Written Answers Nos. 70-77
70. Deputy Charlie McConalogue asked the Tánaiste and Minister for Social Protection the status of an application for a carer's allowance by a person (details supplied) in County Donegal; and if she will make a statement on the matter. [42029/15]
Amharc ar fhreagraThe person concerned applied for carer’s allowance (CA) on 9 July 2014. To qualify for CA an applicant must be providing full-time care and attention to a person who requires that level of care. Where an applicant can prove to the satisfaction of a deciding officer that they have arranged for adequate provision of the relevant person, they can be employed, self-employed or engaged on educational training courses outside the home for a maximum of 15 hours per week.
The CA application was refused because the applicant was employed in excess of 15 hours per week.
The person concerned appealed the decision and the appeal was disallowed on 10 July 2015.
The person concerned submitted a new application for CA. The application is currently with a social welfare inspector (SWI) to reassess the level of care being provided, assess means and confirm that all the conditions for receipt of CA are satisfied. Once the SWI has reported, a deciding officer will make a decision as quickly as possible. The person concerned will be notified directly of the outcome.
71. Deputy Dan Neville asked the Tánaiste and Minister for Social Protection the status of an application for farm assist by a person (details supplied) in County Limerick; and if she will make a statement on the matter. [42030/15]
Amharc ar fhreagraThe Social Welfare Appeals Office has advised me that an appeal by the person concerned was registered in that office on 21 October 2015. It is a statutory requirement of the appeals process that the relevant papers and comments by or on behalf of the Deciding Officer on the grounds of appeal be sought from the Department of Social Protection. These papers have been received in the Social Welfare Appeals Office on 4 November 2015 and the case will be referred to an Appeals Officer who will make a summary decision on the appeal based on documentary evidence presented or, if required, hold an oral hearing.
The Social Welfare Appeals Office functions independently of the Minister for Social Protection and of the Department and is responsible for determining appeals against decisions in relation to social welfare entitlements.
72. Deputy Sean Fleming asked the Minister for Finance for a list of all new State agencies or bodies established under the aegis of his Department since March 2011; and if he will make a statement on the matter. [41877/15]
Amharc ar fhreagraIn response to the Deputy's query please find, in tabular form, all new State agencies or bodies established under the aegis of the Department of Finance since March 2011.
I would ask the Deputy to note that The New Economy and Recovery Authority (NewERA) has been established on a statutory basis within the NTMA following the commencement of the relevant section of the National Treasury Management Agency (Amendment) Act 2014. All staff assigned to the NewERA are employees of the NTMA. NewERA is not a new Body/Agency, it is a new function of the NTMA.
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Name of new Body/Agency created |
Date created |
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Credit Union Restructuring Board (ReBo) |
The Credit Union Restructuring Board (ReBo) was established by the Minister on an Administrative basis in August 2012. ReBo was placed on a statutory basis on 1 January 2013 on commencement of section 42 of the Credit Union and Co-Operation with Overseas Regulators Act 2012.
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Irish Bank Resolution Corporation (IBRC) |
Irish Bank Resolution Corporation (IBRC) was formed on 1 July 2011 and was the amalgamation of two pre-existing bodies (Anglo Irish Bank Corporation and Irish Nationwide Building Society). Irish Bank Resolution Corporation was subsequently liquidated and Irish Bank Resolution Corporation (in Special Liquidation) was created on 7 February 2013. |
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Irish Fiscal Advisory Council (IFAC) |
The Irish Fiscal Advisory Council (IFAC) was established on an interim basis in July 2011 and put on a statutory footing in December 2012 by the Fiscal Responsibility Act 2012. |
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Strategic Banking Corporation of Ireland (SBCI) |
The Strategic Banking Corporation of Ireland (SBCI) was incorporated in September 2014. |
73. Deputy Robert Troy asked the Minister for Finance if he considers the application of the universal social charge on public service pensions to be discriminatory; and if he will make a statement on the matter. [41922/15]
Amharc ar fhreagraThe USC was introduced in Budget 2011 to replace the Income Levy and Health Levy. It was a necessary measure to widen the tax base, remove poverty traps and maintain revenue to reduce the budget deficit. It is a more sustainable charge than those it replaced, and is applied at a low rate on a wide base.
The USC, like the Income Levy before it, does not apply to social welfare payments, such as the contributory and non-contributory State pensions, or payments of a similar nature. However occupational pensions, including occupational pensions of retired civil servants, are liable to the USC if the payment is greater than the exemption threshold, which for 2015 is €12,012.
As you are aware, delivering on a commitment in the Programme for Government, the USC was reviewed by my Department in the lead up to Budget 2012. The report is available at www.finance.gov.ie. The issue of USC applying to occupational pensions of retired public servants who entered the public service before April 1995 was examined as part of that review. Such individuals are (or were) liable to modified rate PRSI, which does not generate an entitlement to the State Pension.
