Seanad Éireann

Vol. 212 Wednesday, No. 2 7 December 2011

DÍOSPÓIREACHTAÍ PARLAIMINTE PARLIAMENTARY DEBATES

SEANAD ÉIREANN

TUAIRISC OIFIGIÚIL—Neamhcheartaithe (OFFICIAL REPORT—Unrevised)

Dé Céadaoin, 7 Nollaig 2011.

Business of Seanad ………………………………77 Order of Business …………………………………77 Financial Emergency Measures in the Public Interest (Amendment) Bill 2011: Second Stage …………………………………100 Committee and Remaining Stages …………………………111 Local Government (Household Charge) Bill 2011: Committee Stage ………………122 Business of Seanad ………………………………167 Local Government (Household Charge) Bill 2011: Committee Stage (resumed) …………168 Adjournment Matters Flood Relief …………………………………169 Higher Education Infrastructure Funding ………………………172 School Staffing ………………………………173 Situation in Libya ………………………………176 SEANAD ÉIREANN

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Dé Céadaoin, 7 Nollaig 2011. Wednesday, 7 December 2011.

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Chuaigh an Cathaoirleach i gceannas ar 10.30 a.m.

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Paidir.

Prayer.

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Business of Seanad An Cathaoirleach: I have notice from Senator Deirdre Clune that, on the motion for the Adjournment of the House today, she proposes to raise the following matter:

The need for the Minister for Finance to ensure that companies providing home insurance in the Cork area do not use the term “flood risk” as a reason to impose blanket increases in charges.

I have also received notice from Senator Susan O’Keeffe of the following matter:

The need for the Minister for Education and Skills to provide an update on the status of the plan at St. Angela’s College, Sligo, to complete the long awaited work to ensure access for the disabled across the entire campus.

I have also received notice from Senator Thomas Byrne of the following matter:

The need for the Minister for Education and Skills to discuss his policy on small schools, in particular after the expenditure measures announced on Monday; and the news report that a Department spokesperson called on these schools to consider their future.

I have also received notice from Senator Jim D’Arcy of the following matter:

The need for the Minister for Jobs, Enterprise and Innovation, in light of the recent appointments of two Libyan Irish residents to senior posts within the new Libyan Govern- ment and administration, to ensure that these close links are being utilised by the Govern- ment to assist its enterprise agencies in securing contracts for Irish companies in construction, consultancy and other areas as the reconstruction of Libya commences.

I regard the matters raised by the Senators as suitable for discussion on the Adjournment and they will be taken at the conclusion of business.

Order of Business Senator Maurice Cummins: The Order of Business is No. 1, Financial Emergency Measures in the Public Interest (Amendment) Bill 2011 — all Stages, to be taken on the conclusion of the Order of Business and to conclude no later than 3 p.m., with the contributions of group spokespersons on Second Stage not to exceed ten minutes and the contributions of all other 77 Order of 7 December 2011. Business

[Senator Maurice Cummins.] Senators not to exceed eight minutes, and the Minister to be called on to reply no later than 1.45 p.m., with Committee and Remaining Stages to be taken immediately on the conclusion of the debate on Second Stage; No. 2, Local Government (Household Charge) Bill 2011 — Committee Stage, to be taken at 3.30 p.m. and to conclude no later than 7.30 p.m., if not previously concluded. There will be a sos between 3 p.m. and 3.30 p.m.

Senator Darragh O’Brien: Yesterday I raised the proposed cuts in the disability allowance both on the Order of Business and during the debate on the budget. I asked the Leader and his colleague, Senator Ivana Bacik, to raise it with the respective Ministers. I am pleased that it appears the Government will row back on this. I watched what the Minister for Finance, Deputy Michael Noonan, said last night in response to my colleague, Deputy Michael McGrath. All Members will agree that a cut in the disability allowance, particularly for young adults, is not appropriate or progressive and simply should not happen. I wish to record our complete opposition to it. We are trying to be constructive on this. There are many items in the budget that we can criticise, as we will and are entitled to do, but this is the single most important. I call on the Leader to give me an update on the discussions in Government with regard to reversing the proposed cut for young adults on the disability allowance.

Senator Terry Leyden: Well done to Senator O’Brien.

