Tuesday, 7 Nov 2017

Departmental Reviews

Ceisteanna (167, 168, 169, 170)

Maurice Quinlivan

Ceist:

167. Deputy Maurice Quinlivan asked the Tánaiste and Minister for Business, Enterprise and Innovation the terms of reference for the review into the Succeed in Ireland initiative. [46900/17]

Amharc ar fhreagra

Maurice Quinlivan

Ceist:

168. Deputy Maurice Quinlivan asked the Tánaiste and Minister for Business, Enterprise and Innovation the person or group that has been appointed to undertake the review into the Succeed in Ireland initiative. [46901/17]

Amharc ar fhreagra

Maurice Quinlivan

Ceist:

169. Deputy Maurice Quinlivan asked the Tánaiste and Minister for Business, Enterprise and Innovation when the 17 submissions to the public consultation on the Succeed in Ireland initiative will be published. [46902/17]

Amharc ar fhreagra

Maurice Quinlivan

Ceist:

170. Deputy Maurice Quinlivan asked the Tánaiste and Minister for Business, Enterprise and Innovation when the review into the Succeed in Ireland initiative will be completed. [46903/17]

Amharc ar fhreagra

Freagraí scríofa

Tánaiste and Minister for Business, Enterprise and Innovation

I propose to take Questions Nos. 167 to 170, inclusive, together.

As has been announced previously, my Department will be commissioning an independent review of the Succeed-in-Ireland initiative. The aim of the review is to equip us with a thorough understanding of the programme’s results and its contribution to employment generation in the State.

However, the review cannot proceed until it is possible to assess the total projected costs of the programme, which will itself necessitate the resolution of the dispute between Connect Ireland and IDA Ireland. As I have said before, I hope that the dispute can be resolved as soon as possible and that the review can then go ahead.

Earlier this year, my Department launched a public consultation calling for observations on the draft terms of reference for the review. A total of 17 responses were received from a range of stakeholders, including public representatives and the general public. It is intended to publish the submissions in due course.

Departmental Reports

Ceisteanna (171)

Maurice Quinlivan

Ceist:

171. Deputy Maurice Quinlivan asked the Tánaiste and Minister for Business, Enterprise and Innovation the reports that her Department has received in 2017 that have yet to be made public by title in tabular form; and the reason each report has not been published. [46904/17]

Amharc ar fhreagra

Freagraí scríofa

Tánaiste and Minister for Business, Enterprise and Innovation

The following table sets out the reports that my Department has received in 2017 and which have not yet been made public:

Name of Report	Reason why the Report has not been Published
Report from the Director of Corporate Enforcement under section 955(1)(a) of the Companies Act 2014.	The Report has been the subject of detailed consultation with the Office of the Attorney General. I received further advice from the Attorney General recently, which I am considering with my officials.
Review of RDI Supports available to businesses in Ireland to Maximise Business Expenditure on Research and Development	This report was received at the end of September is currently being reviewed prior to publication
Indicative Baseline Assessment of Corporate Social Responsibility in Ireland	Report currently being finalised for publication
Microfinance Ireland Quarterly Report (Q3 2017)	Recently submitted to Ministerof State Breen for approval. Once the Minister approves this for publication it will be published on the Department's website alongside previous Quarterly Reports.
Credit Guarantee Scheme Quarterly Report (Q3 2017)	This will be submitted to Minister of State Breen for approval shortly and then published on the Department's website alongside previous Quarterly Reports.

IDA Ireland Data

Ceisteanna (172)

Peadar Tóibín

Ceist:

172. Deputy Peadar Tóibín asked the Tánaiste and Minister for Business, Enterprise and Innovation further to Parliamentary Question No. 18 of 10 October 2017, if the figures will be provided for same. [46952/17]

Amharc ar fhreagra

Freagraí scríofa

Tánaiste and Minister for Business, Enterprise and Innovation

Further to the Deputy's question on 10 October, IDA Ireland has provided the following details regarding investment projects outside the four main urban centres in the country since 2013:

