Dáil Éireann díospóireacht -
Tuesday, 15 Apr 2014

Vol. 838 No. 1

Topical Issue Debate

VAT Exemptions

Deputy Seán Kyne

Mountain rescue teams perform an essential job on a voluntary basis. I acknowledge and welcome the funding provided by the State to the 12 teams operating in Ireland. I also welcome the work of the Minister for Transport, Tourism and Sport, Deputy Leo Varadkar, in directing his officials to examine the introduction of a modest capital grant scheme to support the vital work of the teams.

Tourism and physical activity are two areas on which the Government is focusing generally. Both involve the development of outdoor sports and adventure activities which have a hugely positive impact on rural economies. The Department of Transport, Tourism and Sport, the Department of Jobs, Enterprise and Innovation and Fáilte Ireland are working together to encourage more people to visit Ireland by emphasising the adventure tourism activities on offer here, including hill walking, mountaineering, rock climbing, mountain biking and more. The Department of Health's Healthy Ireland strategy, a framework for promoting improved health and well-being, encourages citizens to take up exercise to realise the health benefits of outdoor pursuits. These policies increase the number of people on our hillsides and mountains, which is very welcome. At the same time, however, there is likely to be an increase in the numbers requiring the services of our voluntary mountain rescue teams.

To provide this often life-saving service, mountain rescue teams must be adequately equipped, which can be costly. While we rightly fund the rescue teams from State funds, it does not make sense for the State to charge taxes on the procurement of equipment. VAT has long been a cornerstone of the EU's method of funding its institutions and activities. This can be seen in the original EEC Directive No. 338 of 1977 and subsequent directives governing the administration of VAT in member states. These directives aimed to establish a common system of VAT and a uniform assessment process. The most recent update to VAT law at EU level was Council Directive No. 112, which was introduced in November 2006 and came into operation from January 2007. Under this provision, member states retain overall competency in taxation matters. However, EU rules pertaining to VAT have established a standard 15% rate, with member states permitted to apply one or two reduced rates not lower than 5% on certain products or services. Member states such as Ireland and the United Kingdom have also been permitted to retain reduced rates which were already in force prior to the introduction of various EU directives. Other exemptions from VAT are permitted for socioeconomic reasons and include activities such as hospital and medical care and goods and services linked to welfare, work, education and cultural activities. Significantly for this particular debate, a zero rate of VAT and a VAT refund order apply to vessels for rescue or assistance at sea and on inland waterways, respectively.

The European Commission has commenced a communication process involving the Parliament, Council of Ministers and the European Economic and Social Committee on the future of VAT. The overall aim is to create a simple, more robust and efficient VAT system for the Single Market. In its communication, the Commission calls on member states to make use of the existing options to alleviate the burden of VAT on non-profit organisations and offers to provide guidance on the VAT regime applicable. Mountain rescue teams are the very definition of non-profit organisations, as reflected in the relevant sections of the VAT directive. For example, Article 132, subsection 1(m), refers to "the supply of certain services closely linked to sport or physical education by non-profit-making organisations to persons taking part in sport". Article 131, subsection 1(p), talks about "the supply of transport services for sick or injured persons in vehicles specifically designed for the purpose, by duly authorised bodies". Article 133 further identifies the organisations that may be covered by various provisions of Article 132 and notes that the organisations "must not systematically aim to make a profit" and "must be managed and administered on an essentially voluntary basis".

I am calling on the Minister to extend the exemption from VAT to mountain rescue and lowlands teams in order that they can conduct their vital work in the most efficient and effective way.

Minister for Finance (Deputy Michael Noonan)

I am pleased to have this opportunity to deal with the question of VAT incurred on the purchase of equipment used by mountain and lowlands rescue teams. I acknowledge the excellent work undertaken by these teams made up of unpaid volunteers, who provide a very important emergency rescue service to the public, often in difficult circumstances, terrain and weather.

