Written Answers Nos. 228-249
229. Deputy Brendan Smith asked the Minister for Transport the measures that will be introduced as a matter of urgency to assist the haulage industry due to the particular problems facing that sector at present as a result of increased costs and labour shortages; and if he will make a statement on the matter. [54670/21]
Amharc ar fhreagraLike many other sectors of the economy, road haulage is facing the dual challenges of increased costs and labour shortages.
The global oil price has increased substantially in 2021; however, the Minister for Finance has retained the diesel rebate scheme for the present. The scheme, first introduced in 2013, allows licensed haulage and bus operators to apply to Revenue for a rebate on tax paid on diesel purchased in the State.
In relation to labour shortages, it is clear that the haulage sector is facing driver shortages across Europe and not just in Ireland. The HGV driver shortage is a multifaceted issue, with a wide range of different contributing factors, including the COVID-19 pandemic, which has clearly had a huge impact on the labour market for all sectors.
The National Logistics and Supply Chain Skills Group, which my Department chairs, has been engaged on this issue since it was established in 2019. The Group includes haulage and logistics sector industry representatives, education and training providers and all relevant Government Departments and Agencies. I have asked the Group to examine the HGV driver shortage issue and make recommendations, which I expect to receive shortly.
A number of actions are already being implemented. I have been working with colleagues across Government to help address the current difficulties facing the sector, for example:
- Following engagement with Minister English and discussions between my Department and the Department of Enterprise, Trade and Employment, the quota for employment permits for HGV drivers from outside the EU is being removed.
- In tandem with this, the Road Safety Authority is pursuing HGV driver license exchange agreements with a number of non-EEA countries, to allow drivers from these countries to apply for Irish employment permits.
- I have had a range of meetings with the haulage and logistics sector to discuss the issue and get their perspective on the key actions that will help to ease the current shortage of drivers; and
- I wrote to Education and Training Boards Ireland to offer support for the many HGV driver training courses offered by the ETBs around the country.
230. Deputy Christopher O'Sullivan asked the Minister for Transport if he will instruct Transport Infrastructure Ireland to introduce significant traffic calming measures on the N71 in Leap village at the section of road by the local primary school, local playground, local church and shop in the interest of safety for pedestrians and motorists; and if he will make a statement on the matter. [54690/21]
Amharc ar fhreagraAs Minister for Transport I have responsibility for overall policy and exchequer funding in relation to the National Roads Programme. Under the Roads Acts 1993-2015 and in line with the National Development Plan (NDP), the operation, management and upgrading of individual national roads is a matter for Transport Infrastructure Ireland (TII), in conjunction with the local authorities concerned. This is also subject to the Public Spending Code and the necessary statutory approvals. In this context, TII is best placed to advise you.
Noting the above position, I have referred your question to TII for a direct reply. Please advise my private office if you do not receive a reply within 10 working days.
231. Deputy Willie O'Dea asked the Minister for Transport the position regarding the persons who have undertaken the initial basic training for learner motorcyclists but who have been unable to attain a test date within the required two years of completing the course; if he will allow a time extension for these persons; and if he will make a statement on the matter. [54751/21]
Amharc ar fhreagraThe validity period of Initial Basic Training (IBT) certificates is set out in legislation. In 2020, an extension was granted for IBT certificates. In 2021 a further extension was granted as follows -
(a) an IBT certificate issued during the period beginning on 01 March 2018 and ending on 30 June 2018 was made valid until 01 October 2021,
(b) an IBT certificate issued during the period beginning on 01 July 2018 and ending on 31 August 2018 was made valid for a period of 3 years and 2 months from the date of issue, and
(c) an IBT certificate issued during the period beginning on 01 September 2018 and ending on 30 June 2019 was made valid for a period of 3 years from the date of issue.
No further extensions are being considered at this time.
I appreciate that some people will have narrowly missed benefiting from these extensions, but that will be the case whatever dates are set.
232. Deputy Peadar Tóibín asked the Minister for Transport the reason the plug-in hybrid electric vehicle SEAI grant relief for hybrid plug-in vehicles has been reduced from €5,000 to €2,500; and if he will make a statement on the matter. [54753/21]
Amharc ar fhreagra233. Deputy Peadar Tóibín asked the Minister for Transport the way the Government expects to reach its targets for 2021 and 2022 in terms of sales of electric hybrid plug-in cars while it is reducing the financial incentives for persons to purchase such vehicles. [54754/21]
Amharc ar fhreagraI propose to take Questions Nos. 232 and 233 together.
