SELECT COMMITTEE ON COMMUNICATIONS, NATURAL RESOURCES AND AGRICULTURE (Select Sub-Committee on Communications, Energy and Natural Resources) díospóireacht -
Wednesday, 6 Jun 2012

Vote 29 - Department of Communications, Energy and Natural Resources (Revised)

Chairman

This meeting has been convened to allow the select sub-committee to consider the 2012 Revised Estimate for Vote 29 - Communications, Energy and Natural Resources. I welcome the Minister for Communications, Energy and Natural Resources, Deputy Pat Rabbitte, the Minister for State at the Department, Deputy Fergus O'Dowd, and their officials. As we see, the Estimate is presented in a new programme format, with key output indicators shown for each programme. Later in the meeting, members of the select sub-committee will have an opportunity to comment on this approach and some members may wish to express views on how this approach might be further developed. More important, this meeting gives us an opportunity to explore the policy issues underpinning the various spending provisions. It is important that we are able to consider these matters as fully as possible.

Before the sub-committee proceeds to consider the detail of the Estimate, programme area by programme area, the Minister wishes to make a brief opening statement.

Minister for Communications, Energy and Natural Resources (Deputy Pat Rabbitte)

I thank the Chairman for giving me the opportunity to introduce the 2012 Estimate for the Department of Communications, Energy and Natural Resources.

The gross provision of more than €437 million represents a decrease of 2% over last year's outturn. The net provision is €193.7 million, or a reduction of 8% on the 2011 outturn. Although the Vote is small in terms of overall Government expenditure, the areas it encompasses are key to economic and social development. The vast bulk of capital investment in energy is funded by the commercial State bodies under the aegis of the Department and, in telecommunications, by the private sector. This investment is not encompassed in this Estimate.

The Estimate reflects an increase of 3% in gross current expenditure and a decrease of 16% in gross capital expenditure. The latter reduction reflects a contribution to the overall downward adjustment of €750 million in capital expenditure which is necessary in order to meet our fiscal targets in 2012. The increase in current expenditure is off a 2011 base which involved savings of €14 million on the 2011 Estimate. The 2012 current Estimate, therefore, is €3 million below the 2011 Estimate. Almost €95 million is provided for expenditure in the energy area, the bulk of it for investment in energy efficiency schemes. This expenditure has the dual effect of maintaining badly needed jobs in the construction sector while also promoting environmental sustainability and assisting energy affordability.

A first-class communications infrastructure is also critical for economic growth and recovery. Ireland has an excellent record in attracting key multinationals in the digital and ICT sectors. This has undoubtedly been facilitated by recent improvements in our communications infrastructure. Notwithstanding recent improvements, Ireland needs to further progress to a world class broadband infrastructure. Although broadband services will be delivered primarily through private investment, the 2012 Vote provision will fund enhancements to our broadband infrastructure. Efficiency and effectiveness in the delivery of public services is critically important. My Department prioritises the best use of resources. This year the Estimate presents for the first time key high level output and impact indicators across the various sectors, as the Chairman indicated.

I will take the sub-committee through some key details of the Vote. The administrative budget provides, among other matters, for the salaries and associated costs of the staff of the Department. It also covers the engagement of consultancy expertise, the ongoing implementation of the Department's information technology strategy, staff training and development and value for money and policy initiatives. The increase of 10% in the 2012 administrative budget provision, in comparison with the outturn for 2011, masks the fact that the 2012 provision is at the same level as the corresponding 2011 Estimate even though the 2012 Estimate includes an additional provision for preparations for the EU Presidency. The low 2011 outturn reflects the efficiencies being driven by my Department and the focus on achieving value for money.

The total spend on the administrative budget was €40 million in 2007 but had decreased to €22.4 million by 2011. This represents a reduction of 44% over a four-year period. This partly reflects the transfer of some functions but mostly arises from a reduction in the Departments staffing resources from 339 at the end of 2007 to 243 at present. This represents a reduction of 96, or 28%. The Department has continued to oversee and implement a wide range of new and existing programmes, undertake certain regulatory functions and provide policy advice across its wide brief. Productivity will have to be further reinforced in 2012 and coming years. In this regard, the Department has embraced shared services in information and communications technology with the Department of Agriculture, Marine and Fisheries and in payroll services with the Department of Finance. Despite the restrictions on numbers, the Department must be resourced as well as possible to implement its complex and wide array of tasks while discharging its heavy EU Presidency burden in the first half of 2013. The Department will fill vacancies on a targeted basis within its employment ceiling over the rest of this year.

Some €28.6 million is being provided in 2012 for communications and multimedia developments. Availability of broadband services in all areas of the country and a significant enhancement in broadband speeds are major priorities for the Government. Good progress has been made on broadband provision in recent years. The number of broadband subscribers in Ireland has increased from 437,000 to 1.66 million over the past five years. By the end of 2012, almost one third of homes will have access to speeds of 100 megabits and basic broadband services will be available to all. It is estimated that almost 50% of the population will have access to speeds of 100 megabits by 2015. The estimated broadband household penetration rate is now 55.4% compared to 39.6% five years ago. Some 71.8% of homes and 88.5% of small and medium-sized enterprises are using broadband speeds between two megabits and ten megabits while 21.3% of homes and 5.4% of SMEs subscribe to services greater than ten megabits. While the bulk of this improvement has resulted from private sector investment, over €13 million is being provided in 2012 for Government investment in broadband infrastructure. Following the completion of the roll-out of the national broadband scheme network in October 2011, every part of Ireland has a broadband service available from at least one service provider. This is ahead of the 2013 deadline that was set by the digital agenda for Europe. Despite Government and private investment in broadband, there are isolated cases of premises throughout the country - it is estimated that less than 1% of premises are affected - being incapable of receiving broadband services for technical and other reasons.

The rural broadband scheme aims to provide a basic broadband service to individual unserved rural premises that are outside the national broadband scheme areas. Funding of €3 million is being made available this year for the scheme under subhead A3. The response of the industry to the scheme strongly suggests that the offer of basic broadband services is widely available from at least one existing technology platform. It is not possible to be definitive about the issue until the verification process which is under way is completed by the companies involved, but it is expected that a very significant number, if not all, applicants under the scheme will be capable of being served by commercial operators arising from the verification phase of the scheme. If any applicants remain unserved after this phase, a service will be procured by my Department. Our target is to have this rolled out by the end of the year. As we try to create a knowledge society, we must enable our schools to ensure our students have first-class digital skills. Some €5 million is being provided in 2012 under subhead A3 towards the phased national roll-out of 100 megabits broadband to 200 post-primary schools. This project, which is progressing in conjunction with the Department of Education and Skills, will see a 100 megabits broadband service installed in all post-primary schools by the end of 2014.

The report of the task force on next generation broadband, which I chaired, was published recently. The report highlighted the likely investment developments in this area over the next eight years. It also recommended measures to help accelerate private sector investment and highlighted the role of the State in addressing infrastructure deficits. I will bring proposals for a national broadband plan to the Government shortly, with a view to agreeing a comprehensive set of policy actions to underpin the provision of high speed broadband services on a national basis. This is a key priority. A particular challenge will be the source of funding to address gaps in high speed coverage in areas the market may deem to be commercially unviable.

Provision is also made under subhead A3 for the introduction of postcodes. This complex national project has the potential to deliver significant economic and social benefits. In particular, it can assist service providers in delivering a better service to their customers nationwide. Some €8.4 million, including capital carryover of €800,000, is provided in 2012 under subhead A4. Some €3.5 million of this is provided for the work of the Digital Hub Development Agency. The agency continues to attract digital media enterprises and has a current cluster of 70 companies with approximately 800 employees.

