Peadar Tóibín
Ceist:12. Deputy Peadar Tóibín asked the Minister for Finance the total value of wage subsidies provided in 2020 and 2021. [6406/22]
Ceisteanna Eile - Other Questions
Covid-19 Pandemic Supports
The Government imposed the longest and most severe Covid restrictions in the EU. It shut schools, businesses, building sites, healthcare facilities and society for longer than any other country in the EU. In many ways, the scars of the shutdown are only becoming apparent. My question is to find out the total value of the wage subsidies provided between 2020 and 2021.
The total cost of the temporary wage subsidy scheme, TWSS, and employment wage subsidy scheme, EWSS, was €10.26 billion. The schemes have played a role in protecting the jobs of up to 690,000 people in our country.
I agree that the funds provided by the Government have been absolutely necessary. There is no question about that. If a government is going to shut down a business and prevent its owner from making a living, it has to provide an income to that owner so he or she can live. If a government is going to tell workers they are not allowed to work, it has a responsibility to provide them with an income to pay for the costs arising for their families. The Government had many choices to make but took an outlier position, a position that no other country in Europe decided to take. That aspect of expenditure alone necessitated €10 billion. It is estimated that the total Exchequer expenditure was €40 billion. That is the second-largest investment by a state on a crisis since the banking crisis. My concern is that there is so little investigation and analysis of the decisions made by the Government in the period in question.
The Deputy is the person who opposed the use of vaccination certificates for the reopening of the hospitality sector. I say to him time and again that he was against the closure of our economy and country but that when we tried to reopen them safely, he was against that as well. He was against both. I accept that the lockdown lasted many months. The Government accepted the impact it had on the economic and mental health of those with a job and those who create jobs in our country. I would have thought it appropriate for the Deputy, in his evaluation of how we performed, to have noted that the measures we had in place played a significant role in minimising the loss of life and the number of people who contracted the awful disease. While it was the case that we had measures in place that required businesses to close for longer than was the case elsewhere, it was also the case that the measures we put in place prevented the deaths of even more of our citizens. The Deputy was against the closing down of our economy and our efforts to reopen it safely.
I welcome the support the Government provided to businesses and their employees throughout the pandemic. It was money incredibly well spent when it was needed to keep businesses afloat. Could the Minister outline to the House the scale of his engagement with businesses and their response to the EWSS? He certainly responded to calls from Deputies like me to extend the scheme, which businesses called for. They called for certainty, which the Government was able to provide to them by indicating it would extend the scheme, as it did, and wind it down gently. Many sectors and businesses in my constituency were utterly dependent on the EWSS. As for the contribution to the deficit generally, is it not the case that VAT and the corporation tax yield have been higher than expected and that we are on a trajectory to manage much more effectively in this regard than was thought at the outset of all the difficulties?
We sought the use of antigen testing when the Government pooh-poohed it and refused to use it. We, like many other countries, knew antigen testing was a better way of stopping Covid from entering the hospitality sector and that the sector could be kept open through its use. We sought air filters in schools and extra hospital capacity so people's lives would be protected without having to shut down to the extent we did. We sought the proper management of nursing homes and hospitals. The majority of people who died actually caught Covid in those two locations, under the management of the Government.
The party that sells itself as the party of fiscal responsibility is now the party that has created a national debt of a quarter of a trillion euro. The Minister will have as his legacy a national debt of a quarter of a trillion euro. That is an eye-watering figure. It steals from future generations. It prevents hospitals from being built, it prevents doctors and nurses from being employed, it prevents schools from being built and it prevents society, in the future, from functioning as it should. The Minister's choices have robbed from future generations.
Deputy Tóibín is the second Deputy who has attempted to write my legacy today. I do not know what has provoked that.
A quarter of a trillion euro.
Deputy Tóibín is the Deputy who voted against the legislation to safely reopen our country and our economy. He voted against it.
That is utter rubbish.
He consistently voted against it. I remember the debates in here vividly. The Deputy came here, voted and argued against-----
-----the use of certificates that allowed the hospitality sector to reopen. If the Deputy wants to have a debate about my legacy, I ask him to look at what is happening now with the number of employers that are opening up again. I ask him to consider how quickly the pandemic unemployment payment, PUP, fell and the way in which the viability of employers was affected during a moment of the greatest challenge for our country. Indeed, I published a debt report today, which also states that our level of higher debt has now stabilised. There is a possibility that next year-----
It has stabilised at a quarter of a trillion euro.
-----our debt, as a percentage of national income, will be back to what it was before the pandemic.
I thank Deputy Carroll MacNeill for raising the issue of engagement. There is constant engagement with businesses, big and small, across our country, not to mention with Deputies, such as Deputy Carroll MacNeill, in this House.
A quarter of a trillion euro has a phenomenally significant impact within society. That money is owed as a State, in large part because of the decisions that have been made. On another related issue, what efforts is the Government making to recoup wage subsidies and supports that were paid to firms that made profits and paid dividends in this period of time? Again, all of this money comes out of society's ability to deal with the major projects and challenges that we have in the future, including to pay for housing, healthcare and education. What are the Minister's plans in that regard?
