Written Answers Nos. 104-118
104. Deputy Brian Stanley asked the Minister for Finance the status of the list of prohibited countries, described as such by Bank of Ireland, which is used as the criteria for immigrants from those listed countries to open bank accounts. [8239/16]
Amharc ar fhreagraI can confirm that officials in my Department have referred the Deputy's question to Bank of Ireland and have received the following response in this regard:
The Bank of Ireland Group is a diversified Financial Services organisation and is required to comply with all regulatory and legislative requirements in all markets in which it operates.
105. Deputy Jim Daly asked the Minister for Finance the discretion afforded by law to the Revenue Commissioners to forgo the collection of penalties applied to individuals who made a late tax return, less than one year late and due to illness, and who are certified by a medical report as being incapacitated at the time, noting the person has discharged all sums due of the actual tax; and if he will make a statement on the matter. [8301/16]
Amharc ar fhreagraI am advised by the Revenue Commissioners that section 1084 of the Taxes Consolidation Act 1997 (the Act) imposes a surcharge on any taxpayer, whether an individual or a corporate, for the late submission of a tax return. The surcharge applies to the full amount of the tax due irrespective of payments of preliminary tax and is graded by reference to the length of the delay in filing. Section 1084 also places an upper limit on the amount of the surcharge.
Where a return of income is delivered less than two months after the return filing date, the surcharge is 5% of the tax liability, subject to a maximum of €12,695.
Where a return of income is delivered two months or more after the return filing date, the surcharge applied is 10% of the tax liability, subject to a maximum of €63,485.
The surcharge has been in existence since 1995 and is an established and important driver of timely compliance with the return filing self-assessment system.
While there is no explicit provision in the Act for mitigation of a surcharge, section 864 places the taxes comprehended by the Act under the care and management of the Revenue Commissioners. I am advised that Revenue accepts that, in the case of normally compliant taxpayers, exceptional circumstances may occasionally arise which could justify the waiving of the surcharge, and are prepared to consider representations from taxpayers, or their agents, in this regard.
If the Deputy's question relates to a particular taxpayer I would advise that the individual in question contact his or her local tax office and outline the circumstances which gave rise to the late filing of the relevant tax return.
106. Deputy Robert Troy asked the Minister for Finance if it is fair that a person with serious medical conditions is only entitled to a full pension at 75 years of age under the conditions of the approved minimum retirement funds legislation introduced in January 2015 (details supplied). [8306/16]
Amharc ar fhreagraApproved Minimum Retirement Funds (AMRFs) form part of the suite of flexible options available to individuals in relation to their pension funds at retirement, depending on the circumstances.
Prior to Finance Act 1999, individuals with Defined Contribution (DC) pension savings had no option but to purchase a pension income or annuity with their savings after taking the allowable tax-free retirement lump sum. Finance Act 1999 introduced flexibility and choice for certain individuals in relation to their pension savings and those flexible options at retirement have since been extended to all benefits from DC retirement benefit schemes and other DC pension savings. These arrangements are therefore long-standing.
Choices which are now available to individuals (after taking the tax-free retirement lump sum) include the option to purchase an annuity with the remaining pension 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 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 minimum 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 per annum and this income requirement can be satisfied, to a significant extent, by the amount of the State pension in payment to an individual in his or her own right (e.g. excluding any payment being received on behalf of a dependent.)
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 maximum amount of the "set aside" is €63,500 or the remaining pension fund amount, if lower, after taking the permissible tax-free retirement lump sum. The funds in an AMRF can be used at any point, in full or in part, to purchase an annuity, including an annuity which, with existing pension income, would be sufficient to meet the minimum specified income requirement after which the AMRF becomes an ARF and any remaining funds therein can be accessed at the owner's discretion, subject to taxation.
The purpose of the AMRF is to ensure that an individual without the minimum guaranteed pension income for life has a pension "safety-net" 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, until 2015, be withdrawn by the AMRF owner, subject to tax at the marginal rate.
