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Dáil Éireann díospóireacht -
Wednesday, 19 Oct 2016

Vol. 925 No. 2

Other Questions

Teachers' Remuneration

Paul Murphy

Ceist:

12. Deputy Paul Murphy asked the Minister for Public Expenditure and Reform if he or his Department has advised other Departments regarding the restoration of pay and conditions with the ASTI trade union; and if he will make a statement on the matter. [30840/16]

Ruth Coppinger

Ceist:

23. Deputy Ruth Coppinger asked the Minister for Public Expenditure and Reform if he or his officials have met with the ASTI regarding the implementation of different pay scales for second level teachers. [30843/16]

I welcome the ASTI's strike ballot. It is showing the way for all workers, in particular new entrants in the public sector, through its actions. The first strike day will be next Thursday.

I propose to take Questions Nos. 12 and 23 together.

Officials from my Department and the Department of Education and Skills met the ASTI regarding the union's concerns on 7 July, 18 August and 13 September. The issues of new entrant teachers' pay and supervision and substitution payments among other matters were discussed in respect of ASTI members, forming the focus of those meetings. Notwithstanding these engagements between the parties, it has not been possible to date to reach an agreement on issues of direct mutual concern.

The inconclusive outcome of the ASTI meetings is in contrast with the agreement reached between the two Departments and the TUI and INTO on new entrant pay. This agreement will result in increases of up to €2,000 per year for new teachers at the start of their careers. The estimated value of these increases over a teacher's career is €135,000. This agreement gives substantial benefits to new teachers and shows what is possible through dialogue and negotiation within the Lansdowne Road agreement.

I will provide a practical example that highlights the increases over the period 1 September 2016 to 1 January 2018 for new entrants who commenced in 2014 and have signed up to the agreement. The starting point of 31 August 2016 is €33,168. The point on 1 January 2018, including increments, new entrant pay restoration, supervision and substitution, and the Lansdowne Road agreement increase, is €39,482. This is an increase of €6,314 between the end of this summer and the start of 2018, representing a percentage restoration and gain of 19%.

We discussed some of this issue on the previous question. The fact remains that, even with the agreement of the INTO and TUI, significant pay inequality and discrimination against new entrants persist. This is why the strike is going ahead regardless of whether the Minister likes it, that is, unless there is a resolution and the Government concedes on the key issue of pay equality.

Will the Minister comment on the advertisements reported in today's newspapers that offer parents and members of the public the opportunity on a paid basis to supervise in schools where strike action is due to take place? I referenced strike breaking earlier and, to me, this is nothing if not strike breaking. Has the Minister approved the projected expenditure by the Department of Education and Skills that may arise from funding this strike breaking? Does he believe that this is a good approach to take to the dialogue with the ASTI or in terms of setting parents against their children's teachers or parents teaching their children that they should break strikes? It is not.

My overriding message in light of where we stand with the ASTI and the representative bodies of An Garda Síochána is the need for continued engagement in the coming days and into next week between them and both Departments. It is vital that the Government's proposals and the framework offered by the Lansdowne Road agreement be used to determine whether an affordable agreement can be reached for those organisations, cognisant of the broader needs of the public service.

Regarding the Deputy's analysis of where we stand and reverting to Deputy Broughan's previous question, the further restoration of pay will be a consequence of the unwinding of FEMPI legislation over time. That unwinding can only happen when the resources and funding are available to the State to do it. I am clear in my commitment to make that happen, but I must also fund new and existing public services and meet the needs of many across society who have a claim on the use of Exchequer resources.

I return to my question on strike breaking and the attempt to recruit parents into same against striking teachers. If that is what the Government favours and has approved, how does that marry with any idea of being open to negotiation, the importance of dialogue, etc.? It appears to be part of a pattern of behaviour to try to undermine the ASTI because it has stood up in the face of discrimination against new entrants. We have already seen this in the Department's instruction that ASTI members be discriminated against in the allocation of additional hours. It is perverse that the State is offering payment to strike bearers for supervision duties when a part of the ASTI's campaign is the restoration of supervision pay for its members and the refusal to work enforced and unpaid hours.

I am not aware of the advertisements to which the Deputy referred, but the Minister for Education and Skills, Deputy Bruton, has made it clear that he wants to do everything possible to minimise the disruption caused by the closure of secondary schools across the country, if we get to that point. The Minister is mindful of the difficulties and challenges that will be created within schools, but he is also conscious of the challenges that will be created for families if the schools close.

