Written Answers Nos. 82-98
82. Deputy Noel Rock asked the Minister for Finance the reason it took a significant length of time for oversight officials to charge a bank (details supplied) for terrorist financing; the reason oversight officials did not flag suspicious transactions; and if he will make a statement on the matter. [21232/17]
Amharc ar fhreagraI am advised by the Central Bank that its investigation into designated persons' compliance with anti-money laundering ("AML") and countering the financing of terrorism ("CFT") preventative obligations set out in Criminal Justice Act 2010 (CJA 2010) was conducted under the Central Bank's Administrative Sanctions Procedure (ASP) as per Part IIIC of the Central Bank Act 1942.
For the purpose of clarification, an investigation under ASP is not a criminal investigation. The Central Bank's supervisory remit is to monitor credit and financial institutions for compliance with AML/CFT control measures. It has not a statutory remit to investigate or prosecute substantive money laundering or terrorist financing offences.
Any fine that is imposed for AML/CFT breaches by the Central Bank under ASP relates to control breaches and not to actual money laundering or terrorist financing offences.
One of the relevant AML/CFT breaches for an ASP case can be a breach of section 42 of the CJA 2010, which requires designated persons to submit a suspicious transaction report ("STR") to An Garda Síochána and to the Revenue Commissioners "as soon as practicable". Designated persons are obliged to submit STRs where a suspicion or knowledge of money laundering or terrorist financing arises during the course of business.
The duration of ASP investigations conducted by the Central Bank is determined by a number of factors, including inter alia the complexity of the matters under investigation; the fact that the ASP is a legal process requiring fair procedures to be followed (including procedures relating to the acquisition of relevant evidence) and the requirement for remediation measures (which can be significant) to be addressed before the case can be finalized.
83. Deputy Michael McGrath asked the Minister for Finance the respective nominal amounts for each item under total age related expenditure one to five years of age in table 20 on page 42 of the stability programme update April 2017, for each of the years 2013, 2020, 2030, 2040, 2050 and 2060 in tabular form; and if he will make a statement on the matter. [21265/17]
Amharc ar fhreagraThe Economic Policy Committee (EPC), an official level EU Committee, undertakes an assessment every three years reviewing the impact of long-term demographic trends on the public finances of Member States.
Table 21 on page 43 of the Stability Programme Update, published on May 2nd, sets out the long-term expenditure projections as published in the 2015 Ageing Report, under 5 broad headings; total pension expenditure, health care, long-term care, education expenditure and other age-related expenditures.
All of these projections were expressed as a share of GDP in the report and the corresponding nominal amounts were not published as part of the 2015 Ageing Report. This is the more appropriate approach to assess long-term trends as these projections in particular require a scaling factor to control for, inter alia, inflation and population growth.
As can be seen from the figures in table 21, reproduced below, unfavourable demographic trends in the coming decades will have significant implications for the economy and the evolution of the public finances.
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Table 21: Long-term spending projections |
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|
% of GDP unless otherwise stated |
2013 |
2020 |
2030 |
2040 |
2050 |
2060 |
|
Total age-related expenditure [items 1-5] |
22.1 |
22.9 |
23.9 |
24.6 |
25.6 |
23.9 |
|
1 Total pension expenditure |
7.4 |
8.0 |
9.1 |
10.0 |
10.0 |
8.4 |
|
: Social security pensions |
5.5 |
5.5 |
6.4 |
7.4 |
8.0 |
7.0 |
|
: Gross occupational pensions (Public Service) |
1.8 |
2.5 |
2.7 |
2.6 |
2.0 |
1.4 |
|
2 Health care |
6.0 |
6.3 |
6.9 |
7.3 |
7.3 |
7.2 |
|
3 Long-term care |
0.7 |
0.7 |
0.9 |
1.1 |
1.3 |
1.4 |
|
4 Education expenditure |
6.0 |
6.4 |
5.8 |
5.2 |
6.0 |
5.9 |
|
5 Other age-related expenditures* |
2.1 |
1.5 |
1.2 |
1.0 |
1.0 |
1.0 |
|
Underlying Assumptions |
2013 |
2020 |
2030 |
2040 |
2050 |
2060 |
|
Labour productivity growth |
-0.1 |
1.4 |
1.6 |
1.5 |
1.5 |
1.5 |
|
Potential GDP (growth rate) |
0.5 |
1.4 |
1.8 |
1.4 |
1.9 |
2.7 |
|
Participation rate males |
76.9 |
74.5 |
72.1 |
73.5 |
73.9 |
72.9 |
|
Participation rate females |
62.7 |
63.1 |
63.1 |
64.1 |
63.4 |
63.1 |
|
Total participation rates aged 15-64 |
69.7 |
68.8 |
67.6 |
68.8 |
68.7 |
68.2 |
|
Share of population over 65 years old |
12.4 |
15.0 |
19.4 |
23.1 |
24.9 |
21.4 |
|
Economic old-age dependency ratio |
28.7 |
34.5 |
43.9 |
53.9 |
63.0 |
52.5 |
Source: Economic Policy Committee and European Commission using Commission forecasts out to 2060. As reported in 2015 Ageing Report Economic and Budgetary projections for the EU28 Member States 2013-2060. Based on EUROPOP2013 population projections. Baseline in the 2015 Ageing Report was 2013.
