Written Answers Nos. 240 - 255
240. Deputy Mary Lou McDonald asked the Minister for Finance if he will provide the annual saving to the Exchequer of a 20% reduction to all professional fees, including but not limited to legal, consultancy, IT related, advisory, advertising and accountancy; the company name and the amount invoiced between 1 June 2012 and 31 May 2013. [34577/13]
Amharc ar fhreagraBased on my reply to Parliamentary Question No. 240 of 16 July 2013, the gross expenditure by my Department on professional fees was 3.672 million euros. A 20% reduction on this would yield savings of €734,000.
241. Deputy Mary Lou McDonald asked the Minister for Finance if he will provide, in tabular form, the annual saving to the Exchequer of a 1%, 5%, 7%, 10%, 12%, 15%, 17% and 20% reduction in travel and expenses for his Department. [34593/13]
Amharc ar fhreagraThe following table sets out the Department of Finance’s travel and subsistence expenditure for 2012:
|
- |
2012 |
|
Travel and Subsistence for Domestic and Overseas Travel |
€392,000 |
|
EU Presidency Travel |
€80,791 |
My Department has calculated the annual savings to the Exchequer based on the percentage reductions being applied to the figure of €392,000 (i.e ignoring the non-recurring Presidency amounts)
|
% Reduction |
Saving euros |
|
1 |
3,920 |
|
5 |
19,600 |
|
7 |
27,400 |
|
10 |
39,200 |
|
12 |
47,040 |
|
15 |
58,800 |
|
17 |
66,649 |
|
20 |
78,400 |
242. Deputy Mary Lou McDonald asked the Minister for Finance if he will provide, in tabular form, the annual saving to the Exchequer of a 5%, 7%, 10%, 12%, 15%, 17% and 20% reduction in training and development for his Department. [34609/13]
Amharc ar fhreagraThe current allocation for training and development for 2013 in the Department of Finance is €311,000. The Department of Finance continues to invest in staff development in order to supplement the skills and qualifications of our teams through a combination of internal and external training and development initiatives. Under the revised Statement of Strategy 2011-2014, the Department aims to improve training in order to develop greater technical, management and leadership skills. Using the performance management and development system (PMDS), the Department will review our staff’s performance, and identify any skills requiring enhancement to ensure our training resources are used most effectively. The Department also undertook a comprehensive Training Needs Analysis (TNA) survey in late 2012 which has also assisted in identifying the training and development needs of staff within the Department.
The Department of Finance has completed 36 training programmes to date this year and has given training to 499 participants (please note some staff members may have participated in more than one training programme).
The annual savings to the Exchequer of a 5%, 7%, 10%, 12%, 15%, 17% and 20% reduction in this allocation are outlined in the following table:
|
Reduction |
Potential Saving |
|
5% |
€15,550 |
|
7% |
€21,770 |
|
10% |
€31,100 |
|
12% |
€37,320 |
|
15% |
€46,650 |
|
17% |
€52,870 |
|
20% |
€62,200 |
243. Deputy Mary Lou McDonald asked the Minister for Finance if he will provide, in tabular form, the annual saving to the Exchequer if all his special advisers' pay was capped at the first point of the principal officer grade; and if he will provide a list of all salaries, post-implementation of the Haddington Road agreement paid to his special advisers. [34625/13]
Amharc ar fhreagraIn my Department, I have appointed Mary Kenny and Eoin Dorgan as special advisers. Their salaries are outlined as follows.
|
Name |
Salary at 30 June 2013 |
Salary from 1 July 2013 (post implementation of the Haddington Road Agreement) |
|
Mary Kenny |
€89,898 |
€84,706 |
|
Eoin Dorgan |
€86,604 |
€81,676 |
The pay scales for Principal are outlined below:
|
Date |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
|
|
01-Jul-13 |
Haddington Road |
€75,647.00 |
€78,670.00 |
€81,676.00 |
€84,706.00 |
€87,258.00 NMAX |
€89,906.00 LSI1 |
€92,550.00 LSI2 |
|
01-Jan-13 |
Budget 2009 |
€80,051.00 |
€83,337.00 |
€86,604.00 |
€89,898.00 |
€92,672.00 NMAX |
€95,550.00 LSI1 |
€98,424.00 LSI2 |
244. Deputy Michael Creed asked the Minister for Finance if his attention has been drawn to concerns raised by the Irish Post Masters Union regarding the requirement for anti-money laundering regulations to be complied with in respect of the sale of prize bonds over €25 in value; if he sees merit in its suggestion that this limit be set at €100; and if he will make a statement on the matter. [34638/13]
Amharc ar fhreagraEuropean legislation has been adopted to protect the financial system and certain professions and activities from being misused for money laundering and financing of terrorism purposes. The anti-money-laundering obligations applicable in Ireland derive from the Third EU Money-Laundering Directive. The Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 was enacted in July 2010 to transpose the Third Money Laundering Directive (2005/60/EC) and its Implementing Directive (2006/70/EC) into Irish Law. Part 4 of the Criminal Justice Act 2010 sets out the obligations of “designated persons” in relation to customer identification. One such obligation set out in the Act is the obligation to conduct customer due diligence, prior to the establishment of a business relationship. Customer due diligence refers to the identification of customers and that of any beneficial owners of financial products associated with the customer.
An Post and the Prize Bond Company are deemed to be a “designated person” under the Criminal Justice Act 2010 as they fall within the definition of a “financial institution”. In light of this, An Post and the Prize Bond Company are required to comply with the relevant provisions of the Act in relation to the sale of Prize Bonds to customers. This means, in practical terms, that customer due diligence must be conducted on all purchases of prize bonds, irrespective of value.