The SEAI grant scheme aims to encourage behavioural change and support the Government’s commitment to achieving a 51% reduction in transport emissions by 2030. The grant schemes are kept under continuous review to ensure that they are as effective as possible in driving the decarbonisation effort.
To date in 2021, over €65m has been provided in grants to support the purchase of electric cars. By year end, this will represent almost a doubling of the allocated supports to EVs.
As a result, the EV percentage of overall car registrations has increased significantly this year and represented over 15% to end Q3 2021. Government is on track as regards the number of vehicles which need to be sold in 2021 to reach its projected annual EV target as set out in the CAP 2019. As of 30 September, there were 45,423 EVs registered in the national fleet.
In the past year, many new BEVs with ranges of over 400km on a single charge have been introduced to the Irish market. Range anxiety is no longer an issue for electric vehicle purchasers, and while PHEVs provided an interim option, but emit both CO2 and air pollution emissions, this interim option is no longer necessary. Government supports should be provided to full electric vehicles, which will be the most effective means of reaching our carbon reduction pathway.
The EV Purchase Grant Scheme was updated earlier this year to support the most efficient and environmentally friendly vehicles on the market. Support in the form of government funding is being refocused to prioritise battery electric cars. Grants for these EVs continued at a rate of €5000 whereas from the 1st of July 2021, the value of the purchase grant for PHEVs changed from €5,000 to €2,500.
Furthermore, I announced after the budget that grant support for PHEVs will be removed from 1 January 2022. Any PHEV which registers for the grant in accordance with the scheme rules before this date will be approved and the commitment carried forward into Q1 2022. However, from 1 January 2022 the SEAI will no longer accept grant applications in respect of PHEVs.
For the top 10 PHEVS sold in 2020, four are high cost vehicles for which a grant would not be applicable and two have a direct BEV equivalent, that would be more useful in terms of decarbonising the car fleet. Of the four remaining, three are made by manufacturers that have an equivalent size BEV model and only one model has no BEV alternative in its range.
Under the Terms and Conditions of the grant process, drawdowns normally need to be made by year end (31 Dec). However, due to the slowdown in global car manufacturing, I am extending this drawdown date to 31 March 2022, to allow time for customers to take final possession of the vehicle.
A range of incentives are in place to encourage the purchase of electric vehicles including:
- VRT relief of up to €5,000 for BEVs;
- A grant of up to €600 towards the installation cost of a domestic charge point for new and second-hand BEVs or PHEVs;
- A low rate of motor tax;
- BEV and PHEVs qualify for 50% and 25% toll reductions respectively up to a maximum €500 annual threshold for private vehicles and a maximum annual threshold of €1,000 for commercial vehicles (greater off-peak rates also apply to the M50 toll);
- BEVs qualify for a 0% Benefit-in-Kind rate up to €50,000 without mileage conditions;
- BEV/PHEVs and their associated recharging infrastructure qualify under the ACA scheme and;
- A grant of up to €10,000 to support the purchase of a BEV in the taxi/hackney/limousine sector with an additional €2,500 available for those choosing to make their vehicle wheelchair accessible. Those scrapping older, more polluting, or high mileage vehicles are now eligible for double the normal grant if they make the switch to electric with up to €20K available for a new BEV, €25K for a new wheelchair accessible BEV and €15K for a new wheelchair accessible PHEV.
234. Deputy Brendan Smith asked the Minister for Transport if urgent consideration will be given to the issues outlined in detailed correspondence from a representative organisation (details supplied) in relation to the serious difficulties facing this sector at present; and if he will make a statement on the matter. [54760/21]
Amharc ar fhreagraThe correspondence referred to is addressed to the Minister for Finance, the Minister for Public Expenditure and the Minister for Environment, Climate and Communications. It relates in particular to measures announced in Budget 2022, which are primarily a matter for the Minister for Finance and the Minister for Public Expenditure.
Like many other sectors of the economy, road haulage is facing the challenge of rising costs. The global oil price has increased substantially in 2021. However, the Minister for Finance has retained the diesel rebate scheme for the present. The scheme, first introduced in 2013, allows haulage and bus operators licensed by the Department to apply to Revenue for a rebate on tax paid on diesel purchased in the State. The rebate rate is based on the average purchase price of diesel provided by the Central Statistics Office, CSO. The rebate amount is capped at 7.5 cent per litre. VAT-registered businesses are also eligible to claim a refund on the VAT paid for diesel used in the course of business activities.