Note: Participation rates refer to 15-64 cohorts. Economic old-age dependency ratio refers to inactive population over 65 as a share of employed population aged 15 to 64.
* Unemployment benefit
A range of policy measures have been undertaken over recent years to address the budgetary implications of population ageing including legislated step-increases in the state pension age over time, the planned introduction of a total contributions approach for the State Pension (Contributory), reform of public service pension entitlements and moves to place long-term care expenditure on a more sustainable footing.
The Department is committed to monitoring long-term demographic trends and will play an active role in the publication and subsequent analysis of updated figures in the 2018 Ageing Report.
84. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 5 and action point 8 in the Report on the Cost of Motor Insurance; if developments have occurred at an EU level in the first quarter of 2017; and if he will make a statement on the matter. [21365/17]
Amharc ar fhreagra85. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 5 and action point 9 in the Report on the Cost of Motor Insurance; if it has been necessary to make representations with the EU Commission and Parliament; if so, the details of same; and if he will make a statement on the matter. [21366/17]
Amharc ar fhreagra86. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 9 and action point 18 and 19 in the Report on the Cost of Motor Insurance; if the forum has been set up to discuss consumer and business issues; if that forum has met; the details of that meeting; the persons that have been appointed to this forum; and if he will make a statement on the matter. [21367/17]
Amharc ar fhreagra87. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 7 and action point 14 in the Report on the Cost of Motor Insurance; if progress has been made by a company (details supplied) and his Department on the declined cases agreement; if information has been provided on the company's website; the details of such information; if he has satisfied himself with the details provided; and if he will make a statement on the matter. [21368/17]
Amharc ar fhreagra88. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 10 and action point 20 in the Report on the Cost of Motor Insurance; if the advisory committee on small public service vehicles met with a company (details supplied); the details of that meeting; if actions have taken place as a result of that meeting; and if he will make a statement on the matter. [21369/17]
Amharc ar fhreagraI propose to take Questions Nos. 84 to 88, inclusive, together.
The recommendations in the Report on the Cost of Motor Insurance are being progressed in accordance with the Action Plan contained in the Report. The first quarterly progress update in respect of the implementation of the recommendations is now available on the Department of Finance website, under the Insurance Policy section.
This update shows the progress to date on the overall implementation of the Report, with a particular focus on action points which were due for completion in the first quarter of 2017.
The 5 parliamentary questions which have been composited all relate to Objective 1 of the Report – "Protecting the Consumer".
In respect of Recommendation 5 (Support efforts and raise awareness of the need to improve cross-border insurance provision at EU level) and Action Points 8 & 9 (Monitor EU developments and make representations as necessary with EU Commission and EU Parliamentarians), it should be noted that the Department of Finance is monitoring developments at EU level on an ongoing basis and has instructed the Permanent Representation in Brussels to hold consultations with relevant institutions on issues raised in the report. In this regard, I understand that engagements have taken place with the European Commission. Furthermore, representations have been made in the Financial Services Committee to reflect the concerns outlined in the report. There will be further engagements with other institutions going forward.
On the basis of these engagements, I understand that the European Commission is due to publish a review of its Green Paper on Retail Financial Services which will contain an action on the need to complete an evaluation of the Motor Insurance Directive later this year, in response to numerous complaints, particularly regarding no-claim bonuses on a cross-border level. Separately, the Commission has stated that it is reviewing supervision and enforcement in relation to insurance companies operating on a cross-border basis in Member States, on foot of a number of concerns following recent bankruptcies of such companies.
