Thursday, 7 May 2015

Written Answers Nos. 45-55

JobsPlus Scheme

Ceisteanna (46)

Olivia Mitchell

Ceist:

46. Deputy Olivia Mitchell asked the Tánaiste and Minister for Social Protection the current number of claimants and jobs supported under the JobsPlus scheme; and the associated cost. [18056/15]

Freagraí scríofa

Minister of State at the Department of Social Protection

JobsPlus provides a direct monthly financial incentive to employers who recruit employees from the Live Register and those transitioning into employment. It provides employers with two levels of payment - €7,500 or €10,000 - over two years provided the employment is maintained.

The Department made payments of just over €1.793m in April 2015 to 3,437 employers in respect of 4,670 employees. A total of €19.505m has been expended to date on the initiative since it was launched in June 2013. Just over 60% of jobseekers who have secured employment with the support of JobsPlus were on the live register for over 24 months at the time of recruitment.

Tax Code

Ceisteanna (47, 48)

Michael Healy-Rae

Ceist:

47. Deputy Michael Healy-Rae asked the Minister for Finance his views on a matter (details supplied) regarding tax liabilities for landlord property owners; and if he will make a statement on the matter. [17984/15]

Michael Healy-Rae

Ceist:

48. Deputy Michael Healy-Rae asked the Minister for Finance his views on a matter (details supplied) regarding the private rental sector; and if he will make a statement on the matter. [17985/15]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 47 and 48 together.

The Deputy's questions relate to the tax treatment of landlords. I would highlight that income tax is charged under Schedule D of the Taxes Consolidation Act (TCA) 1997 in respect of a number of sources of income, including rent received by landlords (both individuals and companies) from property in the State.

In the case of rental activity, taxable income is the gross rent as reduced by a limited number of specified deductions as set out in section 97 (2) TCA 1997. The main deductible expenses are:

- any rent payable by the landlord in the case of a sub-lease;

- the cost to the landlord of any goods provided or services rendered to a tenant;

- the cost of maintenance, repairs, insurance and management of the property;

- the interest paid on borrowed money used to purchase, improve or repair the property (which, in the case of residential property, is restricted to 75% of the interest and is subject to compliance with PRTB registration requirements for all tenancies that existed in relation to the property in the relevant year); and

- payment of local authority rates.

In addition, wear and tear capital allowances are available in respect of the capital expenditure incurred on fixtures and fittings provided by a landlord for the purposes of furnishing rented residential accommodation. These allowances are granted at the rate of 12.5% per annum of the actual cost of the fixtures and fittings over a period of 8 years.

The effect of the deduction of allowable expenses from gross rent means that the amount of taxable rental income will often be substantially lower than the gross rent, and could, depending on individual circumstances, be nil.

The Government is monitoring the rental market closely and the overriding objective in relation to rents is to achieve stability and sustainability in the market for the benefit of tenants, landlords and society as a whole. Housing policy is a matter for the Department of Environment, and my officials have been in contact with officials in that department. Any tax proposals would be considered by the Government as part of the annual Budget and Finance Bill process.

Banking Sector

Ceisteanna (49)

Pearse Doherty

Ceist:

49. Deputy Pearse Doherty asked the Minister for Finance when he will meet the main lenders; and if he will direct those in which he is the shareholder to reduce their standard variable rate interest rates and offer realistic solutions to families struggling with mortgage arrears that involve maintaining the family home. [17767/15]

Freagraí scríofa

Minister for Finance

The lending institutions in Ireland - including those in which the State has a significant shareholding - are independent commercial entities. I, as Minister for Finance, have no statutory role in relation to regulated financial institutions setting interest rates. This is a commercial matter for the institutions concerned.

Equally, the Central Bank has no statutory role in the setting of interest rates by regulated entities, apart from the interest rate cap imposed on the credit union sector in accordance with the provisions of the Credit Union Act, 1997 and the requirement to be notified of penalty or surcharge interest imposed in respect of arrears.