I am deeply aware of my responsibility for the additional €32 billion of national debt and understand the impact it could have in the future. I am not sure what element of that Deputy Tóibín was against. Was he against the employment wage subsidy scheme?
Was he against the pandemic unemployment payment? Was he against the additional money we put into our health services when the pandemic hit?
The Minister knows that is not the case. I have already said that.
What element of it was the Deputy against? What element would he have done differently?
The outlier restrictions.
As for the closure of our economy, I fully accept that it-----
The outlier restrictions
-----had an effect on so many. Yes, the level of closure that we had was higher than many but so was the number of deaths that we were successful in preventing within our country. I refer to the loss of life and the number of people we were able to help not get this disease. Those who had the disease in our country also fared fairly well. However, as I said, I know there are thousands of people in our country who do not have a loved one here with them today. I am very aware of them when we have debates like this.
Tax Code
Pádraig O'Sullivan
Ceist:13. Deputy Pádraig O'Sullivan asked the Minister for Finance if he will prioritise the removal of VAT from defibrillators following the agreement by European Union finance ministers to amend Council Directive 2006/112/EC on 7 December 2021 given that the removal of VAT will increase the ability of many sports clubs and community organisations to purchase private life-saving assistance; and if he will make a statement on the matter. [9689/22]
I ask the Minister if he will prioritise the removal for VAT from defibrillators from following the agreement by European Union finance ministers to amend Council Directive 2006/112/EC.
The EU Commission published a proposal on the reform of VAT rates in January 2018 which would allow member states more flexibility in how they apply VAT rates. As the compromise text agreed at the meeting of the Economic and Financial Affairs Council, ECOFIN, in December has been amended significantly in comparison to the original proposal, the European Parliament will once again be consulted for its opinion. While not providing for as much flexibility as the original proposal, it still provides greater scope for member states to make changes when it comes to setting VAT rates. Assuming the Parliament issues its opinion on the proposal, the Council will formally adopt the directive. I understand that the Slovenian Presidency wrote to the European Parliament looking for an early response. I expect the response will be due in the coming months. Following the Council formally adopting the directive, it will be published in the Official Journal of the European Union and will enter into force on the 20th day following that of its publication. After that, we will consider what our options are with regard to setting VAT rates. I hope that we will get an answer back from the European Parliament in relation to this proposal in the coming months. After that, I know that the Council will act to try to implement the directive quickly.
It is encouraging to see that this is finally progressing. Hopefully, it will end in a positive result. As the Minister is probably aware, approximately 5,000 people die in this country every year from sudden cardiac death. Around 14 or 15 years ago, when I used to train an under-13s soccer team, I witnessed a defibrillator saving a young person's life on the pitch. I am fully aware of the benefits of having them in as many locations as possible. As recently as three weeks ago, we were down in Glounthaune, County Cork, where Stryker, the medical devices company, sponsored three defibrillators that have been kitted out in old telephone booths along the new greenway that we are installing between Carrigtohill and Glanmire. We are fully aware of the importance of these machines. It is important that we get them out to as many areas as possible. I ask the Minister to expand on precisely what process must happen on the EU side before we see the introduction of these VAT changes.
I am very aware of the really important role that defibrillators play in sporting and voluntary clubs all over our country. I see them in many clubs that I go into. In terms of what will happen, firstly, the European Parliament has to come back with an opinion on the decision that has been made by the finance ministers at the meeting of ECOFIN. When the Parliament comes back with that opinion, it will then be considered by ECOFIN. At that point, the final decision is made on the matter and it will then be published in the Official Journal of the European Union. That is the procedure that is ahead. I very much hope it can be concluded quickly.
The Minister mentioned that the current proposal is not perhaps as flexible as the original proposal. I am not fully aware or au fait with what has happened previously. I ask the Minister to expand on why it is not as flexible as the original proposal. Second, I am aware that in the context of the negotiations around this issue at EU level, a list of supplies to which a reduced VAT rate can be applied is to be increased. Member states will also be allowed to make some supplies subject to 0% VAT. The emphasis here is going to be on issues regarding improving the environment, public health and the digital transition. I ask the Minister to comment on that.
The reduced areas of flexibility refer to two new limitations that will be on member states. They are included in the third annexe of the current proposal. The first limitation will limit member states to applying a 0% rate to no more than seven value added taxable categories. The second limitation will limit member states to using a maximum of 24 categories to which a reduced rate can be applied. In other words, it will be setting a floor of no more than seven categories and a ceiling of 24 categories. The area of reduced flexibility concerns the kinds of goods and services to which a lower rate of VAT can be applied. The Deputy made reference to the question of whether these VAT rates can then be applied to the kind of changes in technologies that are needed for a lower carbon future. Indeed, they can be, but that will then depend on the decisions that individual member state governments make.
Question No. 14 replied to with Written Answers.
Tax Code
Richard Boyd Barrett
Ceist:15. Deputy Richard Boyd Barrett asked the Minister for Finance if he will now consider establishing an escalating tax on the owners of multiple properties given the role that property investment funds and entities are now playing in dominating the housing market and contributing to unaffordable rents and limiting housing options for ordinary persons; and if he will make a statement on the matter. [9675/22]
People Before Profit has always opposed the tax that is imposed on the family home because it is an unjust and regressive form of taxation.