In line with the Programme for Government, the Department of Transport is working towards developing a ten-year strategy for the road haulage sector. The aim is to develop a strategy that will focus on generating efficiencies and improving standards, and helping the sector move to a low-carbon future. A public consultation was held earlier this year and the responses to that consultation are being examined. Another round of consultation is planned. I will remain engaged with the sector and with my colleagues in Government towards the completion of that strategy.
235. Deputy Richard O'Donoghue asked the Minister for Finance if discussions are expected to give VAT and taxation incentives to encourage landowners back into forestry in order to contribute to the Climate Action Plan. [54777/21]
Amharc ar fhreagraThe Government launched the Climate Action Plan 2021 on 4 November 2021, this is a detailed plan for taking decisive action to achieve a 51% reduction in overall greenhouse gas emissions by 2030 and setting us on a path to reach net-zero emissions by no later than 2050, as committed to in the Programme for Government and set out in the Climate Act 2021. In addition to maintaining existing re-afforestation plans, it is intended that by 2030 a planting rate of 8,000 hectares a year will be achieved to increase carbon sequestration.
There is an existing tax incentive that encourages landowners into forestry. Section 232 of the Taxes Consolidation Act 1997 (TCA 1997) provides that profits or gains from the occupation of woodland in the State, which is managed on a commercial basis and with a view to realising a profit, are exempt from income tax and corporation tax (but not the Universal Social Charge and Pay Related Social Insurance).
Capital gains arising to an individual on the sale of woodlands are also exempt from capital gains tax (CGT) insofar as they relate to standing timber under section 564 TCA 1997. Any gain attributable to the underlying land is however subject to CGT.
I am advised by Revenue that the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. The activity of forestry and other forestry services is considered an agricultural activity which is generally undertaken by farmers.
Farmers who elect to register for VAT and charge VAT on their supplies can claim a deduction for VAT incurred on costs that are used for the purposes of their taxable supplies.
Alternatively, farmers can remain unregistered and opt for the Flat Rate Scheme which is designed to reduce the administrative burden for farmers and to compensate them for the VAT borne on the purchases of goods and services relating to their activities. An unregistered, flat rate farmer can also claim a refund of VAT incurred on the fencing, drainage or reclamation of any land intended for use for the purposes of his or her farming business including forestry.
A reduced VAT rate of 13.5% currently applies to Forestry services. This includes lopping, tree felling, pruning, hedge trimming & similar services. It also includes combined sowing & planting. Consultancy services for forestry are also subject to a reduced rate as they are considered a farm advisory service. However the standard VAT rate applies to drawing of timber & haulage which is standard rated.
236. Deputy Denis Naughten asked the Minister for Finance the plans there are or proposed to amend the disabled drivers and disabled passengers scheme; and if he will make a statement on the matter. [54602/21]
Amharc ar fhreagraThe Disabled Drivers & Disabled Passengers Scheme provides relief from Vehicle Registration Tax and VAT on the purchase and use of an adapted car, as well as an exemption from motor tax and an annual fuel grant.
The Scheme is open to severely and permanently disabled persons as a driver or as a passenger and also to certain charitable organisations. In order to qualify for relief, the applicant must hold a Primary Medical Certificate issued by the relevant Senior Area Medical Officer (SAMO) or a Board Medical Certificate issued by the Disabled Driver Medical Board of Appeal. Certain other qualifying criteria apply in relation to the vehicle, in particular that it must be specially constructed or adapted for use by the applicant.
To qualify for a Primary Medical Certificate an applicant must be permanently and severely disabled, and satisfy at least one of the following medical criteria, in order to obtain a Primary Medical Certificate:
- be wholly or almost wholly without the use of both legs; - be wholly without the use of one leg and almost wholly without the use of the other leg such that the applicant is severely restricted as to movement of the lower limbs;
- be without both hands or without both arms;
- be without one or both legs;
- be wholly or almost wholly without the use of both hands or arms and wholly or almost wholly without the use of one leg;
- have the medical condition of dwarfism and have serious difficulties of movement of the lower limbs.