It is important to clarify what is referred to in this instance by an exemption from VAT for mountain rescue teams, as this can have a number of meanings in Irish VAT law. As the Deputy has pointed out, that law must comply with the EU VAT directive. An exemption from VAT could refer to supplies of goods or services made by mountain rescue bodies. It could also refer to the supply of goods and services exempt from VAT, or at a zero rate of VAT, to mountain rescue bodies. Finally, it could refer to a compensation mechanism allowing mountain rescue bodies to claim a refund of VAT incurred on their purchases.

In general, exemption from VAT refers to a situation where goods and services are supplied without VAT charged on them but where the supplier of those goods is not entitled to claim any VAT paid on their input costs. The same system applies to bodies and persons who are outside the scope of VAT. Mountain rescue bodies are generally outside the scope of VAT. As such, they do not apply VAT to any supplies they make, such as merchandising, and they cannot claim VAT paid on their purchases. Where a mountain rescue body is registered for tax purposes as a charity, it will be exempt from VAT and the same VAT treatment applies.

The EU VAT directive provides that certain services are exempt from VAT, including medical services, some postal services and financial and insurance services. Other services are specifically exempt from VAT in Ireland for historical reasons, such as transport services and the supply of water. The supply of goods is not normally exempt from VAT. It is not possible, therefore, under EU VAT law, to introduce an exemption from VAT on goods and services received by mountain rescue teams. Any goods and services attracting the zero rate of VAT will also benefit mountain rescue bodies purchasing such goods or services. However, the application of the zero rate can only apply to goods and services which were subject to the zero rate on and from 1 January 1991.

Ireland applies a zero rate to most food, books, oral medicines and children's clothing and footwear. Where mountain rescue teams purchase such goods they will be free of VAT. However, it is not possible under EU VAT law to introduce a zero rate on any goods not subject to the zero rate on and from 1 January 1991.

With regard to the introduction of a compensation mechanism allowing mountain rescue bodies to claim a refund of VAT on their purchases, the Value Added Tax Consolidation Act 2010 allows for the creation of VAT refund orders which provide compensation for VAT incurred by individuals or bodies in specific circumstances. However, while providing a compensation method does not affect VAT being charged according to the EU VAT directive, this is not clear-cut where relief is provided in respect of a particular good or service as it is generally counter to the provision that VAT should be paid by the final consumer of goods and services. It is for this reason that Ireland has not introduced any new VAT refund orders since the I980s. Any changes to VAT refunds since then have been either by EU requirement or minor changes to existing refund orders.

A VAT refund order for the purchase of small sea rescue vessels was introduced in 1985, which provided for repayment of VAT incurred on small craft for rescue at sea and on ancillary equipment. This was extended last year to cover small rescue vessels operating on inland waterways. This followed the introduction of a zero rate of VAT in 1978 on the supply of larger sea rescue vessels, which was specifically provided for under EU VAT law, under Articles 148 and 169 of the recast EU VAT directive. Irish VAT law does not specifically provide a refund of VAT for mountain rescue teams purchasing mountain rescue equipment as the EU VAT directive does not provide for a VAT exemption for such goods. Should VAT law be amended at EU level to allow mountain rescue equipment to be exempt from VAT, or for the introduction of a compensation mechanism for VAT incurred on mountain rescue equipment, I will then consider introducing such a reform, taking into consideration Exchequer implications.

The Deputy will also be aware that mountain rescue organisations receive Exchequer funding from my colleague, the Minister for Transport, Tourism and Sport, with over €1 million paid to mountain rescue teams and management organisations over the past five years.

Deputy Seán Kyne

I thank the Minister for his reply, which I will need to study in more detail. If it is the case that current provisions of the VAT directive regarding exemptions, some of which I have outlined, are not applicable to mountain rescue teams then the European Commission's communication on VAT represents a prime opportunity to bring about this necessary change. In this regard, the European Commission cannot act alone. While the Parliament has a role to play, more specifically, the Council of Ministers, which in this case is the Council of Finance Ministers, has a central role to play. One of the greatest challenges in terms of law making and the introduction of reforms at EU level is the complexity of the European Union. I fear that while many people in many countries would agree with the exemption of mountain rescue equipment from VAT, with all the wrangling in regard to who is responsible for this, no reforms will be made.