2017	DATE	COMPANY	LOCATION
NO.
1	13/01/2017	Aerie Pharmaceuticals	Athlone
2	26/01/2017	Almac Group	Dundalk
3	27/01/2017	Element Six	Shannon
4	03/02/2017	Waters Ireland	Wexford
5	06/02/2017	Mercury Filmworks	Kilkenny
6	06/02/2017	Red Hat	Waterford
7	01/03/2017	MTI INc	Drogheda
8	28/04/2017	BorgWarner	Tralee
9	29/05/2017	Abbott	Sligo
10	29/5/2017	MSD	Carlow & Cork
11	31/07/2017	Valeant Pharmaceuticals	Waterford
12	13/09/2017	Graebel	Dundalk
2016
NO.	DATE	COMPANY	LOCATION
1	11/01/2016	JRI America Incorporated	Tralee
2	21/01/2016	First Data	Tipperary
3	15/04/2016	Shire	Meath
4	21/04/2016	OPKO Health/Eirgn	Waterford
5	28/04/2016	KelltonTech Solutions Limited	Drogheda
6	13/06/2016	Eurofins	Dungarvan
7	05/06/2016	iDirect	Kerry
8	19/07/2016	Endress and Hauser	Kildare
9	30/08/2016	Se2	Waterford
10	01/09/2016	Coca Cola	Ballina
11	26/09/2016	Fort Wayne Metals	Castlebar
12	04/11/2016	Compar AG	Waterford
2015
NO.	DATE	COMPANY	LOCATION
1	20/01/2015	Amax	Shannon
2	28/01/2015	PPD	Athlone
3	06/03/2015	Northern Trust	Limerick
4	25/03/2015	Sunlife	Waterford
5	01/04/2015	Prometric	Dundalk
6	24/04/2015	Agora Publishing	Waterford
7	29/04/2015	Bausch and Lomb	Waterford
8	15/06/2015	CRI Wexford	Wexford
9	18/06/2015	Moss Vision	Roscommon
10	29/06/2015	Abbvie	Sligo
11	08/07/2015	Aercap	Dublin/Shannon
12	22/07/2015	Pramerica	Donegal
13	31/07/2015	Amneal	Tipperary
14	07/09/2015	CipherTechs	Kilkenny
15	07/09/2015	Bluefin	Waterford
16	15/09/2015	Patterson Pumps	Mullingar
17	16/09/2015	Nexvet	Tullamore
18	22/09/2015	MSD	Tipperary
19	25/09/2015	United Technologies	Shannon
2014
NO.	DATE	COMPANY	LOCATION
1	03/02/2014	Alexion	Athlone
2	10/02/2014	Jazz	Roscommon
3	14/04/2014	Ethicon	Limerick
4	07/05/2014	Becton Dickinson	Drogheda
5	26/05/2014	Indos	Wexford
6	27/05/2014	Ericsson	Dublin/Athlone
7	11/06/2014	Hollister	Mayo
8	18/06/2014	Paypal	Dundalk
9	30/06/2014	NuVasive	Waterford
10	22/07/2014	Internal Results	Portlaoise
11	02/10/2014	West Pharma	Waterford
12	13/10/2014	Colour Communication	Roscommon
13	30/10/2014	Teleflex	Athlone
14	05/11/2014	Clearstream	Wexford
2013
NO.	DATE	COMPANY	LOCATION
1	12/02/2013	Genzyme	Waterford
2	14/02/2013	eBay	Dundalk
3	28/03/2013	Nypro	Waterford
4	04/06/2013	Prometic	Dundalk
5	04/07/2013	Becton Dickinson	Louth
6	09/08/2013	Overstock	Sligo
7	20/09/2013	National Pen	Dundalk

Office of the Director of Corporate Enforcement Reports

Ceisteanna (173)

Róisín Shortall

Ceist:

173. Deputy Róisín Shortall asked the Tánaiste and Minister for Business, Enterprise and Innovation if she has received the advice she requested from the Attorney General regarding the publication of a report (details supplied); the reason for the delay in the issuing of this advice; the number of times her office has sought an update on this matter from the Office of the Attorney General; if she will now publish the report; and if she will make a statement on the matter. [47102/17]

Amharc ar fhreagra

Freagraí scríofa

Tánaiste and Minister for Business, Enterprise and Innovation

I received a report under Section 955(1)(a) of the Companies Act 2014 from the Director of Corporate Enforcement on 23 June. This Report addresses the issues highlighted by Judge Aylmer in his ruling in the case of DPP v Sean Fitzpatrick. The report sets out the facts relating to the case and does not purport to be an investigation or an enquiry.