The current medical criteria medical criteria were included in the Finance Act 2020, by way of amendment to Section 92 of the Finance Act 1989. This amendment arises from legal advice in light of the June 2020 Supreme Court judgement that the medical criteria in secondary legislation was not deemed to be invalid, nevertheless it was found to be inconsistent with the mandate provided in Section 92 of the Finance Act 1989 (primary legislation).
While I am very aware of the importance of this scheme to those who benefit from it, I am also aware of the disquiet expressed by members of this house and others in respect of the difficulties around access to the scheme. With this in mind I provided an undertaking to review the scheme, including a broader review of mobility supports for persons with a disability. My officials have been carrying out preliminary work, including an examination of the main issues which will frame the scope of the review and engaging with other Departments and agencies.
Separately, I have reached out to the Minister for Children, Equality, Disability, Integration and Youth, in the context of a review that was commenced in March 2020 under the auspices of the National Disability Inclusion Strategy, to examine transport supports encompassing all Government funded transport and mobility schemes for people with disabilities. Its work was interrupted by the COVID-19 pandemic. Minister O’Gorman has confirmed that he has asked his officials to reconvene the working group established to carry out that review at the earliest opportunity and we are both agreed that this is the most appropriate forum for the review. With this in mind, my officials will work closely with officials from the Department of Children, Equality, Disability, Integration and Youth to progress this review, and on foot of that will bring forward proposals for consideration.
237. Deputy Michael Healy-Rae asked the Minister for Finance if a series of issues (details supplied) in relation to fuel costs and carbon tax for transport operators will be examined; and if he will make a statement on the matter. [53960/21]
Amharc ar fhreagraThe price of petrol and diesel is determined by a number of factors including taxation, the price of the raw materials, the prevailing exchange rates as well as the fact the different wholesalers can enter into forward contracts at different rates for the purchase of oil. The price of fuel on the forecourt is set by the individual retailer and would likely take into account the costs associated with the retail of the product such as those mentioned above together with the cost of having oil delivered.
The current spike in energy prices arises principally from the global recovery from the Covid-19 pandemic and is being witnessed across the European Union as well as many other regions.
For large scale diesel consumers such as those involved in the road haulage and public transport sectors, the Deputy will be aware that the Diesel Rebate Scheme was introduced by my predecessor in 2013. This Scheme offers a partial excise refund to qualifying operators based on the retail price of diesel. The scheme is designed to provide a level of support when the retail price of auto diesel is relatively high. The rebate kicks in when the price at the pumps goes above €1.23 per litre; increasing gradually to a maximum rebate of 7.5c when diesel reaches €1.43 per litre. In Budget 2020, I provided for a temporary enhancement to the scheme in light of the challenges arising from Brexit uncertainty facing the industry. This involved a doubling of the marginal rate of compensation at prices over €1.32 (VAT inclusive) up to the maximum repayment rate of 7.5 cents per litre. In recognition of the vital role that the haulage sector plays in the economy, I have maintained this enhancement to the scheme which offers more generous conditions to essential users. This measure is aimed at maintaining the competitiveness of the road haulage sector and minimising the impact for the sector and related businesses which rely on road haulage services. Passenger transport is also benefitted by this scheme which is available to passenger bus operators.
The Deputy may also wish to note that businesses that are registered for VAT may deduct the VAT charged to them on the purchase of business inputs, such as road diesel and other motoring costs.
238. Deputy Catherine Murphy asked the Minister for Finance the steps he has taken in respect of the provision of premiums by insurance companies to persons in homes that are not designated as a flood risk; and if his attention has been drawn to instances in which insurance companies are refusing to provide cover in instances in which OPW flood maps clearly identify areas as not being in a flood area. [53969/21]
Amharc ar fhreagraIt is important at the outset to state that the provision of flood cover is a commercial matter for insurance companies, based on an assessment of the risks they are willing to accept. As such, the Government cannot interfere in the provision or pricing of insurance, or direct as to where cover is provided. Consequently, neither I nor the Central Bank of Ireland can interfere in this, as reinforced by the EU framework for insurance (Solvency II Directive).
Current government policy on flood insurance is centred on significant investment in sustainable flood management and the exchange of information between the insurance industry and the Office of Public Works (OPW). While the majority of property insurance policies contain flood cover, I acknowledge that some households can experience difficulties. My Department will continue to engage with Insurance Ireland, the OPW, the Department of Housing, Local Government and Heritage and other stakeholders through the OPW-led Memorandum of Understanding Working Group on the level of flood insurance. Please note that flood cover was also discussed by the Cabinet Committee Sub Group on Insurance Reform on 20 October 2021.
