Tuesday, 7 Feb 2017

Written Answers Nos. 146 - 171

Asylum Applications

Ceisteanna (146)

Jonathan O'Brien

Ceist:

146. Deputy Jonathan O'Brien asked the Tánaiste and Minister for Justice and Equality the reason for the delay in processing an application for asylum for a person (details supplied). [6126/17]

Freagraí scríofa

Tánaiste and Minister for Justice and Equality

I am informed by the Irish Naturalisation and Immigration Service (INIS) of my Department that the person referred to had his applications for asylum and subsidiary protection fully considered, following which they were refused, and he is now the subject of a Deportation Order made on 16 December 2010 and therefore has no entitlement to residency in the State.

Representations were received from the person concerned pursuant to Section 3 (11) of the Immigration Act 1999 (as amended), to revoke the Deportation Order. The Deputy might wish to note that any such decision will be to 'affirm' or to 'revoke' the existing Deportation Order. In the meantime, the Deportation Order remains valid and in place.

Queries in relation to the status of individual immigration cases may be made directly to the INIS of my Department by e-mail using the Oireachtas Mail facility which has been specifically established for this purpose. This service enables up to date information on such cases to be obtained without the need to seek information by way of the Parliamentary Questions process. The Deputy may consider using the e-mail service except in cases where the response from the INIS is, in the Deputy’s view, inadequate or too long awaited.

Brexit Issues

Ceisteanna (147, 158, 173, 177)

John Lahart

Ceist:

147. Deputy John Lahart asked the Minister for Finance the preparations the Revenue Commissioners have in place for the potential ending of the customs union; and if there is an estimation of the cost of establishing customs and excise surveillance along the Border. [5338/17]

Maurice Quinlivan

Ceist:

158. Deputy Maurice Quinlivan asked the Minister for Finance the way the Government plans to deal with a potential customs border if Northern Ireland is not part of the EU customs territory after the UK exits the EU; and if he will make a statement on the matter. [6314/17]

Maurice Quinlivan

Ceist:

173. Deputy Maurice Quinlivan asked the Minister for Finance if the Revenue Commissioners have any preparations in place for the potential ending of the customs union; if there has been an estimate made of the cost of establishing customs and surveillance along the Border; and if he will make a statement on the matter. [5523/17]

Thomas P. Broughan

Ceist:

177. Deputy Thomas P. Broughan asked the Minister for Finance the preparations the Revenue Commissioners are making for Brexit and the possibility that the customs union will be ended; the cost of implementing customs and excise Border surveillance; and if he will make a statement on the matter. [5868/17]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 147, 158, 173 and 177 together.

The Government's position is very clear in that we want the closest possible trading relationship with the UK.  As articulated by the Taoiseach, any manifestation of a hard border would have very negative consequences. In that regard a key priority is to ensure the continued free flow of trade on the island and the need to avoid a hard border.

The United Kingdom has not yet issued formal notification of its intention to leave the EU and it is clear that the discussions that will follow that notification will be complex. In that context, it is not possible to provide any meaningful estimation of potential costs associated with any arrangements that may prove necessary. I am informed by Revenue that they are engaged in research into the legal and practical implications of a range of scenarios, in order to support Ireland's stated objectives, and to ensure that the cost to Irish trade and economy will be minimised whatever the outcome of negotiations.

EU Budget Contribution

Ceisteanna (148, 151, 152, 178)

John Lahart

Ceist:

148. Deputy John Lahart asked the Minister for Finance the extent to which Ireland's contribution to the EU budget will increase following Britain's departure from the EU; and the impact the loss of British funding to the EU will have for schemes including the Common Agricultural Policy. [5339/17]

Niall Collins

Ceist:

151. Deputy Niall Collins asked the Minister for Finance the amount Ireland's extra contribution to the EU budget will be post Brexit; the impact the loss of UK funding to the EU will mean for schemes post 2020; and if he will make a statement on the matter. [5496/17]

Niall Collins

Ceist:

152. Deputy Niall Collins asked the Minister for Finance the amount Ireland's extra contribution to the EU budget will be post Brexit; the impact the loss of UK funding to the EU will mean for the successor to Horizon 2020, post 2020; and if he will make a statement on the matter. [5497/17]

Thomas P. Broughan

Ceist:

178. Deputy Thomas P. Broughan asked the Minister for Finance if his officials are examining the changes that will occur with Ireland's EU contributions once the UK has left the EU; the examinations that are taking place at an EU level into the impact of the withdrawal of the UK's contributions on all schemes including the Common Agricultural Policy; and if he will make a statement on the matter. [5869/17]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 148, 151, 152 and 178 together.