The Central Bank of Ireland has an ongoing engagement with the relevant European authorities in order to ensure common standards are applied consistently. In addition, the Central Bank fully participates in EIOPA (the EU overarching insurance regulatory body) to establish high quality common regulatory and supervisory standards and procedures. EIOPA is also due to report in 2019 on the barriers to providing cross-border insurance in general. The Department of Finance and the Central Bank will feed into the development of this report to ensure views expressed during the Working Group consultations are considered.
In respect of Recommendation 7 (The Declined Cases Agreement to be subject to ongoing review to ensure transparency) and Action Point 14 (Insurance Ireland to provide information on their website), Insurance Ireland has made the necessary alterations to its website in order to provide more prominent information in respect of the Declined Cases Agreement on its home page. I am satisfied that the link from the home page provides sufficient details on the Agreement and the procedure for making an application for consumers, including relevant contact details.
In respect of Recommendation 9 (Insurance Ireland to establish a Forum for Consumer and Business Issues) and Action Points 18 & 19 (Forum to be established by Insurance Ireland for consumer and business issues, and the Forum to meet twice yearly), I have been advised that Insurance Ireland set up the consumer and business forum in March and invited the relevant stakeholders, including representatives from the Department of Finance, the Department of Jobs, Enterprise and Innovation, the Central Bank of Ireland, the Financial Services Ombudsman, the Competition and Consumer Protection Commission, and the Consumers’ Association of Ireland, to the first of its biannual meetings due to take place on May 16th. The first meeting of the forum will concentrate on motor insurance with a view to broadening its scope at the second meeting.
In respect of Recommendation 10 (The Advisory Committee on Small Public Service Vehicles should enter regular discussions with Insurance Ireland to explore solutions for drivers in the sector) and Action Point 20 (Advisory Committee on Small Public Service Vehicles to meet with Insurance Ireland), I have been advised that the Minister for Transport, Tourism and Sport met the Advisory Committee on Small Public Service Vehicles, commonly known as the Taxi Advisory Committee (TAC), in March and this recommendation was discussed. The TAC is scheduled to meet with Insurance Ireland to explore solutions for drivers in the sector on May 22nd and will then report to the Minister for Transport, Tourism and Sport before the end of Q2 2017.
89. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 11 and action point 22 in the Report on the Cost of Motor Insurance; if the key aggregated metrics for a national claims database have been specified; the details of metrics used; the progress that has been made on establishing a claims information database; and if he will make a statement on the matter. [21370/17]
Amharc ar fhreagra90. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 12 and action point 25 in the Report on the Cost of Motor Insurance; if a quarterly publication of key aggregated metrics on claims costs and trends within the market has been published; the details of that publication; and if he will make a statement on the matter. [21371/17]
Amharc ar fhreagraI propose to take Questions Nos. 89 and 90 together.
I propose to take PQ's 89 and 90 together which deal with Recommendation 11 (Establish a National Claims Information Database) and Recommendation 12 (Quarterly Publication of Key Aggregated Metrics, on Claims, Costs and Trends within the Market).
The recommendations in the Report on the Cost of Motor Insurance are being progressed in accordance with the Action Plan contained in the Report. The first quarterly progress update in respect of the implementation of the recommendations is now available on the Department of Finance website, under the Insurance Policy section.
This update shows the progress to date on the overall implementation of the Report, with a particular focus on action points which were due for completion in the first quarter of 2017.
A common theme that emerged from discussions with stakeholders during the deliberations of the Working Group was that an improvement in transparency, facilitated by additional collection and publication of data, was essential. In this regard, the Report on the Cost of Motor Insurance concluded that a national claims information database is needed for the motor insurance sector so that amongst other things we can see what claims are being made against property or for personal injuries, the legal and other costs that are being incurred, and the channel of resolution and what impact this has on the final settlement. In order to better understand how claims costs impact premiums, the Cost of Insurance Working Group decided that an incremental data gathering approach should be adopted to increase transparency and improve data availability across the insurance sector along the following lines:
1. the short-term publication on a quarterly basis, of a number of key aggregated claims-related metrics.
2. to be followed by the establishment of a National Claims Information Database which would facilitate a more in-depth annual claims’ trends analysis.
To that end, a data sub-group was established to commence examination of these issues. The sub-group is chaired by the Department of Finance, and includes membership from the Central Bank of Ireland, the Society of Actuaries, the Personal Injuries Assessment Board, the State Claims Agency and the Central Statistics Office, and it met seven times between January and March.
