Written Answers Nos. 42 - 50
42. Deputy Micheál Martin asked the Tánaiste and Minister for Foreign Affairs and Trade the discussions he has had regarding inviting members of the British royal family to the 1916 commemorations; and if he will make a statement on the matter. [19928/14]
Amharc ar fhreagra43. Deputy Micheál Martin asked the Tánaiste and Minister for Foreign Affairs and Trade if he has asked any other Heads of State here to commemorate 1916; and if he will make a statement on the matter. [19929/14]
Amharc ar fhreagraI propose to take Questions Nos. 42 and 43 together.
The centenary of the Rising in 2016 will be the centre-piece of the Government’s decade of commemorations programme. The format and programme for the 2016 commemoration in Dublin is still under consideration. In September 2013, in my speech to the British-Irish Association, I noted a responsibility to be attentive and respectful of all traditions on this island in our approach to the decade of commemorations. In that context, I expressed the hope that the Government would host representatives of the British Royal Family and the British Government, along with leaders of Irish unionism, in Dublin to mark the centenary of the Easter Rising. The commemoration will be a unique opportunity to promote Ireland internationally. In that context the attendance of our international partners will of course be considered in the coming period.
44. Deputy Brendan Griffin asked the Minister for Finance if the changes to one parent family tax credit in budget 2014 will be eased in budget 2015; if not, if he will consider other ways of assisting the persons affected by the change; and if he will make a statement on the matter. [20631/14]
Amharc ar fhreagraAs you are aware the One-Parent Family Tax Credit has been replaced with a new Single Person Child Carer Credit from 1 January 2014. However, the credit is more targeted in that it is, in the first instance, only available to the principal carer of the child. Given the difficult fiscal environment, it is essential to review all tax reliefs, credits and incentives in order to ensure that they are properly targeted and if necessary re-focused in order that they can achieve the socio-economic objectives that are set for them. A system that allows multiple claims in respect of the same child is unsustainable. The new credit is designed to be an activation measure, which was the original intention behind the One Parent Family Tax Credit, which it replaced. It is designed to be an in-work benefit to support a principal carer to take up, or remain in, employment.
Notwithstanding the above, as a result of an amendment which I brought forward at Committee Stage of the Finance Bill, a principal carer who is entitled to the credit and who does not wish to avail of it can choose to surrender it. A secondary carer may then make a claim for the credit, provided that the qualifying child resides with him or her for not less than 100 days in the tax year. I have no plans to review this reform at this early stage although, as is part of normal practice in the preparation of the annual Budget, my officials monitor all tax measures to ensure that they are operating effectively.
In addition to the credit, the One-Parent Family Payment (OFP) is a payment provided by the Department of Social Protection to both men and women aged under 66 years who are bringing up a child or children without the support of a partner. In order to get this payment, a person must first meet certain qualifying conditions and satisfy a means test. The number of OFP recipients stood at 77,714 in March, 2014. A key decision for Budget 2014 was to maintain the basic rates of social welfare income support payments. As such, no change was made to the OFP payment. The maximum personal rate for the parent remains at €188 per week with a further €29.80 per week for each additional qualified child.
In recent years, reforms have been made to the OFP scheme. These reforms are aimed at tackling the high rate of poverty and social exclusion experienced by one-parent families which can be caused by long-term welfare dependency. They aim to provide the necessary supports to lone parents to help them to escape poverty and social exclusion, participate in education and training, enter the workforce and, ultimately, attain financial independence and social well-being for both themselves and their families. They also aim to bring Ireland's support for lone parents in line with international provisions where there is a general movement away from long-term and passive income support.
The Social Welfare and Pensions Act, 2012, introduced several changes to the OFP scheme including the phased reduction of the age limit of the youngest child at which a recipient's payment ceases to seven years from 2014 for new entrants and from 2015 for existing recipients. Transitional arrangements will apply during the period between 2013 and 2015 depending on the date that a recipient first claimed the OFP payment. By 2015, the maximum age limit of the youngest child will be seven years for all OFP recipients. Special provisions exist for lone parents who are in receipt of the Domiciliary Care Allowance (DCA) or who are recently bereaved.