Deputy Paul Murphy called this an attempt at strike breaking, but the alternative way of looking at it is that the Department of Education and Skills is seeking to put in place measures to minimise the disruption to schools.

I have listened with interest to the way in which the Deputy has described unions that have signed up to the Lansdowne Road agreement. The Deputy has described them as acting in a manner that he does not agree with. I am confident that if we get to a point at which we can resolve this with the ASTI, the Deputy will come in and condemn it for doing so as well. Deputy Murphy's interest is not in the welfare of teachers or in dealing with issues in a way that is affordable for all. His interest is in pursuit of a political agenda that will not meet the needs of teachers in a way that our country can afford.

Question No. 13 replied to with Written Answers.

Expenditure Reviews

Dara Calleary

Ceist:

14. Deputy Dara Calleary asked the Minister for Public Expenditure and Reform the process and proposed timing for the spending review as announced by him in his budget speech; the proposed involvement of the Oireachtas Committee on Budgetary Oversight; and if he will make a statement on the matter. [30934/16]

The Minister announced on the day of the budget that he was going to conduct a spending review in 2017. I want to tease that out with him. What will it involve? Is it a spending review or an efficiency review? What level of consultation will there be within the House, with organisations outside the House and with his colleagues in Cabinet?

In my statement on the expenditure Estimates on budget day, I announced that a spending review will take place in advance of budget 2018. The exact review will be determined over the coming months but will be informed by the Irish Government Economic and Evaluation Service paper, Spending Reviews in Ireland: Lessons for the Future. This was published within the expenditure report for 2017. Officials from my Department will engage with the Oireachtas Committee on Budgetary Oversight to discuss the arrangements for this engagement. These arrangements should build further on those put in place for engagement prior to this year's budget.

Since the onset of the crisis that we are looking to emerge from, spending reviews have played an important role in our efforts to restore expenditure policy and to put it on a more sustainable footing. What is crucial for me in this new approach is that we do not look at the increments or additional spending but at the totality of spending. We must look at all of the choices that we are making with all of the resources that are available to us.

I agree that we should look at the totality of spending but I am concerned as to what the Minister is looking at it for. I have made the point about how budget day announcements fail in many cases to meet the need on the ground in various different services such as health, education, local government etc. Are we going to look at that, at how spending gets to services on the ground and at how it makes a difference to people's lives? Will the review be pre-determined or is the Minister going to open up the scope of it for consultation beforehand? I presume the Minister has a savings target in mind. Has he? Is the purpose of the review either to improve and enhance services or to deliver savings? In terms of the spending reviews in Ireland and their lessons for the future, what kind of consultation or involvement will there be within Government and with people who will be affected by this review?

The main way we will deal with the consultation needs within the Oireachtas that the Deputy outlined will be through engagement with the relevant Oireachtas committee. It would appear to me at this stage that the best committee for engaging with this process would be the Committee on Budgetary Oversight. I am open to feedback from colleagues on that. There will be a savings figure that we will look to establish. At this point, I have not established what that figure will be. I am very open to engaging with groups and stakeholders in conducting this process.

On the Deputy's final point about whether it will track the impact on services on the ground, the only way we could do that would be to pick a certain number of particular areas and prioritise those within the approach. If we were to look at the totality of Government spending and its impact on front-line services, we would not complete it inside the time I want. We published some examples on budget day of how this could be done when we looked in particular at the impact of the availability of medical cards and social services to young people to offer a baseline approach as to how this work could be done.

Given that the Minister wants this done for budget 2018 and that he is also going to be carrying out a capital review at the same time, what budget has he set aside within the Department to complete the spending review? Will he be involving outside consultants or does he see it being done completely in-house?

I have not yet set a budget for this work. My anticipation would be that nearly all of it would be done in-house because I am confident that I have the expertise within my own Department to do this work in the way it needs to be done. If there are any particular areas of focus that require external support, I am happy to look at them. However, I believe we will be able to do nearly all of it inside my own Department and within my own Vote. When I have the figure determined for the budget, I will be happy to share it with the Deputy.

Public Sector Pensions Data

Thomas Pringle

Ceist:

15. Deputy Thomas Pringle asked the Minister for Public Expenditure and Reform the savings to the Exchequer if public sector pensions were capped at €50,000 per annum; and if he will make a statement on the matter. [30928/16]

This is a question on the potential for savings that could be achieved if there was a cap on public service pensions of €50,000 per year. As the Minister knows, there are approximately 90,000 public servants in receipt of a pension at a cost of about €2.9 billion per annum.