We think there is an added case, however, given the role the vulture funds, cuckoo funds, buy-to-rent property investors or whatever name one wants to give them who are now controlling and dominating the housing sector are playing in driving up rents and house prices to unaffordable levels, to have a real property tax - not one on family homes but on these people who are wrecking the housing market.
As we have debated on several occasions already, these funds and this capital are leading to the supply of more homes overall and this does have to be seen in conjunction with, for example, a very strong public housing programme. I know the Deputy wants us to build more public housing but we are going to build well in excess of 6,000 public homes this year through local authorities and approved housing bodies, AHBs.
At the moment, these companies are taxed when the income they have is redistributed to those who invest in these funds. It is liable for tax at either 20% or 25%, depending on whether it is a real estate investment trust or an Irish real estate fund. They are taxed in the same way a pension is taxed. The income is taxed when it is distributed out of the fund. Do I currently have any proposals to change that taxation again in the future? I have changed this taxation regime in the past, dependent on concerns that I and my officials have had regarding efforts made to minimise tax. The option is always open to me to make further changes in how they are taxed if such issues are presented to me again. That is the main reason I would be looking to change the taxation of those funds at the moment.
Ultimately, they do play a role in terms of the supply of more homes. I appreciate how much they are contested and the political debate in respect of them but it fundamentally boils down to whether we want the savings that exist in other parts of Europe and the world to play a role in building more homes in Ireland. I believe those savings do have a role to play in more homes being built in this country and that is why a stable taxation regime in respect of them, as we have had in recent years, is appropriate.
That sounds good but it is just not what is happening on the ground. We are going to have to blow this fantasy out of the water. As I have pointed out on several occasions, zero council houses were built last year in Dún Laoghaire-Rathdown. We just got the figures. Next year, five will be built. There is a lot of construction going on in Dún Laoghaire-Rathdown. The Minister should drive out there to have a look. There are strategic housing developments, SHDs, going up all over the place. These are private build-to-rent developments that will be rented for €2,200 a month if one is lucky. There is an opportunity cost here, if one likes, to use economic jargon. If all the construction workers are building unaffordable profit-driven developments, they are not building council houses. The facts are clear on the ground. The council is delivering nothing. The Minister referred to AHBs. Who is building for the AHBs? It is the same property investors and they are charging a fortune. This is nonsense. We need to stop these people wrecking our market and start building affordable and public housing.
Nevertheless, the social housing list in Dún Laoghaire is being addressed through AHBs and the provision of housing generally. I know my colleague from Dún Laoghaire objects to SHDs. He raised a particular development in Glenageary, namely, Cualanor, in the House several weeks ago. He objected to one down the road as well. I was in Cualanor on Saturday and I saw all the houses and apartments where several hundred, if not 1,000, people are living with their families. It has a beautiful small playground for kids.
The Deputy raised it a couple of weeks ago and he is objecting to another set of apartments being build 500 m up the road. I would like to see housing developed right across Dún Laoghaire for the people who need it. I know the families, as does Deputy Boyd Barrett, who need to move into different types of accommodation right across our constituency. There is a finite amount of land that can be developed. There is sea on one side of the constituency. It is an urban area. There is a need to build upwards to accommodate the growing population of people who have been living there for a long time, as well as people who want to come here, work here and develop our economy. The Deputy does not want housing here; he does not want housing there. He tells the Minister and the Government to solve the housing crisis, but just not on his territory.
As we have heard from the exchange that has just taken place, there are more homes being built in the constituency represented by Deputy Boyd Barrett. It is not for me to say that; Deputy Carroll MacNeill is more of an expert than I am in that regard. Those homes are being built. They are part of the increased number of homes that are being built in the country overall. We know more need to be built but more than 20,000 homes were delivered last year, more than 30,000 homes have been commenced and more than 35,000 homes are in the planning process. That is what is happening. Those are homes that are being built.
As regards what is happening in the social housing programme we have in place, we have a record budget in place now to deliver those homes. Is it not the case that a share of all the homes the Deputy sees being built across the constituency he represents are being set aside for public use and will deliver more public and social housing for families who need it?
My constituency colleague being sent in to mark me is an interesting new phenomenon. This is a new tactic on the part of Fine Gael. It does not matter.
I have no interest in marking the Deputy. I am just setting the facts straight as the Deputy is well able to do. I have no difficulty-----
I have a public office that is visited by people who are homeless and cannot afford stuff; the Deputy does not. I have to deal with------
The Deputy is right. I do not use State funds for that. I have to meet them at my own cost.
I have to deal with the families who are being thrown off the housing list.
I meet people at my own cost. I do not use State funding for things like that.
Deputies, please.
The rents in the places the Deputy is talking about are €2,200. They are not affordable for the people on the housing list and that is why people are ending up in homeless accommodation. There are 5,000 families on the various housing lists. They have been waiting 15 to 20 years because all the construction workers are building developments for profit. We get a tiny proportion of those at a huge cost but, meanwhile, those construction workers are not down at Shanganagh Castle building on public land the public housing we need. They are not inputting the water infrastructure on the Old Connaught Road or up in Stepaside where there is public land on which we should be building public housing.