I decided to change the arrangements for AMRFs last year so as to allow AMRF-owners voluntary, tax-liable access to a maximum of 4% of their AMRF assets each year until it 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 a maximum of €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 decided not to purchase a pension annuity in the meantime.
The arrangements which I have described provide a variety of options and choices for individuals to access their pension savings, subject to certain safeguards which I consider are reasonable and proportionate in present circumstances.
107. Deputy Éamon Ó Cuív asked the Minister for Finance if the Revenue Commissioners pay the banks through the tax relief at source scheme in the event of mortgage holders not paying either some or all of their mortgage payments; and if he will make a statement on the matter. [8344/16]
Amharc ar fhreagra108. Deputy Éamon Ó Cuív asked the Minister for Finance if the Financial Regulator, the Revenue Commissioners, the Comptroller and Auditor General or any other State body carries out an audit on the banks to ensure that they fully pass on the tax relief at source to customers; and if he will make a statement on the matter. [8346/16]
Amharc ar fhreagraI propose to take Questions Nos. 107 and 108 together.
Section 244 of the Taxes Consolidation Act 1997 provides for tax relief in respect of interest paid on qualifying mortgage loans. The requirement that the relief is paid at source through the relevant lending institutions is contained in Section 244A.
The relief, which is subject to varying rates and ceilings, is only allowable on the actual amount of interest paid within a tax year. In instances where borrowers pay less than the amount of interest due, then the TRS amount is reduced to reflect the actual amount of interest paid. Where no interest payments are made the relief is not allowed.
With regard to the Deputy's Question on audits of TRS, I am advised by Revenue that, while it is not possible to individually review each of the 330,000 accounts currently receiving mortgage interest relief at source, it does carry out ongoing random checks to ensure the relief is correctly calculated and paid.
Revenue also carries out compliance visits on the lending institutions to ensure they are operating the Tax Relief at Source scheme in accordance with the legislation and each individual complaint or query from mortgage holders is fully investigated to ensure the proper amount of relief is being applied.
109. Deputy Bríd Smith asked the Minister for Finance to seek clarification from a bank (details supplied) as to the way in which it intends to conduct a sale of credit card debt of small and medium enterprises in County Dublin in the near future; to whom invitations are issued to partake in this sale; the discount the bank is offering for the purchase of the debt portfolios; and if he will consider purchasing these portfolios in order to alleviate the negative impact that this sale could have on local businesses and jobs. [8368/16]
Amharc ar fhreagraThe Deputy will be aware that I, in my role as Minister for Finance, have no direct function in the relationship between the banks and their customers. I have no statutory function in relation to the banking decisions made by individual lending institutions at any particular time and these are taken by the board and management of the relevant institution. This includes decisions in relation to the sale of debt portfolios as determined by the banks from time to time.
As the Deputy may be aware, the Consumer Protection (Regulation of Credit Servicing Firms) Act, 2015 was enacted on 8 July 2015. It was introduced to fill the consumer protection gap where loans were sold by the original lender to an unregulated firm. The 2015 Act introduced a regulatory regime for a new type of entity called a 'credit servicing firm'. Credit Servicing Firms are now subject to the provisions of Irish financial services law that apply to 'regulated financial service providers'. This ensures that relevant borrowers, whose loans are sold to third parties, maintain the same regulatory protections they had prior to the sale, including under the various statutory codes (such as the Consumer Protection Code, Code of Conduct on Mortgage Arrears, Code of Conduct for Business Lending to Small and Medium Enterprises and the Minimum Competency Code) issued by the Central Bank of Ireland and the Central Bank (Supervision and Enforcement) Act 2013 (Section 48) (Lending to Small and Medium-Sized Enterprises) Regulations 2015 which comes into operation on 1 July 2016.