Based on data sets that are available to my Department in respect of public service pensioners across all sectors, it is estimated that savings of the order of €85 million per year would be generated for the public finances if pensions were capped at €50,000. I should point out, however, that the payment rates and award levels of higher value public service pensions have been significantly decreased under the financial emergency measures in the public interest, FEMPI, legislation. These decreases are attributable in particular to the public service pension reduction, PSPR, measure, which is in place since 1 January 2011 and was made more severe for most pensions above €34,000 on 1 July 2013. 

While FEMPI 2015 amelioration provisions mean that the burden on pensioners is being eased over the 2016 to 2018 period to the particular benefit of those receiving low to middle value affected pensions, higher value pensions and specifically most of those in excess of €50,000 will continue to be paid at a reduced rate following the completion of that amelioration on 1 January 2018.  These phased PSPR changes across the public service will cost an estimated €90 million annually in 2018 and will ensure that the top 20% higher value public service pensions will continue to be impacted by the PSPR.

Community Employment Schemes Supervisors

Dara Calleary

Ceist:

16. Deputy Dara Calleary asked the Minister for Public Expenditure and Reform the discussions he has undertaken since taking up office to examine the case presented by community employment supervisors to have access to a pension scheme; the current position of his Department on the matter; and if he will make a statement on the matter. [30937/16]

The Minister is aware that I am a big fan of community employment schemes, but the success of a community employment scheme is utterly dependent on its supervisor. Since 1998, there has been an issue around pensions for supervisors. In the Labour Court in 2008, it was decided that community employment scheme supervisors should be given a pension. Many of them have worked for decades on community employment schemes and have provided a huge service to their community. The issue was being dealt with by the former Minister, Deputy Howlin, who established a community sector informal forum at Department of Public Expenditure and Reform level. There does not seem to have been much activity in recent months since the Minister came to office. I want to get a sense of where it is at.

I am aware of the issues being discussed in, and the activities of, the community sector higher level forum, or the working group, which was convened to examine certain issues pertaining to the community employment sector, having regard to the consequences for costs and precedent. This includes community and employment supervisors and assistant supervisors who have been seeking, through their union representatives, the allocation of Exchequer funding to implement a Labour Court recommendation relating to the provision of a pension scheme dating back to 2008, as the Deputy acknowledged.  The forum met on 27 November 2015 and on 11 April 2016.  I plan to appoint a new chair soon and future meetings will be planned once the appointment is made.

Our position has always been that FÁS or the Department of Social Protection is not the employer and that it is not possible for the State to provide funding for such a scheme to employees of private companies even if those companies are, or were, reliant on State funding.  In considering the matter, I must have regard to costs and the precedent of such an arrangement were one to be created but my plan is, mindful of the fact that this working group has not met for a number of months, to appoint a chairman and restore the process that was under way.

This goes back to 1998 when the Labour Court linked community employment scheme supervisors with managers in community training workshops. FÁS set aside €2.75 million to pay towards pensions. Most companies that run CE schemes just about have the resources to provide the budgets to run them and, therefore, pension schemes do not happen. I welcome the fact that the Minister is about to re-establish the working group within his Department but given many of the supervisors are approaching retirement age, urgency is needed to address the matter.

I will put in place a chairman to get that work under way again. This relates to the debate I had with Deputies Murphy and Broughan earlier as one of the issues I face is the knock-on effects of such an arrangement across other sectors. For example, there are more than 3,000 section 39 bodies in the health sector. They are in receipt of State funding and they have their own employees. They have the welfare of their employees at heart but I have to consider what precedent would be set were an arrangement put in place for the community sector given the individuals employed in the sector are ultimately not employed by the State, even if many of the services they provide are funded by the State. However, I accept this is a serious matter and I will put a chairman in place and ensure the working group meets soon.

Institutes of Technology Funding

Thomas Byrne

Ceist:

17. Deputy Thomas Byrne asked the Minister for Public Expenditure and Reform if his Department favours putting in place a borrowing framework for institutes of technology, IOTs, or for technological universities, that give institutes autonomous borrowing powers outside of general government; and if his Department is of the view that it would be legally possible to put such an autonomous borrowing framework in place under EUROSTAT rules. [30729/16]

Thomas Byrne

Ceist:

30. Deputy Thomas Byrne asked the Minister for Public Expenditure and Reform the reason there is no borrowing framework in place for IOTs, as there is for universities, whereby they can borrow autonomously from private sources independently of general government, in view of the fact that there is no statutory distinction between IOTs and universities; and his views the introduction of a borrowing framework for IOTs to enable them to borrow autonomously. [30730/16]

I am raising an important issue which has implications for public expenditure and education and housing sectors, which is the lack of borrowing power for IOTs. This key issue has been raised with me by sectoral representatives since my appointment as education spokesperson. They cannot borrow to build student accommodation, the result of which is the rental markets in the areas around the institutes is out of sync, even more so than the general market, because they cannot build accommodation.