Until it formally withdraws from the European Union, the UK remains a full EU Member, with all of its existing rights and obligations including in relation to the EU Budget. Brexit is likely to involve complex discussion on the Multiannual Financial Framework, particularly as the UK is an important net contributor to the EU Budget. Therefore, Brexit will have a significant impact on EU Budget funding and expenditure and may need to be mitigated by either increased contributions from other Member States, reductions in EU funding programmes, or a combination of both.

While my Department has undertaken some broad modelling work to estimate the potential impact of Brexit on our EU budget calculations, this analysis will need to be developed in more detail in the coming period, when the parameters of the budget negotiations are better defined. In particular, a key point will be getting agreement amongst the EU27 on a common approach to the future of the EU Budget.

Brexit Issues

Ceisteanna (149)

John Lahart

Ceist:

149. Deputy John Lahart asked the Minister for Finance if the Government has secured any assurances that Ireland's corporation tax regime will not be targeted following Britain's departure from the EU. [5340/17]

Freagraí scríofa

Minister for Finance

Taxation is a sovereign Member State competence and decisions at Council on tax matters require unanimity. Ireland's sovereignty on tax matters is not affected by Brexit and this sovereignty is guaranteed by the EU Treaties.

Fiscal Data

Ceisteanna (150)

Dara Calleary

Ceist:

150. Deputy Dara Calleary asked the Minister for Finance his plans to review the use of the commonly agreed methodology in fiscal planning for budget 2018; and if he will make a statement on the matter. [5444/17]

Freagraí scríofa

Minister for Finance

Ensuring the plausibility of estimates of potential growth is a key priority given their significance in the application of the fiscal rules. As previously noted by both my own Department and the Fiscal Advisory Council, the harmonised methodology for estimating potential output is subject to limitations particularly when applied to Ireland. My Department continues to assess the merit of alternative models for estimating potential output for Ireland. Considerable work has been undertaken on this front to assess both the plausibility and, importantly, the stability of these alternative estimates. An outline of this work is set out in Box 1, page 24 of the Stability Programme Update 2016 (SPU), published in April. This work was further updated in the slides presented to the Budget Oversight Committee and to IFAC in October last year.

Notwithstanding the advance of alternative models, for the purposes of assessing the cyclical position of the economy in the context of fiscal monitoring, the harmonised methodology remains the relevant legally binding metric. In addition to developing alternative models, efforts continue to be undertaken at technical level in Europe to improve the performance of the harmonised methodology, to which Ireland continues to actively contribute.

In summary, Ireland's budgetary policy will be framed by the requirements of the Stability and Growth Pact and the harmonised methodology. 

Questions Nos. 151 and 152 answered with Question No. 148.

Corporation Tax

Ceisteanna (153)

Niall Collins

Ceist:

153. Deputy Niall Collins asked the Minister for Finance if the Government has secured assurances that Ireland’s corporation tax regime will not be targeted following Britain’s departure from the EU; and if he will make a statement on the matter. [5498/17]

Freagraí scríofa

Minister for Finance

Taxation is a sovereign Member State competence and decisions at Council on tax matters require unanimity. Ireland's sovereignty on tax matters is not affected by Brexit and this sovereignty is guaranteed by the EU Treaties. 

Insurance Coverage

Ceisteanna (154)

Maureen O'Sullivan

Ceist:

154. Deputy Maureen O'Sullivan asked the Minister for Finance if his attention has been drawn to problems faced by businesses in coastal areas obtaining insurance in view of the fact certain companies are basing their refusal on their own climate change presumptions; if his Department commissioned any study to examine specific coastal areas that will be adversely affected by rising sea levels; and if he will make a statement on the matter. [5580/17]

Freagraí scríofa

Minister for Finance

I am conscious of the difficulties that the absence of flood cover can cause to householders and businesses alike. 

However, you should be aware that the provision  of insurance is a commercial matter for insurance companies, which has to be based on a proper assessment of the risks they are accepting. This assessment will in relation to coastal communities, in many cases include  insurers  own climate change presumptions based on their own modelling and research. Consequently, neither the Government nor the Central Bank has any influence over this matter. This position is reinforced by the EU framework for insurance which expressly prohibits Member States from adopting rules which require insurance companies to obtain prior approval of the pricing or terms and conditions of insurance products. 