A provision of €4.4 million is being made towards the operating costs of the National Digital Research Centre to continue the development of translational research projects in the digital media field. Some €514,000 is allocated for digital engagement, of which €285,000 is for the payment of the balance of grants due to projects under the Benefit 3 inclusion grant scheme, which is providing basic digital literacy training all over the country. Some €950,000 million is provided in subhead A5 for the information society. This will provide for initiatives in relation to the exemplar network, cyber-security and the emergency call answering service.

Subheads B3 to B7 provide €249.095 million in respect of the broadcasting sector in 2012. It is estimated under subhead H4 that 2012 broadcasting licence fee revenue will be €222.130 million. This amount will provide grant-in-aid of €185.724 million to RTE under subhead B3, cover licence fee collection costs of €12.457 million under subhead B4, make a contribution to the grant-in-aid funding of TG4 of €9.245 million under subhead B5 and provide over €14.704 million for the broadcasting fund under subhead B6. The total provision for TG4 of €33.585 million, which includes direct Exchequer funding of €24.340 million, under subhead B5 will allow TG4 to maintain and further develop its Irish language schedules. Some €2.625 million is provided in subhead B7 for digital terrestrial television costs associated with the need to inform the public about the closure of analogue television services on 24 October next and its replacement with the new digital system. I intend to take my holidays on 25 October, Chairman.

It is appropriate in this context to refer to the financial difficulties facing RTE. The company faces a serious financial situation arising from accumulated deficits in recent years and a projected deficit of €57 million this year. A significant part of the 2012 projected deficit is due to a restructuring programme which will deliver significant savings in future years. RTE aims to break even in 2013 and this target must be achieved as the current loss-making trend is not sustainable. It should, however, also be acknowledged that RTE has funded from its own resources and through borrowing the capital costs of the new DTT network. Apart from providing greater choice and quality for free-to-air television viewers, this investment will also release valuable spectrum for high quality mobile broadband. This is a valuable digital dividend and I commend RTE on its investment and on the role it is playing in informing people in regard to the analogue switch-off and the introduction of digital television.

Under the energy programme, the Vote makes provision for a spend of €95 million in the energy area. Funding of over €80 million, including capital carryover, has been allocated in subhead C4 for the better energy national retrofit programme and for energy efficiency upgrades in the domestic, commercial and public sectors this year. This funding will achieve energy savings of 433 gigawatt hours, with an estimated monetary saving of €28 million. It will provide 17,000 low income homes with energy efficiency measures, with estimated energy savings of 35 gigawatt hours and monetary savings of €2.4 million.

The programme for Government commits to a shift from State supports for energy efficiency by the end of 2013 towards a pay-as-you-save scheme. My officials are working on the development of a national pay-as-you-save framework. Over €1.8 million is allocated for the electric vehicle programme.

Some €8.3 million is provided in subhead C5 for energy research and some €2.9 million is being provided for ocean energy in 2012. Ocean energy, while still very much at the research stage, can contribute to Ireland's renewable energy targets and also has potential for inward investment and enterprise activity.

There is a provision of over €30 million in 2012 for the natural resources area. Nearly €1.4 million is provided in subhead D3 for petroleum services. While the Irish offshore has recognised potential as a petroleum producing area, it is relatively unexplored and, as a result, its petroleum potential is largely unproven. My Department takes a proactive approach to promoting the opportunities for exploration investment, both offshore and onshore Ireland, and the outcome of the recent Atlantic margin licensing round, while encouraging, was still relatively modest. More exploration effort, in particular exploration drilling, is needed if the petroleum potential of the Irish offshore is to be realised.

I thank the sub-committee for its recent report on offshore oil and gas exploration - perhaps the opportunity will arise for an exchange of views with the sub-committee on it. The Minister of State, Deputy Fergus O'Dowd, and I look forward to engaging with the findings and recommendations of the report in the weeks and months ahead.

Subhead D4 provides funding of over €4 million in respect of mining services in 2012. This includes some €800,000 in respect of rehabilitation works at Silvermines and over €1 million for health and safety works in Avoca. The provision of €2.138 million under subhead D6 will fund a range of multi-annual initiatives in the geoscience field. Subhead D7 provides €3 million in 2012 for INFOMAR, the successor to the Irish national seabed survey. Subhead D8 provides for the payment of grant-in-aid of €8.466 million to Ordnance Survey Ireland.

Some €33 million is provided for the management of Ireland's inland fisheries resource. This includes €28.5 million for the operations and activities of Inland Fisheries Ireland, including salmon management and operations under the water framework and the habitats directives. Some €2.6 million is being provided as the State's 50% contribution to the operational costs of the Loughs Agency, a North-South body with responsibility for the conservation, protection and development of fisheries and aquaculture in the Foyle and Carlingford loughs.

In conclusion, the overall Vote provision for my Department is comparatively small. The areas we deal with are, however, of major strategic importance and complex in nature. Energy and communications infrastructure and costs are a key component of the competitiveness mix. Broadcasting is critically important from an economic, social and cultural viewpoint and it also provides a key platform for open debate and discussion that is important in nurturing and promoting our democracy. Finally, we must try to exploit our national resources in a sensitive and sustainable way while ensuring an economic and social benefit from them. I thank the Chairman and look forward to the contributions from the sub-committee.

Chairman

Thank you. We are all in new territory. I call on Deputy Ó Cuív to begin the questions. I had suggested we would begin with the issue of administration in general.

Deputy Éamon Ó Cuív

I thank the Minister for that very comprehensive outline. I hope to deal with the high level issues. One point that strikes me in regard to what the Minister said about administrative costs is that while we might change the format, we never change the performance. I cannot for the life of me understand why salaries are up by 2%. If a person could live with whatever they got in 2011, why did the Minister have to put in the padding in 2012? The saving could have been used, for example, for doubling the investment in the seabed survey or some other issue. The Minister might outline why there is a 2% increase and why, when the Department found people could perform for less last year, it did not say "That is great of you. Stick at that and let us have a bit of a saving here". Salaries are up by 2% at a time when I thought the employment framework meant salary costs should, if anything, be going down. I suggest that, for 2013, we peg the salary level of this Department back to the 2011 level.

Second, in global terms, how can the Minister justify a 30% increase in all other administrative costs? I will not go into the micro-management of this as I believe it is much better to take the global figures. However, my suggestion is that, when we come to 2013, the total administrative costs, including salaries, are pegged back to the 2011 level at a minimum.

Deputy Colm Keaveney

On a related matter, there has been shift from 339 to 243 whole-time equivalent posts, which equates to a cut of 96 posts or 28%. I invite the Minister to comment in the context of the employment framework on whether we are achieving our targets and whether we are above or below quota in that respect. I am concerned at what is at face value a dramatic cut. In the context of forthcoming EU Presidency, is the Minister confident we can achieve our targets in the ambitious programme he has presented here today? Have we an adequate allocation of resources to deal with the forthcoming challenge coming down the line with regard to the EU Presidency? I invite the Minister to share with us his view on the impact of the loss of 28% of the whole-time equivalents of the Department.

I thank the Minister for his presentation. It is an ambitious report and one I always look forward to reading because this is one of those innovative areas where, in difficult times, we can get very good value for money. Given my background, however, I am surprised how it is possible we can get the outturn the Minister is ambitiously trying to achieve in light of the fact we have lost nearly 30% of the whole-time equivalents of the Department.

Deputy Pat Rabbitte

As I know from having spent many years on the other side of the House, these figures can be difficult for Deputies when presented with them for the first time. Deputy Ó Cuív has got the wrong end of the stick, because the trend has been in the other direction. Deputy Keaveney is quite right to draw attention to the rather dramatic savings in the management of this Department. As recently as 2007, the administrative budget was €40 million. It is now €22.4 million and the reduction in the number of staff is at a level that gives me cause for concern. Over this period, the number of staff has decreased from 339 to 243. Ironically, I was asked this question at an energy conference last week. Sectors of the industry were concerned that the staffing of the Department has been pared back as severely as it has.