The Minister stated in his reply that should VAT law be amended at EU level to allow mountain rescue equipment to be exempted from VAT, he would consider introducing such a reform here. The issue now is how we make the case for this at European level. I believe that the European Council of Finance Ministers can provide the necessary leadership in this regard. I note and welcome the Minister's reply this week to a parliamentary question tabled by me in which he said: "Where VAT law is amended at EU level to provide that VAT does not apply to mountain rescue equipment or for the introduction of a compensation for VAT incurred on mountain rescue equipment, I will then consider introducing such a reform". I would like to leave here today in the knowledge that the Minister, as a member of the Council of Ministers, will champion this issue and persuade, convince or cajole the other Ministers into working with the European Commission and the Parliament into making mountain rescue equipment exempt from VAT. Perhaps the Minister will when responding say whether other countries have put forward similar initiatives to that which I am proposing in respect of mountain equipment.

Deputy Michael Noonan

There has been no discussion on this issue at the Council of Ministers. In my view, when seeking a change such as this in the code, which change is relatively minor, the best approach is to go through the European Parliament. The Deputy has an opportune time now in the context of the European elections, to lobby the candidates for the European Parliament on making this one of the objectives of their campaign. It is not a huge request. If the impetus came from the Parliament, I am sure the change could be made. I will follow if the EU VAT directive is changed.

Fish Quotas

Deputy Noel Harrington

I thank the Ceann Comhairle's office for selecting this topic for discussion and the Minister of State, Deputy Tom Hayes, for coming to the House to respond to it. The background to this issue rests with what I would describe as the jewel of the crown of the Irish fishing industry, namely, the mackerel fishery, which is worth more than €100 million per annum to the State and the industry.

During the past number of years, the fishery has changed, with countries such as Iceland and the Faroe Islands arbitrarily allocating themselves a huge amount of the quota which historically has been bound by international agreements in the north east Atlantic between the countries of the European Union, Norway, Iceland, the Faroe Islands and Russia. The effect of this unilateral allocation of quota has led to a huge political impasse and an economic crisis in the industry. I commend the Minister, Deputy Coveney, on his efforts in terms of being the first to call for the imposition of sanctions on Iceland and the Faroe Islands owing to what they had done. This led to feverish negotiations at a European level. Ultimately, over a series of meetings an agreement was, regrettably, reached between the European Union and the countries, with the exception of Iceland. In my opinion, this agreement will impact negatively on the mackerel fishery in this country. Included in the agreement is an increase from 890,000 metric tonnes to 1.24 million tonnes, in allowable catch in the north east Atlantic waters, to be shared among the countries mentioned. The problem is that the European Union share in this allocation has decreased considerably.

While there will be an increase in the 2014 total allowable catch, the future for this fishery will more than likely be a severe decrease in subsequent years, as a result not alone of the advice from the International Council for the Exploration of the Sea, ICES, but from the decreased share which the European Union will have in this fishery. This will lead to two significant problems for all sectors of the mackerel industry in this country. First, an increased allocation for the coastal states, including Ireland, will lead to increased landing and as a result depressed prices. This will be inevitable. Second, will be an increased expectation on some of the segments for an increased share of the Irish mackerel quota, particularly those within the polyvalent-pelagic segment. Currently the Irish mackerel quota is divided, with 87% of it being allocated to the RSW pelagic sector, which comprises 23 large vessels, and the remaining 13% being sub-divided between the remaining sectors and based on vessels' gross tonnage-size.

I understand the need for a large allocation for the RSW segment. There have been huge investments made in that segment, leading to greater quality fish landed at our ports. However, it would be unfair not to put on the record that there will be increased demands on this industry as a result of a short term gain. This matter needs to be handled carefully.