Furthermore, it is important to highlight that the transfer of a loan from one entity to another does not change the terms of the contract or the borrower's rights and obligations under the original contract.
110. Deputy Marc MacSharry asked the Minister for Finance to introduce greater transparency for insurance companies in order to help curb the rising cost of motor insurance; and if he will make a statement on the matter. [8503/16]
Amharc ar fhreagraMy Department has commenced a Review of Policy in the Insurance Sector. This is being undertaken in consultation with other Government Departments and Agencies, the Central Bank of Ireland and relevant stakeholders.
The objective of the Review is to recommend measures to improve the functioning and regulation of the insurance sector. This Review will include an examination of the factors contributing to the cost of insurance and the issue of the availability of reliable insurance data has already been raised. The current lack of available data presents difficulties from a policy analysis and development perspective.
As well as for policy and statistical analysis, insurance data can be very useful in the drive to reduce insurance fraud and reduce the numbers of uninsured drivers on the roads. My colleague, the Minister for Transport, Tourism and Sport, is raising specific issues with the insurance industry in relation to the establishment of a motor insurance database. The cooperation of the insurance industry is important if progress is to be made on this issue.
The Review of Policy in the Insurance Sector which will continue over the coming months and is expected to be completed by the end of this year. The final report will be presented to Government in due course.
111. Deputy James Lawless asked the Minister for Public Expenditure and Reform if he will review the pension related deductibles for public servants and if he will phase out this measure; and if he will make a statement on the matter. [8072/16]
Amharc ar fhreagraA review of the public service Pension-related Deduction (PRD) was conducted last year and its application was ameliorated to reflect the improved fiscal environment. Specifically, the Financial Emergency Measures in the Public Interest (FEMPI) Act 2015 increases the threshold before PRD applies on a phased basis from €15,000 as applied up to 2015 to €28,750 with effect from 1 January 2017. This PRD relief, which also formed part of the Lansdowne Road Agreement, will remove the burden of PRD from those public servants with relatively lower pay, while those not fully removed from the imposition of PRD will receive an effective pay boost of €1,000 per year. The FEMPI 2015 Act also provides public servants with significant additional amelioration of FEMPI-imposed cuts by way of restoration or part-restoration of direct pay reductions.
The Minister for Public Expenditure and Reform is required by statute to carry out a review of the FEMPI Acts annually and the next review is required before 30 June 2016.
112. Deputy Darragh O'Brien asked the Minister for Public Expenditure and Reform the steps he is taking to combat coastal erosion; the moneys spent on the alleviation of coastal erosion, by local authority area, in each of the years 2012 to 2015; if a national plan to combat coastal erosion is in place; and if he will make a statement on the matter. [8265/16]
Amharc ar fhreagraThe Irish Coastal Protection Strategy Study (ICPSS) has surveyed and assessed the coastal erosion risk along the entire national coastline and this information is available to all Local Authorities to enable them to develop appropriate plans and strategies for the sustainable management of the coastline in their counties including the identification, prioritisation and, subject to the availability of resources, the implementation of coastal protection works both of a structural and non-structural nature as appropriate.
Coastal erosion is a natural and ongoing process. Coastal erosion may threaten human life or infrastructure such as roads and may undermine and cause damage to properties. However, it can also have beneficial effects such as providing natural nourishment and supply of sediment to adjacent beaches. Due to the considerable extent and nature of the Irish coastline impacted by erosion and the fact that it is an on-going natural process, it would be uneconomical and impractical for the State to protect all of this coastline.
It is the responsibility of local authorities in the first instance to identify, investigate and address on a prioritised basis problems of coastal erosion in their areas. The primary objective of The Office of Public Works (OPW) policy on coastal protection is to ensure that, in areas identified as being at greatest risk of damage or loss to assets through coastal erosion or flooding, appropriate and sustainable measures are identified by Local Authorities to protect those assets and, where intervention measures are economically justified and compatible with all required environmental and other statutory requirements, they are implemented subject to the availability of resources.