The Report has been the subject of detailed consultation with the Office of the Attorney General both at ministerial and official level. I received further advice from the Attorney General recently, which I am considering with my officials.

Tax Reliefs Availability

Ceisteanna (174)

Noel Grealish

Ceist:

174. Deputy Noel Grealish asked the Minister for Finance his plans for a special tax break or incentive for persons who rent rooms in their homes to persons who are on the social housing waiting list and in need of long-term accommodation; and if he will make a statement on the matter. [46110/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

Section 216A of the Taxes Consolidation Act 1997 provides for the Rent-a-Room scheme. Under the terms of this scheme, sums arising to an individual in respect of the letting, for residential purposes, of a room or rooms in his or her home, may be fully exempt from income tax where they meet the conditions of the scheme and where the individual's total gross income from such letting(s) is below €14,000 for the tax year in question; this includes where the persons to whom they are renting are on the social housing waiting list.

Policy responsibility for social housing rests with the Minister for Housing, Planning and Local Government and the provision of non-tax incentives or other measures in this area are matters for him.

Property Tax Yield

Ceisteanna (175)

Noel Grealish

Ceist:

175. Deputy Noel Grealish asked the Minister for Finance the amount collected through local property tax in each local authority in 2016 and to date in 2017 by local authority area or municipal district in each local authority; and if he will make a statement on the matter. [46187/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

I am advised by Revenue that the amount of Local Property Tax (LPT) collected broken down by Local Authority for 2016 is available on the Revenue website at: https://www.revenue.ie/en/corporate/information-about-revenue/statistics/local-property-tax/end-of-year-reports/local-property-tax-2016.aspx. Information in respect of LPT collection by Local Authority for the first three quarters of 2017 is available at: https://www.revenue.ie/en/corporate/information-about-revenue/statistics/local-property-tax/quarterly-reports-2017/local-property-tax-october-2017.aspx.

Disabled Drivers and Passengers Scheme

Ceisteanna (176)

Brendan Ryan

Ceist:

176. Deputy Brendan Ryan asked the Minister for Finance if a person (details supplied) qualifies for the disabled drivers and disabled passengers scheme; and if he will make a statement on the matter. [46556/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

I am advised by Revenue that it has no record of an application under the scheme from the person concerned. If that person contacts the Revenue Central Repayments Office, M:TEK II Building, Armagh Road, Monaghan, Telephone LoCall: 1890 60 60 61 advice and assistance will be provided.

I am advised by Revenue that, in order to qualify for the Drivers/Passengers with Disabilities Scheme, a vehicle must be specially constructed or adapted to take account of the applicant’s disablement. In the case of wheelchair use, vehicles qualify where specific constructions or adaptations have been carried out to the vehicle in order to facilitate access for the wheelchair user. Full details of the scheme, including the qualifying criteria, are set out in Information Leaflet VRT 7, which is available on the Revenue website www.revenue.ie

Tracker Mortgage Examination

Ceisteanna (177)

Clare Daly

Ceist:

177. Deputy Clare Daly asked the Minister for Finance the reason the Government cannot initiate a criminal investigation into the tracker mortgage scandal; and if he will make a statement on the matter. [46605/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

It should be noted that the Central Bank is responsible for the supervision of regulated financial service providers. In this context the Central Bank maintains contact with other statutory bodies as appropriate and in its recent update on the tracker mortgage examination the Central Bank indicated that, since the previous March update report, it had met with the Competition and Consumer Protection Commission and An Garda Síochána. The Central Bank has also indicated that it will rigorously pursue its enforcement investigations in relation to the tracker mortgage issue. However, it should be noted that any matter relating to the initiation of a criminal investigation or prosecution would be a matter for the independent criminal investigation and prosecution authorities and the Government would not have any role in such matters.

Universal Social Charge Application

Ceisteanna (178)

Robert Troy

Ceist:

178. Deputy Robert Troy asked the Minister for Finance if a couple earning under €36,000 as a pension will not be subject to USC following new guidelines issued in budget 2018; and if this change will come into affect in January 2018. [46677/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

It is unclear from the Deputy’s question whether the earnings of under €36,000 refer to the pension of one individual or the combined pension income of both individuals in a couple. It is also unclear if the question refers to Social Welfare pension income and/or to occupational pension income.