In addition to this, we have the onus of the forthcoming EU Presidency. Deputy Ó Cuív will appreciate how onerous those duties are on a small country and, in this case, on a small Department. The dramatic reduction in the number of staff indicates how difficult it will be to meet all of the requirements of what is a developmental Department. Furthermore - the Deputy could not be expected to know this - the Department existed last year, because of the exceptional circumstances in which we found ourselves, way below its employment ceiling. Whereas there are 243 people employed in the Department, the employment control framework, ECF, would permit 260. I propose, with as much despatch as I can urge on my colleagues, that we fill those posts, because of the demands on the Department and because of the upcoming EU Presidency during which I will be responsible for two Council meetings, telecommunications and energy. Management has complied with strictures on us from the Department of Finance to a point where questions are being raised about the capacity of a small cadre of people to provide the traditional quality of service provided and expected. We are operating below the ECF framework and it is my intention, as early as possible, to bring numbers up to what we are permitted in the cuts agreed with the Department of Finance and the Department of Public Expenditure and Reform.

Deputy Éamon Ó Cuív

I am not sure we are comparing apples with apples in comparing the figures for 2007 or 2008, because functions have been changed around. Could the Minister provide us with a table covering employment in each sector, from 2008 to 2012 and broken down under the subheads here? We are dealing with the Estimate on communications, broadcasting and so on. The Minister has broken down the Department in the expenses, but we did not get the figures on employment. Can he give us the employment figures for 2008 to 2012 for communications, broadcasting, energy and so on so that we are informed as to what has happened at staff level in the various sections of the Department?

If the numbers fell further than required under the employment framework, why did the Minister do nothing about that last year? Why is he only now dealing with that issue? Why, when staff numbers fell below 260 did the Minister not immediately recruit staff up to the 260 allowed, particularly when staff are so urgently needed? I suggest that the next time we are dealing with Estimates, we are given the figures for the previous two years and the employment numbers in each section.

Deputy Pat Rabbitte

We will supply Deputy Ó Cuív with as much information as we can. He said he did not want to micro-manage, but it looks like he does. He is entitled to the information and I will try to get it for him. With regard to why nothing was done, this issue emerged shortly after the new Government took over in March. At that stage, as the Deputy knows, governance was so dysfunctional and the country was so much on its knees that I did not think it was a time to press for the filling of posts, particularly when we could not be sure we would be able to have a turnout at the end of the year that would be acceptable to the only lender now available to the Government. We could have moved to fill some of the posts last year, but we deliberately did not do that. However, confronted with the demands now and the demands of preparing for the EU Presidency, we have no choice in the matter.

Deputy Éamon Ó Cuív

I believe that administration figures for this Department in 2013 should be the equivalent of the 2011 level outturn, although when in opposition, the current Government said these figures were bloated.

Chairman

Perhaps when looking at the issue we should look at the overall ceiling.

Deputy Éamon Ó Cuív

We cannot change the figure for 2012, but we might as well change it for 2013.

Chairman

The ceiling is 260, but perhaps we should look at that and what it implies. The Department is currently operating with fewer staff, but wants to reach that ceiling.

Deputy Éamon Ó Cuív

It was the Minister who said we need to fill up the numbers to the ceiling.

Chairman

Maybe that is something we should look at in the context of the overall budget.

Deputy Éamon Ó Cuív

I agree.

Chairman

We can review that at another date.

Deputy Pat Rabbitte

Did Deputy Ó Cuív say that somebody said the Department was bloated?

Deputy Éamon Ó Cuív

When we were in government, the Minister, who was in opposition, said administration was bloated.

Deputy Pat Rabbitte

When did I say that?

Deputy Éamon Ó Cuív

The Minister's colleagues in government said it.

Deputy Pat Rabbitte

The Deputy cannot just throw that out.

Deputy Éamon Ó Cuív

If the Minister wishes, I will find the references for him.

Deputy Pat Rabbitte

Yes, get the references for me. Perhaps when we exchange information, the Deputy will give the references to me.

Deputy Éamon Ó Cuív

I will get the references demonstrating the Minister said there were huge savings to be made from cutting out waste. I think he said €4 billion could be saved.

Chairman

We are talking about this specific Department. The only point made on this in the opening statement was that the spend has gone from €40 million to €22.4 million, for various reasons.

Deputy Éamon Ó Cuív

Forestry has been removed.

Chairman

That is acknowledged and the breakdown on that can be sought.

Deputy Ann Phelan

I would like to thank the Minister for his report and have some specific questions for him. Do we have a national digital strategy, particularly with regard to the Internet?

Chairman

Would the Deputy mind parking that question until we get to that issue? We are dealing with administration currently.

Deputy Ann Phelan

Okay, as long as we are not getting stuck on it.

Chairman

We will get back to that, but we will proceed now to go through the programmes.

Deputy Noel Harrington

I have a question based on the Minister's statement that staffing levels in the Department are a cause of concern. In view also of some of the issues this sub-committee has been discussing and will inevitably be discussing over the next 12 to 18 months, such as fracking, interconnectors, oil and gas exploration and telecommunications, is the Minister confident that the Department can deal with those issues within those constraints? The Minister referred to the issue of shared services but these are far bigger than the minor issue of savings made by shared services. These will be significant issues not just for the Department or this sub-committee but they are contentious national issues. Is the Minister confident that the Department has the staff to be able to deal with these issues?

Deputy Pat Rabbitte

My honest assessment in response to Deputy Harrington's question is that the Department is stretched as regards numbers of staff employed and it needs to deal with some very complex areas. It also has the task of supervising a number of State companies which themselves employ a significant number of people, as compared to the Department. In addition, the Department has a role in the regulatory framework surrounding much of the Department's remit, whether in the sectors of energy, telecommunications, broadcasting or whatever. The capacity of regulators to employ professional people in order to discharge their functions is not constrained in the same fashion as is the Department itself. Truthfully, in my observation, the Department is stretched but it is contending with the situation and staff are doubling up and taking on extra duties and discharging their functions. So far, in my view, a quality job is being done.

Chairman

We will move on to deal with the programmes. Programme A deals with communications.

Deputy Éamon Ó Cuív

The whole communications area is very important. I was a little taken aback to note the key outputs of the digital hub and that 3,700 people are in the rural broadband scheme. I note that the number of schools in the schools broadband scheme has risen from 78 schools to 200 schools. I thought that very high-level European goals were laid down with a European target of 30 megabits or more for 100% of public access to broadband by 2020. I would have expected to see in the outputs the target output, the Government's investment plan, the current base line. There is also a European target of 100 megabits for broadband provision to 50% or more of households by 2020 and again I would have liked to see in the outputs the plan to deliver the Government investment. I note that only 19% of fixed broadband lines are equal or above ten megabits. Why is there not an output target for this?

The NewERA programme was to be a major programme to reinvest in broadband. However, I do not see any reference to NewERA and nor do I see any targets mentioned in the outputs in relation to NewERA and the investment in broadband.

The Minister referred to one third of homes having access to speeds of 100 megabits and that basic broadband should be available to all. I think it is fair to say that the previous Government went a long way to making very basic broadband available to all. What are the high-level targets for the roll out of high speed broadband? That 30% represents UPC and Eircom competing in a natural way in the cities without any Government policy needed because Eircom is being upstaged by UPC and in order to fight back, it is rolling out fibre to houses. That is all very well but it means that many people have two services while other people have no fast broadband service.