The Office of Public Works has a scheme in place entitled the Minor Flood Mitigation Works and Coastal Protection Scheme, which was introduced in 2009. The purpose of this scheme is to provide funding to local authorities to undertake minor flood mitigation works or studies to address localised flooding and coastal protection problems within their administrative areas. The scheme generally applies to relatively straightforward cases where a solution can be readily identified and achieved in a short time frame. All applications received are considered in accordance with the scheme eligibility criteria, which comprise economic, social and environmental criteria including a requirement that any measures are cost beneficial, and having regard to the overall availability of resources for flood risk management.
In some cases a 'do nothing' or ‘no active intervention’ approach might well be the most appropriate management response to coastal erosion, and international studies have borne this out. The European Commission Erosion study - Living with Coastal Erosion in Europe – which was completed in 2004 highlighted some important findings including the fact that some previous interventions, whilst solving erosion problems locally, have exacerbated coastal erosion at other locations or have generated other environmental problems. This study also highlighted the concept of ‘coastal squeeze’ which occurs in low-lying and inter-tidal areas which would otherwise naturally adjust to changes in sea level, storms and tides but cannot do so due to the construction of sea walls and other inflexible coastal barriers. The outcome can often be a gradual loss of amenity beach and habitat.
Because intervention within a coastal area may cause problems further along the coast, any proposed intervention measures are best developed in conjunction with a formal coastal erosion risk management study which has carefully investigated the problem and explored the full range of management options. Where warranted OPW is prepared to fund such studies under the Minor Flood Mitigation Works and Coastal Protection Scheme, in advance of any proposed erosion management works or measures.
Details on funding approved by the OPW for coastal protection works for each county from 2009 to the present is available on the OPW website under Flood Risk Management/Minor Works Scheme/Annual Lists of Minor Works Projects for which Funding has been Approved. The OPW does not have information on coastal protection or repair works that would have been carried out by the Local Authorities funded from their own or other (non-OPW) resources.
113. Deputy Michael Healy-Rae asked the Minister for Public Expenditure and Reform the status of an issue of cliff erosion (details supplied); and if he will make a statement on the matter. [8267/16]
Amharc ar fhreagraFollowing a meeting between the named person and the local Engineer of the Office of Public Works (OPW), the OPW procured a survey to assess the extent of erosion. The erosion was found to be not as severe as had been reported initially, but would require works at some stage. OPW flood defence assets in the south west region have suffered significant damage from the storms of recent years, and due to the need to prioritise repair work to these assets, it has not been yet possible to progress works at this location. The OPW is keeping the position under review.
114. Deputy Seán Haughey asked the Minister for Public Expenditure and Reform if the Office of Public Works makes available information in relation to flooding to home insurance companies; the data available from the OPW in the case of the Mayne River in Baldoyle, Dublin 13; and if he will make a statement on the matter. [8449/16]
Amharc ar fhreagraThe Office of Public Works (OPW) has no role or function in relation to the oversight or regulation of insurance matters. The provision of insurance cover, the level of premiums charged and the policy terms applied are matters for individual insurers. Insurance companies make commercial decisions on the provision of insurance cover based on their assessment of the risks they would be accepting on a case-by-case basis.
The Memorandum of Understanding between the OPW and Insurance Ireland, which was signed on 24th March 2014, outlines the principles of agreement between the parties on the provision of information to insurers to facilitate, to the greatest extent possible, the availability to the public of insurance against the risk of flooding. The OPW is committed to providing Insurance Ireland with data on all completed OPW flood defence schemes showing the design, extent and nature of the protections offered by these works. Insurance Ireland members will then take into account all information provided by the OPW when assessing exposure to flood risk within these areas.