As a result of the reforms to the OFP scheme, once an OFP recipient's youngest child reaches the relevant maximum age limit threshold, they will no longer be entitled to the OFP payment. Should they still have an income support need, they will be required to apply for another social welfare income support payment. Persons who are working 19 hours or more per week may be entitled to apply for the tax-free Family Income Supplement (FIS) or to have their existing FIS claim re-rated as appropriate. Others may be eligible for the Carer's Allowance.
Former OFP recipients can also apply for either the Jobseeker's Allowance (JA) or the Jobseeker's Allowance (JA) transitional arrangement. They will then have access to the Department's full range of work activation supports to enable them to improve their employability and to subsequently find work. If a person is unable to meet either the JA or FIS scheme rules, and if they continue to have an income support need after their entitlement to the OFP payment ceases, they may have recourse to the Supplementary Welfare Allowance (SWA) scheme.
45. Deputy Charlie McConalogue asked the Minister for Finance if it is possible for the Revenue Commissioners under current legislation and regulations to decide to accept a fresh and new application for a VRT exemption certificate for a vehicle in a situation where an initial application was refused and the appeal period expired, and where new and substantial evidence can accompany a new application to demonstrate its eligibility; if it is not possible for the Revenue Commissioners to decide to accept such an application, if he will provide details of the appropriate section in legislation or regulation that prevents the Revenue Commissioners from considering such a fresh application; and if he will make a statement on the matter. [20684/14]
Amharc ar fhreagraI refer the Deputy to my answer of 30 April 2014 to Parliamentary Questions Nos. 19710/14 and 19711/14. As I said in that answer, the temporary exemption from the payment of Vehicle Registration Tax (VRT) is provided for under section 135 of the Finance Act 1992, as amended. Subject to certain conditions, restrictions and limitations, a qualifying vehicle, i.e. a vehicle which is validly registered outside the State, may be granted temporary exemption from the requirement to be registered in the State. On receipt and examination of the required documentation to process an application, an officer will make a determination on the application.
In the event of an application being refused, the officer outlines the grounds for refusal and the appeal process is clearly explained to the applicant. Sections 145 and 146 of the Finance Act 2001 govern the appeal procedure and allow the applicant two months to lodge an appeal. The vehicle registration tax due on the vehicle must be paid before the appeal can be processed. When an application for exemption from VRT is lodged, it is the responsibility of the applicant to furnish the required proofs to meet the necessary criteria. If all of these proofs are not available at that time, the applicant will be given a period within which to produce these proofs. However, if after the expiry of this period, these proofs are still not forthcoming, the application will be refused. The applicant has the opportunity to lodge an appeal and present the proofs, should they become available, to the Appeals Officer.
Where the appeal process has not been availed of, there is no provision for Revenue to continue processing an application. Where an applicant is deemed ineligible for any of the legal exemptions from VRT in respect of vehicles registered in another Member State, or, if a person brings in a non-State registered vehicle into the State which is not exempt from payment of VRT, that person is legally obliged to register the vehicle and pay the appropriate tax in order to use it in this jurisdiction. Failure to do so within the prescribed period (30 days) constitutes an offence under Section 139 of the Finance Act 1992.
46. Deputy Michael McGrath asked the Minister for Finance if his attention has been drawn to difficulties with bank transfers including salaries and direct debit payments on 1 May 2014 which coincided with a public holiday in a number of European countries; if the Central Bank of Ireland will discuss with banks the action that can be taken to prevent a similar occurrence in the future; and if he will make a statement on the matter. [20707/14]
Amharc ar fhreagraI am informed by the Central Bank that this issue arose because 1 May 2014 was a normal business day in Ireland but the euro settlement and payment systems (TARGET2 and STEP 2) were closed due to the fact that 1 May is a bank holiday in most EU member states. While this situation has occurred in previous years, the Irish banks were able to process payments between themselves as the domestic payment system continued to operate. However, the full implementation of the Single Euro Payments Area (SEPA) has resulted in this option no longer being available. Notwithstanding this, most of the Irish banks made every effort to process payments for their customers on 1 May and the level of disruption was not as significant as might have been expected.