The extent to which any particular person or product may be exempted from the customer due diligence requirements of the Act is determined by reference to the Act having regard to the underlying Directives.
The Central Bank of Ireland has no discretion to exempt certain firms from the requirement to comply with the Act.
In light of the above, I am exploring with the National Treasury Management Agency (NTMA) and my colleague the Minister for Justice whether or not exemptions available under the Directives may be applied to small value purchases of prize bonds facilitated on behalf of the State by An Post and the Prize Bond Company.
245. Deputy Pearse Doherty asked the Minister for Finance if he will provide details of the persons who were the partners and senior executives responsible for conducting the PwC project Atlas - Anglo Irish Bank Corporation plc - over the duration of the three parts of the report, phase 1, phase 2, phase 3; if any of the partners or senior executives who were part of the team or were involved in the aforementioned PwC report is part of the team currently valuing the liquidated Irish Bank Resolution Corporation loan book; the names of the partners and senior executives who have worked on both mandates; the total number of staff who have worked on both mandates; and if he will make a statement on the matter. [34644/13]
Amharc ar fhreagraIt would not be appropriate for me to disclose the details of the persons who were partners and senior executives of the PwC Project Atlas engagement. The Special Liquidators have confirmed that they have received confirmation from PwC that no members of their valuations team are subject to any actual or perceived conflicts vis-a-vis IBRC.
246. Deputy Pearse Doherty asked the Minister for Finance the total number of firms which tendered to the special liquidator for the mandate to value the Irish Bank Resolution Corporation loan book; if PwC offered the lowest fees for the job or if there were other criteria which led it to win the valuation mandate; if he will detail such criteria; and if he will make a statement on the matter. [34645/13]
Amharc ar fhreagraThe Special Liquidators invited a number of firms (5) for the tender on tranche 1 and for tranche 2(14). The Special Liquidators have confirmed that PwC were not the lowest on fees. The criteria used were as follows, for which each respondent was graded:
- Process/ Execution methodology and ability
- Knowledge of the portfolio and recent relevant credentials
- Delivery team experience
- Fees.
The Special Liquidators have appointed UBS and PwC to value different segments of the IBRC loan portfolio.
247. Deputy Pearse Doherty asked the Minister for Finance the person who is responsible for assessing whether there is merit in the continuing legal corporate entity of Irish Bank Resolution Corporation suing the former auditors of Irish Nationwide Building Society and current special liquidators of IBRC, KPMG; if he will confirm that IBRC is suing Ernst and Young for its role in auditing Anglo Irish Bank; if he will further confirm that he is considering instructing the special liquidator to sue his own company as special liquidator for the role his company played in auditing Irish Nationwide Building society; if KPMG is not going to be sued by IBRC for the role it played as auditor of Irish Nationwide Building Society, the reason this is the case; and if he will make a statement on the matter. [34646/13]
Amharc ar fhreagraIn November 2012, the then Board of IBRC, after taking legal advice, decided to institute proceedings against Ernst and Young the former auditors of Anglo, for their role in the audit of the Anglo accounts. I am advised that these proceedings have been continued by the Special Liquidators following their appointment in February 2013. In respect of INBS, I am advised by the Special Liquidators that following the reconstitution of the Board of INBS in late 2009, the new Board conducted (over 2010-2011) a wide ranging investigation into historic lending practices and corporate governance issues in INBS. This included an investigation into the role played by the former auditors of INBS, KPMG. Following these investigations, the then Board of INBS, on foot of legal advice, made a decision not to institute proceedings against KPMG the former auditors of INBS. This decision was taken before the Special Liquidators were appointed in February 2013. It is understood that the decision was taken on the basis of legal advice to the effect that there was no legal liability on the part of the auditors. The Department of Finance was informed of the decision taken at the time.
248. Deputy Pearse Doherty asked the Minister for Finance if he will provide details of the names of the partners and senior management responsible in KPMG for the auditing of Irish Nationwide Building Society and Irish Life and Permanent; if he will confirm if any of these partners, senior managers, or staff members who audited Irish Nationwide Building Society and Irish Life and Permanent are responsible for any of the work currently being undertaken by KPMG in the liquidation of Irish Bank Resolution Corporation; if he will name these partners or senior managers, as well as detailing the total number of staff who have worked on both mandates; and if he will make a statement on the matter. [34647/13]
Amharc ar fhreagraI am advised by the Special Liquidators that there are two members of KPMG who are currently involved in the Special Liquidation who had previously worked on the audit of IL and P at a senior management and partner level. I am further advised that, prior to those individuals carrying out any work in the liquidation, the Special Liquidators considered this position and came to the view that there is no conflict of interest in relation to the work currently being undertaken by these individuals in the Special Liquidation of IBRC and their previous roles in relation to the audit of IL and P.
249. Deputy Pearse Doherty asked the Minister for Finance if his attention has been drawn to news reports in Spain that Deloitte may lose its Spanish licence to operate in the country as an auditor as a result of the very serious violations found by the Economy Ministry's ICAC Accounting and Audit Institute in its investigation of the firm's role as Bankia's auditor; if he will confirm whether these types of measure are being considered; if any adverse findings are made against auditors for the way they audited the Irish banks that subsequently required taxpayers' money; and if he will make a statement on the matter. [34648/13]
Amharc ar fhreagraAs Minister for Finance, I cannot comment on individual cases, nor do I have any role in relation to the supervision of auditors.