I ask the Minister to clarify what he said in his opening contribution when he referred to the number of broadband subscribers to be 1.62 million. In the context any impact indicators he referred to the number of broadband users but I do not know how he works out the number of users because many people could share the same broadband. Does this really mean the number of broadband subscribers has now gone to 1.62 million? Is that both domestic and business subscribers? Does it cover 91% of the buildings in the country?

Deputy Ann Phelan

Under the communications heading, is there a national digital strategy document to govern all the areas of media and multimedia and particularly the Internet? I welcome the estimated broadband household penetration rate which is now 65% compared to 13% five years ago.

On the benefits-free inclusion grant scheme, is the Minister working with the Department of Social Protection to ensure that unemployed people are able to avail of that grant scheme? I refer to ocean energy -----

Chairman

That is under another heading and I ask the Deputy to stay with the communications heading.

Deputy Ann Phelan

I will deal with that matter later.

Deputy John O’Mahony

I have a question under this heading. The Minister notes that despite Government and private investment in broadband there continues to be 1% of isolated cases without a broadband service. Will this remain the situation because a number of that 1% of people have been in touch with me? Is there light at the end of the tunnel for those isolated cases or will there always be this percentage?

Deputy Colm Keaveney

The Minister claims the rural broadband scheme sets out to provide basic broadband services and I welcome the provision of €3 million expenditure in that area. Is the Minister in a position to explain what is meant by the verification process underway to establish the significant number of applicants under the rural broadband scheme? Will it be served by commercial operators as a result of the verification process?

I welcome the fact that if applications remain unused after that phase of the verification that a service will be procured by the Department and the target will be to roll out broadband by the end of that year. I ask the Minister to explain.

Deputy Noel Harrington

There is provision of €1.5 million for post codes. Is there a final date for the roll-out of a post code system or will this be an ongoing programme into the following year? Is there any provision for supporting connectivity to international tier 1 broadband connectivity or high speed or data connectivity within this programme?

Deputy Pat Rabbitte

I am sorry but I did not get the Deputy's last point.

Deputy Noel Harrington

Is there any provision for supporting connectivity to international tier 1 broadband connectivity or high speed or data connectivity within this programme? By and large it is funded by the private sector but in some cases it may take promotion or support to get people interested in dealing with suppliers of tier 1 connectivity.

Deputy Pat Rabbitte

I thank the Deputies. In respect of the roll-out of broadband in schools, Deputy Ó Cuív and I may be at cross-purposes as I am not sure what he means by saying that we do not have any particular outputs or expectations in that regard. It is very clear that 200 second level schools - - - - -

Deputy Éamon Ó Cuív

Except for the three minor targets, the schools, the rural broadband, but there are no major targets for the roll-out of broadband.

Deputy Pat Rabbitte

If they are so minor, it is a wonder that Deputy Ó Cuív did not do them when he was in Government.

Deputy Éamon Ó Cuív

We put the programme in place.

Deputy Pat Rabbitte

That Government had a lot of things to do but it did not do it.

Deputy Éamon Ó Cuív

This Government is implementing it with the rural broadband scheme.

Deputy Pat Rabbitte

Chairman, to respond to the question on schools, 200 schools will have 100 megabits industrial strength broadband by the beginning of the next school year in September. A further 200 schools will be equipped the following year and the remaining 250 schools will be equipped by the school year in 2014. I have seen industrial strength broadband serving 65 classrooms at the same time. There cannot be any doubt but that is leading edge provision. This is important because it transforms the teaching environment not only for the students but for the teachers as well. That is immensely important.

In terms of the targets for other areas, the Deputy will be aware that I recently published the report of the taskforce that I chaired and that comprised the chief executives of the leading telecommunications companies and the senior people in my Department. We had observers from Forfás and so on. The Deputy will be aware from the report the view taken in respect of targets and on the means of enhancing the broadband services that are there.

The point that is being missed is the role of the private sector. I hope that Deputy Ó Cuív is not arguing that where the private sector can provide a Rolls Royce service he is not suggesting that the State should intervene and provide a competing service. Where the private sector is capable of doing the job, that is great, where it is not capable of doing the job and where there is market failure, the State must intervene. In that regard, as I said in my opening remarks, I intend to bring the national broadband plan to Government before the recess. We will address these issues. I must, of course, also be able to source funding for the areas where there is market failure. That is a big commitment. The 1.66 million subscribers include domestic and small and medium sized enterprises, SMEs, but do not include the large multinationals, and businesses with leased lines.

Deputy Éamon Ó Cuív

Are they the subscribers?

Deputy Pat Rabbitte

Yes, the subscribers.

Deputy Éamon Ó Cuív

Does the Minister have an idea of the total number of premises? The Minister is saying it is 91%.

Deputy Pat Rabbitte

The total number of premises in this country is something of a puzzle as we are discovering in other areas, but when I get an actual figure on it, I will inform the Deputy.

Deputy Éamon Ó Cuív

The total number of broadband subscribers is 91%. To what does the figure of 91% relate.

Deputy Pat Rabbitte

It refers to 91% of premises in the country.

Deputy Éamon Ó Cuív

The lie is given to that because the Minister states that only 66% of domestic dwellings have broadband.

Deputy Pat Rabbitte

What I said was that 71.8% of homes and 88.5% of SMEs are using broadband speeds of between 2 megabits and 10 megabits.

Deputy Éamon Ó Cuív

However, the broadband household penetration rate is 65% compared to 13% five years ago. Then the reference to 71% of homes, means that 71% of those with broadband have power of between 2 and 10 megabits. Some will have more megabits and some will have less broadband speed. Will the Minister give us an idea of the baseline to which the 91% applies?

Deputy Pat Rabbitte

Does anyone have the reference to 91%?

Deputy Éamon Ó Cuív

The total number of broadband users is 76%, 87% and 91%. I ask to what does this 91% relate.

Deputy Pat Rabbitte

Where did I use the 91% figure?

Deputy Éamon Ó Cuív

It is under the heading of context and impact indicators in the Estimate we were given this morning. The Minister will see it at the bottom of the Estimate, where the total number of broadband users is 91%. I am asking what segment of the market does this figure of 91% refer to.

Deputy Pat Rabbitte

I do not know if the 1.62 million people represents 91%. I will check it out and revert to the Deputy.

Deputy Éamon Ó Cuív

These figures are in the Estimates, which are in the public domain. A percentage figure is given for the total number of broadband users. Normally when one expresses figures in percentage terms, one states what it is a percentage of. It is extraordinary that an Estimate published by the Government would not tell us that information.

Deputy Pat Rabbitte

It seems to me that the figure of 1.62 million subscribers is 91% of all broadband users. That would appear to be what it states.

Deputy Éamon Ó Cuív

That is mathematically meaningless.

Deputy Pat Rabbitte

That figure of 91% is the total number of Internet users in the country and the remainder - - - - -

Deputy Éamon Ó Cuív

Yes, but 91% of what? Perhaps the Minister will come back to me on it?

Deputy Pat Rabbitte

No. As the Deputy has made such a fuss about the percentage figure, we will try to explain it as best we can. It refers to the Internet users who use broadband as opposed to narrowband. Some 91% of Internet users use broadband and 9% use narrowband.

Deputy Éamon Ó Cuív

Why was that not said?

Deputy Pat Rabbitte

I could be here until tomorrow evening dealing with every detail. The Deputy asked a question and I have responded.

Deputy Éamon Ó Cuív

The Minister is saying that of the total number who use the Internet, 91% use broadband and the remainder dial up.

Deputy Pat Rabbitte

Yes, that is all that the figure is telling us.