Minister of State at the Department of Agriculture, Food and the Marine (Deputy Tom Hayes)

I thank the Deputy for the opportunity to outline the position in this area on behalf of the Minister, Deputy Coveney, who is, unfortunately, unavailable owing to another commitment.

A three-party agreement on the management of the mackerel stock in the north-east Atlantic involving the EU, Norway and the Faroe Islands was agreed on 12 March in London, following lengthy discussions over many months and years. Iceland, despite being involved in all of the negotiations is not party to this agreement. The key elements of the agreement are as follows: the total allowable catch has been set at 1.24 million tonnes for 2014 and in subsequent years it shall be based on the levels advised by the International Council on the Exploration of the Sea, ICES; the agreement is for five years; 12.6% of the total allowable catch has been allocated to Faroes; and a further 15.6% has been held as a coastal state and fishing party reserve. The latter would cover the possible accession of Iceland to the agreement as well as the interests of Russia and Greenland.

Ireland could not support the final agreement because of the unacceptably high number of shares allocated to the Faroe Islands and the level set aside for a reserve. However, there are aspects of the agreement that we can welcome. I refer, for example, to the fact that there will be no access to EU waters for Iceland, access for Norway has been restricted and the relative shares of the EU and Norway have been respected, with each paying proportionately to cover the new arrangements. In addition, the quota for the Irish fleet for 2014 has been increased - from the initial one set at the December Council - by over 60% to 105,000 tonnes. The final quota involves an 82% increase on the quota for 2013.

We have always been supportive of a deal that would bring an end to the irresponsible and excessive fishing of the mackerel stock which we have witnessed during the past five years. This new five-year agreement while far from ideal will at least ensure that, in line with the EU and Norway, the Faroese will be subject to fixed quotas set on the basis of ICES advice. This will protect against the previous dangerously high levels of fishing in which they participated. However, we are disappointed by the fact that the final outcome gave the Faroe Islands a significantly increased 12.6% share of the stock. The 15.6% reserve is intended to cover Iceland, Greenland and Russia but as all these parties are operating outside a formal agreement, there can be no confidence that they will respect even this very generous allocation.

From an Irish perspective, there is considerable disappointment with the high level shares and set aside granted. These appear to reward irresponsible behaviour. Ireland consistently argued at Council, and during the wider negotiations, that the levels being proposed for the parties to which I refer were too high. It is on that basis that we cannot support the overall deal. However, the European Commission and the EU member states with mackerel fishing fleets, including the UK which is the largest mackerel quota holder in the Union, were willing to accept the granting of those levels of share to the Faroes and the share set aside in the reserve.

An Leas-Cheann Comhairle

The Minister of State's time is exhausted. I suggest that he read the remainder of the reply during the next slot allocated to him.

Deputy Noel Harrington

I thank the Minister of State for his reply. I agree with the sentiments he expressed and I share his disappointment. The European Commission sacrificed sustainability for expediency in the context of the agreement that was reached. Unfortunately, the UK authorities were blinded by the offer of 30 pieces of silver for short-term gain.

The point I really wish to get across is that the deal changes the game completely in respect of the sustainability of the mackerel fishery, not just for Ireland but also for the European Union as a whole. As already stated, the mackerel sector here is divided into two segments and I strongly urge that the Minister of State and the Department consider the economic impact this will have in terms of depressing prices in the longer term and giving rise to smaller quotas. I am of the view that, despite the initial reward relating to the deal being done, quota levels are going to plummet in the future. The latter is going to have an impact on both the RSW pelagic segment, which is entitled to be dealt with in a sustainable way, and polyvalent pelagic segment, which comprises the vast majority of those vessels that have an entitlement to fish mackerel. It is unwise to allow to be carried through a deal that is going to prove unsustainable in the context of one or both of these segments. I request that a strategic review be carried out in respect of the long-term impact of the agreement on the Irish fishing sector and on coastal communities throughout the country.

Deputy Tom Hayes

The points the Deputy makes in respect of the economic impact are extremely important. In that context, I wish to outline the position with regard to where we find ourselves.