250. Deputy Joan Collins asked the Minister for Finance the number of lenders operating in the Irish property market who are prepared to operate the mortgage to rent scheme; the number of mortgage restructurings which have been initiated by lenders under the mortgage to rent scheme; and the number of split mortgages with the parking of both capital and interest payments which lenders have offered under the mortgage arrears resolution process. [34655/13]
Amharc ar fhreagraThe Mortgage to Rent scheme is a Government initiative to help homeowners who are at risk of losing their homes due to mortgage arrears. A pilot scheme was established in February 2012 and was extended nationally in June 2012, targeting those low income families whose mortgage situation is unsustainable and where there is little or no prospect of a significant change in circumstances in the foreseeable future. The scheme will enable eligible families to remain in their homes, while ownership is transferred to an approved housing body which, in turn, rents it to the original owners. The Housing Agency, which manages the scheme, has advised that the lenders currently operating the scheme are:
- AIB
- EBS
- BOI
- PTSB
- KBCI
- Pepper
- Start Mortgages
- Nua Homeloans
- Ulster Bank
- Danske Bank
- Haven Mortgages.
The Housing Agency has advised me that, based on the latest available information, 1,289 cases have been submitted by lenders and of these, 847 are still in the system, with a total of 510 approved for customer contact.
The necessary overall strategy and building blocks to address the mortgage arrears problem are now in place. These include the Central Bank mortgage restructuring targets initiative, the new Code of Conduct on Mortgage Arrears, the fundamental change to personal insolvency legislation, including the provision of new, more accessible and less penal resolution mechanisms to debtors, as well as a comprehensive mortgage information and advice service.
The onus is now on lenders to move to address individual arrears cases in a comprehensive and speedy manner. The Deputy will be aware that the latest Central Bank data on mortgage arrears and repossessions shows that at end March 2013 there were 144 split mortgage restructures. I expect the banks to increase the number of “split mortgage” and the other long-term restructured mortgage arrangements over the remainder of this year.
251. Deputy Billy Kelleher asked the Minister for Finance if he will provide, in tabular form, the commitments in the programme for Government within his remit; if the commitment has been met or is in the process of being met; the estimated time for same; and if he will make a statement on the matter. [34680/13]
Amharc ar fhreagraThe Programme for Government contains 53 commitments within the remit of the Department of Finance and significant progress has been made in implementing these commitments: 30 commitments have been implemented, 15 are ongoing or under way, one is a matter for the independent Fiscal Council, two are a matter for the Department of Public Expenditure and Reform, while 5 are under review or cannot be introduced in the manner in which they are stated in the Programme for Government. I would note that the commitments identified as on track are well advanced. The Department of the Taoiseach published the Programme for Government Annual Report 2013 which outlined progress for all Programme for Government Commitments to March and is available at www.taoiseach.gov.ie. Since the publication of that report there has been further progress in a number of areas including the extension of the maximum weighted average maturities on our EFSF and EFSM loans by up to 7 years, the introduction of the Property Tax on 1 July 2013 and continuing augmentation of the skills set of the Department.
The timeline for delivery of the commitments is over the lifetime of the Government.
The following table sets out all Programme for Government commitments assigned to the Department of Finance, and the current status of each commitment:
Programme for Government
Department of Finance – Progress on Commitments
|
Commitment |
Status |
|
We will seek a reduced interest rate as part of a credible re-commitment to reducing Government deficits to ensure sustainability of our public finances. |
Achieved |
|
We will re-commit to structural reforms required to accelerate growth, job creation and debt sustainability. |
D/PER |
|
We will attach the utmost priority to avoiding further down-grades to our sovereign credit rating by setting further capital spend by the State on bank recapitalisation at a level that is consistent with national debt sustainability. |
Achieved |
|
In this regard, we will defer further recapitalisation of the banks until the solvency stress tests are complete and known to the new Government. Earlier recapitalisation in advance of publication of the stress tests will not contribute to market stability and confidence. |
Achieved |
|
We remain committed to a smaller banking system that reduces its reliance on funding from the Irish and European Central Banks and volatile market sources. In order, however, to limit further calls on the State to cover bank losses from distressed asset sales, bank de-leveraging must be paced to match the return of more normal market conditions and demand for bank assets. |
In progress |
|
As an interim measure, we will seek to replace emergency lending to our banks with medium-term, affordable, official financing in a way that can restore confidence among other potential lenders in the liquidity position of our banks. |
Achieved |
|
We will end further asset transfers to NAMA, which are unlikely to improve market confidence in either the banks or the State. |
Achieved |
|
We will ensure that an adequate pool of credit is available to fund small and medium-sized businesses in the real economy during the re-structuring and down-sizing programme. |
In progress |
|
We will introduce a comprehensive special resolution regime for dealing with bank insolvencies. |
Achieved |
|
The Government accepts that enabling provisions in legislation may be necessary to extend the scope of bank liability restructuring to include unsecured, unguaranteed senior bonds. |
Review |
|
The new Government will seek to dispose of the public stakes in the banks as soon as possible at the best possible return to the taxpayer. |
In progress |
|
We will create an integrated decision making structure among all relevant State Departments and Agencies to replace the current fragmented approach of State bodies in dealing with the financial crisis. |
Achieved |
|
The new Government will re-structure bank boards and replace directors who presided over failed lending practices. We will ensure that the regulator has sufficient powers of pre-approval of bank directors and senior executives. To expedite this change-over we will openly construct a pool of globally experienced financial services managers and directors to be inserted into key executive and non-executive positions in banks receiving taxpayer support. |
Achieved |
|
We will insist on the highest standards of transparency in the operation of NAMA, on reduction in the costs associated with the operation of NAMA, and that decision-making in NAMA does not delay the restoration of the Irish property market. |