I propose to take Questions Nos. 17 and 30 together.

A key consideration in relation to the scope for independent borrowing by institutions in the higher education sector is whether the subsequent expenditure funded by the borrowings is classified as falling inside the general government sector and, therefore, whether it impacts on the general government balance.  A detailed framework is in place under EU law, implemented at national level by the CSO, for classifying what entities in the economy are part of or outside of the general government sector and how their expenditure impacts on the general government balance. It is, therefore, not just a matter for the IOT sector in term of whether institutes can borrow. One of the questions is how that borrowing would be classified on the national balance sheet.

Universities have traditionally enjoyed autonomous borrowing powers on account of their classification as outside general government.  Borrowings by universities are off-balance sheet and do not impact on general government debt and this reflects a combination of the autonomy of such institutions and their capacity to generate own income, allowing them to meet the so-called "market test". However, these considerations do not apply to IOTs.  Unlike universities they are classified as inside general government. Consequently, their expenditure impacts on the general government balance and their borrowing contributes to the general government debt.

The Deputy referred to the impact on the rental sector and accommodation. I have some appreciation for this matter because of the prominence and scale of DIT within my constituency and I am aware of the accommodation needs of students and the impact that has on the rental sector.

The Minister for Housing, Planning, Community and Local Government recently published the Housing (Miscellaneous Provisions) Bill 2016 which includes an enabling provision that would facilitate higher education institutes to borrow moneys from the Housing Finance Agency for the purpose of financing student accommodation provision. However, we still have to resolve the issue of how that borrowing would be classified and the impact it could have on other expenditure plans by the State.

Many Members, including myself, have been vocal about the need for a borrowing framework to be put in place for IOTs. DIT is building student accommodation in Grangegorman but the mechanism it is using to finance it is costing more than it would if DIT had the same borrowing power as universities. That will feed into increased rents for students, which means this is a lose-lose scenario.

Thankfully, the general government debt is very much on its way down. Surely there is scope to provide for modest borrowing by IOTs. Ten years ago, it was envisaged that they would have the power to borrow but this has not been acted on. This is an urgent issue. Ministers and officials can have all the meetings they want, with the Department of Education and Skills meeting the Minister's Department and the housing Department pushing another provision but action is needed quickly.

I spoke to one IOT president who had visited America. He met students who wanted to attend his institute but their parents asked him where they would stay and he had nowhere to put them. If he were able to borrow money, he would be able to put them up and it would be a win-win scenario for everybody.

I hoped the Deputy would acknowledge that we are trying to create the legal provision to deal with this matter. I acknowledge the case he is making, which has been made to me by the Minister for Education and Skills. This is the reason an enabling provision has been included in the Housing (Miscellaneous Provisions) Bill 2016. We still have to resolve the matter of who would be able to borrow and how it would be classified but we have included a provision in this Bill.

The Housing (Miscellaneous Provisions) Bill 2016, which has just been published. I will then need to deal with the issue of IOTs being able to access that borrowing because they do not all have the same financial health and cannot borrow in the same way. Great strides have been made in delivering more student accommodation around DIT and elsewhere but in recognition of the challenge this has created, the enabling provision has been included in the Bill. My officials and I are engaging with the Department of Education and Skills on this matter. We will keep the Deputy informed. No doubt he will raise it again in the coming weeks.

I acknowledge the Bill and the efforts that have been made and I also acknowledge the legislation that was put in place ten years ago. I want to see action. As I understand it, DIT is paying more than it should to build the accommodation in Grangegorman through the creative mechanism it has with other State authorities.

Others do not have it all. We want a proper student rental sector which has less impact on the general sector and I think the Minister wants that too. Members on all sides want to let this happen in the best way possible. Let us work it out. It would really help those institutes of technology that are able to do it. I acknowledge what the Minister said about certain ones that will probably not be able to do it.

I agree with the Deputy. I hope we can reach a classification of the borrowing levels that will ensure this can be done in an affordable and sustainable way. I agree with the sentiments the Deputy has concluded with.

Questions Nos. 18 and 19 replied to with Written Answers.