Nobody is being sent in to mark anybody here.
I have noticed the new tactic. Fair enough. It is all politics.
Deputy, please.
I would have thought, given Deputy Boyd Barrett's prowess as a public speaker and the way in which he------
I am not objecting; I am just pointing it out.
------tackles me regularly, that he would be up for debate and discussion as opposed to, frankly, the feigned outrage he indulged in just there.
It is not feigned at all.
The Deputy is entirely-----
It is real anger.
Well the Deputy appears to have recovered from it pretty quickly. We are surely-----
Every week, I come in here enraged by the housing crisis in my area. There is nothing feigned about it.
Can we let the Minister respond, please?
I would have thought the Deputy would welcome debate and that a perspective on what is happening in his constituency can be legitimately given in this Dáil by a fellow Deputy who also represents that constituency. I am well aware of the level of housing need that is there. I am well aware of the anxiety and trauma it is inflicting upon so many but I simply make the case to the Deputy that with the funding we are putting in, we will see and are seeing more public housing being built. These funds, which I know the Deputy is against, play a role, particularly in delivering more apartments.
Question No. 16 replied to with Written Answers.
Insurance Industry
Ruairí Ó Murchú
Ceist:17. Deputy Ruairí Ó Murchú asked the Minister for Finance the status of his plans to address the rising cost of and limited access to public liability insurance; the detail of his recent engagements with an organisation (details supplied); and if he will make a statement on the matter. [9473/22]
Cormac Devlin
Ceist:28. Deputy Cormac Devlin asked the Minister for Finance if he will report on his engagement with an organisation (details supplied). [9682/22]
What are the plans of the Minister to address the rising cost of and limited access to public liability insurance? What recent engagements has he had with the insurance industry, Insurance Ireland and his office to promote competition in the insurance market? I think he would struggle to find a company offering bouncy castles that has insurance. We have reached that doomsday scenario where they are operating without insurance because we have not been able to bridge the gap.
I propose to take Questions Nos. 17 and 28 together.
As the Deputy is aware, insurance reform is a priority for the Government, with the establishment of the office to promote competition in the insurance market representing an important action within the overall reform agenda. One of the roles of the office, which I chair, is to engage with insurance industry stakeholders. The office held more than 60 meetings with a wide range of groups in 2021 and earlier this year.
The Deputy referred to a particular sector. Fáilte Ireland produced extensive reports and helped fund and establish tourism products that deal with adventure sports.
That organisation is up and running. It is encouraging people in the tourism adventure sport area to come together collectively as a group, work through a broker, and then approach insurance companies rather than them being picked off one by one by the major insurance companies. They are now approaching these insurance companies through a broker with ten, 20 or 30 similar type businesses around the country and are able to get insurance on that basis. Many of them have been very successful.
I accept that there are some companies out there, small operators that may not be part of that particular group at this time, but the arrangement mentioned is proving very successful already. There are similar areas in high risk. I can think of the equestrian centres, pony clubs, and point-to-point races which had major problems with insurance over the past six months. They have come together collectively as a group rather than individual point-to-point clubs seeking to get their own personal insurance for their own riders and the Department of Agriculture, Food and the Marine was helpful in that respect. Most of these activities are back up and running. Some of the point-to-point races and pony club activities commenced on 1 February, which did not look possible in November. There has been great progress in some of the areas specifically referred to by the Deputy.
Gabhaim buíochas leis an Aire Stáit. I accept that there have been advances and these are to be welcomed. I am talking specifically about a number of companies operating in the leisure industry that probably run very large events. They are breaking their companies into individual parts. If they are dealing with marquees, they are keeping that separate. They cannot in any way, shape or form, and I am talking specifically here about bouncy castles, get these covered. That means that local authorities, for example, and community organisations and centres that want to run events for children will not be able to do that or use these sort of services into the future. We have looked at options and are still working with Insurance Ireland and others from the point of view of trying to get a broker and to deal with regulation. I have met the Minister of State previously on this issue and the problem is that we are past the doomsday situation. These people are operating, many of them very well, using best practice but they just cannot get insurance.
I thank the Deputy again for consistently raising this issue because it is a very important sector of the Irish business environment. There has been great success in the reduced premiums in motor insurance and the same is happening in house insurance this year. On 1 July we will have new price-walking measures introduced by the Central Bank which will have immediate effect. People will receive notifications of their renewals. People who have been charged what I would call a loyalty penalty up to now, from mid-May of this year in just a couple of weeks' time, will see the benefit of that loyalty penalty being dealt with effectively by the Central Bank on policies that come to be renewed after 1 July.
I acknowledge the work of Insurance Ireland and Brokers Ireland. Everybody knows that this House and the Department of Finance has no role in the market. It is a private sector business but I will say that we are very open to refer people to both Insurance Ireland and Brokers Ireland to see what commercial arrangements they can make themselves. Again, this has proven very successful.