In progress |
|
Once the banking sector has been restored and is functioning effectively, we will introduce a bank levy based on the size of a bank’s liabilities (other than shareholder capital). |
Review |
|
We recognise the important role of Credit Unions as a volunteer co-operative movement and the distinction between them and other types of financial institutions. In Government, we will establish a Commission to review the future of the credit union movement and make recommendations in relation to the most effective regulatory structure for Credit Unions, taking into account their not-for-profit mandate, their volunteer ethos and community focus, while paying due regard to the need to fully protect depositors savings and financial stability. |
Achieved |
|
We support the future development of the IFSC as a source of future employment growth, subject to appropriate regulation. We will establish a taskforce on the future of the financial services sector to maximise employment opportunities in financial services for staff leaving employment as a result of downsizing. |
In progress |
|
We will ensure that the investigations into failures in the banking system are adequately resourced. |
D/PER |
|
All remuneration schemes at banks subject to state support will undergo a fundamental review to ensure an alignment of interest between banks, their staff and the taxpayer. |
Achieved |
|
Cut the 13.5% rate of VAT to 12% up to end 2013 |
Achieved |
|
We will exempt from VAT service companies that export more than 90% of their output. |
Not being pursued |
|
Subject to a cost benefit analysis, we will amend the RD tax credit regime to make it more attractive and accessible to smaller businesses, in the following ways: companies with RD expenditures of under €100,000 will be entitled to full tax credit on those entire expenditures as opposed to just the increment over the base year, with marginal relief for companies with expenditure just over €100,000, we will allow companies to offset the RD credit against employers. PRSI as an alternative to corporation tax, to cut down on red tape in the applications process, companies in receipt of a Research, Technology and Innovation (RTI) grant from one of the development agencies will be automatically deemed as entitled to the RD tax credit. |
In progress |
|
We will direct the Revenue Commissioners to examine the feasibility of introducing – on a revenue neutral basis – a Single Business Tax for micro enterprises (with a turnover of less than €75,000 per annum) to replace all the existing taxes on sole traders and small businesses to cut compliance costs and make starting a business much less daunting. |
Review |
|
We will create a Strategic Investment Bank that will become a provider of finance to large capital projects, a conduit for venture capital and a lender to SMEs. |
In progress |
|
The Government will put in place a parallel, commercially-financed investment programme in key networks of the economy to support demand and employment in the short-term, and to provide the basis for sustainable, export-led jobs and growth for the next generation. Streamlined and restructured semi-States will make significant additional investments, over and above current plans, over the next four years in “next generation” infrastructures in energy, broadband, forestry and water. These investments – and the accompanying semi-state restructuring process – will be financed and pro-actively managed by a New Economy and Recovery Authority (NewERA), which will absorb the National Pension Reserve Commission. |
In progress |
|
We believe it is appropriate, in order to enhance international credibility, to stick to the aggregate adjustment as set out in the National Recovery Plan for the combined period 20112012. |
Achieved |
|
In preparation for Budget 2013, we will review progress on deficit reduction, and draw up a plan which will achieve the objective of reaching the 3% of GDP target for the General Government Deficit by the target date of 2015. |
Achieved |
|
Should Ireland succeed in obtaining a lower interest rate on its loans, this should be offset against the aggregate adjustment required over the term of the programme. |
Achieved |
|
We believe that achieving the 3% of GDP deficit target should be seen as an intermediate step in the process of restoring the public finances, and that further reductions in the general government deficit as a share of national income will be required thereafter |
In progress |
|
As part of our fiscal strategy the new Government will: Keep the corporate tax rate at 12.5% |
Achieved |
|
Maintain the current rates of income tax together with bands and credits. We will not increase the top marginal rates of taxes on income. |
Achieved |
|
We will reduce, cap or abolish property tax reliefs and other tax shelters which benefit very high income earners. |
Achieved |
|
We will also ensure the implementation of a minimum effective tax rate of 30% for very high earners. |
Achieved |
|
Consider, arising from the previous Government’s deal with the IMF, various options for a site valuation tax. Any site valuation tax must take into account the significant number of households in mortgage distress and provide local government with a reliable stream of revenue |
Achieved (As per Government decision to introduce Local Property Tax) |
|
We will limit the top rate of VAT to 23% |
Achieved |
|
We will review the Universal Social Charge |
Achieved |
|
We will ensure that tax exiles make a fair contribution to the Exchequer |
Achieved |
|
We will establish an independent Fiscal Advisory Council (FAC), separated from fiscal decision-makers in government, that would undertake official fiscal macroeconomic projections and monitoring. Its functions would include identifying and advising on cyclical and counter-cyclical fiscal policies and structural deficits; the cyclical or temporary nature of particular revenues; and the need to maintain an appropriate and effective tax base. The Fiscal Advisory Council will be independent of Government and will report to the Dáil and the public. |
Achieved |
|
The modelling assumptions and inputs of the Fiscal Advisory Council will, as far as possible, be open to public scrutiny and its outputs would be freely available to external bodies, including in particular, the opposition parties. |
Matter for the Fiscal Council |
|
We will open up the Budget process to the full glare of public scrutiny in a way that restores confidence and stability by exposing and cutting failing programmes and pork barrel politics. |
In progress |
|
We will reform the Department of Finance by bringing in new leadership and skills to restore its capacity and credibility in financial and macroeconomic management. Specifically, we will make an external appointment of an economist of international repute to head up the Department’s Budget and Economic Policy division. |
In progress (New leadership in place) (Recruitment process underway for Chief Economist) |
|
We will bring new talent and skills into the Department of Finance. |
Achieved (Ongoing) |
|
Tax incentives for private hospital developments will cease. |
Achieved |
|