The Government decided not to exempt the occupational pensions of these individuals from the USC charge as it would be very costly and difficult to achieve, and it would involve all income earners with the equivalent income benefiting from the exemption. In addition, it would also undermine the principle of the USC being applied to income with few exceptions.
However, as a result of the review of the USC, the Government decided in Budget 2012 to increase the entry point to the Universal Social Charge from €4,004 to €10,036 per annum. Budget 2015 provided for an increase in the exemption threshold to €12,012 and I announced in my recent Budget speech that this threshold will increase to €13,000 per annum from 1 January 2016. It is estimated that over 700,000 income earners will not be liable to USC at all from next year.
This exemption threshold equalises the position for single individuals whose sole source of income is the State Contributory Pension with Public Service pensioners whose pension is at an equivalent level. Furthermore, I intend to continue to reform the tax system in future budgets, subject to having the required fiscal space.
For the reasons outlined, I do not consider the application of the USC on Public Service pensions to be discriminatory. I would point out that the changes to the income tax system included in Budget 2015 mean that individuals who paid Income Tax and/or USC in 2014, including pensioners, are seeing a reduction in their tax bill this year where incomes are equal. Budget 2016 is now continuing this process of reducing the tax burden on low and middle income earners including, among other changes, a decrease in the three lowest rates of USC announced to take effect from January 2016.
74. Deputy Robert Troy asked the Minister for Finance his plans to enable credit unions to offer point-of-sale cards; and if he will make a statement on the matter. [41957/15]
Amharc ar fhreagraMy role as Minister for Finance is to ensure that the legal framework for credit unions is appropriate for the effective operation and supervision of credit unions.
The Registrar of Credit Unions at the Central Bank is the independent regulator for credit unions. Within her independent regulatory discretion, the Registrar acts to support the prudential soundness of individual credit unions, to maintain sector stability and to protect the savings of credit union members.
The Credit Union Act 1997 ("1997 Act") and related statutory instruments (provide for services exempt from additional services regulations) set out the services that a credit union may provide to its members. Where a credit union wishes to provide services to its members, in addition to the services that are provided for under the 1997 Act, an application may be made to the Central Bank for approval to provide such additional services in accordance with the provisions set out in sections 48-52 of the 1997 Act.
The Central Bank has informed me that since 2010 it has received less than 10 applications for approval of additional services under sections 48-52 of the 1997 Act. These have all been received in the last 15 months and are currently at various stages in the approval process, with a number having been fully approved.
The Central Bank has indicated to credit unions that where they are considering offering debit card services to members, the credit union should, in the first instance contact the Registry of Credit Unions to inform them of any such proposals. I have been informed by the Central Bank that a small number of credit unions are currently offering card services to members or are involved in card services pilot schemes.
I have been further informed by the Central Bank that it is, in principle, supportive of credit unions developing additional services and is open to working with the credit union sector to ensure that prudent and appropriate development can be facilitated within the regulatory framework. In its role of supporting the sustainable and prudent development of the sector, the Central Bank wants to ensure that proposed changes to the business model are prudently structured and implemented. Given a number of areas identified in feedback received on consultation paper 88-CP88, and through other engagements with sector stakeholders, the Central Bank will engage with interested parties to participate in focused dialogue in the coming months. Dialogue will initially centre on:
- the services credit unions wish to develop in the areas of card services and payment accounts; and
- credit unions' aims regarding longer term lending including further developments on the provision of mortgages to members.
To commence this engagement process, an initial meeting with a number of credit union stakeholders, including the representative bodies and a number of credit unions was held by the Central Bank in mid-November.
The Central Bank also informs me that the Annual Information Seminars for 2015 are currently taking place and will run until late November and these will also provide an opportunity for the Central Bank to engage with individual credit unions and hear their views on business development.
The Government's priorities remain the protection of members' savings, the financial stability of credit unions and the sector overall and it is absolutely determined to continue to support a strengthened and growing credit union movement.
75. Deputy Terence Flanagan asked the Minister for Finance if he will address concerns regarding levies (details supplied); and if he will make a statement on the matter. [41977/15]
Amharc ar fhreagraEvery year, in order to cover the costs of financial regulation, the Central Bank prescribes levies to be paid by entities subject to such regulation. The Central Bank had briefed industry representatives in August that it was proposing significant increases in those levies in 2015. The proposed increases were driven by a proliferation of legislative regulation and corresponding regulatory activity; a need to meet a shortfall from 2014's levies; and an increase in staff pension costs arising from Financial Reporting Standard 17 (which was coupled with prevailing low yields on the bond market).