Senator Darragh O’Brien: I am disappointed that no additional time was given yesterday evening for many speakers still offering for the debate on the budget. The budget is crucial in that it sets out the financial strategy of the Government for the coming year. Legislation will follow and we will consider the social welfare Bill here for two days next week, which is important. However, many people were offering yesterday evening and did not get an opportunity to give their views on the budget. Debates have lasted a good deal longer than two hours on other matters. We will propose several amendments to the Order of Business to try to discuss various items today. In particular, I propose an amendment to the Order of Business for a debate on health matters, specifically on the increases to private health insurance brought about by the increase that Deputy Reilly has announced for the use of public beds by private patients. Two weeks ago I raised this matter on the Order of Business. As Members will be aware, 43,000 people have given up their private health insurance this year alone because they cannot afford it. The measures announced by the Government yesterday will at the least increase average premiums by more than 50%. Thousands more will give up private health insurance and this will put additional strain on the public health system which at the moment is broken in many aspects. Contrary to the promises of the Minister, Deputy Reilly, more people are on trolleys this year than ever in the history of the State and the system is getting worse. Government proposals for an increase in charges will make it worse still. The Government will push people out of private health insurance into a public system that cannot deal with them. I propose an amendment to the Order of Business to the effect that the Minister for Health, Deputy James Reilly, should attend the House to discuss his policy on private health insurance premium increases and public nursing home closures in which, as I have stated previously on the record of the House, he should have no involvement——

Senator Maurice Cummins: He has none.

Senator Darragh O’Brien: ——due to a direct conflict of interest that the Minister has.

Senator Maurice Cummins: He has not. 78 Order of 7 December 2011. Business

Senator Ivana Bacik: I call on the Leader for a debate in the new year on the way in which we conduct debate in the House. In recent weeks, especially on the Order of Business, there has been a great deal of barracking and heckling especially from the other side of the House.

Senator Darragh O’Brien: Really.

Senator Ivana Bacik: It is unfortunate because this undermines one of the strongest assets the Seanad has always had, that is, our tradition of courteous, respectful and dignified debate. Numerous Ministers from various parties, not only serving Ministers, have commented on that fact that in the past the Seanad has been a place where, especially in the case of legislation, there has been an opportunity for thoughtful and considered debate and the taking of amendments. It would be unfortunate to change that tradition through an overuse of heckling and barracking.

Senator Ned O’Sullivan: We should bring back Deputy Buttimer.

Senator Mark Daly: Where is Jerry when you need him?

Senator Ivana Bacik: There is an example now, a Chathaoirleach.

Senator Mark Daly: Senator Bacik is no angel.

An Cathaoirleach: Senator Bacik without interruption.

Senator Ivana Bacik: There have been mornings on the Order of Business when I have been unable to finish a sentence and I am not the only person who has been hassled, barracked and heckled by the other side. It is something of which we should be aware.

Senator Darragh O’Brien: Senator Bacik is going well this morning.

Senator Ivana Bacik: The Fianna Fáil Members opposite could learn a great deal from their colleague, Deputy Michael McGrath. I do not agree with what he says but I appreciate that he has a restrained style and that it is a more effective way of making his points in debate——

Senator Darragh O’Brien: With all due respect, there is no point in Deputy Bacik standing here lecturing us.

An Cathaoirleach: Senator Bacik without interruption.

Senator Ivana Bacik: ——than the sort of loud-mouthing we often have here and that we are hearing now from the Opposition.

Senator Mark Daly: We hear it from Senator Bacik more often than not.

Senator Maurice Cummins: Senator Daly is welcome back.

An Cathaoirleach: Senator Bacik without interruption.

Senator Ivana Bacik: Could I say——

Senator Mark Daly: Let she who is without sin cast the first stone.

An Cathaoirleach: The Senator without interruption.

Senator Ivana Bacik: If I could finish my sentence, all of us welcome the genuine engagement, especially on “Prime Time” last night, between the Minister, Deputy Noonan, and Deputy 79 Order of 7 December 2011. Business

[Senator Ivana Bacik.] Michael McGrath. In the course of a genuinely respectful exchange, the Minister, Deputy Noonan, made the point about the disability allowance.

Senator Darragh O’Brien: Senator Bacik dismissed it yesterday.

Senator Ivana Bacik: All of us are keen to see a constructive debate through genuine engagement and changes made to ensure that young persons with disabilities are not disadvantaged unduly by the change to align different rates of disability and social welfare payments. This is an important point about respectful engagement in the House. I compliment Senator Feargal Quinn who referred to the issue of central European time yesterday. This is something he has raised in the House in a courteous and respectful way for many years. I am pleased to report the justice committee is debating the issue. In the new year when we have finished our review in the justice committee I will put it to the Leader that we might debate in this House a move to central European time. This is likely to take place next year and will bring with it numerous benefits to us not only in terms of carbon emissions but in terms of the economy, tourism and other benefits.

