Deputy Mick Wallace is not present for his question.
Other Questions
Question No. 90 replied to with Written Answers.
Office of the Ombudsman Status
Mary Lou McDonald
Ceist:91. Deputy Mary Lou McDonald asked the Minister for Public Expenditure and Reform to set out his views on a proposal to constitutionalise the position of the Ombudsman made at a conference hosted by the Institute of Public Administration on 7 November 2014 which the Ombudsman attended and addressed. [47798/14]
My question refers to the position of the Ombudsman. As the Minister is aware, the Ombudsman had cause to make public comment recently in respect of Áras Attracta and more generally in respect of investigations into complaints in the relevant sector. He highlighted what seems to have been a lack of information flow from HIQA and the HSE to his office, thus preventing legitimate investigations. The question is more generally posited and refers to the idea of constitutionalising the role of the Ombudsman, a suggestion that comes from that office.
The Ombudsman has submitted to me a range of proposals for reforms to his office and how it operates. I have asked my Department to examine these matters and report to me after further consultation with the Ombudsman.
I listened with interest to the Ombudsman's speech at the IPA conference to celebrate the establishment of the Office of the Ombudsman 30 years ago, in which he set out the basis for some of these proposals, including the constitutional issue referred to in the Deputy's question.
The Deputy will note that under the Ombudsman (Amendment) Act 2012, which we piloted through the Houses in recent times, there was a significant expansion of the powers and remit of the Ombudsman. This represented the most substantial extension in over three decades in the powers of the Ombudsman and his remit, which will significantly enhance the accountability of public bodies to citizens.
As part of the review of the proposals, it will be important to examine the impact and effectiveness of the reforms to date and the progress made by the Office of the Ombudsman in implementing the new powers and fulfilling the expanded mandate given to him by the Oireachtas.
As the Deputy will be aware, the Government has already implemented a substantial programme of constitutional reform. Six referendums have been held since the Government took office. Five of these referendums arose directly from commitments in the programme for Government. The programme for Government has also committed to the establishment of the Constitutional Convention to examine a range of constitutional issues. In response to recommendations in the first three reports of the convention, we have announced that we will bring forward proposals for referendums on marriage equality, reducing the voting age to 16 years and reducing the eligibility age for candidates for President to 21 years. The Government announced that it would also bring forward proposals for a referendum on the removal from the Constitution of the offence of blasphemy. In July 2014, the Government agreed to hold a referendum on the ratification of the international agreement on a unified patent court and approved the drafting of the constitutional amendment Bill for the referendum.
A range of constitutional issues are at play and we should debate, perhaps in the House, how these can be sequenced in order that we can set priorities for what should be done without overwhelming the people in any proposals to amend what is a very precious document to most citizens.
I absolutely appreciate and agree with that. I note in the Minister's list of proposed amendments he did not mention the extension of the right to vote in the presidential election to citizens outside the jurisdiction.
I do not have the full list yet.
I am relieved to hear that it is on the list. I am not raising this with the Minister with an eye to asking him to fast-track it as the most important constitutional reform, but I believe it merits serious consideration, because the Office of the Ombudsman is essential from the citizens' point of view in terms of ensuring quality of service delivery, and, in some cases, periods of service delivery, as well as dealing with complaints and concerns as they arise.
The argument for making this a constitutional position is that it would serve to reinforce the independence of the office.
It would offer further reassurance to members of the public that their complaints would be dealt with on their merits. That is a fair assertion. It is a very interesting proposal and one that should be considered more deeply.
I do not have a closed mind on that at all. There has been significant appreciation and regard for the work of the Office of the Ombudsman over its 30-year remit. We have been very lucky with the people selected by various Administrations over the past 30 years to hold the office and who have built public confidence therein.
The raft of additional bodies under the remit of the Ombudsman, including third-level educational institutions, education and training boards, the National Roads Authority, the fisheries board, the Courts Service of Ireland and many others I have not time to mention, will give it a lot of additional work. I am not sure that simply giving the office constitutional underpinning would strengthen public confidence in it. It already enjoys robust public confidence. However, I do not have a closed mind in considering that for the future.
The Minister would have heard the Ombudsman note in the same speech the fact that some companies — he instanced Irish Water — provide services that were once under his remit but no longer are. He cited all the networked services, including the post, electricity, gas, public transport and telecommunications services. He raised this as a really serious issue concerning public accountability. He also raised it, very fairly, as an issue concerning the assurance of quality of service, or the provision of a service at all for some sections of the population. He is arguing on the one hand for the underpinning of the position within the Constitution — we can debate whether that raises its status and whether it is desirable — and, on the other, for the expansion of the office's remit to encompass all those services that may be regarded as public services, even if provided by private providers.