Brexit Issues

Thomas P. Broughan

Ceist:

20. Deputy Thomas P. Broughan asked the Minister for Public Expenditure and Reform his role in funding Departments and agencies to address the challenge of Brexit; if there are provisions and plans for any necessary additional spending in the period 2017 to 2019 to make Ireland Brexit ready; and if he will make a statement on the matter. [30778/16]

Brexit represents one of the biggest challenges to the State since 1922. As I said in the first debate we had in the House just after the vote in the UK, there should be a Minister for Brexit here. Fianna Fáil has now taken a similar position. The issue is so important and critical to our future that we should adopt that position. The Minister has allocated certain moneys in the budget to address Brexit, including the farmers' loan and the continuation of the 9% VAT rate, which is very expensive. Tourism from the UK is already down 12% in recent months. However, the actual figure the Minister has allocated for Brexit per se is very small. How does the Minister interact with the Taoiseach's committee and what kind of funding will be needed in the next few years?

I am a member of the Taoiseach's committee and attended a further meeting of it this morning along with the Minister of State in my Department, Deputy Eoghan Murphy. I anticipate that the committee will meet even more frequently in the coming weeks and months. At meetings of the committee, I am obliged to update the Taoiseach and other Ministers on work I am undertaking in respect of dealing with the consequences of Brexit. Deputy Broughan acknowledged the provisions in the budget to deal with the consequences of Brexit. These include funding we have put in place for the regional development plan, the rural development plan and agriculture. The decision on the 9% VAT rate was taken in the context of Brexit and the effect it might have on our tourism and services sector. I have also provided additional current funding to allow Enterprise Ireland and IDA Ireland to hire more people to work abroad and represent our companies. Those are measures we have put in place to deal with the consequences of Brexit.

On the need for a Brexit-focused Minister, I respectfully take a different view to the Deputy. This is a matter of such importance to the State that it is more appropriate that our approach to it be headed up by the Taoiseach. Other countries are taking a different approach and I am keeping on eye on that to see if it is working elsewhere. Mindful, however, of its importance, the only way it can be done is to have it headed up directly by the Department of the Taoiseach. The Taoiseach holds all Ministers to account for action steps to which we have committed in respect of dealing with Brexit.

It is likely that when Article 50 is triggered next spring, the challenge will intensify and grow deeper. We have a particular responsibility to our own workers, jobs in this country, agriculture and the Common Fisheries Policy, about which hardly anyone has spoken so far. My own constituency has an interest in both fisheries and the fact that there may well be profound changes in that area. Most of all, there is the issue of the future status of Northern Ireland and the fact that we want it to have a special status. Clearly, Brexit has huge implications in that regard. The desire of the House has always been to have a national union of our country. Hopefully, that will happen. The circumstances which are now evolving in the North, however, with the responsibility of the Executive, as well as in Scotland and possibly Wales and England itself, may well accelerate the situation. Have other Departments come to the Minister to ask for additional resources as the Brexit process intensifies next year?

Yes, they have in the context of discussions we had on the recent budget. In particular, I was approached by the Departments of Jobs, Enterprise and Innovation and Agriculture, Food and the Marine. There was also a particular focus on Brexit by the Minister for Education and Skills, Deputy Bruton. Much of his focus was on the development of the third-level education sector here in the context of the challenges we face with Brexit and the pressure that will be exerted on our universities and institutes of technology in the coming years. It was a process in which additional spending requests were made to me. I did my best to respond to them and it played a significant role in the decision we made on the allocation of funding for education and in respect of where we ended up with agriculture, in particular, and the funding for State agencies such as IDA Ireland and Enterprise Ireland. Deputy Broughan is correct that when the actual decision to trigger Article 50 is made, this will have further consequences, not least of which should be that in the run-up to this the nature of the Brexit the British Government is looking to achieve will become clear. Fisheries policy was discussed as recently as this morning and it is acknowledged as a significant issue of concern.

Departmental Expenditure

Bernard Durkan

Ceist:

21. Deputy Bernard J. Durkan asked the Minister for Public Expenditure and Reform the extent to which he remains satisfied that all Departments can remain within their expenditure targets without diminution of services in the current year; and if he will make a statement on the matter. [30966/16]

The purpose of the question is to ascertain the extent to which the Minister is satisfied that each Department can remain within its budgetary targets without diminution of services in the course of the year.

Responsibility for the delivery of public services and meeting targets on front-line services is a matter for each Minister and his or her Department. We are in constant communication with them on this, in particular as we approach the end of 2016. There is very regular reporting to Government on these matters and information is published monthly and made available to me as part of the Exchequer statement. In terms of where we stand at present, gross voted expenditure of €39.836 billion to the end of September was €439 million below profile. Gross current expenditure of €364 million was 1% below profile and capital expenditure was 3.4% below profile. The matter is checked regularly by my Department and the line Departments. The direct answer to the Deputy's question as to whether I expect Ministers to come in on budget and deliver the services to which they have committed for 2016 is "Yes".