Senator Mary Ann O’Brien: I wished to highlight some concerns last night during the statements on the budget. However, I was prevented from doing so by an inadequate time allocation provided for such a serious and relevant debate. The refusal to extend the time last night shows once again how the Seanad system is so badly broken. I am deeply ashamed and embarrassed because of the shameful cuts imposed on our young disabled people in the budget. I echo the comments of Senators relating to the drastic reduction in disability allowance for young people between the ages of 18 and 24 years and the 20% cut in the fund for students with disabilities at third level. I acknowledge the Minister, Deputy Noonan’s comments on “Prime Time” last night and I welcome the increase in the age of entitlement for disability allowance from 16 to 18 years of age and that the entitlement to domiciliary care allowance will be extended to those aged 18 years in line with this. Parents’ groups have been calling for this for several years. However, I have grave reservations about the reduction in weekly payments for disabled people between the ages of 18 and 24 years. While there are no immediate cuts to those already in receipt of disability allowance, all new applicants will be subject to the new regime. Those aged between 18 and 21 years will now received €100 per week. While many young people with disabilities progress through the education system and secure employment, this is not an option for all. I employ one of these people upstairs, Kevin, my personal assistant in the Seanad. Since this announcement was made on Monday, Kevin has identified what such a cut would have meant to him if it had been introduced as he progressed from education to employment. One thing the Minister has failed to factor into her logic is the extra costs associated with a disability. This is a real story. It is like Coca Cola, it is the real thing. For someone such as Kevin, who is blind, this would include additional adaptive equipment and software and additional travel costs to name only some. Kevin is certain that if such a cut had been imposed on him, he would have been unable to complete his primary degree or obtain his masters degree. Many young people in receipt of disability allowance are unable to take up employment opportunities due to the nature and severity of their disability. The argument put forward by the Minister is utterly flawed and marks the unravelling of the good work done to assist people with disabilities. Figures released only last week by the Central Statistics Office show that the 80 Order of 7 December 2011. Business number of people with disabilities living in consistent poverty has increased dramatically in recent years. I intend to put together a pledge after the Order of Business and I will e-mail everyone and ask them to sign our pledge because we must get a cross-party motion on this issue and get it through. It is embarrassing for us all.

Senator Darragh O’Brien: Hear, hear.

Senator Mary Ann O’Brien: I have some questions for the Leader. I am a Seanad novice but I cannot believe what is going on here. Will the Leader tell the House this morning why the Government failed to freeze increments? “Increments” is a word I had to look up in the Oxford English Dictionary. It seems that it is a regular increase in salary, known in the private sector as a definite pay rise, every year. We are in the real world. There is no such thing in the private sector. Why did the Government not talk gently to the public service, which will cost us €300 million next year in increments? This step is not prohibited by the Croke Park agreement, something widely accepted by Ministers such as Deputy Pat Rabbitte. We are broke and insolvent. We simply cannot go on. I could continue to highlight the difficulties imposed on young disabled people. It embar- rasses me greatly. I emphasise to each Minister, Deputy and Senator that these decisions should be revised. I call on the Leader to go further and ask his Government colleagues to allow people in receipt of disability allowance to take up places in the labour activation programmes announced by the Government such as Springboard and JobBridge. They are currently prevented from doing so. This would bring them into line with those of a similar age in receipt of jobseeker’s allowance.

Senator Cáit Keane: I am afraid I will repeat what Senator Mary Ann O’Brien has just said but it is worth repeating.

Senator Mark Daly: We will see how the Senator goes.

Senator Cáit Keane: I wished to comment during the debate yesterday evening as well but due to time constraints I did not get to say my piece. I understand that we must run the Seanad in an orderly way but perhaps if we cut out the repetition we would be able to operate within the time constraints agreed on the Order of Business. If we allow it to run over all the time we will get nowhere. It would be good if research was done in the Seanad on how many times an issue was repeated because one hears the same things. An emergency meeting of the Fine Gael parliamentary party discussed disability. I heard the Minister for Finance, Deputy Noonan, on “Prime Time”. He said he would re-examine the issue, which I welcome. By chance I met the Minister for Social Protection, Deputy Burton, this morning. I would never stop a Minister in his or her tracks in a corridor because it is discourteous. I apologised for mentioning the issue to her but I said it is the most important issue which has arisen in the Seanad since I became a Senator. Her heart is in the right place. She said she was prepared to look at the issue. I ask the Leader to go to both Ministers and tell them there is all-party agreement that the issue will have to be revisited. The change will not affect those currently in receipt of the allowance and there is a two-year span. The issue needs to be addressed immediately. The labour market activation fund, work experience, SpringBoard and JobBridge are all in place. I know children with Down’s syndrome who are well able to work and have told me they have been on work experience for a long time. They asked me if there is anything I can do to take them off that platform and into a real job. I ask the Minister to address things like that and the use of the labour market activation fund for such people. 81 Order of 7 December 2011. Business