In accordance with the Memorandum, the OPW has provided Insurance Ireland with data on sixteen completed OPW flood defence schemes. Details of the information provided to the Insurance Sector is available on the OPW website, www.opw.ie. The OPW has not carried out any flood defence scheme on the Mayne River, and so has not provided any data on that river to the insurance industry.
115. Deputy Seán Haughey asked the Minister for Public Expenditure and Reform if the Office of Public Works will engage with a not-for-profit community organisation (details supplied) with a view to reducing its rent and associated service and maintenance charges to ensure it continues its vital work; and if he will make a statement on the matter. [8452/16]
Amharc ar fhreagraI am advised by the Commissioners of Public Works that the operators of the Northside Civic Centre Crèche were identified following a competitive process and the Commissioners are therefore not in a position to renegotiate the terms and conditions of the agreement midway through its term.
116. Deputy Regina Doherty asked the Minister for Public Expenditure and Reform to reinstate pension entitlements for retired community employment supervisors, given the recommendation from the Labour Court advising for the immediate provision of same. [8061/16]
Amharc ar fhreagraUnions representing CE Supervisors and Assistant Supervisors have sought the provision of Exchequer funding to implement a Labour Court recommendation relating to the provision of a pension scheme dating back to 2008. In this regard the position has remained that it is not possible for the State to provide funding for such a scheme to employees of private companies even if those companies are or were reliant on State funding. It should be noted that the Labour Court recommendation related to future pension provision for persons in this type of private employment who are not currently benefiting from an employer supported pension scheme, rather than re-instatement of a previously held employee benefit or provision of a pension for retired persons.
Notwithstanding this the matter has remained under review and I held a constructive meeting with SIPTU and IMPACT trade unions in relation to this matter. Having listened to their respective positions I reconvened the Community Sector High Level Forum which ceased operation some years ago in order that this matter is fully examined, having regard to costs and precedent.
The Forum commenced its work on 27 November 2015 and a further meeting of the Forum took place on 11 April 2016.
117. Deputy Michael Healy-Rae asked the Minister for Public Expenditure and Reform the status of a shore bank (details supplied) that has been breached; and if he will make a statement on the matter. [8068/16]
Amharc ar fhreagraIt is a matter for Kerry County Council (KCC) in the first instance to identify, investigate and address issues of coastal protection and flooding at the location indicated.
KCC may carry out any necessary works using its own resources. It is open to the Council also to submit an application for funding if under the Office of Public Works (OPW) Minor Flood Mitigation Works & Coastal Protection Scheme. Any application received will be assessed under the scheme's eligibility criteria which includes a requirement that any measures are cost beneficial, and having regard to the overall availability of funding. Full details are available on the OPW website http://www.opw.ie.
118. Deputy Dara Calleary asked the Minister for Public Expenditure and Reform to define the term "freeze" in the context of section 2.19 of the Haddington Road agreement; if, now that the agreement has concluded, such freezes have finished; and if he will make a statement on the matter. [8080/16]
Amharc ar fhreagraThe Haddington Road Agreement (HRA) reached in 2013 provided for a range of cost-saving measures to the public payroll, including a series of deferred increments for public servants depending on salary level. For those earning between €35,000 and €65,000, section 2.19 of the Agreement provided for two three month increment pauses, i.e. increments would fall to be paid after 15 months instead of the usual 12 months. Agreement has been reached between the parties to the Agreement on how these modified increment measures will cease; details are available on my Department's website at http://circulars.gov.ie/pdf/circular/per/2015/20.pdf.
The remuneration terms of the Public Service Agreement 2013-2018 (Lansdowne Road Agreement or LRA) negotiated in 2015, does not include any additional increment deferrals. Those public servants who are encompassed by the Lansdowne Road Agreement will receive annual or multi-annual increments subject to the normal requirements for incremental progression. Section 7 (as amended) of the Financial Emergency Measures in the Public Interest Act 2013 provides for a suspension of incremental progression to 1 July 2018 for public servants not so encompassed.
