. It would bring some clarity to the issue.

These issues will only be resolved on a case-by-case basis and it will depend on the level of indebtedness. My understanding from the Department of Finance's perspective is we are only speaking about people in personal dwellings and it does not involve investment properties. This is an important message to send out.

When the Government had to recapitalise the banks, provision was made for this and there was always going to be a circumstance where some form of partial write-down would have to be part of the mix of solutions, depending on the indebtedness of individuals and the circumstances, and whether in a forbearance test they were able to pay back in a circumstance where a solution could be found. The task of the Government has been to get onto the banks to get this done. Clear targets have been set by the Central Bank as I stated in my remarks. It is now the task of the banks to achieve these targets. This is the focus of the Government. There was always going to be a mix of solutions.

However, I accept the point the Deputy raises that for those who are trying to get a workable solution to the banks and who then hear willy-nilly of what I understand to be a small number of cases, in which some kind of debt write-down has been given as part of the solution, a more substantive statement by the bank or possibly the bank's involvement in a parliamentary committee setting out the circumstances would be of general assistance. The point made by Deputy Ann Phelan is absolutely on the money. People need to know these things and customers who are dealing with the bank and who are having difficulty in arriving at a solution also need to hear this. Consequently, I echo her remarks.

Broadband Service Charges

I wish to raise the need for the Government to discuss the cost of broadband in Ireland and appreciate the presence in the Chamber of the Minister for Communications, Energy and Natural Resource to respond to this Topical Issue. I am sure the Minister is aware a new study has found that Ireland has the third highest cost of broadband in the European Union when making comparisons in respect of the cheapest package available. The research was carried out by the European Commission last year and examined comparative costs of broadband across the European Union. The study, carried out by SamKnows, found that Irish consumers who get their broadband using xDSL technology only receive 49.9% of the speeds advertised by their Internet service provider, which is well below the European Union average of 71% of the advertised speeds. I have raised this issue a number of times, both in this Chamber and in committees and so on. This finding is shocking and the Minister will remember that I tabled an amendment to the ESB (Electronic Communications Networks) Bill 2013 to deal with this issue, which was rejected at the time.

The survey found out that the Irish consumer pays a minimum of €31.40 per month for broadband up to a maximum of slightly more than €60 per month, which ranks as the third highest in the European Union. Surprisingly, within the European Union's Internal Market, the research found a 400% variation in price between the cheapest and most expensive broadband packages, underlining the variable nature of broadband charges. For a country such as Ireland, which prides itself on being at the cutting-edge of technology in the world, this is not good news as it has an impact. Services such as broadband are increasingly necessary and are essential to carry out business and to compete on a commercial level and the cost of such services affects how consumers act. The high cost of broadband will restrict people from moving to e-commerce and e-services. Another survey carried out by Eurobarometer found that approximately three quarters of people living in Ireland limit calls made on their mobile telephones to national numbers and numbers in other European Union states as a result of the charges. The study also found that approximately 70% of people in Ireland limit their fixed line calls to other European Union countries and mobile or fixed line networks run by other operators, due to concerns about charges. In a European Union that espouses the Single Market, this is most disappointing. The Minister should be working to end these charges as soon as possible and should support any action to so do in the European Parliament.

As for the cost of broadband in Ireland, as I stated during the debate on the aforementioned Bill, I accept and welcome the entry of the ESB into the market. This should increase competition in the broadband and electronic communications markets, which hopefully will result in reduced costs and increased broadband coverage throughout the country, although I am not certain whether it will extend to those areas that are devoid of broadband coverage at present. I ask the Minister to outline his thoughts as to the reason broadband in Ireland is so expensive. He also might outline the actions he will take in future to try to bring down the cost, as well as outlining what he intends to do to ensure that Irish consumers get the service for which they are paying, that is, the service that is being advertised. I assure the Minister that my party will be supportive of any measures he might outline to bring about better and lower-cost broadband, as well as a better service of broadband throughout the communities to make sure that businesses and homes in Ireland have a proper broadband service.

I am grateful to Deputy Moynihan for giving me the opportunity to address the House on this matter. As the Deputy is aware, Ireland's telecommunications market has been liberalised since 1999. This means that retail price fixing for deregulated services is not permitted. Governments can, however, establish an investment environment that promotes an active competitive market. Hopefully, this will in turn improve the quality of services and place downward pressure on retail prices. Moreover, the commercial broadband market has made progress, with the number of broadband subscribers increasing from 600,000 to more than 1.6 million within five years. Increasingly, consumers are opting for bundled services from a single provider. These now account for more than 50% of all fixed-line subscriptions. Moreover, smart phone adoption is continuing to increase, with an increase of more than 16% recorded last year. In the fixed-line broadband market, customers are moving from lower to higher broadband speeds, where available.