The Universal Social Charge is an individualised tax, meaning that a person’s liability to the tax is determined on the basis of his or her own individual income and personal circumstances. Therefore the USC liability may differ depending on the split of income between the individual members of the couple.

It is therefore not possible to provide a detailed reply to the Deputy’s question. However, I would point out that social welfare pensions are not liable to the USC and are not taken into account in determining the income of an individual for USC purposes. The current entry threshold to USC is €13,000, therefore a pensioner would be within the scope of USC only if he/she personally has income, other than State pension or other social welfare income, exceeding €13,000.

The Deputy will be aware that, in Budget 2018, I have continued to fulfil the Government’s commitment to make steady and sustainable progress in reducing the income tax burden, with a particular focus on low and middle income earners. Therefore, should the couple referenced be within the charge to USC, they will benefit from the reduction in the 2.5% USC rate to 2% and potentially also from the reduction in the 5% rate to 4.75%.

Revenue have published a leaflet setting out, in summary form, the tax and USC provisions that are due to come into effect from 1 January 2018 and this is available at https://www.revenue.ie/en/corporate/press-office/budget-information/2018/budget-summary-2018.pdf

Tracker Mortgage Examination Data

Ceisteanna (179)

Michael Harty

Ceist:

179. Deputy Michael Harty asked the Minister for Finance the number of persons in County Clare that have been affected by the tracker mortgage scandal; and if he will make a statement on the matter. [46698/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

The Central Bank has advised that it does not have data at the level of granularity as requested by the Deputy.

However, at an aggregated national level, the recent Central Bank update on its tracker mortgage examination (see attached www.centralbank.ie/news/article/statement---tracker-mortgage-examination) indicated that circa 13,000 affected customers have been identified to date through the Examination, the majority of whom will receive their redress and compensation before the end of the year. Prior to the commencement of the industry wide Tracker Examination, the Central Bank ensured a further 7,100 cases involving tracker mortgage issues were rectified and remedied. The Central Bank has indicated that it will continue to push lenders using all of its powers to ensure that all affected customers are identified and included in redress and compensation programmes.

Film Industry Tax Reliefs

Ceisteanna (180)

Bríd Smith

Ceist:

180. Deputy Bríd Smith asked the Minister for Finance the number of companies that have availed of the section 481 tax scheme for the film industry since 2010; and the number of persons employed by those companies availing of this scheme. [46748/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

I am advised by Revenue that prior to 2015 Section 481 Taxes Consolidation Act (TCA) 1997, operated by giving relief to individuals and companies investing in the film industry. The information in respect of the tax cost and number of investors who claimed relief under section 481 for the years 2004 to 2015 is available on the Revenue webpage at http://www.revenue.ie/en/corporate/information-about-revenue/statistics/tax-expenditures/costs-expenditures.aspx.

With effect from 2015, the scheme provides direct support to film producer companies in the form of a tax credit. However, where an application was received up to and including 14 December 2014, it was processed under the previous scheme. Investors availing of the old scheme can choose the year in which to claim their relief. The number of companies claiming the tax credit and included in the tax expenditure information for 2014 and 2015 is 53 and 44 respectively.

Revenue analysis of applications made in respect of section 481 TCA 1997 indicate that 3,415 full-time equivalent jobs were created over 184 projects in 2015 and 2016. However, it should be noted that jobs created in the film industry are predominately of a short term nature.

The following are the number of companies granted relief during 2015, 2016 and 2017;

2015: 32 companies in respect of 43 films

2016: 54 companies in respect of 75 films

2017 (up to end of quarter 2): 31 companies in respect of 41 films

The information relating to the beneficiaries under the current scheme can be found at:

- 2015 beneficiaries: http://www.revenue.ie/en/companies-and-charities/documents/beneficiaries-tax-relief-2015.pdf

- 2016 beneficiaries: http://www.revenue.ie/en/companies-and-charities/documents/beneficiaries-tax-relief-2016.pdf

- 2017 (to Quarter 2) beneficiaries: http://www.revenue.ie/en/companies-and-charities/documents/beneficiaries-tax-relief-2017.pdf

Central Bank of Ireland Staff

Ceisteanna (181)

Michael McGrath

Ceist:

181. Deputy Michael McGrath asked the Minister for Finance the number of vacancies that remain to be filled in the Central Bank; the length of times these vacancies have been open; the different departments these vacancies are in; if the Central Bank has communicated concerns on its ability to deal with the influx of firms resulting from Brexit; if the Central Bank is of the view it will lose vital staff as a result of the Brexit influx; and if he will make a statement on the matter. [45631/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

I am informed by the Central Bank that the Central Bank Commission approved additional complement for 2017 to circa 1,800 staff, which will be a target net increase of 200 staff on the total at end 2016.