I have actually discussed this issue with the Ombudsman, because he has very good ideas on it and I would like to develop these. I do not want to overwhelm the Office of the Ombudsman, because there is a raft of new bodies that have now come within its remit.
I heard the Ombudsman on the radio last week signalling his office's openness to claims of maladministration in regard to the circumstances in Áras Attracta. That was very welcome. The net point the Deputy makes on services being provided by commercial semi-state bodies that were formerly provided entirely by State bodies is one in respect of which I have listened to the views of the Ombudsman. There is something to be developed in that regard in the future.
Ministerial Pensions
Richard Boyd Barrett
Ceist:92. Deputy Richard Boyd Barrett asked the Minister for Public Expenditure and Reform if he acknowledges the continuing public concern over ministerial pensions; his plans for further measures in this area; and if he will make a statement on the matter. [47834/14]
A question that arises time and again for me and, I suspect, quite a few Members of this House - in the context of the recent protests and, in a general sense, based on people's experience of austerity and their financial difficulties - concerns the running sore of ministerial pensions. People keep talking about this and are outraged and furious that some of the key Ministers and taoisigh involved in bankrupting this country have walked away with enormous severance payments and salaries. I would like the Minister to give some detail on this. While I know there have been some changes, I contend that even sitting Ministers and taoisigh will be entitled, after just two years of serving in this Government, to a pension. The Taoiseach will get €20,000, while a Minister or the Tánaiste will get €18,000 just after two years. The average civil servant, however, would have to work 40 years to get an equivalent amount. Ministers, on top of being entitled to pensions, get a Deputy's salary and so on. How does the Minister respond to the anger and outrage over that sort of injustice?
One does not get a pension and a Deputy's salary at the same time. That was abolished.
The pensions of Oireachtas Members, including Ministers and other officeholders, have been subject to a range of measures in the past few years that have substantially reduced the benefits awarded by previous Governments to political officeholders and that have had significant downward effects on the pension entitlements of current officeholders.
The Public Service Pensions (Single Scheme and Other Provisions) Act 2012 introduced a new single public service pension scheme for all new entrants, including new Oireachtas Members, from 2013. The scheme applies a new minimum pension age of 66 years, raised from 65 years, to new entrant public servants and is linked to increases in the age for the contributory State pension. Benefits under the new scheme are substantially revised, with pensions for all new entrant public servants, including Ministers and Oireachtas Members, to be based on career average earnings rather than the current final salary basis.
Successive Financial Emergency Measures in the Public Interest Acts have had an impact on the pay and pensions of officeholders. For example, the pay reductions have reduced the salaries on which pensions are calculated substantially. A progressive public service pension reduction, PSPR, was introduced from January 2011 on the pensions of those who retired before March 2012. From January 2012, a new higher PSPR rate of 20% was introduced for pensions of more than €100,000. Further PSPRs were introduced subsequently for pensions of €32,500 and above from July 2013. These will have an impact on all those retiring before the end of the current grace period. These measures were deemed necessary and appropriate to ensure that higher-paid pensioners, including officeholders, made a fair and proportionate additional contribution to fiscal consolidation.
Other measures introduced in recent years which have had an impact on pensions include the exclusion for pension purposes of long service increments, the bar on serving Oireachtas or European Parliament Members from receiving ministerial pensions and the application of aggregation of public service pensions in the calculation of a pension where the aggregated value of such pensions are in excess of €32,500 per annum.
We have reduced pay for current officeholders, including the Taoiseach, whose pay has been reduced by 41%, which has a knock-on effect on his pensions. With regard to previous officeholders, to whom the Deputy referred, I have gone as far as the legal advice available to me allows. The Deputy was not present when I debated this matter previously with Deputy Healy. A constitutional issue of preserved property rights arises and I am conscious of the need to avoid introducing any measure that would cause a collapse of the entire financial emergency measures in the public interest legislation, as to do so would be ruinous for the State.
I raise this issue because it angers many people. While I acknowledge that it is a complicated area and a number of changes have been made, it makes people's blood boil when they hear a report that 111 former Ministers were paid pensions worth €9,653,000 in 2012. Notwithstanding the Minister's response, I understand the Taoiseach can walk away with a pension of €20,000 after only two years in the role, and I presume the Taoiseach's pension increases in subsequent years. After two years, the pensions available to the Tánaiste and Ministers are approximately €18,000 and €15,000, respectively. The average public sector worker would have to work for 40 years to accumulate a pension of €20,000, whereas the Taoiseach receives that level of pension after only two years and, on reaching retirement age, he will also receive the pension provided to a Deputy and so forth. Having been hit with all the financial emergency measures, the universal social charge and pension levies, people ask the reason the Taoiseach and other Ministers can walk away from office after only two years with a pension of nearly 20 grand.