I thank the Minister for his reply. Does he sees potential, on foot of the data already available to him, for an overrun in any Department? If so, what measures can be taken to avert that at this stage?

I am not expecting an overrun in any Department. I have made it very clear to all of my colleagues, in particular in the higher spending Departments, that we must deliver against the commitment we have for budget 2016. In fact, many plans for 2017 are predicated on commitments colleagues have to deliver within budget this year. My answer to the Deputy's supplementary question is the same as that which I gave to his first question. I expect all Departments to come in on or under budget in 2016.

Capital Expenditure Programme

Thomas P. Broughan

Ceist:

22. Deputy Thomas P. Broughan asked the Minister for Public Expenditure and Reform the percentage of GDP the capital programme for 2017 represents, including increases for housing, health, education and transport; his views on the fact that capital expenditure is barely level with or below the generally agreed depreciation rate for the capital assets of Ireland; and if he will make a statement on the matter. [30776/16]

This is a question we put to the Minister very strongly at the Committee on Budgetary Oversight. Projections to 2021 indicate that capital spending is barely keeping pace with depreciation. Professor Tom McDonnell of the Nevin Economic Research Institute, NERI, made that point to us most strongly. In fact, the figures he gave us showed that they are below normal accounting depreciation rates. That is a matter of grave concern. We have talked about our infrastructure, including metro north and having a proper road network for the north west and west as well as all the other capital needs of the country, especially housing. Is it not the case that the Minister needs to ramp up capital spending?

As to where we are for this year and next year, following the recent revision to our national income, or GDP, figures, the Department of Finance expects Ireland's nominal gross domestic product for 2017 to be approximately €275 billion.

Therefore, the current State-backed investment plans for next year will stand at 2.5% of nominal gross domestic product and 3.1% of nominal gross national product.

The Deputy's question was where they stand versus other countries. I have acknowledged to the Deputy and the budget oversight committee that we need to rebuild our capital expenditure in light of the growth that has occurred in our economy. We can see the pressure that growth has created in existing infrastructure, whether that is in skills, housing or transport. We also need to build it because if we do not, we will not be able to maintain or accelerate current levels of growth. That is the reason we will commence a review of the current capital plan next year and have it complete by the summer. It is also the reason I aim to allocate an additional €5 billion on top of the €27 billion available for capital investment. My expectation is that at the end of that capital plan, we will bring up for the final two years our investment in capital infrastructure as a percentage of our national income into line with countries with which we compete. The real goal in value will be to keep that level of capital investment flat for years afterwards, so it neither peaks nor goes into a trough from that level and it keeps a steady pace of investment in our schools, roads and other forms of infrastructure, such as metro north.

I mentioned housing and we need to ramp up the construction of social housing by at least 10,000 units per year. In the alternative budget that I submitted, I spoke about having an additional €1 billion for housing this year and every year until 2021 or until we get rid of the horrendous experiences being suffered by people in the city tonight. With regard to transport, we speak of metro north and we were meant to be hopping on metro north in 2026. Perhaps we could do with it in 2021 or 2022, particularly with the expansion of the airport and so on. With education and health, we are just keeping up with demographics, so we need major development.

We heard some worrying aspects of this at the budget committee meetings. The rainy day fund is a great idea and we had it before with McCreevy's money but, unfortunately, it went into the banks. It seems we will have a rainy day fund and yet we are skimping on investment. In particular, there is a new debt figure formulated by the Minister's colleague, the Minister for Finance, Deputy Noonan, when he said we must hit the 45% debt-to-GDP ratio. Why on earth would we do that when we desperately need housing, transport and so on?

With regard to current levels of investment, we are looking to do more than just keep up with demographics, particularly in education and health. One of the benefits of the new approach that has been adopted in how we class government expenditure is that we set aside the portion due for demographics. I have always acknowledged that we must hire a certain number of teachers just to maintain class sizes as they are due to the effect of demographics. We recognised that in what we publish, and the same applies in health issues and our social welfare system. We want to increase this in the way I have outlined to the Deputy, although this depends on our economy growing at a moderate rate across the next five years.