There have been a number of pieces that have been dealt with legislatively here but we still have failings around the fact that the duty of care legislation has not been brought in. That is a major part of this. We have all seen situations such as in my own constituency involving community centres; there may be a claim against two or three parties using a centre and, although the centre itself may never be taken to court, because the incident may have happened on its premises it has seen its premiums go up by something like €10,000, which is utterly unsustainable. The fact is that we do not have enough players in the market. We have to do some serious work. There is an onus on Government in this. I have dealt with the Minister of State and am dealing with other Ministers around this and we will try to get a solution but we really need the Government to put its shoulder to the wheel on this. We could have a situation where children could get injured, or whatever, and are dealing with companies that are operating best practice but do not have insurance because they cannot get insurance.
I thank the Deputy again. I could deal with a wide range of issues but I will try to concentrate on the specific area that the Deputy has mentioned. Duty of care is an absolute priority and is being dealt with. We will have proposals on that in the immediate future. The Department of Justice is seized of that issue, having successfully brought forward the personal injury guidelines last year. All of the claims going through the Personal Injuries Assessment Board, PIAB, are stood over by the Government and PIAB, and are showing reductions of 40% in those areas. Some people are not happy and some will be challenged in court but those figures are holding firm. The duty of care legislation is being dealt with specifically in the areas the Deputy has mentioned.
In respect of community events, I have seen some of the major insurance companies offering to deal with some of those, like community bicycle and cycling groups. Recently another company publicly announced that it is dealing with some social employment scheme in regard to activities that it is running. There is a great deal of information available through Insurance Ireland and Brokers Ireland.
Small and Medium Enterprises
Catherine Connolly
Ceist:18. Deputy Catherine Connolly asked the Minister for Finance the status of the study by his Department into SME survival, recovery and investment following Covid-19; when this study will be completed; and if he will make a statement on the matter. [9680/22]
Gabhaim míle buíochas leis an gCeann Comhairle. I was asking the Minister a very specific question on the publication of the report and he has clarified that it has been published which I am aware of. The misunderstanding was on my part as I thought that the Department of Finance itself was carrying out a report. Can the Minister address in his reply, moving on from the fact that the report has been published and I have it in front of me, where we are going on the findings of that report? I thank the Minister.
Specifically, the findings of the report estimate that the share of firms making losses throughout 2020 and 2021 could have been around one third higher if supports were not available. It finds that in the absence of the extensive supports provided by the Government to SMEs, the distress rate for companies would have been 72% higher.
Moreover, by 2024, without the support that we had in place, the distress rate is estimated to be around 20% higher relative to the baseline. In respect of what happens beyond this, this answer provides the backdrop to the phasing out of the EWSS that is now in place. As the Deputy and the House are aware, we are now in the final phase of the first reduction of the EWSS. Companies that were receiving up to €350 per employee will now be receiving up to €203 per employee and that will now move to €100. The same process will then happen to companies four weeks later which were affected by the December public health regulation requiring companies to close at 8 p.m., such as restaurants and so on. That will provide the backdrop to the phased exit from the EWSS.
I have read the paper and it is not an easy paper to read. It is the second working paper that has been produced by the Minister’s Department along with the Economic and Social Research Institute, ESRI. I fully accept that without the support, all of these businesses would have been much worse off. I am on record in supporting the Government on quick action.
That is not what I am asking here. I am asking where we are going next. When one looks at the figures, for example in the 2021 report from the same group of people, the facts are staggering. SMEs are the predominant enterprise type in Ireland, which we know. They account for 99% of the active businesses with 92% of these being micro, where they have fewer than ten employees. It goes on to say that despite Ireland’s reputation as a high-tech, knowledge-intensive economy, the majority of employees in Ireland work in traditional domestic-facing sectors, where SMEs are the dominant employer. When I take the two reports together, it is the small enterprises that are in serious trouble, notwithstanding the help. The prediction is that by 2024 a substantial proportion of these will have gone out of business.
I am thankful to Deputy Connolly for raising this issue because this has been a matter of considerable concern. Of these sectors, some have been naturally slower to open, particularly in the catering sector where people have been slow to plan events, exhibitions, and so on. It is a sector that is uniquely small in the number of employees, with fewer than ten. I am thinking of two businesses in my own constituency which adapted throughout the pandemic to try to provide food in different ways but they are highlighting that theirs is a slower recovery, even when things are open, because of their dependence on people planning events into the future, such as exhibitions, weddings, big catering events and so on. Is there any capacity for that sort of sectoral analysis that provides additional supports to those small, particularly those microenterprises that Deputy Connolly has referred to, to be able to help them through?
I am afraid I do not follow the questions from Deputy Connolly. She asked me what was the way forward, and I said what the way forward was in the employment wage subsidy scheme. The report focused on the impact of the employment wage subsidy scheme on SMEs.
On the question asked by Deputy Carroll MacNeill, she raised an important point that is covered in this report, which is that there are parts of our economy that clearly are having or have had a slower recovery than other parts of the economy. The way in which we seek to recognise that is by the varying speeds of how different sectors will leave the employment wage subsidy scheme. I believe there will be a need to do further sectoral analysis, to better understand how different parts of our economy are responding to the withdrawal of supports. However, even with that analysis done, the Deputy will appreciate that we simply cannot maintain, nor is the Deputy calling on me to do so, an employment wage subsidy scheme that was introduced for a health crisis when the health crisis has passed. Even though many sectors are now facing new challenges, the solution to those challenges cannot be the continuation of this scheme. Yes, we will do more sectoral analysis, because it will be a key issue for our economy over this year.