Chairman

The number of people accessing the Internet by broadband is 1.62 million, which is 91% of all Internet users.

Deputy Pat Rabbitte

The other 9% use narrowband.

Chairman

Perhaps that could have been stated more clearly. Does that answer your question, Deputy Ó Cuív?

Deputy Éamon Ó Cuív

Yes, it puts the matter in context.

Chairman

Narrowband.

Deputy Éamon Ó Cuív

I would have hoped that figure would be 0% by now.

Chairman

It has moved from 76% to 91% in two years. It has moved up by a quantum of over one quarter.

Deputy Éamon Ó Cuív

It has moved from crank handled telephones to dial up.

Chairman

It has moved from 76% to 91%. The total number of users has increased as well, so the actual percentage has increased along with the amount of users. If we take it that it went to 1.66 million subscribers, not users, from over 300,000-----

Deputy Pat Rabbitte

It was 437,000.

Chairman

It was 1.2 million in 2009 so it has increased by 400,000, and there is an increased percentage at the same time. I accept that it could probably have been explained a little better. We will move on.

Deputy Éamon Ó Cuív

I had a question on NewERA.

Chairman

I think the Minister was to get to that. I presume he had not finished answering Deputy Ó Cuív and NewERA was one of the questions.

Deputy Pat Rabbitte

What was the Deputy asking about NewERA?

Deputy Éamon Ó Cuív

What are the targets and outputs being factored in for NewERA?

Deputy Pat Rabbitte

NewERA is a shareholder executive that provides advice to the Government on investment projects. It is offering advice on the matter of the broadband plan to which I referred. Where there is market failure there will have to be State intervention. It is a big challenge to source funding to deal with that.

As regards Deputy Phelan's question about benefits-free and any interaction with the Department of Social Protection, there is not really any interaction with that Department. It is a scheme operated by my Department which engages with community organisations throughout the country in terms of helping them fund basic digital literacy training for people. Age Action Ireland, for example, is a major partner in the operation of the programme. It is quite separate from the Department of Social Protection. It is an inclusion programme operated by this Department with the community and voluntary sector.

The Deputy also asked about the national digital strategy. That is being engaged in and will be completed, I hope, by the end of this year. In the Department we like to say that the digital strategy we are dealing with would focus on what we call the four Cs - connectivity, content, community and capability. Earlier we were discussing the capacity of the staff in the Department to discharge their functions and there is no doubt that this particular area of the national digital strategy is one we could do with bolstering. There is a great deal of work to be done in this area and there are also huge employment possibilities as well. However, there are also issues with raising awareness of the digital society and so forth. I do not know if it is proper to refer to it in this context but the Digital Hub has a great deal of work in this broad area. There are 70 small companies and 800 people employed. Some of the work is complemented by professionals. Prospective investors who come to this country praise the work taking place there.

Deputy Ann Phelan

On the national digital strategy, was there a public consultation process within that or is one still to take place? There are many practitioners, Internet providers and people who are much more skilled than I am in this area of technology who have great expertise and can offer advice on where we should be going with digital and multimedia. I am well aware of the Digital Hub and the good work it does because members of the sub-committee recently visited it. It is interesting that the Minister mentioned teaching and broadband because we learned from that visit that the whole idea of a physical classroom need no longer exist due to the use of broadband. One can connect to any school within a certain area and by using the Internet conduct a class with children situated in different schools. They can be brought together as a single class. What will happen in that area is very exciting.

Deputy Pat Rabbitte

It is part of the daily work of the Department to interact with the companies mentioned by the Deputy and we do that. On whether there will be a consultation process before the national digital strategy is published at the end of the year, there will be. I should also point out that the task force report on next generation access immediately went out to consultation on publication. Again, the type of expertise mentioned by the Deputy, whether it is in academia or in business, was invited to provide feedback and proposals. They will be taken into account before the national broadband plan is brought to the Government.

Deputy O'Mahony asked about the 1% of the population lacking connectivity. That is definitely a concern. One encounters it in terms of correspondence to the Department from people trying to do business from home and so forth. It is often due to technical reasons, such as the topography of the local area, mountain areas and so forth. The rural broadband scheme is designed to deal with that.

Deputy Keaveney asked about the rural broadband scheme and the verification process. The verification process is to ensure it complies with the terms of the scheme, as announced. If there was an existing provider that ought to have provided the service, the rural broadband scheme did not apply. That verification process is coming to a conclusion. The intention is that it would pick up the 1% connectivity issue to which Deputy O'Mahony refers. There are satellite providers now who were not in place a short time ago and that will be a major benefit in this area as well. Whether it is realistic to say that the needs of all the 1% will be met remains to be seen but certainly it is the intention to pick up the individual residential premises, be they business or domestic. We will soon see what success there is.

Chairman

Perhaps the Minister can finish the responses in respect of programme A, as a vote has been called in the Dáil Chamber.

Deputy Pat Rabbitte

All I wanted to say on that was to confirm what I have said to Deputy O'Mahony and to state the Department will have a handle on it by the end of August.

Chairman

Deputy Harrington asked a question on post codes.

Deputy Pat Rabbitte

The Department still is ironing out some of the issues that arise in respect of the procurement process in this regard. It has taken great care with the aforementioned process to ensure it is beyond reproach. The final tender is due shortly and between then and now I must go to the Cabinet. As for how much will be done by the end of the year, financial, technical and operational issues will determine that but if the Deputy is asking me whether the postcodes will be in place in 2012, they will not. It has been necessary to proceed step by step with the procurement process and the Department is ready to bring the proposal before the Cabinet shortly.

Deputy Noel Harrington

May I ask a supplementary question on whether there is provision for Government support for broadband connectivity?

Chairman

Is this to make the private sector aware that-----

Deputy Noel Harrington

Or to encourage the private sector.

Chairman

An awareness campaign.

Deputy Pat Rabbitte

Private sector operators have invested recently and have further plans. I do not have further plans to invest where, as I stated, the private sector already is doing the business. An important point to understand is the State, especially at this time, is not in a position to duplicate where the private sector is doing the business and where there is healthy competition, as is the case.

Chairman

As members have completed discussion on programme A, we will suspend the meeting. As soon as the vote in the Dáil Chamber is completed, we will resume the meeting with programme B, which deals with broadcasting.

Sitting suspended at 11.20 a.m. and resumed at 11.40 a.m.

Chairman

We now turn to programme B, broadcasting. I call Deputy Ó Cuív.

Deputy Éamon Ó Cuív

The Minister includes a number of hours of distinctive indigenous programming by RTE, across all genres, a total of 4,782 hours. Do I take it that is television only, or radio and television? Presumably it is television only because radio as a whole comes under that. The next point is the average number of hours per day of Irish-produced television programmes broadcast by TG4 - I presume that is Irish-language produced - which is 1.5. Are these figures compatible? Does the first figure include RTE 1 and RTE 2? If so it would seem to indicate they do only 2,300 hours per year each of Irish-produced television, compared to TG4 doing-----

Deputy Pat Rabbitte

Does the first figure include RTE 1 and RTE 2?

Chairman

Radio and television.

Deputy Éamon Ó Cuív

If it is radio and television it is a nonsense.

Deputy Pat Rabbitte

It is only television.

Deputy Éamon Ó Cuív

However, it is for RTE 1 and RTE 2. What the Minister is stating, therefore, taking the figure as half and half, for argument's sake, is that RTE 1 has 2,300 hours of Irish-produced television on average, compared to 1,544 of home-produced programmes on TG4. If that is so, it would appear that TG4 is much better value for money because it is doing this in a minority language, producing a very significant amount of the Irish-produced television hours in the year. I know I will be told that RTE gives an hour's broadcasting per day, or some such thing.