With regard to the debt figure set by the Minister for Finance, Deputy Noonan, the objective is to move to that debt figure across the 2020s. I support the objective as it is to precisely create the kind of buffer zone in our national debt so that if we get hit again by external forces, as happened in recent years, we will have health within our national finances to allow us to respond in a way that we have not been able to in recent years.

Question No. 23 answered with Question No. 12.

Infrastructure and Capital Investment Programme

Bernard Durkan

Ceist:

24. Deputy Bernard J. Durkan asked the Minister for Public Expenditure and Reform the extent to which he and his Department have identified the most important elements of infrastructural deficiency in areas such as housing, health, transport, communications or education that are most likely to affect economic performance in the future; the extent of his ongoing proposals to address such deficiencies with a view to ensuring maximisation of employment opportunities throughout the economy and achievable through improved infrastructure; and if he will make a statement on the matter. [30965/16]

This question asks the extent to which the Minister can identify the most important elements of infrastructural deficiency in areas such as housing, health, transport, communications and education that are most likely to affect economic performance in future and whether it may be possible to address them.

This has happened in the past according to submissions that Departments made to my Department. For example, the Department of Education and Skills would highlight what it believes to be the main educational priorities, and the same would happen for other Departments. We are looking to operate differently with this capital review process. My Department will outline our long-term infrastructural advantages and what we believe to be our long-term infrastructural deficiencies. In addition to the feedback I will receive from Departments, my objective is for my Department to centrally generate a more formal view on this matter; we will use both of these to fund choices made on additional capital projects or in pulling forward existing capital commitments. It is important that this is done. Each Minister does a fine job of arguing what he or she believes to be in his or Department's interest but it will be helpful to have a more centrally generated view of how we can best allocate the resources of the taxpayer.

I thank the Minister. Has he examined individual Departments with a view to liaising with Ministers so they can identify their priorities and concerns for achieving their specific targets that may be impeded by a lack of infrastructure? What has been discovered if that is so? Has the Minister received that information? For example, what is needed in the Departments dealing with housing, health and education, as they are three important issues?

Yes, I have. In the Estimates process that we went through for the 2017 budget, I asked Departments to specify, where possible, over a three-year timeframe what would be their particular capital needs. Not all Departments were able to do it but most were and the Minister for Education and Skills, Deputy Bruton, put forward a view on the capital needs required for the third and fourth level sectors in coming years. My objective is that by putting in place a more formal review of the capital plan, every Department will have the opportunity to do this.

As we put together this process, I want a project-based approach to emerge. We should not go back to the point where we say there is a certain amount available to complete a project. The projects chase the money in those cases and the costs would increase. At other points in our history, we spent more on such projects than we should have. That is why I want to use a project-based approach to making decisions on the funding I referred to.

I thank the Minister for his comprehensive reply. A number of those Departments, such as that dealing with housing, are key to the future economic and social well-being of the country. In the past few days I received a quote from a system builder to the effect that he could build houses for €125,000 per unit. They would be perfectly passable and good houses and they could deal with the emergency that has arisen. Similar emergencies may arise in health or education, and it is in respect of those issues that I am asking the Minister if he is conscious of and generating an urgency and awareness within those Departments through the Ministers of what might have to be done in the not too distant future.

Yes. In trying to respond to the kind of issues referred to by the Deputy, we have already decided and made it clear to the relevant Minister, Deputy Coveney, that from the additional resources that we believe will be available to the country for the coming years, we will allocate a large portion to the Department dealing with housing. From the €5.3 billion that should be available in the coming years for additional capital funding, we have already allocated €2.2 billion to housing.

We have done that in recognition of the housing needs to which the Deputy referred. An issue I am very much aware of is the need to ensure developers and local authorities can make use of land they own or planning permissions they already have. A constraint we are seeing of late relates to a failure to ensure roads are built, infrastructure is developed and utilities are put in place, all of which is happening because local authorities do not have sufficient funding. From 1 January, we will have in place a local housing infrastructure fund of €200 million to address that problem. We have already seen a huge amount of interest in that fund.

Public Sector Staff Remuneration

Bríd Smith

Ceist:

25. Deputy Bríd Smith asked the Minister for Public Expenditure and Reform if any account was taken in preparing his Budget Statement of the need for wage increases among public service workers outside of the already planned unwinding of financial emergency measures in the public interest, FEMPI, provisions by his Department. [30933/16]

As we have only three minutes remaining, I ask the Deputy to forgo her introduction of the question to allow more time for supplementary questions and answers.

