Written Answers Nos. 149-168
149. Deputy Michael McGrath asked the Minister for Finance the number and overall value of a bank's (details supplied) residential mortgages sold by the special liquidator; the details of each transaction including the identity of the purchaser; and if he will make a statement on the matter. [33784/17]
Amharc ar fhreagra150. Deputy Michael McGrath asked the Minister for Finance the number and overall value of a bank's (details supplied) buy to let mortgages sold by the special liquidator; the details of each transaction including the identity of the purchaser; and if he will make a statement on the matter. [33785/17]
Amharc ar fhreagraI propose to take Questions Nos. 149 and 150 together.
As the Deputy is aware, for operational reasons the loan assets of Irish Bank Resolution Corporation Limited (in Special Liquidation) (“IBRC”) were originally divided into six portfolios: Evergreen, Rock, Salt, Sand/Pearl, Stone, Pebble.
The Sand portfolio originally comprised 12,702 Irish originated residential mortgages with a par value of €1.8bn, most of which had transferred from Irish Nationwide Building Society. Buy to let mortgages accounted for 17% of the original Sand portfolio sold in the Special Liquidation.
Having given due consideration to the representations made by residential mortgage holders of IBRC and professional advice received, 64% of the Sand portfolio was sold to two buyers, namely Lone Star and Oaktree Capital Management, L.P.
Subsequently, the remaining 36% of the unsold residential mortgages from Project Sand were sold as two further sales tranches, Project Pearl Tranche 1 and Project Pearl Tranche 2. The first of these tranches? was sold to The Governor and Company of the Bank of Ireland and the second tranche was sold to Mars Capital No. 3 Limited and Mars Capital No. 4 Limited.
151. Deputy Michael McGrath asked the Minister for Finance the number of rent receivers appointed to date in 2017 in respect of buy-to-let properties for each of the State-supported banks; the number of buy-to-let properties affected by such appointments; the number of rent receivers expected to be appointed over the remainder of 2016; the detail of the operation of the rent receivers; the impact on the tenants concerned; the Government's policy on the appointment of rent receivers; and if he will make a statement on the matter. [33786/17]
Amharc ar fhreagraThe data requested by the Deputy is not retained in the Department of Finance. Officials have referred the question to the relevant banks and have received the following responses in this regard:
AIB:
“AIB has not appointed any rent receivers in 2017. The Bank appoints Fixed Asset Receivers with the purpose of selling the asset. Where the Power of Sale is not available, the Receiver will collect rent if available.
AIB has appointed Receivers to c .700 properties to date in 2017 of which c. 50% i.e. 350 are buy to let properties. The bank cannot anticipate the number of Fixed Asset Receivers that will be appointed for the remainder of 2017 as it is dependent on borrower cooperation in reaching sustainable solutions.”
PTSB:
“PTSB has appointed a Rent Receiver over 101 properties for the period 01/01/17 – 30/06/17.
It is expected that a further 100 appointments will be carried out for the remainder of 2017.
“A Rent Receiver is appointed by the bank who operates as an agent of the borrower, collects rent from the tenant(s) and directs it to the borrower’s mortgage account, together with attending to property related issues the tenant may have, in accordance with the lease agreement. It is the bank's intention that the existing tenant(s) once they are paying rent, remain in the property where possible.”
152. Deputy Michael McGrath asked the Minister for Finance the amount and purpose of public funding that has been required to date by the credit union sector; the amount collected from credit unions by way of the levy; and if he will make a statement on the matter. [33787/17]
Amharc ar fhreagraThere are currently three funds in place which can be utilised under certain conditions to fund credit unions, two of which have been supported by public funding.
1. The Credit Institutions Resolution Fund (CIRF)
The CIRF was established under Section 10(1) of the Central Bank and Credit Institutions (Resolution) Act 2011 (2011 Act). The Government contributed €250m to the Fund in December 2011 to provide a source of funding for the resolution of financial instability in, or an imminent serious threat to the financial stability of an authorised credit institution, and in particular-
- To reimburse the Minister for any provision of a financial incentive pursuant to section 46;
- To provide funds for any payment required pursuant to section 37(1), 42(5), 48 or 98;
- With written consent of the Minister, to provide capital for a bridge-bank; and
- To meet the Bank's expenses in discharging its functions under this Act.