How much extra in licence fee will be collected if all premises have to pay, not merely those with televisions? One can now pick up television on an i-Phone if one has such a thing. If every premises had to pay, both commercial and domestic, how much extra would be obtained? If everybody had to pay up, meaning the Minister did not have to establish that people had an instrument for reception, somewhat of an archaic concept, how much of the €12.5 million collection fee would the Minister save?

The Minister gave extra money from the licence fee to RTE this year. I am not disturbed by the station's losses. Let it deal with them, cut down the salaries of the over-paid presenters, cut staff numbers and so on. As the numbers indicate, RTE is very inefficient compared to TG4. Why was the decision made to give RTE €3 million extra when TG4 funding stayed static? Does the Minister get a yearly plan from the State broadcasters before he divvies out the money? How does he do the divvying out - is there a plan to get a plan from the State broadcasters before allocating the licence fee between them? Both get part of the licence fee. I realise TG4 gets Exchequer funding but in the heel of the hunt I am looking at the gross figures the Minister gives to each.

Chairman

Is there another speaker?

Deputy Noel Harrington

Part of the output is a programme to increase the awareness of the digital switchover, the Saorview programme. I will be a little parochial here. I know this situation is replicated, particularly in more challenging geographical terrain. It has been mentioned in parliamentary questions and in the Topical Issue debate and in other media. Parts of the Saorview digital roll-out are ineffective and many of the masts will be shut down. Will there be any provision in the Estimate to assist customers or subscribers financially? They will take a financial hit to have the same service maintained. Many of those subscribers will have fought for decades just to receive basic terrestrial or analogue television and eventually got it in the past five or ten years. All of a sudden it is to be taken from them and they have to pay. I would be very interested to hear if there is provision to assist those people. I accept that Saorsat will provide a service but it will not be a full one and people will still have to pay above the odds to receive it. There is a fairness element involved and I would like to see it addressed in this regard.

My second question is relevant to what Deputy Ó Cuív stated about fees recoverable, if and when the Minister moves to having a household licence rather than a television licence. The agency fees for collection are a bone of contention with the Department. Is the Minister able to provide a percentage of the ratio of agency fees relative to the total amount he envisages collecting if it were down to a per household collection?

Deputy Pat Rabbitte

I do not know the respective costs of an hour's production of Irish language programming in the case of TG4 as compared to RTE but will attempt to get that information for the Deputy. Sub-Committee members might be able to put that question to RTE when they are talking to its representatives. I do not know if it is so easy to compare the one with the other. Nobody, certainly not I, disputes that TG4 runs an efficient company and that a good deal of its output is original indigenous work. However, other considerations apply in the case of RTE. Whether it is possible to get a simple comparison between an hour of indigenous production in the Irish language between one station and another I do not know. If it is, I will get the information and supply it to the Deputy.

I refer to licence fee evasion and to what extent a move to a household charge could address this. The efficacy of the collection system is one of the factors we are looking at in the contemplated change to a household charge. It is estimated that evasion is of the order of 15%, or a loss of some €30 million. It goes without saying that, whatever the platform, the intention would be to improve on that figure. If Deputy Ó Cuív is asking me whether this would wipe out evasion, I am not sure one could say that. One hopes it would be an improvement on the situation we have.

We get an annual report on the meeting of commitments of the companies under the remit of the Broadcasting Authority of Ireland, BAI. I do not know what Deputy Ó Cuív is referring to in regard to the €3 million extra in cash. There was no such extra sum; it is based purely on the estimate of the licence fee.

Deputy Éamon Ó Cuív

As we did, the Minister could have stated that RTE already gets a huge amount of money. He could have given it €182 million from the licence fee and increased the money given to TG4 by €3 million. There were options.

Deputy Pat Rabbitte

Yes, there are always options. The fact of the matter is that TG4 is not in financial difficulty, whereas RTE is in considerable financial difficulty.

Deputy Éamon Ó Cuív

If TG4 got itself into considerable difficulty, perhaps it would get some more money.

Deputy Pat Rabbitte

The Deputy can make ridiculous arguments like that if he wishes, but he knows well that no company goes out of its way to get itself into difficulty.

Deputy Éamon Ó Cuív

Except RTE.

Deputy Pat Rabbitte

I do not think that is fair. The grant it receives, if we want to call it a grant, is a function of the television licence system. As a result of legislation we passed last year, for the first time it is now enshrined in law that TG4 receives €9.345 million or something like that per annum. TG4 runs a tight ship. It does not have an accumulated deficit. The Deputy can argue that it should get extra money, but even if that is provided we will still have to deal with the significant deficit that has accumulated at RTE. It is not a question of favouring one rather than the other. The collapse in RTE's advertising revenue in recent years has been very extensive. TG4 receives more than 90% of its funding from the State. A substantial part of RTE's revenue comes from advertising. The bottom has fallen out of that revenue entirely - I understand there has been a reduction of more than 35% - since the economy crashed. We need to have regard to that when we are arranging the distribution of these moneys.

The Deputy also asked about Saorview. No provision has been made for financial assistance. That is partly because of the circumstances in which the country finds itself. An extensive outreach programme is in operation at the moment with the assistance of the community and voluntary sectors. The programme, which is organised on a parish-by-parish basis, allows us to stay in touch with the needs of people during the switchover. Information is relayed to us from that source all the time. While it is not the intention to leave anybody behind, no financial scheme is in place at this time to support that aim. We are getting assistance from the community sector, for example through the establishment of a digital champion in each county. We think we have our finger on the pulse. We are getting the kind of feedback we need. It is not the intention that anybody will be left behind.

Deputy Éamon Ó Cuív

I would like to ask the Minister about something that somebody has said to me. I do not know whether the person in question is correct. If it is not possible to get Saorview - the new digital platform - from a terrestrial transmitter, the second option is to get it from a satellite. I was told that the satellites are located south of Ireland - over the equator or near the equator - which means that a house to the north of a hill, on which the sun does not shine at 11 a.m. each day at a certain time of the year, will not be served by these satellites. Most people want to know whether some places in this country will not be able to get terrestrial television because they are not in the lines of sight of the reduced number of masts or of the satellites I have mentioned. Some people have suggested that some such locations are already known to officials in the digital section of RTE. Is it the case that if there is a hill to the south of a house, it will not be in the line of sight of the satellite? It would be useful if we could get an unequivocal answer to that question today, or some day in the very near future. It would allow the matter to be put to bed for once and for all. If there is 100% satellite coverage, does that mean all areas are in the line of sight of these satellites? Some of the rumours that are going around are emanating from authoritative sources, if I can put it that way.

Deputy Pat Rabbitte

What the Deputy has said about the satellites over the equator and the sun in the morning is way above my head, as the late Séamus Brennan said about the Dublin Port tunnel.

Deputy Éamon Ó Cuív

It was way above his head anyway.

Deputy Pat Rabbitte

Along with the technical people, we have taken great pains to address this question during the rollout. Topographically difficult areas of the country should not be left behind in any circumstances. I happened across some of the technical people who are trying to address this question in County Kerry last week. The advice we have received indicates that there will be 100% coverage. If there is any change in that regard, I will advise the Chairman.

Deputy Ó Cuív spoke earlier about RTE funding. RTE has invested some €70 million of its own funds in the construction of this project. If we were depending on the private sector to deliver that, it would not have happened. It is fair to acknowledge that. RTE is going to considerable pains to ensure nobody will be left behind. Regardless of what is said about the equator, it is true that there are difficulties with certain parts of this island. The advice we have received is that we will have 100% coverage.

Deputy Éamon Ó Cuív

I will clarify the point about the equator. My understanding is that the satellite is not overhead and therefore the signal arrives in a certain way. I take the Minister's word on this issue.