No provision was made in budget 2017 for additional pay restoration to public servants, beyond the commitments already entered into under the Lansdowne Road agreement. Budget 2017 allocated €290 million for the implementation of the agreement. An additional €10 million was allocated to the Department of Education and Skills for the implementation of a revised salary scale for new-entrant teachers, as recently agreed with teaching unions through the mechanism of the Lansdowne Road agreement.

However, the public service pay bill is a function of both pay rates and numbers and, in response to the critical need to support front-line service delivery, the estimate for gross pay in 2017 in the budget is €16.3 billion, which is €660 million more than the 2016 revised allocation of €15.7 billion. This includes the provision made for the implementation of the Lansdowne Road agreement in 2017 and provision for the appointment of some 6,100 additional staff in 2017.

As our time is limited, I will give way to Deputy Smith so that she has time to put her supplementary questions.

That was an interesting answer to a question I did not get to introduce. The Minister has had to answer a lot of questions today about the Association of Secondary Teachers Ireland and the Garda Síochána unions that are outside the Lansdowne Road agreement. It is my understanding that olive branches are being offered to Garda representatives and some attempts are being made to deal with the concerns of teachers who did not sign up to the agreement. When the Minister says no provision has been made for any extra payment for workers outside the agreement, it begs the question of why he is bothering to talk to them at all. If they agree to come into the tent and say "Yes, Sir; No, Sir; three bags full, Sir", what will happen then? What is the plan if members of ASTI accept all the terms of the Lansdowne Road agreement and agree to continue to do supervisory duties for nothing, as they did until 30 June under the Haddington Road agreement, or if gardaí agree to make some concessions? According to the Minister, there is no extra money to provide for that eventuality.

The fundamental point remains that the Government was well aware there were groups of workers who remained outside the Lansdowne Road agreement and it should have made provision to deal with that. Every trade union is entitled to a free vote on provisions under a certain deal. Teachers have given 36 hours of work for free per year as per the Haddington Road arrangements and are now being told by the Government they will be isolated and made an example of. How will the Minister deal with that? Ultimately, he will have to sit down and speak to the teachers.

Of course I recognise the right of any trade union to form a view on these matters and vote accordingly on any proposal that is put in front of members. However, in the Deputy's analysis she makes no reference to all of those unions that are inside the Lansdowne Road agreement. What about the 20 plus unions that are on side and the more than 250,000 civil and public servants they represent? We must honour our obligations to them, which is what we have done in the budget. While I understand the Deputy's need to focus on people who are outside the agreement, we also must acknowledge those who voted to be inside the agreement. That agreement has demonstrated our capacity to fund and deliver responses to issues raised by members of unions. It enabled us to agree a proposal with the Association of Garda Sergeants and Inspectors, the Teachers Union of Ireland and the Irish National Teachers Organisation in regard to new-entrant pay. It helped us to devise a proposal on rent allowance for new entrants to An Garda Síochána.

My question has absolutely nothing to do with any need of mine to focus on a particular issue. However, if I wanted to ask a question about those inside the Lansdowne Road agreement, I would do so.

The Deputy has no interest in asking about that.

I asked the Minister how he proposes to make provision for those workers who are outside the agreement. He acknowledges the right of every trade union to vote according to its beliefs. I remind the Minister that members of TUI and INTO did not get to ballot on the new arrangements. It was the leadership of those unions which accepted the deal, not the membership. In the case of the workers to whom I am referring, they clearly rejected the constraints of the Lansdowne Road agreement and, as a result, we are facing strikes by teachers and gardaí. The Minister will have to sit down with the unions concerned and resolve the issues at some point. He is saying there is no provision in the budget to do so. I am asking why he should bother talking to those workers if there is no provision to address the issues they have with the agreement.

Deputy Paul Murphy said in the House earlier that it is the right thing that strike action should take place.

The Minister is supposed to be replying to my question.

I am responding to the question the Deputy put to me in respect of wage restoration. What is absent in any part of the view she has put forward today is a recognition that large numbers of civil and public servants are inside the Lansdowne Road agreement.

I did not ask about those who are inside the agreement. My question relates specifically to those who are outside it.

Of course the Deputy has no interest in acknowledging any kind of progress, just as she has no interest in recognising the huge amount of engagement that has taken place with the Association of Secondary Teachers Ireland, the Garda Representative Association and the Association of Garda Sergeants and Inspectors. That engagement will continue as we seek to put in place an agreement that is affordable for all. We will do our best to ensure we avoid the type of disruption none of us wants to see.

The Minister has no interest in answering the question I asked him.

Written Answers are published on the Oireachtas website.
Sitting suspended at 4.50 p.m. and resumed at 5.20 p.m.
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