The CIRF Levy commenced in October 2012 and levies collected from credit unions to date amount to €36.8m. Approximately €30m has been provided to support resolution actions in the credit union sector.
2. The Stabilisation Fund
In accordance with Part 4 of the Credit Union and Co-operation with Overseas Regulators Act 2012 credit unions contribute annually to a statutory Stabilisation Fund. The Stabilisation Fund, contained within the Credit Union Fund, is available to all credit unions with a reserve ratio equal to or greater than 7.5% of the credit union’s total assets and less than 10% and where the Central Bank assesses the credit union as viable. Stabilisation support will be provided to address short-term problems at credit unions that are viable but undercapitalised. Payment of an annual Stabilisation Levy commenced in 2015 (for a period commencing on 1 October 2014) and to date levies collected amount to €9.9m. There have been no drawdowns, to date, from the Stabilisation Fund. A review of the Stabilisation Levy will be carried out in 2017.
3. The Credit Union Fund
The Credit Union Fund was established under section 57 of the Credit Union and Co-operation with Overseas Regulators Act 2012 (2012 Act) for a number of purposes including the provision of stabilisation support, but primarily to provide a source of financial support for the restructuring of credit unions under the Credit Union Restructuring Board (ReBo) and to meet the expenses of ReBo in discharging its functions. The Government provided €250 million? to the Credit Union Fund specifically for restructuring under ReBo. The Restructuring Levy (ReBo Levy) is provided for under section 47 of the 2012 Act and commenced in 2014. To date levies collected amount to approximately €9.4m. The Minister for Finance recently signed ReBo Levy Regulations for 2017 for a levy amount of €1.6m which is due to issue to credit unions shortly. This will bring the total restructuring levy for the sector to €11m, circa 50% of ReBo's total gross expenditure. Approximately €22.6m has been drawn from the Credit Union Fund for restructuring purposes. ReBo concluded its restructuring work on 31 March 2017 and is currently being wound down.
153. Deputy Michael McGrath asked the Minister for Finance the number of credit unions which have been approved and declined respectively for additional services in the past five years; the number of applications ongoing; and the length of time it takes on average from preliminary application stage to full approval. [33788/17]
Amharc ar fhreagraThe Credit Union Act 1997 (the 1997 Act) and the Credit Union Act 1997 (Regulatory Requirements) Regulations 2016 (which set out services exempt from additional services regulations) set out the services that a credit union may provide to its members. These include loans; savings; account access by phone; account access by internet; third party payments (including EFT); ATM services; bureau de change; certain insurance services on an agency basis; group health insurance; bill payment; money transfers; standing orders; direct debits; financial counselling; PRSAs on an introduction basis and insurance on an introduction basis.
Where a credit union wishes to provide services to its members, other than those services that are provided for under the 1997 Act, an application may be made to the Central Bank for approval to provide such additional services in accordance with the provisions set out in sections 48-51 of the 1997 Act.
As set out in communications to the sector the Central Bank is, in principle, supportive of credit unions developing additional services and will consider proposals from credit unions on new additional services they wish to provide to members, where the credit union can demonstrate that:
- the proposed additional service is supported by a robust business case;
- the proposed additional service is not contrary to financial services legislation;
- the board of directors has a sound appreciation of the nature of the additional service proposed and is fully informed of the strategic, governance, risk management, operational, financial and legal implications involved; and
- systems and controls are in place to ensure any risks involved in the provision of the additional service are managed and mitigated.
I have been informed by the Central Bank that in the last five years, 11 applications for additional services have been approved and no application has been declined. The majority of these applications have related to the Central Bank approved suite of additional services known as a Member Personal Current Account Service (MPCAS) under the Additional Services Framework set out in sections 48-52 of the Credit Union Act, 1997.