Ireland was prepared to concede significant shares to both Iceland and the Faroe Islands in the interests of stability and sustainability. However, we do not consider that there is any justification for the EU to have conceded as it has done. The share for Faroes is, unfortunately, now fixed. Ireland will be working hard to ensure lessons will be learned and that, in negotiations to come, EU member states will work more effectively together in order to better protect the Union's share of this vital resource.

In the context of the internal allocation of quota to the fleet, as a result of the coastal states agreement the adjusted national quota for 2014 is 104,967 tonnes. At the December Council, a provisional quota of 65,000 tonnes was set and this was allocated at the beginning of the year. There has been a recent request for a review of the redistribution of mackerel quota allocations between the polyvalent and refrigerated sea water, RSW, pelagic segments of the fleet based on the increase in the quota in 2014. The Minister, Deputy Coveney, has given full consideration to this request and is not of the view that there were changed circumstances which would support a review of the allocations between the segments. It is considered that the percentage-based allocation between the segments can properly deal with year on year fluctuations in national quota in a fair, transparent and balanced way.

An Leas-Cheann Comhairle

The time is up. The remainder of the reply is available in the printed copy that has been circulated.

Children and Family Services

Deputy Aengus Ó Snodaigh

Gabhaim buíochas leis an Aire as an sceideal a athrú. Tá a fhios agam go raibh rud eile eagartha aici. It is important that the Minister is present to take this matter, particularly in view of the fact that the early years initiative comes within her remit. I welcome the recent publication of the Children First Bill and other initiatives that have been taken by the Minister since she took office.

The service which is the subject of the matter I wish to discuss is at risk of closure if funding is not provided. I refer to the Bringing It All Back Home programme, which was first launched in 2011 and which involves an inter-agency approach in respect of children and families. The programme provides people with assistance in order that they might cope with parenting and ensures the children are nurtured from a young age. A gap in this regard was identified in the highly disadvantaged area of Inchicore and that was why the programme was put in place there. However, the programme has extended its reach beyond Inchicore in order to provide assistance to services in the Ballyfermot, Crumlin, Kilmainham and Bluebell areas. The approach taken in the context of Bringing It All Back Home has been lauded by the HSE and others as a model of best practice, particularly for those involved in the operation of the ongoing Meitheal programme. It would be sad if the pilot programme which set the standard for others were to be put at risk.

The programme was initially granted funding for three years, and that period comes to an end in June. Those involved in the programme have asked for it to be funded for a further two years until such time as there is another round of funding to which they can apply for the programme to be mainstreamed properly. Then, whatever changes need to happen to their service can take place.

The programme has been successful. I gave the Minister the evaluation report earlier. An independent evaluation or reading of the report suggests the programme has been invaluable. I have met many of the parents who have come through it. Let us not forget this is only three years in the making. Two of the parents involved have gone on to college, a major achievement given where they came from in the first place. These people have been identified by services as being highly at risk.

One of the initiatives has been that the professional and voluntary services can work together. If this project were not in place there would be higher costs in the provision of these services because, in the main, these services have worked in isolation. They have managed to work together and they are particularly cost-effective, which is testament to those who are pulling it together. It is pulled together under the Daughters of Charity Child and Family Service and the national early years access initiative. I urge the Minister to consider the matter, if possible. The programme is run on a shoestring and those involved are part-time. The annual cost is €120,000, which is not a major cost. For example, those involved sourced all the furniture for the offices themselves. It has not been a burden on the State. That is not the intention. The intention is to service the needs of a seriously disadvantaged community. It is based in Goldenbridge, next to St Michael's estate, an area which, as the Minister and others in the House will be aware, has had tremendous problems over the years and has been disproportionately affected by the downturn. It would be a pity if the service was lost for other parents and children in the area since there are no alternative projects stepping in to take up the flak. There would be a loss of their expertise to the area.