In terms of the OPW flood maps, please note that the OPW is the lead agency for flooding matters. I am informed that the OPW flood maps are community based. As such, they do not designate individual properties at risk and cannot be used for commercial purposes. The insurance industry has highlighted that it does not use the OPW’s flood maps to inform its flood modelling. At a general level, it is my understanding that firms examine the claims history of the individual risk, the risk of flooding in the area and consider any flood protection measures, with the provision of cover based on these assessments examined on case-by-case basis.
In the event that an insurance undertaking refuses to quote a consumer for property insurance, it should be noted that under the Central Bank of Ireland’s Consumer Protection Code, the insurance undertaking must within five business days of the refusal, inform the consumer of its decision and its reasons for declining cover. In addition, Insurance Ireland operates a free Insurance Information service for members of the public who have general queries in relation to insurance cover and this can be accessed at feedback@insuranceireland.eu.
While this is a complex issue, please be assured that both Minister of State Fleming and I will continue to engage on all aspects of insurance reform, including flood insurance issues, and that every effort is being made to encourage a responsive approach from the insurance industry.
239. Deputy Pat Buckley asked the Minister for Finance the way travel and subsistence payments for the construction sector, known as country money, are set; if there are discussions to increase the payments; and if he will make a statement on the matter. [53972/21]
Amharc ar fhreagraI am informed by Revenue that it operates a scheme known as ‘country money’ in relation to employees in the construction sector. This arrangement is designed to reduce the administrative overhead for both employers and employees in the reimbursement of expenses of travel.
Section 114 of the Taxes Consolidation Act 1997 provides that where an employee “is necessarily obliged to incur … expenses of travelling in the performance of the duties of that employment … there may be deducted from the emoluments to be assessed the expenses so necessarily incurred and defrayed.”
This provision allows for reimbursement by an employer, without deduction of tax, of expenses of travel, including subsistence, necessarily incurred by an employee in the course of his or her duties.
While this may be operated on the basis of vouched expenses, for ease of administration, Revenue allows payment of certain set sums of money tax-fee to employees in the construction industry while they are assigned to sites that are remote from their place of employment.
The way travel and subsistence payment rates for the construction sector are set, is based on an employee being employed and working at a site that is located in excess of 32km from the employer’s base or headquarters. The current rates for ‘country money’ are set at a maximum of €181.68 per week for more than four days or €36.34 per day for four days or less.
Furthermore, Revenue confirmed that ‘country money’ may not be paid tax-free in the following circumstances where:
- the employer provides transport to and from the site, or
- the employer provides board and lodgings, or
- the employee is recruited to work at one site only.
The payment of ‘country money’ does not prevent an employee from making a claim for a deduction from taxable income of the actual amount of expenses necessarily incurred by them. However, in these circumstances, any amount of ‘country money’ paid or any other reimbursement of expenses by the employer is treated as additional emoluments and taxed accordingly.
The rates of ‘country money’ are agreed between Revenue and relevant construction industry and employee representative bodies. I am advised that there are no discussions to increase these payments at present.
240. Deputy Ivana Bacik asked the Minister for Finance if his attention has been drawn to the refusal by Irish banks to finance mortgages for so-called cargo container houses due to the fact they are not fixed foundation housing; his views on this policy; and if he will make a statement on the matter. [53988/21]
Amharc ar fhreagraAs the Deputy will appreciate, the decision to grant or refuse an individual application for credit, and/or whether or not to seek security for the provision of credit (and if so the type of such security), or to provide credit on an unsecured basis, is a commercial decision to be made by the individual lender in line with its own lending policies and individual underwriting decisions. As Minister for Finance I have no role in such matters.
However, any regulated lender which offers or provides credit secured on residential property has to comply with certain regulatory requirements. For example, the European Union Consumer Mortgage Credit Agreements Regulations 2016 (CMCAR) applies to credit agreements which are secured on residential immovable property or secured by a right related to residential immovable property where the person to whom the credit is provided is a consumer. The CMCAR sets out certain consumer protection obligations and conduct of business rules on regulated entities which provide such credit, including, where the credit application is refused, the need to inform the consumer without delay of the refusal. The Central Bank’s Consumer Protection Code 2012 imposes further information provision obligations on regulated entities including, where a person's application for credit is refused, the requirement to clearly outline to the consumer the reasons why the credit was not approved and if requested to provide these reasons on paper or on another durable medium.