This service, provides for credit unions to offer debit cards, overdrafts and a full range of payment services within an appropriate risk framework.
Since the Central Bank approved the MPCAS suite of additional services there has been strong interest in this service and the Central Bank is currently processing a significant number of applications, which are at different stages of assessment but the majority are currently at an advanced stage. Details and application forms for the MPCAS service are available on the Central Bank website.
I have been further informed by the Central Bank that the timescale from preliminary application stage to full approval depends on the quality of information provided. Where the application form has been fully completed and contains or includes all of the information requested, the Central Bank endeavours to turn around the application as quickly as possible.
154. Deputy Michael McGrath asked the Minister for Finance the gross contribution Ireland has made to the European Union budget per annum from 2010 to 2016; the estimated contribution in 2017; the net benefit or contribution made in each year, in tabular form; and if he will make a statement on the matter. [33790/17]
Amharc ar fhreagraAs the Deputy will be aware and as outlined in the table below, Ireland became a net contributor to the EU budget in 2014.
EU Budget payments and public sector receipt data are published annually by the Department of Finance in the Budget Statistics publication. The public sector receipt measure captures funds under 'shared management' between national and EU authorities. In addition, the EU also pays some additional receipts directly to private beneficiaries under 'centralised direct management', most notably under the EU research funding programme.
For ease of reference, Ireland's receipts from and contributions to the EU Budget for the years 2010 to 2015 are set out in the following table:
|
Year |
Public Sector Receipts - €m |
Direct Management Receipts* - €m |
Total receipts |
Payments to EU Budget - €m |
Net Receipts - €m |
|
2010 |
1885.3 |
80.4 |
1965.7 |
1352.4 |
613.3 |
|
2011 |
1950.2 |
80.2 |
2030.4 |
1349.7 |
680.7 |
|
2012 |
1837.7 |
108.8 |
1946.5 |
1393.2 |
553.3 |
|
2013 |
1672.9 |
113.0 |
1785.9 |
1726.2 |
59.7 |
|
2014 |
1419.7 |
83.9 |
1503.6 |
1685.5 |
-181.9 |
|
2015 |
1770.9 |
147.7 |
1918.6 |
1952.1 |
-33.5 |
Source: Department of Finance
* - Direct Management - funds which are awarded and spent directly by the Commission. These are primarily research receipts.
Ireland's contribution to the EU budget in 2016 was c. €2,022 million. In relation to receipts for 2016, a final outturn will be published as part of the Budget Statistics report which is due to be published in the Autumn.
According to Budget 2017, my Department forecasts that our contribution to the EU budget will be c. €2,400 million in 2017. However, this forecast is contingent on a number of variables, including the size of the overall EU budget for the year and other EU budget operational developments which will only emerge as the year progresses.
155. Deputy Barry Cowen asked the Minister for Finance the approximate cost of reducing VAT on professional fees in the construction sector. [33986/17]
Amharc ar fhreagra156. Deputy Barry Cowen asked the Minister for Finance the approximate cost of reducing VAT on professional fees on residential construction only and not on commercial or industrial construction. [33987/17]
Amharc ar fhreagraI propose to take Questions Nos. 155 and 156 together.
I am advised by the Revenue commissioners that the information provided to Revenue on tax returns does not require traders to identify the yield generated from specific products or types of activities. Therefore there is no data available to Revenue on which to base an estimate the effect of changing the VAT rate on professional fees in the construction sector.
The EU VAT Directive (Council Directive 2006/112/EC), with which Irish VAT law must comply, provides a list of those supplies of goods and services to which VAT rates lower than the standard rate may be applied. As professional fees on construction are not included on this list, Member States are precluded from reducing the VAT rate on such services below the standard VAT rate.
It should also be noted that where VAT is chargeable on construction services supplied or on the sale of developed property, including residential property, the supplier can reclaim VAT on any professional fees incurred in respect of those activities so that such VAT would not be a cost to the supplier.