The Minister's approach, as opposed to divide and conquer in a classroom, is to have the good student and the not-so-good student who he fails to understand. It is beneath the Minister and it does not do him justice with regard to the issue being raised. I did not ask him about the extension of the programmes he has. I asked what was the follow-up from the report that identified serious difficulties with small to medium-sized enterprises, particularly going up to 2024. I asked him to focus on that. I acknowledged that the Minister did not need to read out the answer to the question to give him extra time to look at the difficulties identified by two reports, last year and this year, relating to small to medium-sized enterprises, and I am highlighting what the reports are telling us. The SMEs are the backbone of the country, as the Minister of State, Deputy Fleming, has repeatedly told us in the Dáil. I agree with him and with the Minister. However, they are highlighted as being in particular trouble. I am not sure why the Minister is shaking his head, but I will try to avoid it and concentrate on the issue. However, my time is up. The Minister is saved by the bell.
I repeat what I said to the Deputy. She has a habit of giving me a very precise question and when I give her a very precise answer, she normally dismisses it.
This is a stand-up comedy.
The Deputy asked me what the future of the schemes was and I answered the question. She asked what was the way forward for the sector, and I answered the question. I gave the Deputy a precise answer to a precise question. I do not know how my answering the question has provoked her to draw an analogy of good pupils and bad pupils.
That is what the Minister did.
I come into this House, as is my obligation and duty, and I answer the questions the Deputies put to me. However, as I said, the Deputy asks a precise question, I give a precise answer and more often than not she dismisses it. The Deputy asked me a question about the future of the employment wage subsidy scheme and I answered it.
I did not ask the Minister that question, but I will keep my mask on to stop me talking.
Questions Nos. 19 to 22, inclusive, replied to with Written Answers.
Tax Code
Catherine Connolly
Ceist:23. Deputy Catherine Connolly asked the Minister for Finance the status of the research and collection of data on property vacancies by his Department with a view to introducing a vacant property tax; if the data collection has been concluded; when this data will be published; when he expects to bring proposals for the vacant property tax before Government; the estimated timeline for the expected introduction of the tax; and if he will make a statement on the matter. [9681/22]
Richard Bruton
Ceist:62. Deputy Richard Bruton asked the Minister for Finance if he has received preliminary returns from the local property tax which might shed light on the case for a tax on properties left vacant for a long period; and the issues to be considered in framing such a tax. [9458/22]
This is a factual question. I was not expecting it to come up.
The Deputy should have ended on better terms.
I always strive to end on good terms so I will use my 30 seconds to bring the Minister back into good humour. He might address himself to the factual question here regarding the status of the research by the Department and the Minister relating to the collection of data on property vacancies and so forth. I will not use up the time as the question has been set out.
I propose to take Questions Nos. 23 and 62 together.
I am glad to assure the Deputy that my humour is good. I am just answering all the questions that are put to me, including by the Deputy. Regarding where things stand with that, I will spend time trying to find the written material here and would do so at the expense of answering the Deputy's question. The Revenue Commissioners are currently assessing the data they received as part of the local property tax returns. I expect that information will be available to me in the second quarter. When that information comes in I will share it with the Deputy and other Deputies who have a keen interest in this matter. I hope that will guide me in the design choices we make in a tax to tackle this issue.
I thank the Minister and accept his answer on this. I wish I could use the time to go back to the other question, but the rules preclude me from doing that.
I am sure the Ceann Comhairle would be liberal in his application of those rules on this occasion if there are any matters the Deputy believes I have not answered.
I would be delighted to follow up on the last question relating to the small and medium enterprises which have been identified. If the Minister chooses to answer that in the spirit that it is asked, I will be delighted. As the backbone of the country a substantial proportion of the small and medium enterprises are in trouble, notwithstanding all the Government's supports which must come to an end at some stage. However, targeted supports are what is needed or a targeted response. We know that as well from another Department's review of the Údarás na Gaeltachta companies. The vast majority of companies in the Gaeltacht areas have fewer than ten employees, so they are particularly vulnerable as well.
As I said, and the Minister of State, Deputy Fleming, was the first to say it, we appreciate the fundamental importance of these companies to the operation of our economy and we recognised that through the support schemes we had in place. To deal with the Deputy's question regarding the future, I will park the EWSS for now, given that we have discussed it already. What does the future hold? The future is, first, to look at what role Enterprise Ireland can play in supporting small and medium-sized companies to scale up and become more innovative, with all the change that is under way and the challenges the Deputy referred to. Second, we have to look at funds such as the additional funding that is being made available to Ireland through the recovery fund and the Brexit adjustment reserve fund and see if we can use that type of funding to support SMEs in particular parts of the country that are being adversely affected by the issues we have touched on this evening. It will be an ongoing focus of mine in the implementation of this budget and beyond to try to deal with particular issues that are affecting the viability of Irish SMEs. I agree with the Deputy about their fundamental importance and the need for us to continue to find ways to support them.