Increasing mortgage interest relief to 30% for First Time Buyers in 2004-08 (from the current sliding scale of 20% to 25% depending on the year the mortgage was taken out), financed in part by bringing forward the abolition of relief for new buyers from June 2011. |
Achieved |
|
Directing any mortgage provider in receipt of State support to present Government with a plan of how intends to cut its costs, over and above existing plans, in a fair manner by a sufficient amount to forego a 25 basis point increase on their variable rate mortgage. |
Achieved |
|
Introducing a two year moratorium on repossessions of modest family homes where a family makes an honest effort to pay their mortgage. |
In progress (Policies in respect of Mortgage Arrears in progress) |
|
We will ensure that the Central Bank and the Financial Regulator supervise credit institutions' mortgage lending practices comprehensively and intensively. |
In progress (whilst respecting the independence of Central Bank and Financial Regulator) |
|
Where credit institutions fail to adequately control mortgage lending risks, the Central Bank will impose loan-to-value ceilings on mortgages, caps on loan-to income multiples, limits on the term of new mortgages, and more rigorous procedures for verifying borrowers' incomes. |
In progress |
|
Increase the penalty for tobacco smuggling for commercial purposes and provide robust detection measures to counteract such smuggling. |
Achieved |
|
Seek to combat drug supplies at source by providing x-ray scanners at major ports; greater patrols along coastline and increasing presence of Customs officers at smaller airports. |
Review |
|
Tightly regulate moneylenders. |
Achieved |
|
We will accelerate Capital Allowances on software purchases against income tax and corporation profits tax from 8 to 3 years subject to a cost benefit analysis. |
In progress |
|
We will exempt farm diesel from further increases in the carbon tax. |
Achieved |
252. Deputy Billy Kelleher asked the Minister for Finance if he will detail, in tabular form, the names of all external public relations, communications consultants and organisations used by organisations or agencies within the remit of his Department since 9 March 2011; the details of the services supplied by each; the expenditure on each; and if he will make a statement on the matter. [34696/13]
Amharc ar fhreagraThe Central Bank of Ireland has advised my Department that it does not currently engage nor has it procured any such services over the last five years. In 2011, a one off specific service was provided by an external PR adviser at a cost of €169.40. However they have also advised my Department that as part of the National Payments Plan, marketing agencies have been and will be engaged to assist in developing communications plans relating to specific, defined public policy initiatives (e.g. the on-going public information campaign around Single Euro Payments Area (SEPA) implementation, and the running of a ‘rounding pilot’ to reduce the need for 1c/2c coins). These agencies have been and will be selected through competitive tender processes, and the costs of these will be split between the Central Bank, the Department of Finance and industry. The Financial Services Ombudsman Bureau have advised my Department that they do not employ the services of a public relations firm or communication consultants and that all such work is dealt with internally by Financial Services Ombudsman Bureau staff.
The National Treasury Management Agency (NTMA) has supplied my Department with the information set out below. NTMA does not maintain an internal press office. Instead, its internal communications resources are supported by an external service provider (appointed following a public procurement process) – currently Gordon MRM - in order to offer a full press office and communications service (including out-of-hours contacts for the media) across all the NTMA’s business areas: Debt Management, National Asset Management Agency (NAMA), National Pensions Reserve Fund, National Development Finance Agency, State Claims Agency, NewERA and during 2011 the Banking Unit. These arrangements were initially put in place during 2010 in light of a significant increase in the volume of domestic and international media queries being received by the NTMA and associated bodies. In September 2012 the NTMA retendered for the provision of these services. Following the tender evaluation process the NTMA awarded a new contract to Gordon MRM in December 2012. The initial contract, in place to end 2012 was based on an hourly rate for services provided. During the term of this contract a 20% reduction in the hourly rate was agreed with effect from June 2011 until the end of the contract. The new contract, which commenced in January 2013, is based on a fixed fee and it is anticipated that this will result in a significant reduction in the overall fees paid by the NTMA. NAMA draws on the NTMA’s shared services in a number of areas including its outsourced press office facility. NAMA reimburses the NTMA in respect of the costs of these services attributable to NAMA. The overall costs incurred for the provision of the services above (ex VAT) were as follows:
|
Year |
€ |
|
2011 |
€205,388 (of which €112,353 was charged to NAMA) |
|
2012 |
€223,723 (of which €142,653 was charged to NAMA) |
|
2013 |
€72,817 (to end June) (of which €36,329 was charged to NAMA) |
In the light of the sovereign debt crisis the NTMA also engaged Powerscourt – a London based communications consultancy - for international communications initiatives in the funding and debt management area. Total costs (ex VAT) incurred for the provision of the services provided by Powerscourt from January 2011 were as follows:
|
Year |
€ |
|
2011 |
74,395 euros |
|
2012 |
10,257 euros |
|
2013 |
12,103 euros (to end June) |
253. Deputy Brian Stanley asked the Minister for Finance if he will confirm that €150 million was taken in the form of motor tax in budget 2013; and if he will confirm where this money was redirected. [33803/13]
Amharc ar fhreagraAs the Deputy correctly points out, Motor Tax is one of the major sources of Local Government funding. However, the increase in revenue associated with Budget changes in motor tax over the last two years was destined for the Exchequer to reduce the deficit. As stated in the Revised Estimates for Public Services, a return, to be agreed between the Ministers for the Environment, Community and Local Government and Public Expenditure and Reform, of up to a maximum of €150m is to be made out of the Fund. This remains the intention and monies are expected be paid over in late 2013.
254. Deputy Brian Stanley asked the Minister for Finance the position local authorities hold in order of priority as creditors when the National Asset Management Agency takes over unfinished housing developments that have outstanding development levies owed by them to the respective local authorities. [33806/13]
Amharc ar fhreagra255. Deputy Brian Stanley asked the Minister for Finance the names of companies that are now in the National Asset Management Agency which owe development levies to local authorities; and if he will outline, in tabular form, the amount owed by each company to each local authority. [33807/13]
Amharc ar fhreagraI propose to take Questions Nos. 254 and 255 together.