Policy at national level in relation to climate change adaptation is being developed in accordance with the Climate Action and Low Carbon Development Act 2015. Under section 5 of the 2015 Act, the Minister for Communications, Climate Action and Environment must submit to Government for approval, not later than 10 December 2017, a National Adaptation Framework (NAF). 

The Irish Coastal Protection Strategy Study (ICPSS) is a national study that was commissioned in 2003 with the objective of providing information to support the Local Authorities making decisions about how best to manage risks associated with coastal flooding and coastal erosion. The Study was completed by the Office of Public Works (OPW) in 2013 and provides strategic current scenario and future scenario (up to 2100) coastal flood hazard maps (and strategic coastal erosion maps) for the national coastline.

In addition, the National CFRAM Programme has investigated in further detail the coastal risk, including the risk that may emerge under possible future scenarios, for 90 coastal communities around the country where the risk was deemed to be potentially significant. Measures to address the risks identified were set out in Draft Flood Risk Management Plans that were published in 2016 for consultation.

Also, in line with the Sectoral Adaptation Plan for flood risk management, prepared by the OPW under the Climate Action and Low Carbon Development Act 2015, the planning and design for flood defence schemes takes climate change into account. This includes the feasible measures being identified through the Flood Risk Management Plans.

Finally, as the Deputy will be aware, the consumer has already recourse to the Financial Services Ombudsman to make a complaint in relation to any dealings with a Financial Services or Insurance provider during which they feel they have been unfairly treated. In addition, individuals who are experiencing difficulty in obtaining insurance or believe that they are being treated unfairly may contact Insurance Ireland which operates a free Insurance Information Service for those who have queries, complaints or difficulties in relation to insurance.

NAMA Assets Sale

Ceisteanna (155)

Catherine Murphy

Ceist:

155. Deputy Catherine Murphy asked the Minister for Finance the reason joint receivers and NAMA agreed to dispose of a CIÉ site to a person (details supplied) that was connected to NAMA under the section 172(3) of the NAMA Act 2009; and if he will make a statement on the matter. [5928/17]

Freagraí scríofa

Minister for Finance

The Deputy will be aware that I, as Minister for Finance, have no role in respect of sales by NAMA debtors or receivers or the sale of loans directly by NAMA. As the Deputy will also appreciate, these are matters for the NAMA Board in accordance with its statutory independent commercial mandate. Under Section 12 of the NAMA Act 2009, NAMA may "sell or dispose of the whole or any part of the property or investments of NAMA, either together or in portions, for such consideration and on such terms as the Board thinks fit". I am advised, by NAMA, that the transaction to which the Deputy refers involved the sale of development rights by the joint receivers, that it was openly marketed and that it also required the approval of the CIÉ Board which holds the freehold interest in the asset concerned. I am further advised that the transaction met with the requirements of Section 172(3) of the NAMA Act.

Vehicle Registration

Ceisteanna (156)

Brendan Griffin

Ceist:

156. Deputy Brendan Griffin asked the Minister for Finance if he will consider the introduction of private number plates for coaches (details supplied) similar to the scheme in place in the UK and Northern Ireland; and if he will make a statement on the matter. [5994/17]

Freagraí scríofa

Minister for Finance

I am advised by Revenue that the specification for the identification mark (the "registration plate") that must be displayed on vehicles is contained in the Vehicle Registration and Taxation Regulations, 1992 (S.I. No. 318 of 1992). These Regulations do not permit the application of special arrangements in relation to the registration plate to be used on coaches or any other category of vehicle.

The existing registration mark is integral to the operations of a number of agencies apart from Revenue, including An Garda Síochána, the Department of Transport, Tourism and Sport, the Department of Housing, Planning, Community and Local Government and the National Roads Authority. Any change to the existing specification could only be undertaken after an assessment of the impact of such changes, including in relation to the systems and other changes that would be required.

I am advised that there are no plans to undertake such a review.

Energy Prices

Ceisteanna (157)

Bernard Durkan

Ceist:

157. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which his Department monitors the economic impact of energy costs; and if he will make a statement on the matter. [6062/17]

Freagraí scríofa

Minister for Finance

I should clarify initially that my Department has no statutory function in the monitoring or setting of gas or electricity prices. Responsibility for the regulation of the electricity and gas markets is a matter for the Commission for Energy Regulation (CER), which is an independent statutory body.