Deputy Pat Rabbitte

We have arranged presentations on this issue for all Deputies. I understand the last presentation was aborted because of business in the Dáil. The next presentation will take place in the Oireachtas audio-visual facility in two weeks' time.

Chairman

I presume people from the digital division of RTE will be in attendance at that presentation.

Deputy Pat Rabbitte

Yes.

Deputy Éamon Ó Cuív

There have been some very interesting developments in television in recent times. The challenge for RTE is to justify its approach on a cost basis. I would love somebody to undertake an analysis of the similar sports programmes that are broadcast by TG4, TV3 and the two RTE channels. Perhaps the Minister can ask the Broadcasting Authority of Ireland to do that. If one watches the championship for the afternoon, one can see one game on RTE and another game on TV3. I would love to see a comparison between the numbers of viewers on the three stations and the costs incurred by each of them when they pay guests and commentators for these similar programmes. If we can get such a direct comparison, we will have a simple benchmark by which we can measure whether RTE is being cost-effective and we will begin to have some idea of whether the licence fee is justified. I would be particularly interested in seeing how much the three channels pay invited commentators like Michael Lyster who come in. Do the ones who get the highest pay get the highest ratings in terms of audience? Then we will know whether I am right or wrong and whether RTE is slim-fit and fit for purpose.

Deputy Pat Rabbitte

One of the outstanding things RTE has done so well down the years is its coverage of sport. It has also taken care to tend to minority tastes in sport, minority sports and so on. Viewers can switch where they like but they will not get that done elsewhere.

If one was doing a value for money audit on RTE, I do not think one could take the simple comparisons that Deputy Ó Cuív advances. There are a whole variety of dynamics that go into any consultancy of value for money in RTE and so on. Comparing the respective broadcast personalities or whatever is probably as realistic as comparing some of the contract staff who are employed in the station itself with the run of the mill workforce. There are arguments, reasons and all the rest for that.

I have had it indicated to me by RTE that it is its intention to cut back on some of the sports coverage, and while I personally regret it if that is necessary, the new director general is determined to get the finances under control and he has extensive plans in that regard. Deputy Ó Cuív can rest assured that the kind of evaluation of value for money he talks about is being done. I do not believe Deputy Ó Cuív expects me to get into commenting on the merits of Marty Morrissey as compared to whomsoever he wants to mention. I am not going to be drawn-----

Deputy Éamon Ó Cuív

What I am talking about-----

Chairman

We are under a certain time constraint. On this point, following further discussions at some stage with RTE's director general and its board with regard to its annual report, perhaps what it plans to do might be reflected in the preparation of the 2013 Estimates. To speak parochially, if it was not for the coverage in particular on RTE radio and on television of Katie Taylor, women's boxing would not be where it is today and certainly would not be an Olympic sport because, to be fair, no one else was pushing it at the time. I am not saying that is a reason to support it but the evaluation cannot be completed until we see what it is that the director general proposes for the reshaping of the station.

I will move on to programme C, which deals with energy. I call Deputy Ó Cuív.

Deputy Éamon Ó Cuív

The allocation for the sustainable energy programme is down from €100 million to €87 million in 2012 despite the promise in the jobs budget in 2011 and despite the fact the 2012 figure includes a carryover of €15 million. Therefore, in real terms, the sustainable energy programme is down from €115 million to €72 million, a decrease of 28%.

Does the Minister accept that, with energy costs rising rapidly over time, there is an urgent need to reduce the €7 billion energy import cost and that energy conservation is one of the most effective ways of doing this? Does he also accept that energy poverty is an increasing problem in our society as energy costs increase so rapidly? Does he agree that a grant of 40% or less is self-financing when income tax and social welfare savings are taken into account, not to mind the long-term benefit to the Exchequer of not importing so much oil? Will Ireland be getting a major slice of the investment coming from Europe when the investment package, which we are led to believe is on the way for this purpose, arrives?

I cannot think of any long-term gain that would equal the investment in the improvement of the thermal quality of houses. This would immediately stimulate the building industry and assist all of the unemployed carpenters, plumbers, electricians and others working in various facets of the building industry. On the other hand, it would be a long-term saving and benefit with regard to the balance of payments and would make us less dependent on the vagaries of the international oil market, which is one of the great uncertainties of the modern world.

On the production of 20% of energy requirements from renewables, I am surprised I could not find any information on the key outputs in terms of achieving the targets. For example, we are not given an annual target of how we will achieve the 20% target by 2020. Will this be included in the output statement from now on?

What is being done with regard to investment in electric cars? Could we invest more to ensure a rapid rollout of this technology and link it in with the use of smart technology so cars would charge themselves at night without wind energy producers being told to close down due to lack of demand? What is happening in this area to ensure we reach the target rapidly and ensure people basically use wind to drive their cars, thereby reducing imports?

Is the Minister satisfied the €2.9 million for ocean energy development is adequate in view of the potential on this island for ocean energy? Does he intend looking for money from this investment package from Europe to extend natural gas to all towns with a population of 10,000 or more, in particular in the south east, the north west and the south west, where even the large towns do not have natural gas, which is a huge disadvantage. Bord Gáis can do the economic part, so very small top-ups in this regard would bring natural gas, and this would be tax efficient in that the investment would probably come back to the State in the tax take following the completion of the work.

Deputy Ann Phelan

I want to ask specifically about the retrofit scheme and the low income earners who will be able to benefit from this. Does the Department see a role for the local authorities in this regard? Will ESB or Bord Gáis operate the pay-as-you-save network? The local authorities have a lot of data about the existing housing stock and about low income families and individuals.

I wish to raise the issue of energy research, in particular ocean energy research, and I accept the point this is currently very much at the research stage. Is there room for an all-Ireland or all-island approach with Britain? While I may be incorrect in saying this, Britain might be a little ahead of us in the development of ocean energy. Given that the British-Irish Parliamentary Assembly has taken a huge interest in this area, is there room for collaboration between the two countries and the two Governments in an all-Ireland approach?

Deputy Noel Harrington

I welcome the retrofit programme to which we have devoted the major part of the discussion this afternoon. The Minister pointed out in his statement that this would achieve savings in terms of approximately 28 million gigawatt hours. We know there are savings to be made and of their potential advantages for the economy in terms of creating work. Can the Minister outline how the Department has valued that at €82 million or €83 million in terms of jobs and a return to the State? Has that been evaluated?

On the question of ocean energy, I am pleased to see that funding has been allocated to research in this area. Ireland has achieved a lot in this regard. In Cork, we have the IMERC centre in Haulbowline and it is leading research in this area. It is worth noting that this investment in research could be recoupable in terms of selling the results of the work done in the energy area. On the flip side, we do not want to spend money on research that is being done elsewhere. Few countries are not doing research on ocean energy in some shape or form, so I would like to think that if we focus scarce resources on ocean energy, we target that towards energy that is particularly suitable for offshore conditions for this country. We should not spend money duplicating research that is being done elsewhere, for example, on the north west coast of France, the west coast of Scotland or the east coast of the United States or Canada. I will be pleased if the Department can assure me that an evaluation has been done by it to ensure duplication does not occur.

Deputy Pat Rabbitte

I agree with all the Deputies who said the retrofit programme is making an immense contribution in terms of better thermal efficiency, employment creation and reducing our imports bill. I agree with Deputy Ó Cuív on the matter of imports, that we have very little control as a country over energy prices but we can try to reduce our imports. We can work towards doing that through reduced consumption and more efficient use of energy. Deputy Ó Cuív looked at the figures for the retrofit programme - we were able to put €30 million extra into that programme last summer - and compares the outturn with the figures this year. That extra €30 million must be taken into account. It is interesting that the number of applications is down but it is difficult to analyse why. The SEAI is trying to analyse the reason for this. There was a minor adjustment to the figures, but it is interesting that applications are down where there was no adjustment. The recession and the mild winter may be factors in the reduction in applications, but the reduced number does not undermine the merit of the scheme.