Senator Labhrás Ó Murchú: The issue regarding the disabled as represented in the budget has been well ventilated in this House and the media. The fact that the Minister has indicated a possible rethink on this should not be seen as a U-turn by the Government. It should be seen as a response to a robust and comprehensive debate on the budget and all its terms. If we do that we may all make a contribution to solutions. None of us have all the answers. When I was on the Government side of the House I always requested those in opposition to endeavour to create consensus on some issues. That is what we should do as legislators. It is good for the country and particularly good for people who do not have a voice. We can do that in a balanced and reasoned way. Yesterday I raised the proposed closure of a considerable number of rural Garda stations. In his response, for which I thank him, the Leader indicated it was a recommendation of the Commissioner. We will not have the opportunity to debate that issue with the Commissioner. In the same manner as the issue relating to the disabled and their families, the issue of Garda stations has been fairly well ventilated. I would like to think the issue would also merit further debate. I propose a change to the Order of Business. As we cannot have a debate with the Commissioner I would like the Minister for Justice and Equality to be invited to the House to give us an opportunity, before it is too late, to put our views forward. I spoke to a councillor on the telephone yesterday about this issue who said his or her area was lucky because closures would not happen in the locality, but that is not what this is about. We are not representing a local constituency, rather we are representing the whole country. I second the change to the Order of Business proposed by Senator O’Brien.

An Cathaoirleach: What is your proposal?

Senator Labhrás Ó Murchú: That we invite the Minister for Justice and Equality to the House to give us an opportunity to debate the proposed closure of rural Garda stations.

An Cathaoirleach: Does the Senator want to invite him in today?

Senator Labhrás Ó Murchú: Yes.

Senator Susan O’Keeffe: I ask the Leader for a debate in the new year on moneylending. Coupled with it are organisations and companies offering debt solutions. People are under pressure, not just because of the times we are in but because Christmas is upon us. They are incredibly vulnerable when they hear advertisements on the radio promising that one should not worry if one has debts of €10,000 because one can pay €25 a week and all will be well. Reading the small print one finds that the cost of these schemes is prohibitive, but many people forget to read the small print or are so tempted by the offer they become stuck before they can get out. Moneylending is the more criminal end but there is also what I would call advertised moneylending which sounds very inviting. It is very dangerous and we need to find a way, through the House, to bring this to the attention of the relevant Minister and seek legislation relating to the administration of such organisations.

Senator Fiach Mac Conghail: On the Private Members’ motion that was discussed in October regarding the prosecution of purchasers of sex, which was highlighted by the Turn Off The Red Light campaign, I commend and applaud what happened in Limerick which has been outlined in a report in The Irish Times today. In Limerick 21 people pleaded guilty to soliciting or importuning for the purposes of prostitution between 11 November and 4 December this year. 82 Order of 7 December 2011. Business

As I said during the debate, those involved were ordinary Irish people who procured sex. The motion, which was defeated by the House, proposed to introduce legislation to criminalise such behaviour. It was promised that the Minister of State, Deputy Lynch, would return to the House to introduce a broader consultation process which would ultimately lead to legislation. I ask the Leader for an update on that. I support Senator Keane in her comments on disability allowance. The Independent group tried to raise the issue on the Order of Business yesterday with little success. I propose an amendment to the Order of Business.

An Cathaoirleach: Each Senator is only allowed one topic on the Order of Business.

Senator Fiach Mac Conghail: I propose to amend the Order of Business to ask the Minister for Social Protection, Deputy Burton, to attend the House to debate disability allowances today.

An Cathaoirleach: Is that a proposed amendment to the Order of Business?

Senator Fiach Mac Conghail: Yes.

Senator Terry Brennan: Dundalk Institute of Technology is better known as DKIT. There are number of institutes of technology throughout the country and they celebrated 40 years of existence last Monday. I attended the celebrations. Distinguished fellowships were awarded to four people as a mark of the celebrations. They included people who have contributed to business, sport, the arts and media, not just in Louth but throughout the world. Our colleague, Senator Fergal Quinn, was awarded a distinguished fellowship, as was Dr. Carmel Naughton for her contribution to the arts, Mr. Joey Maher, a famous handballer and world champion, and a brother of the Minister of State, Deputy O’Dowd, Mr. Niall O’Dowd, who received an award for his international media skills and contribution to the peace process. I congratulate them. Although we are not supposed to do so, I am sure the Cathaoirleach will allow me to congratulate our colleague, Senator Feargal Quinn, and the other recipients of awards.