However, my Department does monitor and advise on all developments that can impact on the economy, including oil price movements. By January of this year, the price of Brent crude oil had increased by around 24 per cent in euro terms (17 per cent in US dollar terms) since September 2016, when the macroeconomic projections that underpin Budget 2017 were finalised. I should note that oil prices were expected to increase this year and, indeed, this was highlighted as a risk in the Economic and Fiscal Outlook published with Budget 2017.

Ireland is a net energy importer and, as such, increases in oil prices have a negative impact on real economic activity in Ireland. Higher energy costs increase firms' input costs, thereby reducing profitability. At the household level, higher energy prices are likely to lead to a fall in real disposable incomes through higher inflation.

However, the recent increase in oil prices has to be considered in a longer term context; January's oil prices were still around 34 per cent lower in euro terms (almost 50 per cent in US dollar terms), compared to where they were in January 2014. 

Also, in recent years consumer price inflation has been near zero in Ireland reflecting inter alia the impact from falling oil prices. A more prolonged period of low inflation would therefore not be welcome as this could potentially lead to a deflationary spiral which would hurt our longer term growth prospects. As a result, the economic impact from recent increases in oil prices is likely to be modest.

My Department will update its inflation forecasts with the publication of the Stability Programme Update in April of this year, which will incorporate the impact of the moderate rise in oil prices seen over recent months.

Question No. 158 answered with Question No. 147.

House Purchase Schemes

Ceisteanna (159, 160, 161, 162)

Pearse Doherty

Ceist:

159. Deputy Pearse Doherty asked the Minister for Finance the number of applications to date for the help-to-buy scheme as announced in budget 2017; and if he will make a statement on the matter. [5368/17]

Pearse Doherty

Ceist:

160. Deputy Pearse Doherty asked the Minister for Finance the number of applications for the help-to-buy scheme that have been deemed valid to date; and if he will make a statement on the matter. [5369/17]

Pearse Doherty

Ceist:

161. Deputy Pearse Doherty asked the Minister for Finance the number of successful or pending applications for the help-to-buy scheme in categories (details supplied); and the total potential cost of the scheme in each category. [5370/17]

Pearse Doherty

Ceist:

162. Deputy Pearse Doherty asked the Minister for Finance the total anticipated cost of the help-to-buy scheme based on the applications to date; and if he will make a statement on the matter. [5371/17]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 159 to 162, inclusive, together.

The Deputy may be aware that a two-stage process is employed for the Help to Buy incentive, under which individuals submit an application for the incentive to receive an indication of the level of tax relief that may be available to them, and subsequently submit a claim for a tax refund. This refund is generally payable to the contractor at the deposit stage in the case of a home purchase, or in the case of a self-build, is paid to the applicant when they have drawn down the first tranche of their mortgage.

I am advised by the Revenue Commissioners that the number of Help To Buy applications received up to Friday 3 February 2017 was:

No. of Applications	Successful applications	*Pending
2,196	432	1,764

*Pending means that the applicants either have to file an outstanding return or address a compliance issue, or the application is to be reviewed by a Revenue caseworker, or the applicant needs to finalise his or her application.

The Revenue Commissioners are encouraging prospective applicants to file any necessary returns and resolve any outstanding issues before they make their HTB application. Applicants can, of course, also use Revenue's website to carry out other requests, for example to file a Form 12 or apply for tax clearance. PAYE taxpayers can use myAccount and the bulk of the applications so far have been submitted via myAccount. Business taxpayers can use ROS Revenue's Online Service.

Information about the loan-to-value ratios is not available when individuals submit their applications, as such figures are not usually finalised at that stage of the process. However, based on the finalised claims submitted by successful applicants, I am advised that the categorisation of claims by the requested loan-to-value ratios as of 3 February 2017 was:

Loan-to-value (LTV)	90%	85% to 90%	80% to 85%	Below 80% (and above 70% minimum LTV)
Total (134)	40	51	23	20

The number of applications and claims for the incentive are too small to materially affect the previous estimated cost of the scheme. In this regard, the Deputy may wish to note that at Budget time, it was estimated that the Help to Buy incentive would cost €40 million per annum, but €50 million in 2017 due to the backdating of the relief in respect of properties which became eligible for the scheme since 19 July 2016.