All the levies the Deputy mentioned also fall on Members of the Oireachtas. We are not immune from any of these measures. Fast-accrual pensions apply to certain categories of person. Whereas a civil servant may be employed in the Civil Service for 40 years, a Taoiseach or garda will not be in his or her role for 40 years. Taoisigh and gardaí have fast-accrual pensions because it is understood they will not be in the same position for a long period. Fast-accrual pensions are occupation-specific.
The Government has taken dramatic measures to reduce salaries. The first action taken by the Taoiseach on taking office was to impose a cap of €200,000 on his salary. This cap obviously has an impact on his pension, and his salary has been further reduced since. These reductions have filtered down to all officeholders.
There is public annoyance that people who were charged with oversight walked away from politics and public administration after the debacle of the crisis.
People believe they did not take a proportionate hit for the crisis that had happened. That is a concern for them, but we can only go so far within the Constitution. We have introduced a pension abatement figure of 20% for those on the highest pensions, which is as far I was advised I could go legally.
I have studied the answer in detail. On the issue of constitutionality, there are two categories. There is a category of people, which includes former taoisigh and Ministers, who are associated with the bankruptcy of the country and who have walked away with large amounts of money. It infuriates people that they can be penalised for what they see as the crimes of others, while those who were at the helm walk away, effectively, scot-free. They would like the Government to re-examine what can be done and whether measures can be taken. They are outraged by this when they cannot make ends meet and have been hit with emergency measures, the imposition of water charges and all the rest. I sat through a committee meeting with the Minister at which we discussed fast accruals, firemen and gardaí. However, when we discuss Ministers, we find that the level of fast accrual is a multiple of what a fireman or garda receives. I understand that for a Deputy there is a fast accrual level of 20 years, but for a Minister it is two years, which is extraordinary and not comparable with the level for a fireman, a garda or a soldier. How can this be justified? They will also receive fairly generous pension entitlements as Deputies, having been remunerated very well as Ministers and so on. After two years they walk away with €18,000 or €20,000. Others say, "We will never get that; we might not get it as our entire pension entitlement at the end of our lives."
Obviously, people will not be Ministers for 20 years. I do not think it happened in the past, but it will not happen in the future. It is understood accrual would be swifter and that has been the way ever since pensions were introduced. As I indicated, we have worked to reduce the amounts considerably. I do not know whether it is the view of the Deputy that there should be no pensions for Ministers because if there was a 20 year horizon, there would be no benefit at all in being a Minister in terms of pension rights, if he wanted to equate it with a Deputy's 20 year pension. We have imposed a significant reduction on anything which has gone before. It is a reasonable set of measures which is proportionate in terms of what is required. There are other public servants, people in academia and the Judiciary who have significant pensions - in some instances, fast accrual pensions - which are linked with and tailored to meet the specifics of their occupations.
Deputy Micheál Martin is not present to take the next question.
Question No. 93 replied to with Written Answers.
Estimates Process
Mary Lou McDonald
Ceist:94. Deputy Mary Lou McDonald asked the Minister for Public Expenditure and Reform his views on the additional €1.1 billion in supplementary allocations sought from him by the various Departments for 2015. [47796/14]
My question refers to the supplementary allocations sought by various Departments for 2015. A figure of some €1.2 billion has already been noted, the largest Supplementary Estimate in the history of the State. I appreciate that, since filing this question, time has been set aside tomorrow for a debate on the Appropriation Bill and that we will at least have some discussion in that format. We told the Minister how disappointed we were that these matters were to go through on the nod without debate and about the failure to bring forward, within the agreed timeframe, information for me and Deputy Sean Fleming. Is it fair to say a Supplementary Estimate of this scale is an explicit recognition by the Minister that the health, education and other sectors were underfunded by him?
The Government published the Revised Estimates in December 2013, with the amount allocated being consistent, as I indicated, with the budget 2014 target of reducing the deficit to 4.8% of GDP.
In the period since then, the fiscal and economic outlook has improved and strong growth has returned an initial 30,000 jobs. Receipts into State coffers are €1.1 billion ahead of what we profiled. As a result, we have been in a position to focus, for the first time in many years, on increasing the delivery of essential public service spending and to consider dealing with certain expenditure pressures through Supplementary Estimates. We are still going to meet all our fiscal targets in spades. The reduced 4.8% deficit for this year will be handsomely exceeded and we will have a deficit of well below 4% this year, reducing next year to 2.7%. Therefore, it is clear we should deploy some of the additional capacity we have to meet pressures. After years of tight budgeting, we should ease the pressure in some areas.