Nonetheless, the issue of regulation of interest rates remains a policy area under active review. I discussed the issue of mortgage interest rates with the Governor of the Central Bank on 2 April. As a result, the Governor is currently reviewing the issue of the standard variable rates charged by the lenders and should be in a position to present this analysis to me in the next 10 days or so. I will then meet the six principal mortgage lenders in order to discuss this issue.

In addition, there have been moves on interest rates. As the Deputy will be aware, on 1 May AIB Group announced a number of reductions to its mortgage interest rates for owner occupier and buy-to-let mortgages.

A series of reductions over a fixed time frame would be acceptable to me and in that context I welcome AIB's announcement as a good first step.

The effective management of the mortgage arrears issue is an area that remains under continuous review.  More and concerted action can be undertaken by the banks to assist customers in arrears. As the Deputy is aware the Taoiseach has previously announced that the Government is considering a range of options to support the existing framework and to improve the uptake of personal insolvency solutions. Given the importance of the issue, his Department is co-ordinating the response across the various Government Departments and agencies and I anticipate that a detailed announcement will be forthcoming shortly.

Pension Provisions

Ceisteanna (50)

Jerry Buttimer

Ceist:

50. Deputy Jerry Buttimer asked the Minister for Finance the reason there was a 4% annual withdrawal limit applied to approved minimum retirement funds; if there is flexibility in this restriction; and if he will make a statement on the matter. [17903/15]

Freagraí scríofa

Minister for Finance

Finance Act 2014 introduced changes to allow owners of approved minimum retirement funds (AMRFs) to draw-down up to 4% of the assets of such funds on one occasion in each year instead of the facility to draw-down the accrued income and gains of such funds, as had applied prior to the changes.

I should explain by way of background, that under the flexible options at retirement arrangements (the so-called "ARF option"), where an individual in a Defined Contribution pension savings arrangement is under age 75 at the time of exercising the option and does not meet the guaranteed pension income requirement of €12,700 per annum, that individual must place a maximum "set aside" amount of €63,500 (or the remainder of the pension funds if less than €63,500 after taking the retirement lump sum) in an AMRF or purchase an annuity with those funds.

Any amount of remaining pension funds in excess of €63,500 can be invested in an ARF with access to those funds at the owner's discretion (subject to tax, at the marginal rate and having regard to the imputed distribution requirements).

The purpose of the AMRF is to ensure that an individual without the minimum guaranteed pension income for life has a pension "nest-egg" to provide for the latter years of his/her retirement. Up to Finance Act 2014, the capital invested in an AMRF could not be accessed until the AMRF owner reached age 75 (or meets the guaranteed pension income requirement before then) at which point the AMRF becomes an ARF with unrestricted access to the funds, subject to taxation. While the capital sum in an AMRF could not be accessed, as set out, any income, profits or gains accrued from the investment of the capital could, up to now, be withdrawn by the AMRF owner, subject to tax at the marginal rate.

I decided to change the arrangements for AMRFs so as to allow AMRF owners voluntary, tax-liable access to a maximum of 4% of their AMRF assets each year up to the point at which the AMRF becomes an ARF. This change provides AMRF owners with access to a definitive and certain level of income from their AMRF rather than the uncertain level of income which access to the accrued income, profits and gains in the AMRF provided.

Under the previous access arrangements for AMRFs, the extent of any income, profit or gains would depend on the performance of the investment options taken and could, therefore, be highly volatile with the possibility of little or no gains accruing in certain years. In addition, the scale of the capital allowed for in an AMRF, at €63,500, would not always permit for investment returns of any significant scale to be made using a prudent investment policy.

The change allowing access to a specified percentage of the capital in an AMRF is primarily aimed at those individuals whose AMRF constitutes a significant part of their retirement funds and who, while not wishing to purchase a pension annuity with those funds, may require access to a portion of these funds to provide a more certain form of supplementary pension income prior to reaching age 75. This facility also ensures that an individual will have some remaining funds in the AMRF at age 75 to provide for their remaining years, assuming the individual has not purchased a pension annuity in the meantime.