NAMA has acquired loans from the Participating Institutions that are secured, in the main, on unsold property at time of acquisition. I am advised by NAMA that, in respect of such unsold property, it requires its debtors and receivers to comply with all statutory obligations. NAMA advises that this includes the payment of development levies as they fall due, on foot of a valid planning permission, for development. NAMA further advises that it works closely with debtors and receivers to ensure that any such liabilities are appropriately addressed. NAMA’s role relates only to those properties that secure its acquired loans. It has no role in relation to other properties, including properties sold prior to its acquisition of loans from the Participating Institutions. The Deputy may also wish to refer to pages 36 and 37 of the Agency’s recently published Annual Report and Financial Statements for 2012, which include extensive information on NAMA’s approach to unfinished housing developments, including its requirement that debtors and receivers prepare, in line with best practice in this area, a Site Resolution Plan with input from stakeholders including residents, the local authority and the bond holder.
NAMA is prohibited under Sections 99 and 202 of the NAMA Act from disclosing confidential information, which is specifically defined to include information relating to its debtors and their properties. Accordingly, the provision of the type of information sought in the Deputy’s second question cannot be provided.
258. Deputy Andrew Doyle asked the Minister for Finance the procedure in place where an official of a financial institution does not offer the code of conduct for mortgage arrears from the Central Bank of Ireland to a client who is in mortgage distress; the details of the reprimand and if it is required; and if he will make a statement on the matter. [34728/13]
Amharc ar fhreagraThe Central Bank’s Code of Conduct on Mortgage Arrears (CCMA) is a statutory Code issued under Section 117 of the Central Bank Act 1989 and lenders are required to comply with the CCMA as a matter of law. The Central Bank has advised me that it has the power to administer sanctions for a contravention of the CCMA under part IIIC of the Central Bank Act 1942.
The CCMA applies to the mortgage lending activities of all regulated entities, except credit unions, operating in the State, including:
- A financial services provider authorised, registered or licensed by the Central Bank of Ireland; and
- A financial services provider authorised, registered or licensed in another EU or EEA Member State and which has provided, or is providing, mortgage lending activities in the State.
The CCMA applies to the mortgage loan of a borrower which is secured by his/her primary residence.
Under the CCMA, lenders must apply the protections of the Code to borrowers in the following circumstances:
i. Borrowers in arrears and in pre-arrears
ii. In the case of joint borrowers who notify the lender in writing that they have separated or divorced, the lender should treat each borrower as a single borrower under the CCMA (except to the extent that an action requires, as a matter of law, the agreement of both borrowers).
Chapter 3 of the CCMA deals with the appeals process and provides that a lender must have an appeals process to enable a borrower to appeal in relation to a decision of the lender, including:
(a) where an alternative repayment arrangement is offered by a lender and the borrower is not willing to enter into the alternative repayment arrangement;
(b) Where a lender declines to offer an alternative repayment arrangement to a borrower; and
(c) Where a lender classifies a borrower as not co-operating,
and for this purpose must establish an Appeals Board to consider and determine any such appeals submitted by borrowers.
Section 50 of the CCMA states that the Appeals Board must be comprised of three of the lender’s senior personnel, who have not been involved in the borrower’s case previously. At least one member of the Appeals Board must be independent of the lender’s management team and must not be involved in lending matters. In addition, the lender must apply Provisions 10.7 and 10.12 of the Central Bank’s Consumer Protection Code 2012 to deal with complaints submitted by borrowers in relation to the lender’s treatment of the borrower’s case under the CCMA, or the lender’s compliance with the requirements of the CCMA.
260. Deputy Pearse Doherty asked the Minister for Finance if his attention has been drawn to a letter sent on 17 June from the National Asset Management Agency to a number of litigants in a case in New York, where the issue of Anglo Irish Bank overcharging interest on loans is being heard, the contents of which include an implicit threat to the litigants to cease their action or face potential loan foreclosure and receivership; and if he will make a statement on the matter. [34762/13]
Amharc ar fhreagraIn line with long-standing practice, I do not comment on matters which are before the Courts.
261. Deputy Pearse Doherty asked the Minister for Finance if his attention has been drawn to evidence given in a trial currently taking place involving the National Asset Management Agency and a person (details supplied) where it has been alleged that David Drumm in his role in Anglo Irish Bank at the time, agreed to the transfer of interest in a loan that was held in this person's name to other members of their family; if his attention has been drawn to a verbal transfer of loan interest being a practice in Anglo Irish Bank; and if he will make a statement on the matter. [34763/13]
Amharc ar fhreagraIt would not be appropriate for me to comment on this matter which is currently before the courts.
262. Deputy Pearse Doherty asked the Minister for Finance the number of asset management companies that have been commissioned by the National Asset Management Agency to date; their names; the total value of the assets being managed by these third party companies; the individual and total fees being paid to these third party companies; and his views on NAMA, an asset management company, choosing this policy of commissioning third parties to manage its assets. [34764/13]
Amharc ar fhreagraI am advised by NAMA that it has not commissioned any asset management companies. NAMA carries outs its own asset management and debtor management directly and otherwise its loans are serviced by the two participating institutions and, in the case of the former IBRC portfolio, by the Special Liquidators to IBRC.