This expansion included dedicated resources of an additional 28 staff to address specific Brexit-related new business needs within existing divisions. Of these 28 staff, 18 have been allocated to supervisory divisions to address specific Brexit-related new business needs within existing divisions.

Furthermore, at its recent June 2017 meeting, the Central Bank Commission approved an additional 36 resources principally to support increases in Brexit-related authorisation/supervisory activity, as well as to support extensions to the post crisis regulatory framework. The Central Bank has already redirected experienced resources to deal with Brexit related activity and are confident that our current recruitment campaigns will support us in having the requisite resources in place.

The Central Bank currently has 138 vacant roles with roles being filled on average within 9 weeks. Theses vacancies are primarily in Financial Regulation and Financial Conduct Pillars.

The recruitment market remains challenging, and the potential for financial services firms relocating to Ireland pre/post Brexit will create further competition for talent. The Central Bank’s overall offering to staff compares favourably in the employment market, which is reflected in the 2016 attrition rate of 6.2%, with similar levels expected for 2017. The Central Bank continues to monitor turnover levels on a continuous basis to understand any trends emerging.

Furthermore, the Governor has previously indicated to me that where further resources are necessary due to an expanded universe of regulated and supervised firms, the Bank has the ability to effectively re-prioritise where it needs to meet the increased level of demand and also to increase staff numbers as necessary.

Departmental Correspondence

Ceisteanna (182)

Michael McGrath

Ceist:

182. Deputy Michael McGrath asked the Minister for Finance if he will address a matter (details supplied); and if he will make a statement on the matter. [45644/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

The matter is being examined by my officials and a reply will issue shortly.

Departmental Correspondence

Ceisteanna (183)

Michael McGrath

Ceist:

183. Deputy Michael McGrath asked the Minister for Finance if matters raised in correspondence (details supplied) have been examined; and if he will make a statement on the matter. [45647/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

I can confirm that the matters highlighted in the correspondence referred to were brought to the attention of the Department in the past. At the time, it was noted that the matters had been raised with the specific bank mentioned, the Central Bank, GSOC, the European Ombudsman, and a variety of Courts both in Ireland and Europe and that one of those cases was against the Minister for Finance in 2004. It was also noted that any decisions that had been made were by independent bodies with the Minister for Finance having no role in adjudicating the validity of court orders.

Research and Development Data

Ceisteanna (184)

Pearse Doherty

Ceist:

184. Deputy Pearse Doherty asked the Minister for Finance when the inconsistency regarding the treatment of research and development in the State’s balance of payments, that is, the way in which it is treated as intermediate consumption, will be rectified in view of its knock on impact on the State's EU contribution; and if he will make a statement on the matter. [45658/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

There are two types of R&D imports recorded in the Balance of Payments (BOP):

1. Direct acquisition of intellectual property patents, copyrights etc.

2. R&D services imports where an entity pays a foreign firm to conduct research on their behalf.

In the National Accounts both types of R&D imports are capitalised, that is, they are considered a use of profits rather than a cost. However, in the BOP standards the guidance is less clear and consequently only the direct acquisition of patents are capitalised with R&D services treated as intermediate consumption. In other words, R&D services are treated as a cost which in turn reduces profit outflows. As a result, profits generated in Ireland by foreign firms are higher in the National Accounts then in the BOP.

This inconsistency inflates Ireland’s GNP and Gross National Income (GNI) as both measures involve subtracting net factor outflows (calculated in the BOP) from GDP (calculated in the national accounts) although the extent of it is mitigated somewhat by reduced depreciation charges. This inconsistency also inflates Ireland’s EU budget contribution as Member State contributions are based on inter alia their share of EU GNI.

The CSO is highlighting this ambiguity in the statistical standards at a forthcoming meeting in EUROSTAT where it is seeking clarification around the application of a harmonised approach across the standards in this specific case of imported R&D services.