Individuals whose AMRF represents a less significant part of their retirement funds and whose circumstances would allow for greater investment risk and, therefore, potentially greater investment returns will be limited to the 4% level of asset draw down. However, this draw down will also be available to them for periods when their AMRF investments make losses or returns of less than 4% of the value of their AMRF assets and where, under the previous arrangement, they would not have been able to make a draw down or a draw down of a lesser value than will now be permitted. I consider that the change will be to the benefit of AMRF owners, generally, over the medium to longer term and I have no plans to reverse it.

Mortgage Resolution Processes

Ceisteanna (51, 52, 53, 54)

Michael Lowry

Ceist:

51. Deputy Michael Lowry asked the Minister for Finance if he will provide, in tabular form, by county, figures showing the exact numbers of persons who are currently experiencing the problem of mortgage arrears and family home repossession. [17915/15]

Michael Lowry

Ceist:

52. Deputy Michael Lowry asked the Minister for Finance if he will provide figures, in tabular form, by county, for those who have availed of Government-led interventions designed to address the mortgage crisis, including the Central Bank of Ireland targets for the banks through the mortgage arrears resolution targets, the mortgage-to-rent scheme and the recasting of personal insolvency legislation, for the period January to December 2014. [17916/15]

Michael Lowry

Ceist:

53. Deputy Michael Lowry asked the Minister for Finance if he will provide figures, in tabular form, by county, for those who have availed of Government-led interventions designed to address the mortgage crisis, including the Central Bank of Ireland targets for the banks through the mortgage arrears resolution targets, the mortgage-to-rent scheme and the recasting of personal insolvency legislation, for the period January to May 2015. [17917/15]

Michael Lowry

Ceist:

54. Deputy Michael Lowry asked the Minister for Finance if he will commit to a specific date to address the issue of the mortgage crisis; and if he will make a statement on the matter. [17918/15]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 51 to 54, inclusive, together.

With regard to the data requested by the Deputy, I am informed by the Central Bank of Ireland that the Residential Mortgage Arrears and Repossession Statistics are published quarterly.  These statistics are collected from a large number of reporting institutions and are designed to capture all mortgage loans secured on properties located in the Republic of Ireland. The data is provided on a national level only and no regional breakdown is available. It is not, therefore, possible to provide the requested county level mortgage arrears and family home repossessions breakdown. The latest Central Bank publication was for end-Q4 2014 and is available here:

http://www.centralbank.ie/polstats/stats/mortgagearrears/Pages/releases.aspx .

In respect of the request regarding those who have availed of the recast personal insolvency legislation, this is an issue which comes under the responsibility of the Minister for Justice & Equality, Frances Fitzgerald, TD.  However,  I would refer the Deputy to the Insolvency Service of Ireland's most recent Statistical update for Quarter 1 2015 at http://www.isi.gov.ie/en/ISI/Press_Release_14_4_15.pdf/Files/Press_Release_14_4_15.pdf.

My own Department's monthly Mortgage Arrears and Restructures publication also collects data on a national level only.  The most recent publication, with data up to February 2015, shows that for the six main banks total PDH mortgage accounts in arrears stood at 84,717, a decline of over 3,000 accounts compared to the January figure.  The number of accounts in arrears of more than 90 days continued to fall and stood at 59,138 accounts and total mortgage accounts that were restructured stood at 106,402 accounts for the same period.  The Deputy may view the full publication at the following link - http://www.finance.gov.ie/sites/default/files/Department%20of%20Finance%20-%20Mortgage%20Restructures%20Data%20-%20end%20Feb%202015.pdf.

 As the Deputy will be aware, responsibility for the administration of the Mortgage-to-rent(MTR) scheme comes under the responsibility of the Minister for the Environment, Community & Local Government and  that Department has provided me with county-level data on the status of all MTR cases processed to date. The data is contained in the first table.  

The Deputy will also be aware that responsibility for the administration of the Courts Service, which deals with repossession cases, rests with my colleague, Frances Fitzgerald TD, Minister for Justice & Equality. The Courts Service Quarter 1 2015 data for family home repossessions in the Circuit Court was released yesterday.  The second table shows possession orders granted by county is also set out.