Senator Feargal Quinn: I thank Senator Brennan for his kind words. It was good to see the representation in Dundalk the other day. I was jolted recently to discover that several of the high-tech companies that were coaxed into investing in Ireland have been unable to find the talent they require among job applicants, particularly in regard to coding and computer technology, and have had to import staff. The reason for this dearth of talent is that we are not encouraging nearly enough people at a young age to pursue training in the area of science and technology. Yet the Government has just reduced the number of career guidance teachers at second level. There must be a heavy empha- sis on such guidance if we are to succeed in this area. Will the Leader invite the Minister for Education and Skills and the Minister for Jobs, Enterprise and Innovation to the House for a debate on this issue? There is a double challenge, encompassing the remits of both Departments, in terms of developing the expertise in computer skills which is needed by the companies investing in this State. There is work to 11 o’clock do in education and at enterprise level, but it is achievable. There have been several interesting success stories such as that of the eight year old girl who is able to teach a class of 15 year olds in her school how to handle computer technology. Children should be introduced to technology skills at the age of seven, eight or nine. Little action has thus far been taken to address this shortfall in expertise among the Irish workforce. 83 Order of 7 December 2011. Business

Senator Martin Conway: I join colleagues in welcoming the indication by the Minister for Finance, Deputy Michael Noonan, on last night’s “Prime Time” that he will review the budgetary decision in regard to disability allowance. With due respect to my Independent colleagues, the fact that this review is taking place is positive. While I acknowledge their amendment to the Order of Business, the Government has already pledged action in this area. This is a very disability-aware Administration, which is keen to ensure that the moneys allocated in this area are spent properly. I tabled a motion on the Adjournment last week in regard to funding for People with Dis- abilities in Ireland, PWDI, an issue which was raised by several speakers on the Order of Business. I was disappointed that none of them attended the Adjournment debate on this issue, where I discovered that 92% of the funding provided to that organisation was spent on administration. What is needed, and is beginning to happen, is an overall value for money audit in respect of the €1 billion plus allocated to the disability sector. My deep concern is that this money is not being channelled correctly to the end user. We must not have ivory towers built on the backs of people with disabilities. The organisations deserving of State support are those which provide front-line services. We must not have a situation where 80% to 90% of funding is spent on the wages of headquarters staff, administrative costs, travel expenses and so on. That is what has been happening in the disability movement for the last ten to 14 years.

An Cathaoirleach: Does the Senator have a question for the Leader?

Senator Martin Conway: Yes. The Government is committed and determined to ensure that the end user, who deserves to benefit, will benefit from the massive resources which the Government will, in its five-year term, invest in the sector. Will the Leader arrange a debate in due course on the funding of the disability sector in order to ensure the moneys being allocated are spent wisely, prudently and efficiently? All organisations in receipt of substantial resources from the State in order to provide services and support to people with disabilities should be accountable to the Oireachtas for how they are spending that money and who is benefiting.

Senator Kathryn Reilly: The events unfolding in Europe are, together with the budget, a source of fear for people throughout the State. Agreements are currently being made between powerful European states and this week’s Council summit will have a potentially long-lasting effect on the State. Last week the Taoiseach clearly stated his opposition to further treaty change, before the Tánaiste indicated that the Government is open to negotiation on treaty change. Where exactly does the Government stand on this matter? We must be told its position on enshrining budgetary policy into EU treaty law, giving the European Court of Justice a say in policing member states’ budgets and the transfer of further fiscal powers from these Houses to the EU institutions. These are the key proposals which Nicolas Sarkozy and Angela Merkel will bring to the EU crisis summit on Friday. These are the demands they will make of member states. Today we learn that the amendments they are seeking are proposed to be made by rewriting a protocol attached to the Lisbon treaty which sets out how Europe deals with countries which persistently breach budget guidelines. This is being seen as a back-door route to treaty change, as the protocol has the same legal effect as the treaty itself. What arrangements, if any, is the Leader putting in place to update this House on the summit? Will he invite the Minister of State with responsibility for European Affairs, Deputy Lucinda Creighton, to the Chamber in order to brief us on developments? I accept that we have a full legislative programme to fulfil before Christmas, but the speed and momentum of developments in Europe are such that a 84 Order of 7 December 2011. Business debate is required as soon as possible. It cannot wait until the next session when the issues will already have been settled.