263. Deputy Pearse Doherty asked the Minister for Finance if his attention has been drawn to the allegations made in a national newspaper on Tuesday, 9, July by the former Irish Life and Permanent chairman (details supplied), where they state they made a statement to the Office of the Director of Corporate Enforcement and the Garda Bureau of Fraud Investigation on the window dressing of Anglo Irish Bank’s end of year books for 2008 but that there has been no follow-up on their affidavit; and in addition that they were informed that the Anglo Irish Bank life deposits were outside the scope of the investigation. [34765/13]
Amharc ar fhreagraI can inform the Deputy that allegations made in a national newspaper by the person whose details were supplied relate to an investigation currently being led by the Garda and it would therefore be inappropriate for me or the Central Bank to provide any information on this matter. The Deputy will be aware that the Terms of Reference for the Nyberg investigation are a matter of public record and are included in the Nyberg report.
264. Deputy Pearse Doherty asked the Minister for Finance if it was a policy of the Central Bank of Ireland in the years leading up to 2008 and following to allow banks to make deposit transfers between themselves to address deficiencies in end of year accounts; if this was an overt policy of the Central Bank of Ireland or if the bank simply toleratesd the policy, as has been alleged. [34766/13]
Amharc ar fhreagra265. Deputy Pearse Doherty asked the Minister for Finance his views on the statement made by former Irish Life and Permanent chairman (details supplied) that support provided by Irish Life and Permanent to Anglo Irish Bank arose solely as a result of a request by the Central Bank of Ireland and Financial Regulator, and that the two had requested Irish Life and Permanent to protect the stability of the Irish financial system. [34767/13]
Amharc ar fhreagraI propose to take Questions Nos. 264 and 265 together.
As the Deputy will be aware the Garda is currently leading an investigation into these matters and it would therefore be inappropriate for me or the Central Bank to provide any information on this matter.
266. Deputy Pearse Doherty asked the Minister for Finance if he will confirm that Anglo Irish Bank sought as a solution to its difficulties on 29 and 30 September 2008 the provision of short-term liquidity support; and if he will explain the reason an alternative to a blanket guarantee, if proposed, was ruled out. [34780/13]
Amharc ar fhreagraI am advised that Anglo Irish Bank would have discussed a number of funding options with the authorities during September 2008. For more detail as to why the ultimate option of a blanket guarantee was adopted, I understand that my predecessor as Minister for Finance gave a detailed account of the lead up to the Government decision to introduce a bank guarantee to the Joint Committee on Finance and the Public Service on 26 February 2009. This transcript is available on the Oireachtas website and the Minister was thanked by Deputies from all parties for the full and frank account he gave to the Committee at that time. http://oireachtasdebates.oireachtas.ie/Debates%20Authoring/DebatesWebPack.nsf/committeetakes/FIJ2009022600003?opendocument.
In addition, Department of Finance officials gave extensive testimony to the Committee of Public Accounts on 22 July 2010 setting out information prepared during 2008 that related to the Bank Guarantee. The Committee of Public Accounts published documents obtained from the Department of Finance. These documents included a presentation by Anglo Irish Bank to the Department in September 2008. These documents are available at:http://www.oireachtas.ie/viewdoc.asp?fn=/documents/Committees30thDail/PAC/Reports/document1.html.
267. Deputy Pearse Doherty asked the Minister for Finance the revenue that could be raised for the Exchequer with the Standard Fund Threshold for pensions reduced to the amount proposed by budget 2013; the income ceiling link for pension tax reliefs reduced to €70,000 per annum, and the tax relief for pension contributions standardised. [34782/13]
Amharc ar fhreagraIn Budget 2013, I announced that changes to the maximum allowable pension fund at retirement for tax purposes (the Standard Fund Threshold - SFT) and other possible changes to give effect to the commitment in the Programme for Government to cap taxpayers’ subsidies for pension schemes which deliver pension income of more than €60,000 will be put in place in 2014. A figure of €250 million was included in the Budget 2013 arithmetic for this measure and was, as clearly stated in the Budget 2013 documentation, a provisional figure pending further detailed analysis of the changes necessary to give effect to the Programme for Government commitment. That analysis is ongoing and involves consideration of changes to the SFT as well as other potential alternative changes relating to the treatment of supplementary pension arrangements.
As regards the proposal to have the income ceiling link for pension tax reliefs reduced to €70,000 per annum, I assume that the Deputy is referring to the current annual earnings cap of €115,000 which operates to limit the level of tax-relieved personal pension contributions in any one year. The annual earnings cap acts, in conjunction with age-related percentage limits of annual earnings, to put a ceiling on the annual amount of tax relief an individual taxpayer can obtain on pension contributions.
A breakdown of the cost of tax relief on employee contributions to occupational pension schemes is not available by income tax rate, as tax returns by employers to the Revenue Commissioners of employee contributions to such schemes are aggregated at employer level. An historical breakdown is available by tax rate of the tax relief claimed on contributions to personal pension plans — Retirement Annuity Contracts (RACs) and Personal Retirement Savings Accounts (PRSAs) — by the self-employed and others, to the extent that the contributions have been included in the personal tax returns of those taxpayers.
There is, therefore, only a limited statistical basis for providing definitive figures. However, by making certain assumptions about the available information, the Revenue Commissioners inform me that the combined estimated full year yield to the Exchequer from reducing the current annual earnings cap of €115,000 to €70,000 and confining tax relief to the standard rate of 20% in respect of individual contributions to occupational pension schemes, RACs and PRSAs would be about €555 million.
268. Deputy Pearse Doherty asked the Minister for Finance the amount of fees paid to a person (details supplied) by his Department since vacating the position as Attorney General on 9 March 2011. [34910/13]
Amharc ar fhreagraMy Department has made no payment of fees to the person (details supplied) for the period in question.