Credit Unions

Ceisteanna (163, 164)

Pearse Doherty

Ceist:

163. Deputy Pearse Doherty asked the Minister for Finance when the implementation group, as per the Credit Union Advisory Committee report, was established or will be established; and if he will make a statement on the matter. [5381/17]

Pearse Doherty

Ceist:

164. Deputy Pearse Doherty asked the Minister for Finance the way in which the membership of the implementation group to be established as per the Credit Union Advisory Committee report will be or was arrived at; the way in which the representatives of credit unions will be or are represented; and if he will make a statement on the matter. [5382/17]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 163 and 164 together.

One recommendation of the Credit Union Advisory Committee (CUAC) in the Review of Implementation of the Recommendations in the Commission on Credit Unions Report (the Report) was that an Implementation Group be established for a specified period of time to oversee and monitor implementation of those recommendations in a methodical manner and to advise the Minister for Finance on progress. 

Publication of the Report in July 2016 was just the beginning of the process. From September 2016 onwards CUAC continued working to enable a coherent implementation plan be devised. The Department has been working closely with CUAC.

In line with CUAC's recommendations, the Department invited one nominee from each of the following: Irish League of Credit Unions; Credit Union Development Association; Credit Union Managers' Association; National Supervisors Forum; and  the Central Bank. The Implementation Group will also have a CUAC representative and will be chaired by the Department. This broad membership will ensure participation and contribution from all credit union perspectives.

Nominees have been notified that the Implementation Group will  have its inaugural meeting on 20 February 2017. This meeting will be attended by all CUAC members. The term of the Implementation Group is for one year which may be extended at the discretion of the Minister. I look forward to receiving regular progress reports on the implementation of those important recommendations which I expect to progress without any undue delay.

Credit Union Lending

Ceisteanna (165)

Pearse Doherty

Ceist:

165. Deputy Pearse Doherty asked the Minister for Finance the legislative action he will take to allow credit unions to lend directly to housing bodies and local authorities for social and affordable housing; and if he will make a statement on the matter. [5383/17]

Freagraí scríofa

Minister for Finance

On 1 January 2016 I commenced the final sections of the Credit Union and Co-operation with Overseas Regulators Act 2012 (2012 Act) following discussions with credit union representative bodies. The 2012 Act was the first credit union specific legislation introduced in 15 years and was implemented in a coherent manner over three years to enable credit unions embed the changes into their day to day business. Following commencement of the legislation, the Central Bank introduced the Credit Union Act 1997 (Regulatory Requirements) Regulations 2016, regarding a number of areas including savings, borrowing, lending, investments and liquidity.

The investment regulations made specific reference to section 43 of the Act and to further classes of investments in which a credit union may invest its funds which may include investments in projects of a public nature. The regulations provide that investments in projects of a public nature include, but are not limited to, investments in social housing projects. The Central Bank will review the investment regulations for credit unions, including a public consultation, in 2017. Notwithstanding any potential changes that may be made to the regulations, the legislative requirement for credit unions to ensure investments do not involve undue risk to members' savings will remain the overriding factor which must inform all credit union investment decisions.

There are a number of areas which some credit unions consider restrict lending. Under section 35(2) of the Credit Union Act 1997 (1997 Act) a credit union can only lend to its members. Under section 17 of the 1997 Act all members must hold the common bond as set out in the rules of the credit union. Under section 6 of the 1997 Act one of the objects of a credit union is the creation of sources of credit for the mutual benefit of its members at a fair and reasonable rate of interest.

In its recent report the Credit Union Advisory Committee (CUAC) made recommendations under seven specific headings. One of those recommendations is to carry out a full review of lending limits and concentration limits under section 35, including the basis of the calculation of the limits together with the liquidity requirements attaching to same. In relation to the common bond, the Commission on Credit Unions in its 2012 Review surveyed credit unions - 54% of credit unions considered that the common bond should remain unchanged, 20% considered that it should be relaxed and 26% believed that membership of a credit union should be open to all. The Commission subsequently did not recommend any fundamental changes to the common bond. However, CUAC has recommended that three policy papers be developed by end September 2017, including a policy paper on the common bond.