Senator Trevor Ó Clochartaigh: Hear, hear.

Senator Colm Burke: Last May I raised the issue of recruitment of junior doctors. Many of their contracts are of six months duration and are again up for review on 11 January. I understand the Health Service Executive is running into the same problem it experienced on 11 July in terms of a shortage of junior doctors. Little has been done in the past six months on the issue of young Irish doctors leaving the country for jobs abroad. There is a need for an urgent debate on the issue. There are more than 750 vacancies for nurses in private nursing homes. The operators of these facilities cannot secure the services of qualified nurses. This raises the question of whether there is a requirement for a new category of qualification between care assistant and the academic qualification that nursing has become. People who obtain a nursing degree now feel that a position in a nursing home does not meet their long-term requirements in terms of matching their qualifications. We must review the entire system. I recently attended a ceremony where awards were given for every category of person working in nursing homes throughout the State. More than 50% of the awards went to non-nationals, a recognition of their vital contribution to the health care sector. We must have a debate on the qualification criteria and why we are losing so many people from the system. I hope that debate will take place as soon as possible.

Senator Mark Daly: I support my colleague, Senator Fiach Mac Conghail, in his call for a debate on the proposed changes in respect of the disability allowance. I hope the House will see its way to facilitating that debate rather than accepting the proposal from the other side of the House that we wait for the departmental officials to do the driving and come back with their considered view. I propose an amendment to the Order of Business that we debate the issue of public sector pay increments, which are not covered under the Croke Park agreement. An increase of €300 million in the public sector pay bill is money that could have been used elsewhere to soften the blow of budgetary measures. Under those proposals a family of three in receipt of social welfare will see their income reduced by €1,052 per annum. On the other hand, a family with three children and a joint income of €150,000 will be impacted to the tune of €1,078. This does not sound like a fair and balanced proposal. On the contrary, it seems that the most vulnerable are being targeted. I look forward to the proposed debate in the new year on parliamentary debating procedures. Parliamentary politics is about cut and thrust. If a Member opposite raises an issue or makes a point in regard to a particular proposal and induces heckling in so doing, one can be sure that this was precisely his or her intention. A particular party tries to induce a bit of heckling rather than allow us sit idle on this side of the House. The budget is anti-rural.

(Interruptions).

An Cathaoirleach: Senator Daly without interruption.

Senator Mark Daly: Oh, dear me, the people in the glasshouses are throwing stones.

An Cathaoirleach: Has the Senator a question for the Leader?

85 Order of 7 December 2011. Business

Senator Mark Daly: They have proven the point that debate is about provoking a response. I am delighted to see that I have succeeded in proving the point.

An Cathaoirleach: A question for the Leader, please, Senator Daly.

Senator Mark Daly: The budget is anti-rural. Small schools are being told to consider their future, Garda stations are being closed down and farm families are being affected. My amendment proposes that the issue of increments be debated today and that the Government should use the €300 million which it is proposed to pay the public service in a fairer way. My colleague, Senator Ó Murchú has an amendment to the Order of Business.

Senator John Kelly: Like everybody else I support calls for a review of any proposed cuts in disability payments. I supported Senator O’Brien yesterday on that issue. However, I reiterate my point that situations have arisen over the past years in which 16 year-olds in second level going on to third level were receiving a disability allowance and were graduating with a degree and obtaining employment. This indicates that perhaps these people should not have been receiving disability allowance in the first place. In my view there is a need for a two-tier system whereby severely disabled people are given the full rate of disability allowance while those with mild and moderate disability could be given an allowance along the lines of the jobseeker’s allowance. On a related issue, a person aged 18 years and in receipt of a disability allowance gets €100 a week. I would insist that such persons qualify for a medical card. I call on the Leader to take note of this point because down through the years anyone with any income was assessed in their own right for a medical card. Since the transfer of the administration of the medical card scheme to the PCRS in Finglas, anyone in receipt of €100 a week in unemployment assistance is no longer eligible for a medical card and no longer assessed in his or her own right. They are now being lumped in with the family income. This is a new regulation and I want the Leader to bring this to the attention of the Minister. We need answers to why this has happened because if this is the case for those in receipt of €100 unemployment assistance, the same will apply if a person is getting €100 disability allowance.