Tax Code
Richard Boyd Barrett
Ceist:24. Deputy Richard Boyd Barrett asked the Minister for Finance his views on whether taxes on energy and heating fuel such as carbon tax and VAT are now directly contributing to fuel poverty and excessive fuel costs for many households; if he plans to take steps to address this; and if he will make a statement on the matter. [9671/22]
Rose Conway-Walsh
Ceist:60. Deputy Rose Conway-Walsh asked the Minister for Finance if he will consider tax measures in order to reduce the impact of rising energy costs; and if he will make a statement on the matter. [9676/22]
Niamh Smyth
Ceist:230. Deputy Niamh Smyth asked the Minister for Finance if matters raised in correspondence by a person (details supplied) will be reviewed; if he will provide clarity on this matter; and if he will make a statement on the matter. [9243/22]
People Before Profit has been against the carbon tax from the outset, despite what some Members appeared to be suggesting rather bizarrely earlier. We have been very clear in opposing carbon tax as an unfair, regressive tax. There is no evidence that it has any significant impact on the reduction of CO2 emissions. However, even if that was always true, it is simply blatantly self-evident that increasing the carbon tax yet again in the current situation is going to contribute to fuel poverty, hardship and injustice.
I propose to take Questions Nos. 24, 60 and 230 together.
This was the subject of a Private Members' motion today and is the subject of another one tomorrow. I will repeat the key points I made earlier. I believe that carbon taxing is playing and will play an important role in how we can reduce carbon emissions in the future. The challenge we face with regard to the climate is existential. Cognisant of the challenges that many people are already facing with the rising price of energy, we are putting in place additional supports to help those who will be affected by the further increase in carbon taxation that will take place a number of weeks hence. If the Deputy looks at the impact that carbon taxing is having on the rising price of energy, it is but a small share of the total cost of fuel and energy in our economy at present. The increase that is coming up is 2 cent per litre. I know when 2 cent per litre is added up it can be a lot for those who have the least, but the reason we have made changes in the social welfare system, in the fuel payment and in the living alone allowance is to help those who will be badly affected by the rising price of energy at present.
To be clear, what is needed are caps on energy and heating prices. That is what we believe is the necessary action.
While the Minister is clearly not going to do that, although he should, it is unacceptable to add additional hardship to people by further increasing carbon taxes. He is absolutely right that on its own it is not enough. He has control of VAT, the PSO and carbon tax. This is more than €1.2 billion worth of taxes that will be levied on people's energy use, with most of it hitting the least well-off. Does the Minister honestly think he should not reduce this and that he should certainly not even contemplate increasing it when we have excess winter deaths and people not able to pay the bills? They are literally making choices between food and bills and skipping meals. Does he not think it is totally unjust?
The mere fact the issue of the carbon tax has been raised so many times, in our Private Members' motion earlier and in another Private Members' motion tomorrow, should show what an important issue it is. The idea of the tax is that it would change behaviours. We told the Minister at the time it would not do so because we did not have alternatives. We have seen the increase in the prices. The Minister might say it is only small but he does not need it at this particular time. He knows we have overshot the runway on VAT, income tax and corporation tax. People are looking to him. The message he is giving out to people is that he will pile more hardship on top of them. This is just not fair. This is why there is such a backlash against the Government. It really needs to listen. It is not just to the politicians he needs to listen. He needs to listen to the Society of St. Vincent de Paul, which always ends up picking up the pieces, and many other organisations such as Barnardos.
I also need to listen to the Climate Change Advisory Council which, as I reminded Sinn Féin in our debate earlier, has advised us that carbon tax is a key component of transition to a low-carbon, climate-resilient and environmentally-sustainable economy. That is its view on this. Of course, I accept the change that is happening. I was at pains to acknowledge earlier that with regard even to the change coming up in May, which in the total cost of energy overall is €0.02 a litre, for many that is a lot. I acknowledge this. This is the reason the Government has brought forward the energy rebate. It is the reason we brought forward the additional fuel payment of €125. It is also the reason we have made many other changes in our social welfare code to protect those who need help the most.
On a number of occasions I have heard many Deputies make reference to where we are with our tax receipts. We did have a strong November, December and January but much of this was fuelled by a high level of savings going into consumption in our economy. This will come to an end. We cannot, on the one hand, be making the case for people's standard of living going down with them being able to purchase less and, on the other, imply the higher level of VAT receipts we see will continue.
I am speaking about the higher level of VAT receipts specifically on energy and heating. Let us forget about the rest. It is up to €481 million and rising. The State has yielded a big tax bonus from the energy hikes that ordinary people are getting through their doors that they cannot afford. This gives the Minister scope not to impose further hardship on them. In fact, it gives him scope to reduce their energy bills and reduce the hardship, as do the profits of the ESB. The Minister is right that it is a publicly owned company. Its profits should be capped. Tell the company not to increase prices because he would rather not impose further hardship on people to get extra dividends. For that matter, the profits of Energia have increased. Tell that company that it does not need to make extra profits this year because people are suffering and they cannot take any more.
When the Minister lauds the merits of the carbon tax he misses the point that there are no alternatives for people. He misses the point this will be the straw that breaks their backs. The Minister for Finance knows what the equilibrium is. He knows the tipping point. He knows that people cannot bear any more of the hardship he is putting on them right now. The message he is sending them is to suck up some more. It is not right and it is not fair. It is certainly not going to change people's behaviour in terms of the climate. The Minister needs to listen to more than one voice. He needs to listen to the people who are suffering most. He needs to listen to the people in his constituency and other constituencies who are feeling the brunt of the hardship they are going through. They cannot meet the very basic cost of living.