It remains the case that many towns, villages and communities are not seeing similar progress. Ireland's widely dispersed population means there are some areas in which it simply is not viable for the commercial sector to provide services. In August 2012, I launched the national broadband plan to change radically the broadband landscape by ensuring that high-speed broadband is available to all citizens and businesses. This will be achieved by encouraging the commercial markets to do so where the business case is present and by establishing a State-led investment for areas in which it is not commercially viable for the market to invest. Since publication of the plan, investments by the commercial sector are under way in both fixed-line and wireless high-speed broadband services. For example, Eircom has plans to pass 1.4 million addresses with its next-generation broadband service, while UPC has increased its entry-level and maximum speeds to 120 Mbps and 200 Mbps, respectively.

As Deputy Moynihan noted, recent legislation to facilitate the ESB's entry into the telecommunications market also can help the roll-out of high-speed broadband, as well as facilitating greater competition. Intensive work continues in my Department in respect of the State-led investment to secure the countrywide introduction of next-generation broadband access. By implementing the national broadband plan, I am committed to ensuring that all parts of Ireland have access to high-speed broadband, with a view to ensuring that all citizens and businesses can participate fully in a digitally-enabled society. The plan will ensure that a combination of commercial and State-led investment delivers access to high-speed broadband service to all as quickly as possible. Therefore, competing service providers and informed customers moving across providers to secure the best value will exercise the required downward pressure on retail prices.

Gabhaim buíochas leis an Aire. There are two issues here, namely, the cost of the broadband and the service level in respect of the broadband. I have received letters and documentation from all over the country, including from one community located 15 miles from O'Connell Street, Dublin, bemoaning the lack of broadband. The cost of broadband must be considered and one must ensure the service providers are competitive in comparison with other European Union countries. However, people everywhere throughout the country are telling me about one single broadband-related issue, which pertains to young people in education. For example, one primary school lacks a broadband service and its pupils are greatly disadvantaged when they go on to second level, which makes use of interactive broadband and so forth. It is necessary to force a rethink on this serious issue of broadband cover because this is critical. Two issues are associated with this Topical Issue and the Minister has responded to the first in respect of the cost.

I beg the Deputy's pardon but I strayed there. He stated there was one issue above all others that is being relayed back to him.

Yes, the issue pertains to the actual coverage of broadband right across the country. As the Leas-Cheann Comhairle will be aware, I have travelled extensively in Ireland in recent weeks but this is the issue in every community, including one only 15 miles from Dublin's O'Connell Street, as well as communities in Wexford, west Cork and north Cork. One school in north Cork lacks broadband coverage and it is of vital importance to target seriously this issue because, as I have stated many times over the past two years, there is an major issue regarding the divide between those who have coverage and those who do not.

The issues involved are coverage and the cost of broadband.

The Deputy has raised these issues on a number of occasions. I accept that there are gaps in the system, but, as I have said before, in terms of the significant State investment in the national broadband scheme, for example, if that had not been done, there would not even be a basic service in many parts of the country. There are technical reasons which I entirely accept and issues that arise such as contention where the speeds promised have not been delivered, which is true, but, by and large, the protocols in place for the national broadband scheme with 3 have worked quite well. The Deputy raises a bigger issue which, in the main, although not exclusively, has to do with the dispersed thinly populated areas of the country which are the focus of the Department because of the mapping exercise under way. It simply has to be acknowledged that the commercial sector will never move into such areas and provide a service; therefore, the State has to do it and obtain state-aid approval, an issue we have dealt with on other occasions. I have no doubt that we will come back to the EU report to which the Deputy referred. To be honest, I have not had an opportunity to look at it or the methodologies involved, but we are a very long way from having an integrated market, which is the desire of the Commissioner. There are huge issues confronting us at that level.

Broadband Service Speeds

My issue follows on the one raised by Deputy Michael Moynihan. I thank the Minister for his presence and I am delighted to have the opportunity to raise this issue.