Minister for Children and Youth Affairs (Deputy Frances Fitzgerald)

I thank Deputy Ó Snodaigh for raising this issue. The report is an important and impressive evaluation of the Bringing It All Back Home project. As Deputy Ó Snodaigh said, it was a project of the canal communities family welfare initiative. This is an inter-agency consortium. I fully agree with what Deputy Ó Snodaigh said in respect of the inter-agency arrangement. It is important that community, voluntary and statutory organisations work together since all are concerned with children's welfare and children's services delivery in the Inchicore and Bluebell areas.

In 2011 the programme identified a gap for children aged zero to four years. Those involved identified a cohort of children and families who were not engaging with services. Since they began their work, they have engaged with families and parents. There are many testimonies from parents in the report summarising the work. Those involved were successful through the national early years access initiative, NEYAI, and Pobal in delivering what was at the time a three year community, parent and family support and education programme. It was run by the Daughters of Charity Child and Family Service, which took on the lead role for the agency. The NEYAI is a partnership involving Atlantic Philanthropies. As Deputy Ó Snodaigh is aware, Atlantic Philanthropies is withdrawing from Ireland in the coming year or two. It also involves the Mount Street Club Trust, the Department of Children and Youth Affairs, the early years education policy unit of the Department of Education and Skills and Pobal, which provided a governance and management role.

Let us put this in context. The national early years access initiative is an important initiative. It comprises 11 local projects from five counties, of which Bringing It All Back Home is one. They work in collaboration with a range of partners. Each has a particular focus, such as training and professional development; integrated family services management and practice; and language, literacy and numeracy. There are five areas of activity. They work to ensure standards in child care, to upskill the early childhood care and education workforce, to help children to be ready for school and to develop parent skills and parenting support. The work involves trying to get a continuum of services out to families as well as working on the well-being of parents and their capacity to nurture their children's development.

They have operated in a climate of rapid change in terms of policy and infrastructure for the development of these services with funding cuts and new funding initiatives resulting in alterations to some of the planned activities. All 11 projects are in the final phase of implementation and all are exploring the question of sustainability, which is a difficult question. They were pilot projects and therefore the question of sustainability and related costs must be examined. They are going through this process and an entire community is working on it. The initiative will finish this year but the projects have different end dates, with two finishing in April, four in July and five in August. Bringing It All Back Home is one of the projects and that contract ends in August.

I emphasise that the projects were started with a clear understanding that they were part of an initiative to test, trial and research ways of working with a vision to be able to streamline good evidence-based practice in early intervention. Funding was agreed for a three-year contract. My understanding is that no further funding is available for the initiative from the source of the original funding - I am referring in particular to Atlantic Philanthropies and the Mount Street Trust - since the arrangement was time bound. There will, however, be a national conference in May at which the findings from the initiative will be discussed and the lessons learned will be examined. Local children's services committees have been involved and there could be discussions with them on proposals for continuing the work of the project beyond the current contract.

Deputy Aengus Ó Snodaigh

I note the final point and I will pass on to those involved in Bringing It All Back Home the fact they can approach the local children's services committee. It is a pity the conference is in May because that is almost too late to ensure the continuation of services, especially if two of the projects finish in April. The only people who will suffer if there is a halt to the continuation of services are the children and parents who are identified as high risk. There is also a possibility we will lose the expertise that has been built up not only in this area but, I presume, in the other four areas, although I do not know anything about how those projects worked. In Inchicore, the service providers, including the HSE and the officials from the Department of Education and Skills, are satisfied with the way things are working. In some ways they are afraid of what will happen when they no longer meet on an inter-agency basis, as has been the case to date.

Some 40 families are engaged with Bringing It All Back Home. I hope there will be some way to ensure there is no gap in the support they get at a time when they are, for once, engaging with a service. A frightening figure came out when I met them. They put it to me that part of the catchment area has in percentage terms the highest number of children going into care. These are the clientele with whom the services are working. If these children end up in care now, there will be additional costs to the State, whereas this type of service reduces costs.