The Deputy is quite wrong on a number of the assertions she made and I have corrected them. The €1.2 billion additional Supplementary Estimate is not new money. Some of these things are a timing issue, as indicated. Some €177 million, for example, in the Department of Agriculture, Food and the Marine, arises because moneys expected from the European Union this year will not come until next year. We will get the money next year, but we must provide for it this year. A sum of €77 million from the Department of Education and Skills is an accounting sum, because the Comptroller and Auditor General asked for it to be accounted for in 2014 rather than 2013. Of course, that will reduce the expenditure in 2013.
The real and only additional money - because the rest has arisen largely from savings we have made across all other Votes - is in the health area, because I am conscious of the real pressures in that area. It is not that there was underfunding last year. For ten years we have had a Supplementary Estimate in the Department of Health and Children, because the provision of health services has become more complex and new drugs and services are coming on stream. There will always be that sort of pressure, not only in the Irish health service, but in every health service on the planet. I have discussed this with the OECD.
I am glad the Minister has discussed this with the OECD. No matter who the Minister discussed it with, he or she would not have to be an expert in economics or health management to tell him the effect underfunding has had within the health system. In my view, the allocation of these moneys to health are an explicit recognition that the figures the Minister delivered here in October fell well short and that he was well aware of that at the time.
I welcome the fact that additional moneys are going to the health service as they are badly needed.
The Deputy cannot have it both ways. She cannot criticise it and -----
Deputy McDonald to conclude.
We talked earlier about the expenditure benchmark under the six-pack and European semester. How will Supplementary Estimates fall once this new regime is introduced, from 2016 onwards? What will be the effect of that expenditure break on any Supplementary Estimates?
The Deputy is focusing on health expenditure and I have indicated to her that I took the opportunity to talk to the expert panel with the OECD on health expenditure generally within OECD countries. Health expenditure is a pressure point everywhere and there is no simple solution anywhere. It amounts to some degree of rationing, either through an insurance or public health model and will be a difficult nut to crack in the future. The notion that we can accurately determine at the beginning of a year exactly what the health pressures will be, what pressure will be on hospitals, what drug refunds will be made or what new drugs will come on stream to meet demand is not facing reality.
On the question regarding the effect of the new European semester on budgeting, I indicated previously that we will be able to increase expenditure in line with projected growth increases. The exact modality of that is a matter of discussion between the Commission and the Department of Finance currently. I am confident we will be able to meet all the social pressures we can afford to meet within the moneys we can generate in this country without impediment from the European Commission.
The Minister for Health was not short about being able to predict accurately and speedily that the moneys allocated in October would fall well short of what will be required in the system. I am concerned about the new rules that will apply from 2016. In response to an earlier question, the Minister said he and the Government will regard the expenditure benchmark as binding on the State, as it is on all others. There is another school of thought within the European Commission that says the benchmark is simply a policy instrument and it is indicative and not binding in the way the Minister suggests.
I am concerned on two fronts - first, he will succumb to the notion that this is binding and, therefore, he must follow every detail of it; and, second, the effect that will undoubtedly have on the capacity of any future Government to introduce Supplementary Estimates. The Minister was quite glib when he said that as a matter of course we can meet all the additional spending and social pressures. If the benchmark is set at the 0.5% structural deficit limit, he will not have that discretion, which is worrying, not least at a time he is heralding the end of austerity in his own words.
With regard to the Minister for Health being able to predict an overrun in October, I had indicated to the House that there would be an overrun in the health Estimate by October 2014. The Deputy is asking for me to have been able to predict this in October 2013 when I introduced the budgetary parameters. That would be a little more challenging but from now on it would be a brave Minister who would ever stand up and say with certainty there will never be a Supplementary Estimate required for the Department of Health because of the complexity in delivering a modern health system with incredibly fast changing diagnostics, treatment procedures and drugs, all of which put pressures on the system. However, thankfully, they are improving both life expectancy and the quality of life.
On the general question of how we will operate in budgetary terms within the fiscal parameters, I answered a previous question on that at length.
Public Private Partnerships Data
Seán Fleming
Ceist:95. Deputy Sean Fleming asked the Minister for Public Expenditure and Reform the current level of exposure of the State and its agencies to public private partnerships, PPPs; his plans to increase the use of PPPs; and if he will make a statement on the matter. [47803/14]
What is the current exposure of the State and its agencies, including semi-State bodies, to public private partnerships, PPPs, that have been entered into in recent years? Has he plans to increase the use of PPPs?