A question was asked about grants and the payback. We are trying to move away from grants to a pay-as-you-save model and a great deal of work has been done on this, both within the Department and by the SEAI. It is not easy to get the right model that will be attractive to the consumer in circumstances where the consumer does not, currently, want to put his or her hand in his or her pocket or purse.

On ocean energy, I agree with Deputy Harrington, Ó Cuív and others that €2.9 million is not enough. I wish it was more. Our exploration in this area is at the research stage. Deputy Harrington will be familiar with the work that is going on at Ringaskiddy, where we are determined to build the remaining piece of the jigsaw and to find money for the valuable work that is going on there. We co-operate with the British Government where we can, most notably on what is known as the "isles project". Co-operation with Scotland in particular has been very strong. With regard to the areas mentioned by Deputy Phelan, we are in discussion with the British Government. The fact Ireland has a limited capacity for energy means that in respect of the point raised by Deputy Ó Cuív and the 2020 targets, there is no point in us generating energy that we cannot use. The question, therefore, is whether we can get a market for any excess capacity we produce. We are in discussion with the British Government on that and I have a meeting with the British Minister for energy later this month. The British Government has been re-evaluating its own approach to renewables and investment in wind energy and members may have seen a lead story on this in The Observer last Sunday. We do not know what the import of that re-evaluation will be. However, I assure Deputy Ó Cuív that the advice available to me is that in terms of meeting our renewable targets, we will be able to do that from onshore capacity. However, in terms of offshore capacity and supplying the neighbouring island, that is an exciting prospect for the medium to longer term.

On electric vehicles, to some extent it is a chicken and egg situation, particularly with regard to the necessary roll-out of the charging points infrastructure. One is not likely to be able to get into a vehicle in Dublin and drive to Corr Na Móna unless there is a charging point along the way. The ESB has been doing considerable work in that area and it is rolling out some 1,500 charge points as well as some 2,000 charge points in domestic locations. There is a grant for the uptake of one of these vehicles. However, the vehicles are not exactly competitively priced and this is an issue. A conference on this issue is due to take place later this month.

Deputy Harrington asked about assessment. The assessment on output and employment is done by the SEAI. We reckon that approximately 8,500 people were supported last year in the retrofit programme and that this year, it will be between 4,000 and 4,500 people. The SEAI monitors the situation closely. That is not the main point of the exercise but it is a very fortuitous dimension of it. Deputy Ann Phelan spoke about the role of the local authorities. The retrofit scheme, like the better energy programme or the warmer homes scheme, was never planned other than to assist the local authorities with their own scheme under the aegis of the Department of the Environment, Community and Local Government. We are reallocating resources to the warmer homes scheme to provide for the demand and consistent with the published affordable energy strategy. We aim to meet as much of that demand as we can by means of the warmer homes scheme. However, this scheme is merely in support of the local authority scheme which operates separately under the aegis of the Department of the Environment, Community and Local Government.

Deputy Éamon Ó Cuív

If I may make one point on programme A.

Chairman

We have very little time, Deputy and we must deal with programme D. I ask the Deputy to be brief.

Deputy Éamon Ó Cuív

I suggest that next year's Estimates would include an output about the achievement of the European targets on renewable energy and on the roll-out of the number of registrations of electric vehicles so that there would be a target.

Chairman

Programme D deals with natural resources.

Deputy Éamon Ó Cuív

I will not dwell on this programme as I hope the Minister will return soon to the sub-committee to discuss the recent report published by the joint committee on offshore oil and gas exploration. I hope also he would meet us to discuss the fracking issue. I believe the seabed survey is of incredible importance to the country because our seabed is greatly in excess of our land mass.

Deputy Noel Harrington

I refer to a point which I raised previously. A decision will be required soon as to whether refining will be part of the State's effort in this field. Is provision being made in this Estimate for how this effort will be progressed?

Deputy Pat Rabbitte

The Minister of State and I are happy to meet the committee to talk about natural resources and the joint committee's report. We are examining the issue of refining to which Deputy Harrington refers. I am due to visit Whitegate in the next few weeks and we are examining the future of Whitegate and the future of refining on the island of Ireland. I accept it is an important policy area. Decisions made by NORA, the organisation which looks after our reserves, have enhanced supplies in the jurisdiction. As to the question of whether refining has a future is something we are actively considering and we welcome any input.

Chairman

It might be more useful if the sub-committee dealt with this programme on natural resources separately rather than when dealing with the Estimates process. The final item is programme E, inland fisheries.

Deputy Éamon Ó Cuív

As the Minister is probably aware, I think this is the cuckoo in the nest. In my view this responsibility should be under the Department of the Environment, Community and Local Government, which looks after both rural recreation and the management of river basins. The Department of Arts, Heritage and the Gaeltacht, has responsibility for Waterways Ireland and the Department of Agriculture, Food and the Marine has responsibility for the marine. There is a need for a co-ordinated plan to develop marine, inland waterways and rural recreation. From my experience of working in the particular field when I had responsibility for rural recreation and the inland waterways, I believe that 6,000 jobs could be created. I recommend that this responsibility be transferred to one of the other Departments. To a certain extent I think it fits best in the Department of the Environment, Community and Local Government now that both rural recreation and the management of the river basins, the responsibility for clean water, rests with that Department.

Minister of State at the Department of Communications, Energy and Natural Resources (Deputy Fergus O’Dowd)

In my view, the Department is doing an excellent job with regard to its responsibility for inland fisheries. The conservation of salmon stocks and conservation generally is very well administered. It is intended to carry out a major survey of recreational angling to find out who the anglers are and where they go to fish in order to develop the tourism potential of angling and the conservation of fish species. In my view this Department is dealing with inland fisheries and doing so very well.

Deputy Pat Rabbitte

I ask the indulgence of the Chairman to allow me to remark on the fact that there have been reports of an earthquake off the west coast this morning. The initial reports suggest that it was felt in Galway and Mayo before 9 a.m. and this is unusual for Ireland. There are reports of some minor damage such as a crack in a school wall, for example. All the evidence so far points to this being a naturally occurring earthquake along a known geological structure. While slightly larger than the usual, such events are not uncommon as history shows. The epicentre is located on a fault system off the Irish shelf. The Corrib gas field in not yet in production and there is no link to this event and there are no reports of damage. This is the only information I have been given on the issue.

Deputy Éamon Ó Cuív

I ask the Minister to give details of the value for money reports under way in the Department.

Deputy Pat Rabbitte

There are two areas affected and one is the future of the digital hub and within that the future of the national digital research centre, both of which are being examined currently. The second issue is whether there is merit in a merger or amalgamation of the Broadcasting Authority of Ireland with ComReg and this is also being examined. The national digital research centre, NDRC, has a separate existence within the hub the funding of which is in the order of €4 million this year from the Department. It is engaged in translational research under the guidance of a board comprising a number of third level academic institutes in the city. The members of the select sub-committee are aware of the origins of the Digital Hub. Given the fact that the property considerations on which the digital hub was constructed are no longer achievable then the future prospects of the hub must be considered. They are the two issues that we are examining.

Chairman

I thank Members, the Minister, the Minister of State and their officials. That concludes the select sub-committee's consideration of the 2012 Revised Estimate. In accordance with Standing Order 87, the clerk to the sub-committee will convey a message to that effect to the Clerk of the Dáil. Under Standing Order 86(2), the message is deemed to be the report of the sub-committee.