Because there is considerable overlap between recommendations 11 and 12, the data sub-group has structured its work in order to enable it to meet the deadlines identified in the report. In this context, its primary focus from the outset has been to identify the key aggregated metrics that can be obtained from the industry in the short term to allow for immediate publication on a quarterly basis from Q2 2017. In this regard, it was therefore decided to seek an update on the information provided by industry for the purpose of Section 7(4) of the Report on the Cost of Motor Insurance.
To facilitate the industry’s completion of this request, the data sub-group developed a template which issued to industry at the end of March, thus achieving action point 25 of the Report.
With regard to commencing the development of a national claims information database, the work and discussion around the identification of key aggregated metrics for immediate publication has assisted the data sub-group in considering the specification of the key aggregated metrics for the national claims information database. This work is progressing well. It should also be noted that concurrently the data sub-group is examining the legislative requirements to underpin the National Claims Information Database.
91. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 14 and action point 30 in the Report on the Cost of Motor Insurance; if a personal injuries commission has been set up; the persons on that commission; if the commission has met; the details of those meetings; and if he will make a statement on the matter. [21372/17]
Amharc ar fhreagraThe recommendations in the Report on the Cost of Motor Insurance are being progressed in accordance with the Action Plan contained in the Report. The first quarterly progress update in respect of the implementation of the recommendations is now available on the Insurance Policy section of the Department of Finance’s website.
This update shows the progress to date on the overall implementation of the Report, with a particular focus on action points which were due for completion in the first quarter of 2017.
In relation to Recommendation 14, the Personal Injuries Commission (PIC) was established in January by the Minister for Jobs, Enterprise and Innovation, with former President of the High Court, Mr Justice Nicholas Kearns appointed as chair. The other members are representatives from stakeholders that include the medical, legal and insurance sectors as well as relevant Government Departments and Agencies. Some of its tasks involve analysing personal injury award levels and settlement systems in other jurisdictions and assessing whether objective medical diagnosis of soft tissue injuries in Ireland can be improved in personal injury cases. The first meeting of the Commission was held on February 10th, at which a Work Plan was agreed. Two further meetings have taken place and it is planned that the PIC will continue to meet on a monthly basis. The first PIC report is due to be submitted before the end of the year.
92. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 18 and action point 39 in the Report on the Cost of Motor Insurance; if consultation has taken place with the Judiciary in relation to a review of the book of quantum; the outcome of such consultation; the details on a possible review and update of the book of quantum with involvement from the Judiciary; and if he will make a statement on the matter. [21373/17]
Amharc ar fhreagra93. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 20 and action point 41 in the Report on the Cost of Motor Insurance; if consultations have been made with the personal injuries commission; the length of time it takes it to bring forward recommendations; and if he will make a statement on the matter. [21374/17]
Amharc ar fhreagra94. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 20 and action point 42 in the Report on the Cost of Motor Insurance; the timeframe for a review of a book of quantum; the details of such a review; and if he will make a statement on the matter. [21375/17]
Amharc ar fhreagra95. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 21 and action point 43 in the Report on the Cost of Motor Insurance; the progress made on the implementation of a review of the framework for motor insurance compensation here; and if he will make a statement on the matter. [21376/17]
Amharc ar fhreagra96. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 24 and action point 49 and 50 in the Report on the Cost of Motor Insurance; the progress made on a report to examine the setting of a discount rate for personal injury lump sum awards; when a report can be expected to be finalised; and if he will make a statement on the matter. [21377/17]
Amharc ar fhreagra97. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 22 and action point 45 in the Report on the Cost of Motor Insurance; if a reliable set of data has been established; if a review has commenced on legal and other fees on personal injury awards; the details of such a review; and if he will make a statement on the matter. [21378/17]
Amharc ar fhreagra98. Deputy Michael McGrath asked the Minister for Finance the position regarding recommendation 23 and action point 47 in the Report on the Cost of Motor Insurance; if a review commenced on the impact of changes to court jurisdictional limits; the timeframe for outcomes from that review; and if he will make a statement on the matter. [21379/17]
Amharc ar fhreagraI propose to take Questions Nos. 92 to 98, inclusive, together.
The recommendations in the Report on the Cost of Motor Insurance are being progressed in accordance with the Action Plan contained in the Report. The first quarterly progress update in respect of the implementation of the recommendations is now available on the Insurance Policy section of the Department of Finance’s website.