157. Deputy Barry Cowen asked the Minister for Finance the approximate cost of allowing local property tax as an allowable expense for the purposes of rental income relief. [33988/17]
Amharc ar fhreagraI am advised by Revenue that the estimated cost of allowing the Local Property Tax as an allowable expense for the purposes of rental income is in the region of €22 million. This estimate is calculated on the basis of Local Property Tax returns where it was indicated that a property was a non-principal private residence, and assumes that each taxpayer would have sufficient rental income against which to offset the amount of LPT paid.
158. Deputy Barry Cowen asked the Minister for Finance the approximate cost of abolishing section 48 development levies in budget 2018 if the Government was to cover the shortfall in local authority budgets. [33989/17]
Amharc ar fhreagraI assume the Deputy is referring to development contributions as described under Section 48 of the Planning and Development Act of 2000 (Number 30 of 2000). The amount collected from such contributions and therefore the revenue foregone in the event of their abolition would be a matter for my colleague the Minister for Housing, Planning, Community and Local Government.
159. Deputy Barry Cowen asked the Minister for Finance the approximate cost of abolishing section 48 development levies in budget 2018, if the government was to cover the shortfall in local authority budgets just for new apartment buildings. [33990/17]
Amharc ar fhreagraI assume the Deputy is referring to development contributions as described under Section 48 of the Planning and Development Act of 2000 (number 30 of 2000). The amount collected from such contributions and therefore the revenue foregone in the event of their abolition would be a matter for my colleague the Minister for Housing, Planning, Community and Local Government.
160. Deputy Barry Cowen asked the Minister for Finance if developers can avail of both the development contribution rebate scheme and the help to buy scheme simultaneously. [33991/17]
Amharc ar fhreagraThe Help to Buy (HTB) incentive is an income tax based incentive available to the first time buyers of new homes or those who wish to build their own first home. The refund available under the incentive, while provided to developers in certain cases, is actually relief to the home purchaser to assist them in obtaining a deposit to put towards the cost of their new home.
The development contribution rebate scheme is primarily a matter for the Minister for Housing, Planning, Community and Local Government. However, I understand that there are no restrictions on that scheme in terms of its availability in conjunction with the HTB incentive.
161. Deputy Margaret Murphy O'Mahony asked the Minister for Finance the way his Department is improving services and increasing supports for persons with disabilities during 2017. [34032/17]
Amharc ar fhreagraThe Department is aware of its obligations as set out in the Disability Act of 2005. In line with the legislation a Disability Liaison Officer (DLO) and Access Officers are in place within the Department. The contact details for these officers are available of the Department's website
http://www.finance.gov.ie/who-we-are/acess-officers-department/access-officers-department#overlay-context.
The Department works closely with the National Disability Authority (NDA) in ensuring its compliance with the legislation in relation to the employment of persons with disabilities and since 2014, the Department's obligations under the legislation have been satisfied.
The DLO attends bi-monthly Disability Liaison Officer Network meetings to share knowledge and assist other DLOs across the Civil Service, as well as engaging with staff in accessing training and learning events, where needed. An example of engagement includes during 2016 and 2017, the Department employed speed typists to assist staff at various learning events.
Over the last year, a major refurbishment project was undertaken by OPW here in Government Buildings on Merrion Street. As part of this project, for example, electronic access doors have been installed to assist the movement of staff across our campus. Ergonomic assessments are currently being undertaken for all staff in both in the Merrion St. campus and our offices in Tullamore.
The Department's Press Office is currently works closely with the IT function on a redesign of the Department's Website in order to be more user friendly and I can confirm that the Press Office and the Corporate Office have not received any requests for information, outside of the standard written format, for example through Braille, in 2016 or 2017.
162. Deputy Fergus O'Dowd asked the Minister for Finance the investment by his Department since March 2016 in County Louth and parts of east County Meath; and if he will make a statement on the matter. [34067/17]
Amharc ar fhreagraMy Department does not make investments from its Vote other than the routine acquisition of IT equipment and systems and certain premises expenses relating to the buildings it occupies.