Senator Jim Walsh: I join with Senator Darragh O’Brien, Senator Mary Ann O’Brien and others who were highly critical of the failure to provide adequate time last night for the debate on a very important matter. We are well paid and some people depend on us to articulate their concerns in this Chamber. The least we should have is the opportunity to do so. I do not know where the blame lies, whether with the Leader or the Government Whip’s office. Whoever is to blame, it is appalling and a disgrace. This is symptomatic of the trend since we came back this term. New Members may not be aware but in the previous Seanad it was not unusual for spokespersons to have between 12 and 15 minutes speaking time and for other speakers to have eight to ten minutes. This time around, spokesperson are given eight minutes and other speakers are given five minutes. Debate is being truncated. A speaker can only give some headline comments. In my opinion this is very bad for government because if people have the opportunity to speak — even if they have opposing or critical views — at least it helps to inform policy formulation. I agreed with certain aspects of the budget last night but, for example, I do not agree with the change in the qualification for widows. I know from personal experience what it is like for families to have to make do with the widow’s pension. The qualification for a widow’s pension is to be increased from three years to ten years. Many women in the workforce leave in order to rear their families and work intermittently over the years. They will be penalised simply because they will not have accumulated ten years. It is an horrendous increase from 156 to 520 weeks qualification and an uncaring decision. If we have any regard for families and widows in particular who are left in very difficult circumstances, this decision should be reversed. 86 Order of 7 December 2011. Business

I propose an amendment to the Order of Business that the Minister for Social Protection come to the House today to debate this issue. I hope that like-minded people on the Govern- ment benches who share my concerns will articulate their concerns about this uncaring and unsympathetic measure.

Senator Catherine Noone: On the issue of the disability allowance, I join with other speakers and in particular with Senator Conway. Many people may not realise that he was born blind because he does not refer to it. I am full of admiration for how he conducts himself every day. I say, hats off to him in every way. It is a great thing in life to be able to admit when one is mistaken. Not just last night but also this morning, the Ministers, Deputy Noonan, and Deputy Howlin, have said they will review this issue. These are two honourable men whom we must take at their word. They have said they will review this issue in advance of Christmas. The Social Welfare Bill will be before both Houses and the issue will be on the table. They have admitted there is an issue with this particular provision in the budget. This is not a U-turn, as Senator Ó Murchú has stated. They have said this will be addressed. I refer to Senator Walsh’s contribution. As a person new to politics, I think brevity in debate is to be commended. I do not speak at length. I am not suggesting anyone else does so unnecessarily——

An Cathaoirleach: Has the Senator a question for the Leader?

Senator Jim Walsh: It was not just brevity, this was actually closing down the opportunity.

Senator Catherine Noone: I ask for a debate on the future of this House——

Senator Darragh O’Brien: A short debate.

Senator Catherine Noone: No, a sensible debate in which people do not interrupt speakers unnecessarily——

(Interruptions).

Senator Catherine Noone: It is very difficult to make a contribution when one is being interrupted.

An Cathaoirleach: The Senator is out of time.

Senator Catherine Noone: I really would like if we could be afforded the opportunity to have a debate in this House on the future of this House.

Senator Trevor Ó Clochartaigh: What we are seeing today with the number of amendments to the Order of Business is probably the product of not having a proper debate about the budget prior to the budget. The chicks are now coming home to roost. Serious issues have been raised. I second Senator Mac Conghail’s amendment to the Order of Business asking the Mini- ster for Social Protection to come to the House to discuss the disability issue. With all due respect to Senators Conway and Noone whom I respect on this issue whose bona fides I accept, “Prime Time” is not the place to discuss issues of policy. This is the national Parliament. We did not get an opportunity to discuss these issues before the budget. If we had been given such an opportunity it is possible these anomalies would have been highlighted. When the Minister comes to the House I would also like to discuss with her the great unfairness of the measures regarding one-parent families who are being hammered by this budget. The cutbacks are an absolute disgrace. I raised issues with the Minister previously regarding the fact that people in receipt of lone-parent payments are exempt from JobBridge; they are not permitted to partici- 87 Order of 7 December 2011. Business

[Senator Trevor Ó Clochartaigh.] pate in that scheme. The budget proposes cutting back their payments and their rights and getting them back out to work as soon as their children are seven years of age but the training opportunities are not being provided to them. These are significant issues. They are being hammered with more VAT, more carbon tax, higher petrol and diesel prices, higher school bus fares, rent costs, water charges, household charges, and more. This is another decision which requires a U-turn. If the House had the opportunity to have a proper debate before the budget, we would have raised this issue and we would have outlined that this is an unfair and inequitable use of the budgetary process. The Minister should come to the House today because this is a massive issue causing significant distress for single parents as Christmas approaches.