If a mortgage or other credit applicant is not satisfied with how a regulated firm is dealing with them, or they believe that the regulated firm is not following the requirements of the Central Bank’s codes and regulations or other financial services law, they should make a complaint directly to the regulated firm. If they are still not satisfied with the response from the regulated entity, the response to their complaint from the regulated entity is required to include details for the borrower on how to refer their complaint to the Financial Services and Pensions Ombudsman.
241. Deputy Catherine Murphy asked the Minister for Finance if he plans to include e-scooters as eligible methods of transport under the cycle to work scheme. [54014/21]
Amharc ar fhreagraThe Deputy will be aware that the Road Traffic and Roads Bill 2021 was recently published and is currently before the Dáil. The Bill includes measures to provide for the legal use of powered personal transporters, including escooters.
Section 118(5G) of the Taxes Consolidation Act 1997 (TCA 1997) provides for the ‘Cycle-to-Work’ scheme. This scheme provides an exemption from benefit-in-kind (BIK) where an employer purchases a bicycle and associated safety equipment for an employee. The scheme does not include escooters.
Given the number of escooters currently in use, I consider that the Bill which will make their use legal will provide a sufficient incentive for people to utilise escooters and I do not see a market failure which would require taxpayer support to further incentivise their use.
As the Deputy will be aware, the inclusion of escooters in the scheme would create an additional cost and that cost must be recovered elsewhere. For that reason, while the scheme is kept under review by officials, I have no plans at present to include escooters in the scheme.
242. Deputy Darren O'Rourke asked the Minister for Finance the estimated cost of the tax relief on the first €200 of income arising from the domestic generation of electricity supplied to the grid will be in one year; the estimated number of applicants in the first year; and if he will make a statement on the matter. [54058/21]
Amharc ar fhreagraIn my Budget 2022 speech I announced a modest tax disregard in respect of personal income received by households who sell residual electricity that they generate back to the grid. The aim of the measure is to remove a potential administrative barrier to entry to the DECC Microgeneration Support Scheme. It is proposed that the measure would not apply to trading income and that it should be allowed to operate for an initial period of three years with a sunset clause applying at the end of 2024.
A provision of €1 million was made in the Budgetary arithmetic for 2022 in respect of this measure. Currently, it is estimated that some 3,000 households may avail of the relief next year at an estimated maximum cost of €290,000. The Budgetary provision allows for potential growth in the estimate of numbers that will participate in the coming year.
243. Deputy Éamon Ó Cuív asked the Minister for Finance if he plans to increase the ceilings of repayment of VRT and VAT on the purchase of vehicles for disabled persons with a primary medical certificate (details supplied) in view of the increase in VRT on vehicles recently and the increase in the price of vehicles and subsequently on the VAT element of the purchase of vehicles; and if he will make a statement on the matter. [54092/21]
Amharc ar fhreagraThe Disabled Drivers & Disabled Passengers Scheme provides relief from VRT and VAT on the purchase and use of an adapted car, as well as an exemption from motor tax and an annual fuel grant. Details of these reliefs and the grant in respect of fuel usage are available on the Revenue website at the following link: www.revenue.ie/en/importing-vehicles-duty-free-allowances/guide-to-vrt/reliefs-and-exemptions/scheme-for-persons-with-disabilities.aspx
The relief from Value Added Tax and Vehicle Registration Tax are generous in nature amounting to up to €10,000, €16,000 or €22,000, depending on the level of adaption required for the vehicle.
It should be noted that changes to the VRT charging table only impact cars with emissions above 110 g/km CO2. For bands 9-12, which represent most new car registrations, there is a modest rate increase of 1%. VRT is an emissions-based tax and therefore the amount of VRT incurred will vary across different vehicle makes and models. The new rates structure will result in increases for high emission vehicles, while lower emission vehicles continue to incur low rates of VRT.
Again, the amount of the remission or repayment of VAT and VRT is decided on the basis of the value and nature of the adaptions made to the vehicle. Accordingly, I have no plans to amend the reliefs at this time.