I am concerned that some of my constituents in Dublin Bay North and people on the northside of Dublin are not able to access fast and consistent broadband services. Residents in Bettyglen, Maywood and on the Howth Road in Raheny, Dublin 5 have contacted me about the poor quality broadband available to them, with many only having access to speeds of less than 3 Mbps. This is as a result of a delay in the roll-out of fibre-optic broadband in the area by Eircom. As we know, Raheny is less than 5 km from the city centre, yet the broadband speeds available are extremely poor, prevent people from doing business from home and affect students in their education and access to the Internet. A constituent who is running a small business from his home has developed an online presence. He has told me he frequently works in and travels to Africa and that there are faster broadband speeds in Malawi than in his home in Raheny. The delay has been caused by the refusal of Dublin City Council to grant a licence to Eircom to construct an additional cabinet at the junction of Maywood Road and Maywood Grove in order to provide for a fibre-optic upgrade for Internet users in Bettyglen. I ask the Minister to intervene to ensure all councils work with providers - Eircom in this case - to resolve these matters. Constituents are not getting answers from Internet providers, including Eircom, UPC or Sky, on whether improved speeds will be available in the area soon. As Deputy Michael Moynihan said, people are continuing to pay very high monthly subscriptions - in this case, to Eircom - for a poor service, while neighbours living a few roads away have a much better and speedier service.

Eircom informed me recently that while the area was set to receive eFibre services, it did not have a date for the provision of services. It states this is because of the uncertainty surrounding the placement of cabinets and the provision of electricity. Obviously, a compromise has to be reached on the provision of infrastructure to ensure customers receive a better service. Constituents in Howth, particularly on Windgate Road, where speeds of no more than 100 kbps are available, are concerned that they are not able to access the same service as neighbours on adjoining roads. These are professionals who are looking to do business and students who are trying to access various websites for educational purposes. I am sure the Minister will acknowledge that there are pockets in Dublin where there is a lack of services, which is very unfair. I very much welcome his response to the previous Topical Issue about the national broadband plan and the aim to ensure highspeed broadband is available to all citizens and businesses, but there are issues and pockets where there are problems and I am glad to have the opportunity to highlight them directly with him. I know the State will only intervene to ensure access to broadband services in areas where the competitive market fails to deliver such services, but in this case a council is refusing to give planning permission for the provision of cabinets. I do not know if there is a section in the Minister's Department which would be able to deal with these very real issues in different parts of Dublin.

I welcome the Deputy ventilating this issue. I did not know from the Topical Issue raised, which refers to the northside of Dublin, that he was referring specifically to Bettyglen and a couple of black spots in Howth, where Gay Byrne goes for a walk. If the Deputy tables particular parliamentary questions to me, I will see what I can do.

The northside of Dublin is, in many ways, a state of mind and, generally, is immensely well provided for in terms of the provision of broadband, but the Deputy is right that there are gaps. The Eircom programme for the roll-out of eFibre, to which the Deputy referred, is especially exciting. As he knows, fibre-optic is the Rolls Royce of the system. Eircom is getting on with the task and committed to passing 1.4 million homes. I cannot tell the Deputy off the top of my head what the delay in roll-out is in the case of Bettyglen, but I can have a look at the matter and he can also pursue it by way of parliamentary questions.

The Deputy has acknowledged that the State is not a service provider in this market and can only intervene in cases where there is a demonstrable market failure. A great deal of progress has been made and the national broadband plan is a clear expression of the importance of ubiquitous quality broadband to the achievement of our economic and social objectives. The Deputy has referred to the fact that some business people are hampered in the particular areas about which he is concerned. Our commitment is to deliver high speed or next generation broadband services across the country by ensuring the environment is right to maximise investment by the private sector and by State-led investment in those areas where it is evident that the market will not deliver.

Since publication of the plan, fixed line and wireless telecommunications providers have accelerated the roll-out of highspeed services. The landscape for quality broadband provision, in particular in urban areas, including Dublin, has changed dramatically as a consequence. There have been a number of significant developments, for example, the programme to which the Deputy referred, Eircom's eFibre programme. New technology is allowing Eircom to deliver speeds of up to 100 Mbps. Some 700,000 premises can now avail of its next generation broadband services.