CUAC has been working for a number of months devising an implementation plan in advance of the first meeting of the Implementation Group on 20 February 2017. My Department has been working closely with CUAC. The Implementation Group consists of a member from each credit union representative body, the Central Bank of Ireland. It will also have a CUAC member and will be chaired by a Department official. I look forward to regular updates on progress in implementing CUACs Report.

Bank Codes of Conduct

Ceisteanna (166, 176)

Pearse Doherty

Ceist:

166. Deputy Pearse Doherty asked the Minister for Finance if customers of a bank (details supplied) can be assured that their debts to the bank, mortgage or otherwise, will not be sold to vulture funds or third parties prior to any sale of a State stake in the bank; and if he will make a statement on the matter. [5384/17]

Michael Healy-Rae

Ceist:

176. Deputy Michael Healy-Rae asked the Minister for Finance the type of security measures which will be put in place if a bank (details supplied) is sold off to protect the persons that may have mortgages or loans with it from vulture funds which might purchase the loan book; the legislation in place to protect the public; and if he will make a statement on the matter. [5654/17]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 166 and 176 together.

Deputies will be aware that there are substantial protections in place for customers in the event that a loan is sold from the original provider to a third party. The Consumer Protection (Regulation of Credit Servicing Firms) Act 2015 was enacted in July 2015 and is designed to protect borrowers in this situation. Under the Act, purchasers of loan books must either be regulated by the Central Bank themselves or else the loans must be serviced by a credit servicing firm who is regulated by the Central Bank.

Under the  Consumer Protection (Regulation of Credit Servicing Firms) Act 2015 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) 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 came into operation on 1 July 2016.

The sale 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. My Department will continue to keep all relevant legislation under review in order to ensure that borrowers whose loans have been sold are properly protected and do not lose any protections which they previously enjoyed. In addition, the Department of Finance expect that the Central Bank as regulator of credit servicing firms, will be vigilant in this area and raise any specific instances where they have found consumers have not had their protections upheld or that their positions have been disadvantaged.

As the Deputy is aware non-performing loans (NPL's) remain at an elevated level across the European banking system and addressing this issue is one of the key priorities for the Single Supervisory Mechanism (SSM). In Ireland significant progress has been made across the banking sector in reducing the level of NPLs since the financial crisis. Despite this progress, the level of NPLs in the Irish banking sector remains well above the European average. Hence the SSM has tasked the management and board of each institution with developing and implementing a strategy to address this challenge. This challenge will have to be met whether or not the State has a shareholding in the bank concerned.

As the Deputy is aware, the relationship between the Minister for Finance and the banks in which the State is a shareholder are governed by a number of Relationship Framework Agreements, which in the case of AIB can be found here: http://www.finance.gov.ie/sites/default/files/Allied-Irish-Banks1.pdf. The Relationship Framework Agreements define the 'arms-length' nature of this relationship, allowing for oversight of significant actions taken while fully preserving the commercial independence of each bank, and the fiduciary responsibilities of their management and Board. The disposal of a loan or portfolio of loans is a commercial decision, and therefore a decision for the management and Board of each individual institution. Such a disposal is not subject to Ministerial consent but, if the value is greater than €100m in the case of AIB, is subject to Ministerial consultation.

State Banking Sector

Ceisteanna (167)

Pearse Doherty

Ceist:

167. Deputy Pearse Doherty asked the Minister for Finance if a decision to approve the sale of any shares owned by the Government in a bank (details supplied) will be put to a vote of Dáil Éireann; and if he will make a statement on the matter. [5385/17]

Freagraí scríofa

Minister for Finance

The State's shareholding in AIB is held in the ISIF's (Ireland Strategic Investment Fund) directed portfolio. In order to take any action in relation to the State's shareholding in AIB I would write to the ISIF and direct it accordingly.

To complete the repair of the banking system and ensure that banks are supporting the wider public interest, the Program for a Partnership Government allows for the sale of not more than 25% of any bank before the end of 2018 (plus any over-allotment option). Consistent with precedent, the decision to proceed with a IPO of AIB would likely be a decision for government. 

Legal Proceedings

Ceisteanna (168)

Pearse Doherty

Ceist:

168. Deputy Pearse Doherty asked the Minister for Finance the number of legal proceedings initiated by each of the State-backed banks in each of the past 12 months, in tabular form, by proceedings regarding principal home debt, buy-to-let debt, commercial debt and other personal debt; and if he will make a statement on the matter. [5387/17]

Freagraí scríofa

Minister for Finance

As the Deputy is aware, the Relationship Framework Agreements define the arm's-length nature of the relationship between the State and the banks in which the State has an investment, and any commercial decisions, including initiating legal action where it is deemed necessary, is decision exclusively for the management and board of each institution.