Therefore, there were no investments by my Department during the period in question in County Louth and parts of east County Meath.
163. Deputy Pearse Doherty asked the Minister for Finance the number of persons who are subject to USC with income over €70,044. [34090/17]
Amharc ar fhreagra164. Deputy Pearse Doherty asked the Minister for Finance the number of persons who are subject to USC. [34091/17]
Amharc ar fhreagra165. Deputy Pearse Doherty asked the Minister for Finance the number of persons who are exempt from USC. [34092/17]
Amharc ar fhreagra166. Deputy Pearse Doherty asked the Minister for Finance the number of persons who paid USC in 2016 and are expected to pay in 2017. [34093/17]
Amharc ar fhreagraI propose to take Questions Nos. 163 to 166, inclusive, together.
I am advised by Revenue that the breakdown of the numbers of income earners at the different USC rates (including numbers of those exempt) from 2012 to 2014 is available at
http://www.revenue.ie/en/corporate/documents/statistics/income-distributors/usc-rates.pd .
The tax year 2014 is the most recent year for which complete tax returns data are available at present. However, I am further advised that the Revenue Ready Reckoner, available at http://www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf, shows on page 3 projections for 2017 for the same breakdown of earners.
167. Deputy Robert Troy asked the Minister for Finance if he will ensure equality of treatment for self-employed persons by removing the 3% USC surcharge. [34137/17]
Amharc ar fhreagraThe 3% USC surcharge is payable on self-assessed income in excess of €100,000. When the USC was introduced in 2011 it was accompanied by a series of other reform measures designed to simplify the tax system and widen the tax base in order to raise the revenues required at that time.
One of these measures was the removal of the €75,000 income ceiling for employees, above which PRSI was not payable. This ceiling was removed for all employees in 2011, with the result that employees on incomes in excess of €75,000 became liable to an additional 4% charge on that portion of their income. At the same time the PRSI rate for self-assessed income earners was increased from 3% to 4%.
The 3% USC surcharge on non-PAYE income in excess of €100,000 was introduced in tandem with the removal of the PRSI ceiling of €75,000 as, in the absence of this measure, self-assessed high income earners would have benefitted when compared to their PAYE counterparts from the tax package introduced in Budget 2011. On the basis of fairness, this could not have been countenanced at the time.
With regard to equality of treatment, the Deputy will be aware that, while Employer PRSI contributions of 8.5% and 10.75% are payable in respect of employees, no similar contribution is payable by the self-employed. In addition, the self-employed also continue to benefit from a broader expense deduction regime than that available to employees.
The Government’s plans to reduce the income tax burden for all taxpayers, with a particular focus on low to middle income earners, were clearly stated in the Programme for Government published in May 2016.
The Programme for Government recognises that high personal tax rates in Ireland discourage work and jobs and have a negative impact on our international competitiveness. Therefore, it contains a commitment for a medium-term income tax reform plan that keeps the tax base broad, while reducing excessive tax rates for middle income earners, and limiting the benefit for high earners. We must appreciate the value of retaining the incentive to work, to enable those who work hard to provide for their families and generate further economic growth through employment and expenditure in the domestic economy.
Preparations for Budget 2018 are now under way. As the Deputy will be aware, changes to one particular tax, such as USC, are not considered in isolation. They must be considered as part of the overall Budget process encompassing both revenue and expenditure measures and in the context of available resources. Any announcement in relation to changes to the income tax system, including USC, would normally be made as part of the Budget and I am not inclined to diverge from this practice.
168. Deputy Robert Troy asked the Minister for Finance if he will consider the pre-budget submission by a group (details supplied) with a view to introducing measures in the 2018 budget which will support the retail sector that is facing many challenges; and if he will make a statement on the matter. [34138/17]
Amharc ar fhreagraIn keeping with tradition, I do not propose to comment on Budget issues in advance of the forthcoming Budget.