The service costs €120,000. I realise every penny counts for such a service. I do not intend to quote from the report but I refer the Minister to page ten in which the evaluation is specific about planning for the future. It is in line with everything the Minister has been saying in terms of services. The best approach involves working on an inter-agency basis. If anything emerges from the conference in May, it should include a recommendation to continue until the Child and Family Agency is fully bedded down and in tune with the services it can fully deliver.

Deputy Frances Fitzgerald

I can only agree with Deputy Ó Snodaigh that this type of early intervention project yields great results. There is no question of that. It could prevent young children going into care if the right support is available for families and parents. This is one of the reasons the Government has committed €30 million for the area-based childhood, ABC, programmes which are similar to the NEYAI programmes. I will ask the local children's services committee to give me a report on the project and the continuity issues that arise in respect of the families.

I will also see how much information we have on the 11 projects nationally and the funding implications for same. Clearly, they were pilot projects, but they merit an examination in terms of whether continuity is possible. The local children's services committees are the first place I will do so. I will undertake that and revert to the Deputy.

Deputy Aengus Ó Snodaigh

Those involved in the project have asked me to invite the Minister to visit it, if she so wishes, along with the area's other Deputies. Deputy Catherine Byrne of the Minister's party is aware of the project.

Deputy Frances Fitzgerald

Okay.

Youth Unemployment Measures

Deputy Dominic Hannigan

I thank the Ceann Comhairle for selecting my Topical Issues matter. I also thank the Minister, Deputy Burton, for being present to discuss this important issue.

The need for a youth guarantee has been discussed for many years. From meetings I have attended and spoken at since becoming Chairman of the European Union affairs committee, I know that there is political will for a guarantee. Last year, I spoke at a conference in Nottingham organised by our sister party in the UK, the Labour Party, where political leaders and young people spoke about how a youth guarantee would help to return hope to young Europeans and give them faith in the European project at a time when many do not understand why Europe is important in their lives.

The young people I have met in places like Ratoath, Duleek and Kells want to know what supports they will have if they need them. What is already in place is not good enough for young people who cannot get jobs after leaving school or college. The Minister has done a great deal of work to improve the system in recent years, but more needs to be done. Of those young people undertaking apprenticeships or trying to start their own businesses, for example, it is important that they know they can take that chance without being left behind if it goes wrong.

The Minister signed the agreement during the Irish Presidency of the European Council with the other member states. She managed to get a specific investment of €6 billion in the youth guarantee scheme across the Union. She also worked hard to get €250,000 to start a pilot project in Ballymun in north Dublin. That project is in operation. I have spoken with my party colleagues, for instance, Ms Emer Costello, concerning the pilot project. She is positive about it and has told me that the group engagement is going well and there is tremendous local interest. I wish the pilot project all the best and hope it turns out to be a success. I also hope that the lessons learned from it can be applied nationally when the scheme is rolled out.

That is my main reason for raising this matter. When can young people in places like Ashbourne, Dunshaughlin and Stamullen expect to have the same support as the young people in Ballymun? We all want to offer every young adult the best opportunities, but for that to happen we need to put the right supports in place. What will the youth guarantee look like in Meath and how will young people interact with it? There is an opportunity to involve local small to medium-sized enterprises, SMEs, and other stakeholders in the scheme. Will the Minister update the House on when young people in County Meath and elsewhere can expect to see the youth guarantee rolled out to them?

Minister for Social Protection (Deputy Joan Burton)

Since entering office, the Government has made firm and steady progress on increasing employment and reducing unemployment. Some 61,000 more people were in jobs at the end of 2013 and unemployment has decreased from a crisis peak of 15.1% to 11.8% now. Data published by EUROSTAT, the EU's statistical agency, show that Ireland's unemployment rate is now in line with the eurozone average, having been up to 40% above the average only two years ago. Youth unemployment has decreased from a peak of more than 80,000 in early 2009 to an estimated 54,000 at present. However, it is still too high. For this reason, I am determined to increase the pace of our progress. The youth guarantee will be central to the issue of youth unemployment.