It is important to stress that, from a legal perspective, the CSO is compelled to produce existing economic statistics (GDP, GNP, GNI etc.) in accordance with internationally agreed methodologies (European System of Accounts 2010) and that our international obligations including the EU budget contribution will continue to be assessed on this basis.

The outcome of the EUROSTAT consultation will, it is hoped, resolve this inconsistency in treatment.

Economic Data

Ceisteanna (185)

Pearse Doherty

Ceist:

185. Deputy Pearse Doherty asked the Minister for Finance the projected figures for net fiscal space in each of the years 2019 to 2023. [45681/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

As I am sure the Deputy is aware, projections beyond 2021 have not been compiled or published.

The current estimates of net fiscal space for years 2019 – 2021 are set out below. It is important to stress that the figures, as always, are work-in-progress estimates and will evolve over time.

-	2019	2020	2021
Net fiscal space (€billions)	3.2	3.5	3.6

I also wish to highlight that the economy is now on a path towards full-employment. In these circumstances, I will not jeopardise our recovery by adopting pro-cyclical fiscal policies that overheat the economy and put our future livelihoods at risk. Instead I will focus on the appropriate stance of fiscal policy.

In other words, I will focus on what is right for the economy and not on what is legally permissible under the rules. In this regard, I want to assure the Deputy that the Government will not repeat the mistakes of the past by adopting inappropriate taxation and spending policies for short-term gain that have involve major long-term pain.

Steady, incremental and sustainable budgetary policy is the way to improve our living standards and that is how I intend to decide and implement policy.

Research and Development Supports

Ceisteanna (186, 187)

Niall Collins

Ceist:

186. Deputy Niall Collins asked the Minister for Finance the additional cost to the Exchequer for a proposal (details supplied) over a full year based on the number of SME-sized firms availing of research and development credit. [45719/17]

Amharc ar fhreagra

Niall Collins

Ceist:

187. Deputy Niall Collins asked the Minister for Finance the additional cost to the Exchequer for a proposal (details supplied) over a full year based on the number of SME size firms availing of the research and development credit. [45720/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 186 and 187 together.

I am advised by Revenue that information in respect of the Research and Development credit is available at www.revenue.ie/en/corporate/documents/statistics/tax-expenditures/costs-tax-expenditures.pdf for all years up to 2015. Additionally, the Deputy may be interested in an analysis by my Department on the R&D Tax Credit which is accessible at http://www.finance.gov.ie/wp-content/uploads/2017/07/1610-R-and-D-Credit-Evaluation-2016.pdf

Information on likely future expenditure on research and development is not available and therefore an accurate estimate of the cost of the proposals cannot be provided. However, based on information included in the 2015 Corporation Tax returns in respect of companies with fewer than 250 employees, the cash flow loss from bringing forward the second and third instalment refund to the first year of claim could be in the region of €56 million.

On a similar basis there could be an additional cost of up to €15 million per year for each 2.5 per cent increase in the expenditure write off allowed for the same group of SMEs (defined as those companies with less than 250 employees).

Pension Provisions

Ceisteanna (188)

Michael McGrath

Ceist:

188. Deputy Michael McGrath asked the Minister for Finance the position regarding an application for approval from the Revenue Commissioners for a legacy pension for a person (details supplied) in County Cork to be transferred to allow the setting up of a personal retirement bond. [45727/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

I am advised by Revenue that a Personal Retirement Bond (PRB), otherwise known as a Buy out Bond (BoB), is a single premium pension policy into which an existing pension fund or the cash value of an accrued pension benefit can be transferred from a Defined Contribution (DC) or Defined Benefit (DB) occupational pension scheme. Such transfers usually occur when a scheme member is leaving the employment of the pension scheme sponsor, the scheme is being wound-up or in circumstances where the scheme member’s pension entitlements are being split under the terms of a pension adjustment order.

A member of a funded pension scheme with an entitlement to preserved benefits (and where payment of those benefits has not commenced) may, depending on the circumstances, transfer the value of those entitlements to a PRB, to another exempt approved occupational pension scheme or to a Personal Retirement Savings Account (PRSA).

Preserved benefits are the retirement benefits that a scheme member retains when he or she has completed two years' qualifying service with an employer and has finished their employment.

PRBs are approved by Revenue on a generic basis as a specialist DC pension product to house the transfer value of the preserved pension benefits of pension scheme members in the particular circumstances outlined above.