269. Deputy Brendan Griffin asked the Minister for Finance if it is preferred policy by the Revenue Commissioners to recover tax liabilities to seek judgments on the homes of previously self-employed persons as opposed to accepting settlements or instalment orders; and if he will make a statement on the matter. [34919/13]
Amharc ar fhreagraFirstly, I would like to briefly comment on Revenue’s approach to tax collection and in particular its overall compliance and debt management approach. Revenue has a strong focus on making sure that every individual and business complies with the responsibility to pay the right amount of tax or duty, including any interest and penalties which are due, in full and on time. This is an appropriate and correct focus for Revenue and one that I fully endorse. Delays in the collection of tax revenues properly due adds to the level of Government borrowing and public debt interest and confers an unfair competitive advantage on non-compliant businesses. Revenue also has to guard against so-called “phoenix” businesses where tax debts are left unpaid from a previous business.
Where payment of a tax debt in a single sum is not possible for the taxpayer or business, perhaps due to temporary cashflow difficulties, then Revenue may, and regularly does, agree to a phased payment arrangement. In such circumstances the onus is on the taxpayer or business to make realistic proposals to Revenue that will see the debt being addressed in the shortest possible timescale. A key condition of any such arrangement is that current taxes are paid as they fall due.
I note that in 2012 Revenue granted in excess of 16,000 instalment arrangements covering €124 million of debt to taxpayers experiencing cashflow difficulties. I am very happy that this level of concession clearly confirms Revenue’s commitment to assist viable businesses during our current economic difficulties.
Remedying late or non-compliance is preferably achieved through engagement with the business or taxpayer, but when that engagement is only partially forthcoming, or perhaps not at all, then Revenue has no option but to utilise measures such as the charging and collection of interest or the deployment of effective enforcement measures to secure payment of the tax debt, to encourage future voluntary timely compliance and to ensure a ‘level playing field’ for the vast majority of taxpayers who meet their obligations in full and on time.
In circumstances where Revenue has to use enforcement measures to secure collection of outstanding taxes, the type of enforcement deployed will always depend on the specific circumstances of a case. However, Revenue generally refers such cases to either the Sheriff or Solicitor in the first instance. Where the Solicitor option is deployed, there is the possibility of judgments being secured through the Courts which result in instalment orders, or in judgment mortgages being placed on properties. Revenue has confirmed to me that the use of judgment mortgages is normally to secure a tax debt in the event of a property being sold by the taxpayer. It does not necessarily mean that Revenue intends to "force" sale of the property, and the Deputy may wish to be aware that as a matter of operational policy, Revenue has never forced the sale of a family home.
270. Deputy Pat Deering asked the Minister for Finance the regulation in place for money being transferred out of the country through over-the-counter media such as Western Union, Moneygram and so on; the controls and checks in place to ensure it is not the reward of illegal activity; the tax rules that apply to this money; and the amount that has been transferred in this way in each of the past three years. [34929/13]
Amharc ar fhreagraI am advised by the Central Bank that all firms involved in money transmission or money remittance are required by it to hold an appropriate authorisation to provide the service. All firms involved in money transmission or money remittance are deemed to be a “designated person” under the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (as amended) as they fall within the definition of a “financial institution”. In light of this such firms are required to ensure that they have appropriate procedures and controls in place to prevent and detect money laundering.
No specific tax rules apply to transfer of money, however in line with the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010, a report must be forwarded to the Revenue Commissioners if the transfer of money gives rise to suspicion on the part of the transferor. The Central Bank advises that no data are available with regard to the amounts that are transferred in this way.
271. Deputy Pearse Doherty asked the Minister for Finance if capital gains tax is collated in such a way as to be able to determine the revenue that would be raised if capital gains tax was higher on vacant land that has benefited in value from rezoning-planning developments; and what the revenue would be if capital gains tax on those occasions was charged at 50%, 60%, 70% and 80%, respectively. [34931/13]
Amharc ar fhreagraI am advised by the Revenue Commissioners that they do not have data on “vacant land”. I am further advised that the Central Statistics Office and the Minister for the Environment, Community and Local Government do not have data on undeveloped land which would enable a yield from a higher rate of CGT, as proposed, to be estimated.
273. Deputy Pearse Doherty asked the Minister for Finance if an observer on behalf of the Central Bank or the Department of Finance was ever present at an Anglo Irish Bank board meeting subsequent to the 2008 bank guarantee; if there was a capacity for the presence of such an observer; if so, on what dates the observers were present and on whose behalf; and if the observers ever heard a reference to the existence or content of recorded phone conversations of the bank's employees. [34944/13]
Amharc ar fhreagraThe Relationship Framework, which was established on 29 March 2012 enabled representatives of the Minister to attend Board meetings in an observer capacity. The representative attended in a passive capacity only and did not play an active role in the meetings. The Board meetings were held monthly and a representative of the Department was usually present. To the best of our knowledge, the content and existence of the tapes was not discussed at the Board meetings following March 2012. I have been advised by the Central Bank that subsequent to the 2008 Guarantee, the Central Bank implemented a more intensive supervisory approach to covered institutions subject to the Credit Institutions (Financial Support) Scheme 2008. This more intensive approach includes attendance at committee and board meetings periodically. The purpose is to observe internal governance in operation, in order to understand the decision making process and also to be aware of individual risks across the covered institutions. The Central Bank does not participate in such meetings and Central Bank officials are not part of the decision making process at those meetings, nor do they otherwise participate in the management of the covered institution. The Central Bank may subsequently follow up items discussed for clarity to raise concerns e.g. how a particular committee operates.
I have been informed by the Central Bank that as Central Bank officials attend board meetings as part of their supervisory responsibilities they are not able (under Section 33AK) to divulge relevant information. Nevertheless they have informed me that they would take action if relevant matters came to their attention through attendance at these meetings.