I understand that Eircom has rolled out high-speed broadband services in a great many areas of north Dublin, or rather, northside Dublin. Eircom also advises that it is planning to offer high-speed services in Clontarf, Santry, Summerhill, Phibsboro and some smaller rural communities in north County Dublin, which I suspect are some of the black spot areas about which Deputy Flanagan is concerned. UPC is also investing in the network. Almost 700,000 homes now have access to its fibre-enabled cable services and this is set to grow to 750,000. It has a wide footprint in the Dublin area and more than 43% of Irish homes can now access the UPC network. Mobile operators are rolling out enhanced product offerings, with Meteor, 3 and Vodafone having recently launched 4G mobile broadband services which are capable of delivering significantly higher mobile data speeds. Vodafone is also upgrading its 3G services. Sky has entered the broadband market, offering services over the unbundled Eircom network and providing intense competition in the marketplace, which is also driving investment. Fixed wireless broadband providers are also providing dedicated broadband services to customers. Earlier, Deputy Moynihan referred to the initiative we have taken with the ESB in a joint venture with a leading telecommunications company.

I thank the Minister for his thorough response. I am happy that the Minister has indicated his willingness to discuss with the county councils the cases in which planning permission has been refused to service providers wishing to upgrade their networks to provide a better service to their customers. The real issue is the cost of broadband, which must be looked at. There is also a problem in certain neighbourhoods with the speed available on one road being far superior to that on adjoining roads. In those circumstances, people feel they are paying a high price but are not receiving the same level of service. That must be dealt with.

Does the Minister have an indicative date for Eircom's plans to roll out the eFibre programme? What plans does the Minister have to deal with the overall cost of broadband? As Deputy Moynihan pointed out earlier, the cost of broadband services here is the third highest in Europe. Given that the Government is focused on improving our economic competitiveness, the high cost of broadband vis-à-vis our European neighbours is deserving of more attention. Having said that, I welcome the fact that there are so many providers involved in the market now. The market is competitive, but how will prices be driven down? Is there anything that the Minister can do in that regard? The quality of the service is also important; home-owners are looking for a decent broadband service.

I do not disagree with Deputy Flanagan. He is right in saying that we have to encourage as much competition in this market as we can. I welcome the entry of a new player, which is important. The sector itself acknowledges that it is not commercially viable to provide a service in particular parts of the country and therefore State intervention is necessary. I sincerely hope that when the broadband plan is in place it will address those issues. I must commend the investment programme to which Eircom has committed, notwithstanding the recent history of that company. It is a big success that it is maintaining that investment programme and maintaining the commitment to roll out its fibre network to more than 1.4 million homes. UPC now has a very large footprint, including in Deputy Flanagan's part of Dublin. I made reference to the mobile providers as well.

The Deputy is correct to point out that each member state of the European Union is different. All we can do is to ensure we have a functioning, competitive market, and all the signs are that we are heading in that direction.

School Staffing

I thank the Ceann Comhairle for allowing me to raise this matter this afternoon.

The current criteria being applied for the allocation of teachers in rural schools are causing a lot of uncertainty and concern in rural communities, and I believe a more flexible approach must be taken by the Department of Education and Skills. I have raised this issue on a number of occasions by way of parliamentary questions, because the current system is casting a cloud over many thriving rural communities which fear the devastating effect that a loss of a teacher would have on them. We cannot compare rural and urban schools either in geographical terms or in terms of their importance in underpinning the social and economic fabric of communities. The fact is that if the local school closes in a rural area, parents have to transport their children up to ten miles to attend an alternative school, and that rips the heart out of the community. We could avoid this disruption for schools and communities if the pupil-teacher ratio for rural schools were less punitive and if the system took account of specific circumstances and fluctuations in population.

Such a unique circumstance has arisen at Labasheeda national school, which is located in a rural parish in west Clare in my own constituency. The two-teacher school is to lose one of its teachers from September 2014. It has been through the appeals process but its appeal has been unsuccessful. The decrease in the school's enrolment is not based on demographics. It is a unique situation, which I have outlined separately to the Minister, in which extraordinary circumstances led to the reduction in numbers currently attending the school. However, while enrolment figures fell during the turmoil, the future is far more positive. The school has signed pre-enrolment forms from parents for the next five years, which shows their commitment to the school and confirms that the school can reverse the decline. The whole-school evaluation, WSE, report from 2012 indicates high standards and a parental survey shows there is overwhelming support for the work being done at the school. If Labasheeda national school is reduced to a one-teacher school, it will mean the remaining teacher will be expected to deliver the full curriculum to eight different grades. Similar problems arise in other rural one-teacher schools. As well at the issue of the curriculum, the question arises as to how the teacher is going to manage the school alone. Recently, another rural school that is losing a teacher was in touch with me and I have put the case to the Department for providing a classroom assistant in the interests of health and safety.