With regard to the specific pension schemes that are the subject of this question, I am advised by Revenue that they have contacted the relevant administrator on this matter and requested additional information so that a decision may be reached in respect of this particular transfer request.

A decision in this particular case cannot be made until the information requested has been furnished by the relevant administrator.

Tracker Mortgage Examination

Amharc ar fhreagra

Eamon Scanlon

Ceist:

202. Deputy Eamon Scanlon asked the Minister for Finance his views on whether it is the banks' sole discretion to decide the persons who are impacted by the tracker mortgage examination; his position with regard to the persons that are being excluded from the scope of the examination; if the pre-2006 cohort of persons (details supplied) will not be excluded from same; and if he will make a statement on the matter. [45966/17]

Amharc ar fhreagra

Clare Daly

Ceist:

214. Deputy Clare Daly asked the Minister for Finance if tracker mortgages taken out pre-2006 with a bank (details supplied) will be included in the Central Bank's review of tracker mortgages; and of persons that took out mortgages with the bank pre 2006 and that have been affected by the scandal will be offered redress and compensation. [46203/17]

Amharc ar fhreagra

Pearse Doherty

Ceist:

250. Deputy Pearse Doherty asked the Minister for Finance the way in which persons that were customers of a bank (details supplied) were offered tracker mortgages pre-2006 are being dealt with by the Central Bank in its examination; if these cases are included in the examination process; and if he will make a statement on the matter. [46924/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 189, 192, 194, 198, 200, 202, 214 and 250 together.

As the Deputy is aware, the Central Bank, as the regulator with the appropriate powers, has been conducting an industry-wide examination of tracker mortgage-related issues. Through the examination, the Central Bank has publicly and unequivocally committed that all affected customers will be identified and to use the full range of its regulatory powers to ensure they receive redress and compensation. These investigations by the Central Bank are statutorily mandated and can lead to significant sanctions. Therefore, as Minister for Finance, I must be cautious not to jeopardise any potential enforcement actions or prosecutions, and refrain from comment on any particular customer or group of customers whose case is under review as part of the ongoing process.

I met with the Central Bank and each of the relevant banks during the week of 23 October, to receive an update on the tracker mortgage examination, and make it very clear that this Government is determined that the banks resolve this matter as quickly as possible.

Following these meetings, all the banks have committed to working with the Central Bank to fully meet its requirements. This will likely result in further affected customers being identified. I expect this aspect of the examination to be finalised as soon as possible so as to minimise the uncertainty for such customers, and for redress and compensation for those further customers to swiftly follow.

The tracker examination is the largest and most complex supervisory investigation undertaken in the context of the Central Bank's consumer protection mandate, involving the review by lenders of more than two million mortgage accounts.

The Central Bank has advised me that the ongoing examination requires lenders which offered tracker interest rate mortgages to their customers to review all mortgage accounts from the date when the lender commenced offering tracker interest rate mortgages until 31 December 2015. The review encompasses all mortgages in respect of both Private Dwelling Houses and Buy-to-Let properties that i) originated on tracker interest rates; ii) had tracker interest rates applied at any stage during the term of the underlying mortgage agreements; and/or iii) where the underlying mortgage agreements provided for contractual rights to or options for tracker interest rates at any stage during the term of the agreements.

The Central Bank issued a statement following our meetings, which can be read here: https://centralbank.ie/news/article/statement---tracker-mortgage-examination

Details on the examination framework can be found here: https://www.centralbank.ie/docs/default-source/consumer-hub-library/tracker-issues/appendix1-framework-conducting-tracker-mortgage-examination.pdf?sfvrsn=4

The Central Bank's regular updates can be found here: https://www.centralbank.ie/consumer-hub/tracker-mortgage-examination.

AIB have provided me with the following information:

"The tracker examination programme is ongoing and is subject to the final agreement and approval of the Central Bank.

The review, working at all times within the Central Bank framework, identified issues relating to contractual matters, inadequate levels of transparency and poor quality customer information.

AIB is advanced in the review and has redressed and compensated the majority of identified impacted customers.

(1) Customers no longer on a tracker

- At the end of September 2017 AIB had identified 3,416 customers who were not on the tracker mortgage rate to which they were entitled. 91 % percent of these have had their trackers restored (to an average tracker margin of 1.2%) and have also been redressed and compensated. The remaining cases will be completed by the end of the year.