In response to the Deputy's question AIB have provided the following response:

"AIB prioritises reaching consensual arrangements with its customers in difficulty and only resorts to court proceedings where this is not possible. In cases where customers do not meaningfully engage or do not engage at all with the bank or reject the offer of a sustainable restructuring solution, AIB will pursue enforcement through the court process. It is important to note that the initiation of legal proceedings does not necessarily result in repossession. As soon as a customer in difficulty engages and enters into a restructured payment arrangement, the bank will pause the legal process. AIB offers the largest suite of solutions and operates multiple engagement channels that facilitate the maximum possible levels of engagement with customers in difficulty.

All information in relation to AIB's loan portfolios is contained in the Risk Management section (pages 36 - 80) of the bank's 2016 Half-Yearly Financial Report."

PTSB have provided the following response:

"Through 2016 permanent tsb issued no new legal proceedings regarding principal home debt, buy-to-let debt or personal debt. This reflected in part a decision by the bank to pause the issuing of such proceedings while it reviewed accounts following lessons learnt in the 2015 Mortgage Redress Programme."

 In response to a similar Parliamentary Question Bank of Ireland have responded:

"Due to commercial confidentiality and sensitivities in respect of individual client cases, Bank of Ireland is not in a position to provide a breakdown of the type requested. Relevant disclosures in respect of legal cases involving Bank of Ireland are publicly available through the Courts Service (including on its website)." 

Banking Operations

Ceisteanna (169)

Pearse Doherty

Ceist:

169. Deputy Pearse Doherty asked the Minister for Finance the number of properties taken into possession by each of the State-backed banks in each of the past 12 months; the number in their possession at the beginning of each month, in tabular form; and if he will make a statement on the matter. [5388/17]

Freagraí scríofa

Minister for Finance

The information requested by the Deputy is not available within the Department of Finance.

As the Deputy is aware, the Relationship Framework agreements define the arm's-length nature of the relationship between the State and the banks in which the State has an investment, and as such each bank is individually and independently responsible for managing their stock of repossessed properties. As noted in the annual reports cited below, repossessed properties are offered for sale by the banks using external agents as soon as practicable. 

All disclosures in relation to AIB's residential mortgages properties in possession can be found on page 53 of AIB's Half-Yearly Financial Report 2016 which can be found here: https://investorrelations.aib.ie/content/dam/aib/investorrelations/docs/resultscentre/annualreport/aib-annual-financial-report-2015.pdf.

Bank of Ireland disclose information on properties in possession and repossessions disposed of for their Retail Ireland Mortgage portfolio on page 370 of their annual report. A link to the 2015 Bank of Ireland report is available here: https://investorrelations.bankofireland.com//wp-content/assets/BOI-Annual-Report-2015.pdf

From the 1st January 2016 to the 31st Dec 2016, permanent tsb took possession of 116 properties; just 11 of these were a result of an Executed Order (i.e. a repossession achieved through the courts) while the remaining were properties which were either surrendered to the bank voluntarily by their owners or properties where the bank took repossession because it deemed the properties to be at risk (typically left vacant by owners). At the 31st December 2016 the bank had a total of 463 properties in its possession.

I would also draw the Deputy's attention to the most recent mortgage arrears and repossession statistics released by the Central Bank: https://www.centralbank.ie/polstats/stats/mortgagearrears/Documents/2016q3_ie_mortgage_arrears_statistics.pdf.

Mortgage Lending

Ceisteanna (170)

Pearse Doherty

Ceist:

170. Deputy Pearse Doherty asked the Minister for Finance when he and the Central Bank will implement the spirit of the Dáil Éireann motion passed on 26 January 2017 on tracker mortgages including the setting of a deadline for victims of the tracker mortgage scandal to be compensated; and if he will make a statement on the matter. [5420/17]

Freagraí scríofa

Minister for Finance

The Central Bank of Ireland is aware of the Motion on tracker mortgages which was carried in Dáil Éireann on 26 January last.

The Tracker Mortgage Examination is the most significant supervisory review undertaken in the context of the Central Bank's consumer protection remit. In line with its mandate to ensure that the best interests of consumers are protected, the Central Bank's immediate focus is to ensure that lenders prioritise the identification of impacted customers and stop the harm.