244. Deputy Michael Fitzmaurice asked the Minister for Finance the reason for the refusal of insurance companies to insure hunt and harrier packs resulting in closure for these businesses; and if he will make a statement on the matter. [54126/21]
Amharc ar fhreagraAt the outset I wish to make it clear to the Deputy that Government is aware of issues that are facing a number of high-risk activity sectors, including in equestrian pursuits in terms of accessing insurance. It is important to note that neither I, nor the Central Bank of Ireland, can direct the pricing or provision of insurance products, as this is a commercial matter which individual companies assess on a case-by-case basis. This position is reinforced by the EU Single Market framework for insurance (the Solvency II Directive) which specifically prohibits Member States from doing so.
Nonetheless, this Government recognises the concerns felt by various groups regarding the cost and availability of insurance. It has therefore prioritised the implementation of the Action Plan for Insurance Reform. As the Deputy may be aware, the first Action Plan Implementation Report, which was published in July, shows that significant progress has been made, with 34 of the 66 actions contained therein now completed.
One of the key achievements in the first half of this year was the implementation of the Personal Injuries Guidelines some six months ahead of schedule. Early data from the Personal Injuries Assessment Board (PIAB) shows that since the commencement of the new Guidelines award levels have reduced by an average of 40%. This is an encouraging development; it is my hope that this trend will continue and result in lower costs for businesses. As the insurance reform agenda progresses, we will continue to hold the industry to account on its commitments to pass on savings from the Guidelines, and other elements of the reforms, to customers. Minister of State Fleming, in his ongoing engagement with the sector, has emphasised the need for insurance providers to reduce premiums and increase their risk appetite to provide cover in new areas.
I would like to take this opportunity to assure the Deputy that securing a more sustainable and competitive market through deepening and widening the supply of insurance in Ireland remains a key policy priority for this Government. In this regard, it is my intention to work with my Government colleagues to ensure that the implementation of the Action Plan can continue to have a positive impact on the affordability and availability of insurance for all individuals, businesses and community groups across the country, including for hunt and harrier packs.
246. Deputy Gino Kenny asked the Minister for Finance if he will intervene in the timing of the branch closures by a bank (details supplied) by replicating the actions of the UK financial sector regulator which will mean the pausing of any closures during the current pandemic; his views on the fact that persons will be greatly impacted by the withdrawal of banking services in their locality at a most inopportune time; and if he will make a statement on the matter. [54267/21]
Amharc ar fhreagraAs the Deputy may be aware, as Minister for Finance, I have no role in the commercial decisions made by any bank in the State. This includes banks in which the State has a shareholding.
Decisions in this regard, including the management of branch networks, are the sole responsibility of the board and management of the banks, which must be run on an independent and commercial basis. The independence of banks in which the State has a shareholding is protected by Relationship Frameworks which are legally binding documents that cannot be changed unilaterally. These frameworks, which are publicly available, were insisted upon by the European Commission to protect competition in the Irish market.
Notwithstanding this, Bank of Ireland provided me with a briefing in advance of its original announcement to close branches which issued on 1st March of this year. The briefing the bank provided me with was consistent with its announcement.
Some of the key points contained in the announcement were:
- The decision to close these branches was in response to changing customer behaviour with a significant acceleration in digital banking.
- The branches closing were predominately self-service locations which did not offer a counter service.
- To preserve local access to physical banking for those who want it, the bank has agreed a new partnership with An Post which will allow personal and business customers use their local post office for a range of banking services – including to withdraw cash and make cash and cheque lodgements – at no additional cost. The closing Bank of Ireland branches all have a post office within, on average, less than 500 meters.
- The bank confirmed that the new partnership with An Post would be available to all Bank of Ireland customers before any branch closes.
247. Deputy Neale Richmond asked the Minister for Finance if he will consider removing the 50% limitation in the Finance Bill 2021 on the amount of land that can be used for solar farms in relation to capital acquisition tax; and if he will make a statement on the matter. [54302/21]
Amharc ar fhreagraPrior to Finance Act 2017, agricultural land which was leased for solar panels was not classified as qualifying agricultural property for the purposes of Capital Gains Tax retirement relief or agricultural relief from Capital Acquisitions Tax.
Following a review announced in Budget 2018, and in recognition of the then Government's commitment to facilitate the development of solar energy projects in Ireland, a revised approach was introduced whereby it is now possible for land leased for the installation of solar panels to be classified as qualifying agricultural property under certain conditions. A key condition is that the total area of land under lease and on which solar panels are installed does not exceed 50% of the total area of agricultural land.
While introducing this amendment, it was important that we did not lose sight of the fundamental principle which underpins our policy in relation to agricultural relief and retirement relief.