- The bank estimates a further 170 cases will be identified by the end of the year and these have an estimated completion date of end Q1 2018.

Customers no longer on a tracker	Customers no longer on a tracker	Redress and compensation status
Identified as at Q3 2017	3,416	91% complete 100% by year end
Identified by year end (estimated)	170	To be completed by end Q1 2018
Total	3,586

(2) Customers on a higher tracker margin

- During the review AIB also established that some customers, who remained on a tracker mortgage, were incorrectly charged a higher tracker margin.

- The majority of these were impacted for a short period of time and by up to €500.

- Two thirds of these customers will be redressed and compensated by the end of this year, with the remainder to be completed by the end of Q1 2018.

Customers on a higher tracker margin	Customers on a higher tracker margin	Redress and compensation status
Identified as at Q3 2017	736	53% complete 100% by year end
Identified by year end (estimated)	280	To be completed by end Q1 2018
Total	1,016

From December 2015 the review has been conducted in accordance with the Central Bank framework and independently assured by KPMG. The programme includes putting customers back on the correct rate, refunding, compensating, and access to an independent appeals process."

Mortgage Interest Rates

Ceisteanna (190)

Pearse Doherty

Ceist:

190. Deputy Pearse Doherty asked the Minister for Finance if the issue of high standard variable rates was raised during his meeting with the banks in October 2017; the progress made by the State owned or other banks in reducing their standard variable rates; and if he will make a statement on the matter. [45816/17]

Amharc ar fhreagra

Freagraí scríofa

Minister for Finance

While the meetings with the banks had initially been intended to cover a wide agenda, in the event the focus of the meetings was on the tracker issue.

The issue of standard variable mortgage rates is a significant one for this Government. In line with this the Programme for a Partnership Government has set out a number of important and practical measures which seek to improve the position of variable rate mortgage holders.

As part of the Programme for a Partnership Government, the Competition and Consumer Protection Commission (CCPC) was requested to conduct a review of the Irish mortgage market. The CCPC has recently produced its report and it outlines a range of short, medium and long term options to improve the operation of the market. The Government will now evaluate and consider these options in detail. A web link to the report is attached for information: https://www.ccpc.ie/business/wp-content/uploads/sites/3/2017/06/CCPC-Mortgages-Options-Paper.pdf

The Government also believes that measures to encourage and promote a greater level of switching in the mortgage market will help boost the level of competition in the market for existing mortgages. In particular, the Programme for a Partnership Government considers that the development of a code of conduct for switching mortgage provider would be a useful and practical initiative which would have the potential to deliver savings to many existing mortgage holders. In line with this commitment, in 2016 the Central Bank commenced research in the area of mortgage switching which was completed earlier this year. Based on this research, the Central Bank has now commenced a consultation process on proposed measures to help consumers to compare their existing mortgage to other mortgage options and to provide consumers with standardised switching information

(https://www.centralbank.ie/docs/default-source/publications/Consultation-Papers/cp112/cp112-enhanced-mortgage-measures---transparency-and-switching.pdf?sfvrsn=2).

The Central Bank has already made some changes to require lenders to better inform and protect variable rate mortgage holders in relation to changes in mortgage rates. These were set out in an Addendum to the Consumer Protection Code 2012 and require lenders to explain to borrowers how their variable interest rates have been set, including in the event of an interest rate increase. The measures will also improve the level of information to be provided to borrowers about other mortgage products their lender provides that could provide savings for the borrower and signpost borrowers to the CCPC's mortgage switching tool.

In overall terms, the Government is of the opinion that increased competition rather than administrative controls is the best way to ensure that retail lending rates are driven down in a sustainable way for the market as a whole but without giving rise to potentially undesirable consequences for the provision of new mortgage lending.

It should be noted that there has been some progress in this area. Recently published Central Bank data showed that standard variable mortgage rates for new PDH mortgages fell by 23 basis points to 3.34 per cent in quarter 2 2017 since the same period in 2016. This does not include the recent rate reductions by a main mortgage lender which will have a further welcome impact on overall mortgage rates. However, this is a policy area that the Government will continue to keep under active review in its ongoing engagement with mortgage lenders and in implementing the Programme for Government commitments to help deliver on a long term basis better outcomes for all mortgage borrowers.