The Examination is a key priority for the Central Bank and it is working to ensure that the Examination is completed as soon as possible. However, it is also critical that each lender carries out a thorough, comprehensive and robust review, which achieves a fair outcome for all customers. While significant progress has been made, the Central Bank advises that due to the scale and complexity of the review, it will take some further time to complete.

Specific timelines have been set for all lenders to complete their internal reviews, and some lenders will have their internal reviews completed sooner than others depending on the size of their mortgage books and the complexities associated with them completing the Examination. Some lenders depending on progress have commenced rate rectification, redress and compensation, as appropriate.

Based on current progress, the Central Bank expects that all relevant lenders will have identified and commenced engagement with most impacted customers by mid-2017. Payment of redress and compensation, processing and consideration of any customer appeals and the Central Bank's own assurance work will continue beyond this point for some lenders.

The Central Bank has set down a robust framework whereby lenders' internal reviews will be overseen by independent third parties.  As part of the Examination, the Central Bank has made very clear what it expects of lenders in terms of redress and compensation to impacted customers, namely:

- Lenders will ensure that harm is stopped at the earliest possible time after each group of impacted customers is identified;

- Interest rates applied to impacted customers' accounts are to revert to the appropriate tracker interest rate or impacted customers are to be given the opportunity to revert to such a rate where relevant;

- Redress should ensure that impacted customers are returned to the position they would have been in had lenders' failure not occurred;

- Compensation, that reflects the detriment suffered by the individual customer, is to be provided by lenders; and

- An additional payment is to be provided to impacted customers to enable them to take independent professional advice regarding the redress and compensation offers made to them.

The Examination framework also requires lenders to establish an independent appeals process to deal with customers who are dissatisfied with any aspect of the redress package that they receive from lenders in respect of these matters. While the Central Bank expects the lenders' reviews to deliver fair outcomes for customers, the Bank believes that the appeals process is a very important part of the overall framework to ensure that there is an independent and transparent process in place for any impacted customer who feels that their particular circumstances were not appropriately considered.

The Central Bank will consider appropriate supervisory action, up to and including enforcement action, where necessary. All possible angles, including potential individual culpability, will be thoroughly investigated and analysed in the context of the legal framework. Enforcement measures will be deployed as appropriate, including investigating issues and taking cases under the Central Bank's Administrative Sanctions Procedure together with the use of its fitness and probity powers.

One enforcement action has already concluded, in which the Central Bank fined Springboard Mortgages €4.5m, the largest fine ever collected by the Central Bank. The Central Bank also advises that two other enforcement cases are ongoing.

The Deputy will also be aware that last year the Law Reform Commission published for consultation an Issues Paper on matters relating to regulatory enforcement and corporate offences. The Commission is continuing to analyse the many aspects of this project, taking account of the many submissions it received on its Paper. It is understood that the Commission's current intention is to publish its final report and recommendations later this year and, when to hand, that report will be considered by relevant Departments and regulatory bodies.

Tax Code

Ceisteanna (171)

Aengus Ó Snodaigh

Ceist:

171. Deputy Aengus Ó Snodaigh asked the Minister for Finance the reason a person (details supplied) is still being taxed as a single person. [5426/17]

Freagraí scríofa

Minister for Finance

I am advised by Revenue that the person concerned is non-resident but is chargeable to tax on income in the State.

In the case of a couple where both spouses are non-resident but one spouse has income chargeable to tax in the State, that spouse is chargeable to Irish Tax on the basis of separate treatment as a single person.

Where the other non-resident spouse has income outside the jurisdiction, some relief may be due where the Irish tax payable under separate treatment on the first spouse's income exceeds the tax that would have been payable if both incomes had been chargeable to Irish tax on the aggregation (joint assessment) basis. Non-Resident Aggregation Relief is given by way of a credit upon review following the end of the tax year.

Although the first spouse is treated as single during the year for the purposes of operating the PAYE system, his or her married status will be taken into account after the end of the tax year if Non-Resident Aggregation Relief is applied for within the statutory four year time limit and all required information is provided.

More detailed information explaining the taxation of married couples in cases involving non-residence is available from the Revenue website at:

http://www.revenue.ie/en/about/foi/s16/income-tax-capital-gains-tax-corporation-tax/part-44/44-01-01.pdf.