This week, by way of parliamentary question, I also raised the issue of small rural schools, and I thank the Minister for this response. I understand from the reply that the configuration of small primary schools has been examined by the Department in a value for money review and that this review will inform future policy direction in this area. In my view, future policy direction for small rural schools cannot be based solely on pounds, shillings and pence. It must take into consideration the social and economic value of these schools and their importance to their communities. It is clear from reports I read in an article in the Irish Examiner this week that while the number of primary school mergers doubled last year, most did not involve small rural schools. Merging is simply not an option for small rural schools, as they are geographically isolated with no access to public transport.

I ask that the Minister publish the aforementioned review as a priority so that we can have a debate on this very important issue. In the meantime, I ask him to give Labasheeda national school a break. It needs the breathing space to allow it recover from what has been a very difficult time in its history. What is the point in taking away one of the mainstream teachers from September when 12 months down the line it will have the numbers to re-engage that teacher? That makes no sense and it will only cause unnecessary disruption for the school and for the community of Labasheeda. I ask the Minister to relax the policy criteria to take account of such special cases. Labasheeda national school will recover provided it is given the opportunity to do so, and I ask the Minister to take account of this unique situation.

I thank the Deputy for raising this matter.

The staffing schedule is the mechanism used for allocating mainstream teaching posts to all schools. It operates in a clear and transparent manner, treating all similar types of schools equally irrespective of location, and on the basis of a general average of one classroom teacher for every 28 pupils with lower thresholds for DEIS band one schools. As part of the 2012 budget decisions, there is a phased increase in the number of pupils required to gain and retain a classroom teaching post in small primary schools with four teachers or fewer. The first phase of the budget measure took effect from September 2012 while the final phase will take effect from September 2014.

Labasheeda national school has two classroom teachers in the current school year based on an enrolment of 21 pupils at 30 September 2012. The enrolment at 30 September 2013 was 17 pupils which entitles the school to one classroom teacher for the coming school year. The school is projecting an enrolment of 16 pupils for 30 September 2014. The school submitted an appeal to the February 2014 meeting of the primary staffing appeals board, under the small school criterion, seeking the retention of its second classroom post for the 2014-2015 school year based on the projected enrolment of 16 pupils at 30 September 2014. A projected enrolment of at least 20 pupils on 30 September 2014 would be required for the school to remain as a two-teacher school.

Given that it projected just 16 pupils, the appeal was deemed ineligible for consideration by the board on the basis that the grounds of the appeal did not meet with the appeal criteria. The board of management of the school has been notified of this decision. The appeals board operates independently of the Department and its decision is final. If other pupils decide to enrol in the school and its projected enrolment in September 2014 increases to the required 20 pupils, then it can submit a new appeal to the appeals board.

The Government recognises that small schools are an important part of the social fabric of rural communities. They will continue to feature on our education landscape.

I thank the Minister of State for his reply. Looking around at the many Members in the Chamber, the people of Labasheeda would have never thought they would have such an interested audience in their school. I did not realise so many Ministers were interested in the school either.

(Interruptions).

Deputy Breen is showing leadership and courage.

I am sure the Minister of State might now consider keeping the two teachers in the schools, given the number of Ministers, backbenchers and media here. I hope it will put pressure on the Minister of State to rethink the position on small schools.

Small schools in the country are having problems.

The Deputy should throw in the small schools of Donnycarney too.

Deputy Finian McGrath would not understand the situation in rural communities and the effect the closure of a small school can have on its community. Not only have rural communities been devastated by recent storms, but they have been hit by unemployment and other problems.

The value for money report into small schools needs to be published as soon as possible, as it will be critical for small schools continuing. They have an important role to play. Once a small school goes from a rural village, the village dies. Will the Minister of State give due consideration to having an exception for these types of schools in communities where the population has temporarily decreased but there is evidence that enrolments will increase in the next four to five years? As I said earlier, keeping such schools open would be only for 12 months until enrolments pick up. It would not cost the Department too much to keep an extra teacher on even as an assistant for health and safety reasons.

The good Clareman that the Deputy is, he hurled the ball very well on that one.

The Minister of State is a good Corkman so he would know.

I sympathise with the Deputy as I too represent a rural constituency, Cork East, where our schools face similar challenges. The Government has set out criteria which are open to the rigours of an independent appeals review. If an enrolment could be increased in September 2014, there is a mechanism for the school and community to come back in.

The Government is still closing small schools.

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