The Central Bank of Ireland worked with the Irish Payments Services Organisation (IPSO) and the banks to minimise any inconvenience to customers. Business representative bodies and businesses that make large numbers of direct debit and credit transfer payments were contacted and advised that where possible they should bring payments forward to 30 April; in addition, a notice advising consumers about the closure and its consequences was inserted in all of the major national newspapers on Friday 25 April and also placed on the Central Bank of Ireland and IPSO websites.
The full implementation of SEPA means that at least for the time being this situation will recur on 1 May in each year that the Irish May bank holiday does not coincide with the European one. The Central Bank of Ireland, IPSO and the Irish banks will make every effort to minimise disruption to customers via an ongoing communications programme aimed at raising awareness of the 1 May payments issue.
47. Deputy Ciara Conway asked the Minister for Finance in relation to policy holders with Setanta Insurance, if they will get their money back in the wake of the collapse of this company; if he will clarify the situation in respect of no claims bonus; if this will be affected; if policy holders will receive a refund; and if he will make a statement on the matter. [20714/14]
Amharc ar fhreagra48. Deputy Ciara Conway asked the Minister for Finance with respect to third party claimants of Setanta Insurance, if the matter proceeds to the High Court and an award is made will third party claimants be entitled to receive 100% of this claim; and if he will make a statement on the matter. [20716/14]
Amharc ar fhreagraI propose to take Questions Nos. 47 and 48 together.
Under EU law which governs non-life insurance, an insurer is required to inform the regulator in its home Member State (its home regulator) that it intends to pursue business in another Member State. The home regulator must then provide the host regulator with a certificate attesting that the insurer covers the EU Solvency Capital Requirement, as well as the nature of the business which the insurer intends to undertake. The insurer may start to pursue business from the date that the certificate is communicated to the host regulator, in this case the Central Bank of Ireland.
Setanta Insurance Company Limited ("Setanta") is a Maltese incorporated company which was both authorised and prudentially supervised by the Malta Financial Services Authority (MFSA). While its financial position is not supervised by the Central Bank of Ireland as the Central Bank has no role in that regard, the firm is supervised by the Central Bank for conduct of business rules, i.e. consumer protection obligations. The Central Bank is in contact with the MFSA in relation to Setanta Insurance Company Limited, the impact on policyholders and the provision for relevant and appropriate information, particularly in relation to claims.
On 16 April 2014, Setanta determined that the company was insolvent. This means that Setanta does not have sufficient funds to be able to honour its full obligations towards claimants, policyholders and other creditors. Setanta was formally placed into liquidation by the MFSA following a meeting of the creditors which took place on the 30 April 2014 where a liquidator, Mr. Paul Mercieca, was appointed. Officials from my Department together with officials from the Central Bank met with the Liquidator and his representatives in Ireland on 7 May 2014. At that meeting, the Liquidator confirmed that Setanta will not be in a position to pay the full amount of claims. It is also unlikely that a pro-rata portion of premiums will be refunded upon completion of the Setanta liquidation.
While the position on each policy is for the Liquidator to decide in due course, all claims must be treated in the same way by the Liquidator. The Liquidator has advised that he intends to place notices in national newspapers shortly and to send letters to policyholders advising them of cancellation of policies next week. It would be prudent for Setanta policyholders to make alternative motor insurance arrangements, as soon as possible, as advised by the Central Bank.
The Motor Insurance Bureau of Ireland (MIBI) is a non-profit-making organisation which was established by Agreement between the Government and those companies underwriting motor insurance in Ireland. The principal role of MIBI is to compensate innocent victims of accidents caused by uninsured and unidentified vehicles. If, for legal reasons, MIBI is not in a position to accept a claim, these third party claims will be eligible to proceed for consideration by the High Court for compensation from the Insurance Compensation Fund (ICF). Claims on personal insurance policies will be payable from the ICF. ICF payments are subject to the limit of 65% of the amount due or €825,000, whichever is the lesser. Under Section 3.6 of the Insurance Amendment Act 1964 (as amended) first party claims by a body corporate or unincorporated body are not covered by the ICF. The refund of premiums for either commercial and personal insurance policies is not covered by the ICF or MIBI.
The Liquidator advised that arrangments are in hand for policyholders to obtain their "no claims bonus" certificates from Setanta. Insurance Ireland have informed me that these certificates will be honoured by other insurers. Until otherwise advised those policyholders which have been affected by the collapse should continue to contact Setanta Insurance Services Limited at 0818 255 255 (if calling from outside Ireland +353 1 897 6300) or on support@setantainsurance.com.