Circuit Court Possession Order Stats for Jan 2015 - Mar 2015

Civil Bills Granted

County	Primary Home	By to let	Other  Unknown	Total Orders Granted
Carlow	2	3	0	5
Cavan	3	3	3	9
Clare	6	3	0	9
Cork	57	3	15	75
Donegal	29	1	2	32
Dublin	63	19	18	100
Galway	12	1	1	14
Kerry	11	2	3	16
Kildare	8	12	0	20
Kilkenny	7	4	3	14
Laois	35	4	0	39
Leitrim	3	0	3	6
Limerick	11	1	3	15
Longford	3	5	1	9
Louth	18	6	2	26
Mayo	11	7	1	19
Meath	12	0	15	27
Monaghan	4	1	1	6
Offaly	17	3	1	21
Roscommon	16	4	5	25
Sligo	0	1	0	1
Tipperary	17	5	0	22
Waterford	13	0	4	17
Westmeath	6	5	1	12
Wexford	10	3	23	36
Wicklow	9	1	1	11
Total	383	97	106	586

Local Authority	Total	Active	Borrower Consent Required	Complete	Sale Not Agreed	Ineligible	Terminated
Carlow County Council	53	11	0	4	1	5	32
Cavan County Council	73	14	1	1	0	16	41
Clare County Council	54	13	2	2	2	8	27
Cork City Council	44	12	0	4	2	1	25
Cork County Council	158	29	9	3	0	32	85
Donegal County Council	49	0	1	0	0	16	32
Dublin City Council	257	67	6	15	3	22	144
Dun Laoghaire/Rathdown	19	1	1	1	2	6	8
Fingal County Council	193	43	9	5	2	15	119
Galway City Council	13	3	2	0	0	1	7
Galway County Council	73	9	2	1	1	21	39
Kerry County Council	47	8	3	1	2	7	26
Kildare County Council	183	42	15	7	2	17	100
Kilkenny County Council	61	12	3	3	2	13	28
Laois County Council	81	19	4	1	2	14	41
Leitrim County Council	14	1	0	1	0	4	8
Limerick City and County C	113	21	4	4	1	19	64
Longford County Council	30	6	1	0	0	8	15
Louth County Council	147	38	2	10	3	15	79
Mayo County Council	42	1	0	0	0	10	31
Meath County Council	250	53	17	7	6	25	142
Monaghan Town Council	35	8	0	0	0	11	19
North Tipperary County Co	0	0	0	0	0	0	0
Offaly County Council	94	21	5	2	0	13	53
Roscommon County Council	32	3	1	0	0	6	22
Sligo County Council	18	1	0	0	0	4	13
South Dublin County Council	191	44	6	6	3	18	114
South Tipperary County Council	0	0	0	0	0	0	0
Tipperary County Council	140	28	4	3	2	21	82
Waterford County Council	7	7	0	0	0	0	0
Local Authority	Total	Active	Borrower Consent Required	Complete	Sale Not Agreed	Ineligible	Terminated
Westmeath County Council	73	13	5	2	0	13	40
Wexford County Council	105	14	3	1	1	14	72
Wicklow County Council	86	16	3	3	1	8	55
Total	2835	590	114	93	39	398	1601

Disabled Drivers Grant Appeals

Ceisteanna (55)

Brendan Griffin

Ceist:

55. Deputy Brendan Griffin asked the Minister for Finance if a person (details supplied) in County Kerry will be granted a disabled driver's grant for vehicle registration tax in respect of a car the person has just purchased; if the person's appeal has been reviewed; and if he will make a statement on the matter. [17958/15]

Freagraí scríofa

Minister for Finance

The Deputy will be aware of the legal provisions governing the Drivers & Passengers with Disabilities Scheme. As I informed the Deputy in my written answer to him on 4 March 2015, the appeal lodged by the person concerned under Section 145 of the Finance Act 2001 was finalised on 13th February 2015 and the initial decision to refuse the tax relief was upheld.

I am advised by the Revenue Commissioners that the person concerned subsequently lodged a further appeal under Section 146 of the Finance Act 2001 whereby his case would be heard by the Appeal Commissioners. That appeal will be listed for hearing before the Appeal Commissioners at the earliest possible date. Finalisation of this matter must await the outcome of that appeal.