I have consistently stated that a fiscal response to the economic crisis was never going to be enough - there must also be a social response. The youth guarantee is a key element of that social response, putting our young people, who will build this country's future, front and centre. The youth guarantee can be summed up in a single word, namely, "opportunities". It is about ensuring that we give our young people the opportunities they need to achieve their full potential.

The concept of the youth guarantee is simple - to ensure that all young people under the age of 25 years receive good quality offers of employment, continued education, apprenticeships or traineeships within four months of becoming unemployed or leaving formal education. Given the size of the challenge involved and the financial constraints under which we still labour, though, this cannot be done overnight. While our published implementation plan is ambitious in its scope, it is important to stress that there is no instant or single solution to the problem of unemployment among young people. It will take time and perseverance and involve ongoing investment and the sustained effort of the State, employers, unions and jobseekers. This is what the Ballymun pilot scheme has clearly shown.

The guarantee will be implemented on a phased basis over time by enhancing the Intreo engagement with newly unemployed young people and maintaining and developing the current range of education, training and employment interventions for young people. By the end of 2014, processes and programmes will be progressively rolled out across the country, including County Meath, to ensure that all of those young unemployed people who need the most support - that is, are assessed as having a low probability of securing employment in the absence of support from the public employment services - will receive youth guarantee offers within four months. The guarantee will initially concentrate on the hard-to-place young people, those who may have left school early or, despite their youth, have been unemployed for a considerable time.

Between 2014 and 2015, all long-term unemployed people under 25 years of age will be engaged by the public employment service and receive a youth guarantee offer if still unemployed after four months of the engagement process commencing. I consider long-term unemployed young people to be a major priority group, not just of the youth guarantee, but of our Pathways to Work activation strategy more generally. Without intervention and help, they risk becoming the "left behind" generation of the great recession.

An Leas-Cheann Comhairle

I must interrupt the Minister, but she will have two minutes to reply to Deputy Hannigan.

Deputy Dominic Hannigan

I thank the Minister for her comments. The guarantee is important for young people around the country. Last week, I spoke in a school in Ashbourne to approximately 80 young students. One of their concerns was the economy. I was able to tell them about our great progress in reducing unemployment levels. As I am sure the Minister is aware, the most recent figures for Kells show that the number of people unemployed has decreased by almost 300 in the past year. We must recognise that progress is being made, although we must do more.

I welcome the Minister's comments on the roll-out of the scheme across County Meath and the rest of the country by the end of 2014. That is positive news. The many people who are keenly watching the scheme will be glad to hear it. Will the scheme be targeted at those areas where trends in unemployment levels are greater than elsewhere? Can we ensure that the people and areas that need the scheme most are prioritised? Are there plans in that regard?

Deputy Joan Burton

The youth guarantee will be run on a national basis.

While it is unlikely that the Department will operate a specific scheme for each of the more than 60 local offices, as well as sub-offices run by contractors to the Department, there will be flexibility to tailor the implementation to local conditions with regard to the cohorts or groups of young people to be selected for engagement in the first instance. Therefore, the specific approach to be followed in County Meath, for example, will be a matter for the local departmental management in consultation with relevant stakeholders. I include public representatives in the area as being among those relevant stakeholders and, most importantly, employers. What I am seeking to achieve is a cultural change and to ask employers to include young people.

Later in the year and specifically in the forthcoming legislation we will widen the scope of a number of existing schemes that the Department operates to open them to people under 25 years of age. That might mean community employment, CE, schemes. There are people aged 24 years who might never have worked and the route to a job for them could be to go back into education or to continue the education they did not finish or it could be to participate in a local community employment scheme. I have visited Cork and saw a number of CE schemes which specifically involve young people in activities relating to local leisure centres, sporting activities and so forth, in which there is a great interest.

It is a very wide canvas but the critical issue is to bring in employers in the locality, both to tell young people about the types of jobs that exist and to include them when considering the people they are hiring.