This update shows the progress to date on the overall implementation of the Report, with a particular focus on action points which were due for completion in the first quarter of 2017.
The 7 parliamentary questions which have been composited all relate to Objective 4 of the Report - Reducing the Costs in the Claims Process.
In respect of Recommendation 18 (Explore with the Judiciary how future reviews of the Book of Quantum/Guidelines might involve judicial involvement in its compilation or adoption) and Action Point 39 (Consultation with the Judiciary), it should be noted that a meeting between the PIAB and the Judiciary was held in March to initiate discussions on the next Book of Quantum. The matter will be progressed further over the coming months. As this work is ongoing, it is not possible to comment on the outcome of the consultation, or the details of a possible review and update of the Book of Quantum.
The position in relation to Recommendation 20 (Introduce more granularity into the Book of Quantum) and Action Points 41 (Consult with the Personal Injuries Commission and implement any recommendations arising from its Report) and 42 (Enhance the Book of Quantum upon each publication) is that the tasks are being considered in the context of the next review of the Book of Quantum, taking account of any recommendations which may emerge from the work of the Personal Injuries Commission. This work is ongoing and in this regard you will note that the Working Group recommended that the Book of Quantum should be updated every 3 years, therefore I expect that it will be completed within this period.
In relation to Recommendation 21 (Implement the Review of the Framework for Motor Insurance Compensation in Ireland) and Action Point 43 (Continue to implement the Review), work is well underway on the implementation of this recommendations and action point. In particular, stakeholders are being consulted and the drafting of the Heads of Bill is being progressed with a view to them being published by the end of Q2 2017.
In relation to Recommendation 22 (Examine the impact of legal and other fees on personal injury awards) and Action Point 45 (Establishment of reliable set of data and commence review), the review has been commenced. However, it has proven to be more difficult than anticipated to establish a reliable set of data and therefore the relevant action point has not been completed as scheduled in Q1. A data set based on the aggregation of cases submitted for adjudication will become available when the new Office of the Legal Costs Adjudicators (OLCA) is established in late 2017/early 2018. A steering group to migrate from the current Office of the Taxing Master to the OLCA was formed earlier this year and the underlying data requirements are being designed as part of the set-up process. There have been discussions in respect of alternative data set(s) in the interim period. The only usable data set in relation to legal costs available to the Working Group was provided by the insurance industry in response to a specific request and it is proposed that a quarterly reporting system on costs trends be put in place with the insurance industry until the OLCA is operational. Other discussions have taken place with the Central Statistics Office on improving the basis of collection of its legal costs data, and with the Office of the Taxing Master with a view to the possibility on an interim basis of aggregate data on costs profiles related to PI cases being extracted manually from its cases. The review has commenced and, following discussions with the Department of Justice and Equality, experts from the Courts Service are now examining existing database systems for the District, Circuit and High Courts to establish means of extrapolating the required data for a quarterly reporting set. Preliminary discussions have also been held with the PIAB with a view to it supplying data on trends from its own settlements spanning the period since the jurisdictional changes.
In respect of Recommendation 23 (Review the impact of the changes to the Court Jurisdictional Limits as they evolve) and Action Point 47 (Review to be commenced), the review has commenced and, following discussions with the Department of Justice and Equality, experts from the Courts Service are now examining existing database systems for the District, Circuit and High Courts to establish means of extrapolating the required data for a quarterly reporting set. Preliminary discussions have also been held with the PIAB with a view to it supplying data on trends from its own settlements spanning the period since the jurisdictional changes. It is expected that the report will be finalised in accordance with the Q2 2018 deadline set out in the action plan.
In relation to Recommendation 24 (Examine the setting of the Discount Rate (in Personal Injury lump sum awards), without prejudice to the outcome of relevant proceedings, and to be reviewed at regular intervals) and Action Points 49 (Review to be commenced) and 50 (Report to be submitted to the Cost of Insurance Working Group), the Department of Justice and Equality has commenced examination of this issue in consultation with the Department of Finance and the State Claims Agency, taking into account the judgments in the case of Gill Russell v HSE, and the recent discount rate changes in England and Wales. The State Claims Agency is also proposing to carry out some analysis on this subject. In the case of Gill Russell v HSE, the Court of Appeal upheld the determination of the High Court that the discount rate of 3% then being applied by the courts to personal injury lump sum awards was too high for cases involving significant long-term care needs. A key outcome of this process will be whether regulations should be brought forward to set the discount rate and if so at what rate should they be set.