In July 2012, I announced a €2.2 billion stimulus package that included the launch of a new PPP programme. The PPP projects, involving estimated overall capital investment of approximately €1.4 billion, are being delivered by a range of Departments and agencies across the education, transport, health and justice sectors. All the projects have been issued to the market.
The capital review, which is being completed by my Department and will be published in the new year, will outline the total level of unitary payments on operational PPPs. It will also include an outline of unitary payment commitments for the programme currently in procurement and offer a complete picture of the ongoing cost of PPP projects accruing to the State. In overall terms, the report of the capital review will highlight that the State will expect to face annual PPP charges of approximately €440 million from 2020.
In budget 2015, I announced that it is this Government's intention to deliver social housing units by 2017 via PPPs as one of the various modalities to deliver such units. The units will be provided by using the successful model that has helped deliver 23 schools in recent years. Following on from the budget, my colleague, the Minister for the Environment, Community and Local Government, has announced a comprehensive housing strategy that involves providing up to 35,000 additional housing units by 2020. The strategy confirms a range of delivery methods, including the extension of the PPP programme announced.
It is my intention to use the forthcoming capital review to help inform future policy in relation to PPPs. Such partnerships have enabled the Government to make additional crucial investments across a range of areas, while respecting the constraints of our immediate fiscal parameters. Although our fiscal position continues to improve, there is a need to continue to maintain strict budgetary discipline while investing in critical infrastructure. PPPs provide government with one approach to delivering such infrastructure. The capital review will offer an assessment of the affordability and desirability of future PPP programmes and help determine the context in which such programmes should be established.
I asked the Minister to give me a list of the current exposure. The Minister is telling me that we will get it some time in the spring as part of the capital review.
I have indicated that the expectation is that it will be of the order of €440 million annually-----
When will we see that figure? The Minister is saying that the capital review will have the breakdown of the unitary payment.
Early in the new year. I have not brought it to Government yet.
I will wait for that. A large element of the €2.2 billion stimulus package the Minister mentioned last year related to primary care services. The outgoing Minister for Health had identified pet projects and pet locations. Could the Minister confirm whether any of those have gone to market because he said education, transport and justice projects have all gone to tender but they might not be back yet? That is fair enough. The Minister missed the health projects. The health projects were a controversial part of that project. There was a list of 20 primary care centres dotted around different Ministers' constituencies at the time. Have they been abandoned? How is that shaping up? Is it possible as part of that capital review to use the expertise of the National Treasury Management Agency to see whether any of those can be bought out and re-financed?
I can give the Deputy a breakdown of the PPPs per sector. In health, 14 primary care centres across the country will be delivered. A shortlist of tenderers has been selected and the final tenders are due to be returned in February 2015. Those 14 centres, which are not substantial in money terms overall, will be delivered by PPPs. The roads sector investment will see the delivery of three projects that I have indicated. There are three projects in education. Two bundles of schools will be delivered, one of which is due to achieve financial close this week. The flagship Grangegorman project will consolidate the current Dublin Institute of Technology into one centre of excellence. Tenders for that were received at the end of November. Again, we expect a preferred bidder to be determined in February but I can give the Deputy the full list.
I look forward to receiving that list. The Minister is concentrating on what he calls the stimulus package of €2.2 billion. My question was broader and concerned all the PPPs out there. It was not specifically concentrating on the ones that are currently working their way through the system.
Does the Deputy mean previous-----
What is the unitary value of the roads and schools projects out there? I am referring to the ongoing commitments out there for the past-----
The totality-----
Yes. I understand that the commitments relating to the PPPs out there are of the order of €5 billion. Perhaps I am wrong. I understand that approximately up to €1 billion worth of those are in water and wastewater services through various local authorities. I believe these might now be transferred to Irish Water but the legislation before the House is now saying that the Government will automatically transfer the assets of local authorities to Irish Water but not necessarily the liabilities. That is the legislation that is yet to be passed here which is an extraordinary new situation. Who will be left with the liability for the PPPs that are currently on the books where the asset is transferring automatically to Irish Water? I want the totality. Roads and schools are the big issue. When the Minister is sending the information, could he include the totality and not just last year's stimulus package?
I have given the Deputy all the PPPs that have come on stream since I became Minister. There are, obviously, liabilities from the new Courts of Justice and other things that were built under PPPs under the previous Administration or Administrations. I will give the Deputy the consolidated unitary payments in a written reply.