49. Deputy Noel Harrington asked the Minister for Finance his plans to increase the amount of €20,000 allowed under the trivial pension rule; and if he will make a statement on the matter. [20730/14]
Amharc ar fhreagraI am informed by the Revenue Commissioners that in relation to what are known as "Trivial Pensions" they allow the payment of once off pensions in certain limited circumstances. If the scheme beneficiary and trustees agree, Revenue will raise no objection to the payment of once off pensions. This may only take place where the total of all funds available for pension benefits, following payment of any lump sum benefit, is less than €20,000 (increased from €15,000 in 2007). The quantum of retirement benefits from all sources must be taken into account for the purposes of calculating the €20,000 limit.
The level at which pensions can be commuted under the "Trivial Pensions" rule is kept under review by Revenue. However, as one of the principal objectives of any pensions policy is to provide a regular income to persons during the course of their retirement it would not be advisable to allow the commutation of large numbers of pensions under the "Trivial Pensions" rule. For this reason, there are no plans at the moment to increase the level from €20,000.
50. Deputy Noel Harrington asked the Minister for Finance his plans to reform the pension rules in line with the recently announced new rules in the UK allowing pensioners to manage their own pension funds; and if he will make a statement on the matter. [20731/14]
Amharc ar fhreagraMy understanding is that, as announced in their recent Budget, from April 2015 the UK Government intend to allow individuals aged 55 and over access their defined contribution (DC) pension fund on retirement as they choose, after taking the allowable tax free retirement lump sum from the fund. Withdrawals from the remainder of the fund will be taxed at the individual's marginal income tax rate regardless of whether it is drawn in full or piecemeal over time. Under current UK flexible access rules, an individual can only avail of full flexibility draw down, subject to marginal rate income tax, where they have guaranteed income in retirement of at least £12,000 per annum (down from £20,000 heretofore) and while full cash withdrawal of a defined contribution pension pot is permitted, it incurs a tax charge of 55%. The UK Government is currently undertaking a public consultation on the proposals, the results of which will help determine how best the policy intention can be delivered on next year.
As regards arrangements in the State, flexible options at retirement are available in respect of all benefits from DC retirement benefit schemes and other DC pension savings. Choices which are available to individuals (after taking the tax-free retirement lump sum) include the option to purchase an annuity with the remaining funds, to receive the balance of the pension funds in cash (subject to marginal rate income tax, as appropriate), to invest in an approved retirement fund (ARF) or an Approved Minimum Retirement Fund (AMRF), subject to certain conditions.
Under the regime the options to invest in an ARF or receive the balance of the pension fund in cash) are subject to conditions. The conditions include the requirements that the individual be over 75 years of age or, if younger, that the individual has a guaranteed level of pension income ("specified income") actually in payment for life at the time the option to effect the ARF or cash option is exercised. The purpose of the specified income requirement is to ensure, before an individual has unfettered access to their remaining retirement funds via an ARF or by way of the cash option that they have the security of an adequate guaranteed pension income throughout the period of their retirement. The specified income requirement is €12,700.
Where the minimum specified income test is not met, and an individual does not wish to purchase an annuity, then an AMRF must be chosen into which a "set aside" amount must be invested. The purpose of an AMRF is to ensure a capital or income "safety net" throughout the latter period of an individual's retirement where their pension income is below the specified income limit. The maximum "set aside" amount is €63,500 of the pension fund or the remainder of the pension fund after taking the tax-free lump sum, if this is less than €63,500.
The capital in an AMRF is not available to an individual until he or she reaches 75 years though any income generated by the fund can be drawn down subject to tax. The capital in an AMRF can be used by the owner at any time to purchase a pension annuity and the AMRF can be changed to an ARF with access to the capital sum (subject to taxation) before the age of 75 where the specified income test is met before that age.In terms of increased flexibility, the primary difference between the proposed UK regime and the regime that operates here is the fact that from April 2015, the UK proposes to dispense with their guaranteed income test. In that regard, I have no plans to change the equivalent rule here or the alternative AMRF set aside rule.