The Minister identified inflation as a particular problem in the budget when he introduced tax reductions, social benefit changes and subsidies to try to address energy prices. It is a huge pressure. What we do not hear acknowledged in the House is the external reality about energy prices generally. I recall a Department of Finance paper from December 2021 about global demand and prices. Events have moved on so much since then. The paper stated wholesale natural gas prices had increased seventeenfold since June 2020 while oil prices more than doubled over the same period. It also stated that at the same time a lower than expected gas supply from Russia, low gas reserves due to the longer winter last year, weather-related disruptions to renewable energy production and an increase in carbon prices put further upward pressure on electricity prices and fuel prices. It stated that governments in many countries, including Ireland, have taken action through a mixture of tax cuts, social benefits and subsidies. The trouble is the tax cuts, the tax changes and widening the bands, which reduced tax for many people in the country, were opposed by Deputies now raising the carbon tax.
We have debated long and hard the impact of carbon taxes and the failure of the Minister to reach out to his colleagues in the European Commission to speak about the potential of reducing VAT. This has not happened, despite the fact I raised it with the Minister in September. Deputy Carroll MacNeill rightly points out the Minister brought forward a tax package. The largest part of that package, which she did not mention, cost €340 million and 80% of earners were left out of it. It was the most expensive part of the Minister's tax package and eight out of ten earners were left out of it. In fairness to the Deputy, they are not the people who are struggling the hardest. They may be struggling but 80% did not benefit from the €340 million package. They could have benefited from other measures that were a lot less costly. The issue is that gas prices are increasing time and again. They are likely to increase further given what is happening in eastern Europe. The Minister and the Government are planning to increase them further.
The reason we introduced the lump sum payment of €125 for those in receipt of the fuel allowance is to ensure that as part of our package we have funding and a payment available to those who need help the most. What we had here was a package that in its breadth and cost of €500 million was looking to respond to the challenges that we accept many are facing due to the rising cost of living. Deputy Boyd Barrett quoted a figure relating to VAT. We have a package that overall cost in excess of €500 million. We have a package that between it and the announcements contained in the budget means a single person in receipt of the old age pension will receive additional support from the State of between €600 and €800 for this year. This will help. We accept that many need more but it is a set of measures we believe will make a difference to those who need the help the most.
Insurance Industry
Michael Moynihan
Ceist:25. Deputy Michael Moynihan asked the Minister for Finance if he will detail his meetings with insurance stakeholders since November 2021. [9307/22]
Joe Flaherty
Ceist:38. Deputy Joe Flaherty asked the Minister for Finance if he will report on his engagement with insurance underwriters and brokers to promote more competition. [9311/22]
Pearse Doherty
Ceist:64. Deputy Pearse Doherty asked the Minister for Finance the number of meetings he has held with an organisation (details supplied) or insurance undertakings since 24 April 2021 to discuss the personal injuries guidelines and ensuring savings made as a result of the new guidelines are passed onto consumers in the form of reduced premiums; and if he will make a statement on the matter. [9696/22]
Will the Minister of State outline to the House the meetings he has had with insurance stakeholders over the past period?
I propose to take Questions Nos. 25, 38 and 64 together.
As the Deputy will be aware, insurance reform is a key priority for the Government and the establishment of the office to promote competition in the insurance market is a programme for Government commitment. The office, which I chair, is positioned within the Department of Finance. Its twin aims are to expand the risk appetite of existing insurers in the Irish market and explore opportunities for new entrants to help increase the availability of insurance.
The office has engaged with a wide range of stakeholders, including insurance providers, brokers and representative associations since its establishment, holding more than 60 meetings throughout 2021.
As part of this, I held a series of meetings with the chief executive officers of the major insurance providers in Ireland in late 2021. The industry confirmed that it is committed to passing on the savings from the new personal injury guidelines and other reforms to customers. It also restated its support for the reform agenda and that it is adhering to the lower award levels established by the guidelines in direct settlements with their clients. The need to expand their risk appetite into pinch-point sectors that are experiencing issues with the availability and affordability of cover, particularly high-risk and high-footfall areas such as leisure activities, was impressed upon the providers at our engagements.
I have met with Insurance Ireland, Brokers Ireland, the Alliance for Insurance Reform and other groups on a number of occasions to discuss a range of issues, most particularly the capacity pinch-points in the market. I met them collectively as a group before Christmas and in January. I plan to meet them again. I am pleased to note that some sectors that were on the list of pinch-points and which had been experiencing difficulty, such as equestrian centres and tourism sectors, have arrived at solutions via the formation of group schemes which have, to some extent, alleviated these problems.
Finally, it is important to point out that a number of legal cases and judicial reviews have been launched in relation to the role of the Judicial Council and the Personal Injuries Assessment Board in the context of the personal injuries guidelines. It is vital that these challenges are resolved as early as possible in order to give clarity to stakeholders and ensure the impact of the guidelines can start to be fully felt by business and individuals alike.
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