The Central Bank's original proposals have since been revised to partially mitigate those increases as per a statement of 30th September 2015 published on the Central Bank's website. The revised proposals significantly reduced the increase in pension costs charged to the regulated sector in 2015 which is instead spread over coming years thereby easing the burden on financial services sector firms this year.
It is important to note that a robust regulatory environment benefits the financial services industry by promoting stability, a level playing field and facilitating prudent development and innovation. A well regulated financial services sector also benefits consumers, industry, and the economy at large. In order to ensure a well regulated financial services sector the Central Bank must be sufficiently resourced, particularly in terms of staff who are key to an effective regulatory regime. Pensions are a standard component in financial regulation costs given their link to staff costs.
Under Section 32D of the Central Bank Act 1942, the Central Bank is required to seek my approval for the Regulations prescribing industry levies. As part of that process officials from my Department met with intermediary industry representatives in order to hear their concerns on the increase in levies payable by their members. Following the publication of the Central Bank's revised proposals, which significantly reduced the pension element of the 2015 levies, I approved the Regulations prescribing the 2015 levies on 7 October last.
76. Deputy Finian McGrath asked the Minister for Finance if he will examine a proposal (details supplied) on tax relief; and if he will make a statement on the matter. [42014/15]
Amharc ar fhreagraThe State encourages individuals to save for their retirement by providing incentives through the tax system for them to invest some of their earned income into pension saving arrangements approved by the Revenue Commissioners. The incentives include exemption from income tax on pension contributions made from annual relevant earnings based on a percentage of those earnings which increases with age and subject to an overall earnings limit of €115,000 per annum. Pension fund growth is also exempt from tax while the retirement benefits drawn down at retirement are subject to tax at the individual's marginal tax rate with the exception of the permissible tax-free retirement lump sum.
Revenue approval of the various pension saving arrangements ensures that the tax incentives outlined above are confined to pension schemes and plans that are taken out for the sole purpose of providing retirement benefits at the appropriate age in line with tax law and Revenue rules.
As regards personal pensions plans such as Retirement Annuity Contracts or PRSAs, an individual must have a source of "relevant earnings" in order to effect such a plan. In general, this covers income taxable under Schedule E from non-pensionable employment and trading and professional income (Schedule D, Cases 1 and 2). Income from investments such as rental income from property, cannot be used to effect such a plan as it is not a source of "relevant earnings". This reflects the fact that pension income replaces an individual's earned income once they retire. In contrast, individuals with investment income do not lose that income source at the point at which they reach what could be considered "normal retirement age". The income will continue as before and they have the investment asset, for example, a property or properties, which may be converted to a capital sum with which they can purchase an annuity if they so wish.
Having excluded investment income from "relevant earnings" for the purposes of private or supplementary pension provision and the tax reliefs on contributions that go with it, it would appear contradictory, to say the least, from a policy perspective to then allow tax relief at a later date on rental income from a property designated a "pension property" by the property owner which appears to be what is envisaged in the details supplied with the question.
Where an individual owns a property and rents it out, the rental income is receivable directly by the landlord and accordingly is taxable in the year that it is receivable. There are a number of allowances and deductions available to reduce the tax on rental income paid. These include, for example: a deduction of 75% of the interest paid on borrowed money used to purchase, improve or repair rented premises; the cost to the landlord of any goods provided or services rendered to a tenant; and the cost of maintenance, repairs, insurance and management of the property.
However, for the reasons outlined, I have no plans to introduce further changes or additional tax incentives as requested.
77. Deputy Finian McGrath asked the Minister for Finance the steps the Revenue Commissioners are taking to monitor car park washing companies to ensure full compliance with taxation legislation; and if he will make a statement on the matter. [42015/15]
Amharc ar fhreagraThe Deputy will be aware that a key feature of our tax system is self-assessment. Businesses or individuals operating in the State who have an obligation to taxation are required to self assess and make the necessary returns and payments to the Revenue Commissioners on a timely basis.
I am advised by Revenue that they adopt a risk focused approach to monitoring and assuring tax compliance by businesses and individuals. Revenue's compliance programmes operate across all business sectors including those businesses providing car wash services. Revenue undertakes a wide range of interventions and assurance checks to tackle serious cases of risk and evasion and provide an appropriate level of support for compliant businesses who meet their obligations in a full and timely manner.
If the Deputy has specific information relating to individuals or businesses providing car wash services that are suspected of being involved in tax evasion, the information may be passed directly Revenue who have provided a specific template on their website which enables a person to submit a report of suspected tax evasion:
http://www.revenue.ie/en/ business/shadow-economy/index.html
https://www.ros.ie/online- enquiry-web/goodCitizen.