I recognise that allowing land leased for solar panels to be classified as qualifying agricultural property is an important element in encouraging solar energy projects. However, this must also be carefully
balanced with the overarching objectives of this valuable relief which aims to encourage the intergenerational transfer of agricultural land which is being actively farmed.
Therefore, I have no plans to adjust the condition that the total area of land under lease and on which solar panels are installed does not exceed 50% of the total area of agricultural land.
248. Deputy Cathal Crowe asked the Minister for Finance if his Department has engaged with a company (details supplied) in particular with regard to homes under its insurance cover which now have confirmed cases of pyrite and mica; and if he will make a statement on the matter. [54366/21]
Amharc ar fhreagraAt the outset, it is important to note that for those homeowners whose houses are affected by pyrite and Mica it is a very distressing and serious issue. It is my understanding that HomeBond is one of the providers of latent defect insurance, also referred to as structural defect insurance (SDI). This type of cover provides protection against defects that occur in the post-construction phase and is a 10 year warranty product. The objective of structural defect insurance is to provide cover for a finite length of time in respect of the repair of major structural defects in new buildings. However, I am informed that Homebond withdrew its pyrite cover in 2011 on foot of a High Court decision which held the supplier of construction material liable for damage caused by pyrite rather than the developer. This was upheld in 2014 by a subsequent Supreme Court decision. Therefore, Homebond does not cover material defects, i.e. faults in construction which arise from defective building materials. Homebond’s SDI covers the work carried out by the builder but not the materials used in construction, such as those set out in the question.
Furthermore, it is important to note that Mica damage is not an insured peril and is therefore not covered in standard home insurance policies. Policy wordings generally exclude damage arising from faulty workmanship, defective design or the use of defective materials. It is also my understanding that normal house insurance does not cover defective construction materials – generally this is confined to accidental damage to structure or contents. Insurers will take a risk-based approach to the provision and pricing of insurance and under the insurance regulatory framework Government cannot intervene in this regard.
In order to improve consumers’ recourse to insurance for housing defects, it is important to recognise that insurers will look to the overall building regulation, standards and the legal environment. Accordingly, this is primarily a construction standards and building materials issue which falls under the remit of the Department of Housing, Local Government and Heritage.
Government fully recognises the difficulties facing many homeowners. As such, the Defective Concrete Blocks Grants Scheme was established under the auspices of the Department of Housing, Local Government and Heritage in June 2020. I am informed by that Department that Minister O’Brien subsequently engaged with homeowners in order to review this scheme and received the final report of the Working Group on Defective Concrete Blocks in early October 2021. He has since been in consultation with Government colleagues and other stakeholders regarding the various options available. Minister O’Brien intends very shortly to bring a memo to Government setting out his proposals for improvements in the existing scheme, its future administration and other matters raised in the Working Group report. Any queries relating to this or on building regulations generally should be directed to the Department of Housing, Local Government and Heritage.
249. Deputy Thomas Gould asked the Minister for Finance the status of the audit of vacant properties being undertaken by his Department; and if this audit will include the reason for vacancy. [54368/21]
Amharc ar fhreagraThe recently announced ‘Housing For All’ strategy includes a commitment that the Department will collect data on vacancy with a view to introducing a Vacant Property Tax.
As I have stated on a number of occasions the primary objective of any vacant residential property tax would be to increase the supply of homes for rent or purchase to meet demand rather than increasing tax revenues. However, before introducing such a tax it is important to have a sound understanding of the quantity, locations and characteristics of long term vacant properties, and the reasons why they are vacant.
The recently enacted Finance (Local Property Tax) (Amendment) Act 2021 includes, at Section 39A, a requirement for owners of vacant properties to provide certain additional information to Revenue when completing their LPT Return, including confirming that the properties remain unoccupied at 1 November 2021, the reason why and whether they (the properties) have been vacant for 12 months or more. Once the extended filing date of the 10 November has passed, Revenue will begin validating the data and will advise my Department of the position when the analysis is complete. This information, together with information from other available sources will be used to assess the merits and precise design of a Vacant Property Tax.
It is important to identify the reasons for vacancy, and whether this is long or short-term in nature. There may be genuine and acceptable reasons for vacancy such as refurbishment work, the temporary absence of the owner for medical reasons or pending the grant of probate for a deceased person’s estate. Appropriate exemptions from any charge would have to be considered in addition to acceptable periods of vacancy.