Senator Paul Coghlan: We should greatly welcome the three-pronged financial rescue pack- age being mooted by the EU Council President Van Rompuy for presentation at the upcoming summit, together with the increased support for the IMF. This will bring about tougher budget rules to be imposed on countries as well as sanctions which can be employed against offending countries who step out of line. The future of the euro is so much bigger than the other very important measures under discussion. On the issue of the disability payments, we should not be making a song and dance about it. We do not need an immediate debate, we have the assurances of the Minister for Finance, the Minister for Public Expenditure and Reform and the Minister for Social Protection, that this matter will be rectified in the Social Welfare Bill.

Senator Jim Walsh: We do not know that.

Senator Paul Coghlan: On an issue raised by Senator Reilly, I ask the Leader to arrange a debate next week on the European summit once the report of the Council President has been produced.

Senator Terry Leyden: I compliment the Fianna Fáil Party leader in the House, Senator Darragh O’Brien, and our finance spokesperson in the other House, Deputy Michael McGrath, on raising proposed cuts in the disability allowance. I also compliment Members who raised the issue at meetings of their respective parliamentary parties. This latter approach is much more effective than resigning on a whim. Public representatives are given the trust of their constituents when they elect them to the Oireachtas to represent a political party. Those who resign are outside looking in rather than inside looking out and are unable to exert influence to change decisions. Members of Fine Gael and the Labour Party, on the other hand, are in a powerful position and can and will influence change. Every budget has difficulties. I was in that——

An Cathaoirleach: Does the Senator have a question to the Leader?

Senator Terry Leyden: Yes, I wish only to compliment members of the Cathaoirleach’s party. At least I presume he is still a member of Fine Gael, although he may have recanted his membership.

An Cathaoirleach: The Chair is above——

Senator Terry Leyden: ——reproach. I was a Member of the Oireachtas when VAT was imposed on children’s shoes. Fortunately, that ill-conceived tax was dealt with in the correct fashion. I was present when the late Jim Kemmy walked the right way through the lobbies and we had a general election as a result ach sin scéal eile.

Senator Michael Mullins: The Senator’s memory is holding up well. 88 Order of 7 December 2011. Business

Senator Terry Leyden: I second the amendments to the Order of Business moved by Senators Jim Walsh and Mark Daly and move my own amendment, namely, that the Minister for Fin- ance, Deputy Michael Noonan, postpone until 1 January 2013 the provision in Financial Resol- ution No. 4 to increase value added tax from 21% to 23% on 1 January 2012 to allow consumers to respond to the pending change. The timeframe for introducing the proposed change is too short. A large number of purchases will be made. Cars will have been booked, sold and bought for 2012. The Government’s proposal is a panic reaction. The Fianna Fáil Party in government reduced capital gains tax, for better or worse, from 40% to 20%, a measure which excited considerable activity.

An Cathaoirleach: What is the Senator’s proposal on the Order of Business?

Senator Terry Leyden: I propose that we invite the Minister for Finance to the House and put to him a proposal that he postpone the increase in VAT from 21% to 23% until 1 January 2013. Our VAT rate is the joint highest in Europe. A postponement would encourage consumer spending.

An Cathaoirleach: Is the Senator proposing the amendment today?

Senator Terry Leyden: Yes.

An Cathaoirleach: His time has concluded. I call Senator Jim D’Arcy.

Senator Terry Leyden: My proposal would stimulate consumer spending, which is what the country needs.

An Cathaoirleach: The Senator can make specific points during the debate.

Senator Terry Leyden: I appreciate the Cathaoirleach’s task as an active Chairman because I know how difficult it is to control business at times.

Senator Jim D’Arcy: I am pleased to say I have been informed by my colleague, Senator Ivana Bacik, that the Taoiseach has announced in the Dáil that he will postpone the proposed changes on the disability allowance and they will not be implemented in this budget. This is an example of the fairness of the budgetary process and shows that the Minister for Finance, Deputy Noonan, is true to his words. I also compliment Deputy Michael McGrath on raising this issue. The Minister for Finance stated he would listen to proposals from the Opposition and has done so. While I do not support the amendment proposed by Senator Jim Walsh, I take on board his comments and hope they will be considered. The significant change announced by the Taoiseach is excellent news. I also congratulate the Minister for Social Protection on her role in this regard.

Senator Brian Ó Domhnaill: If the Taoiseach has made such a statement, I welcome the Government’s U-turn on the disability allowance.

Senator Ivana Bacik: The Senator is being petty.

(Interruptions).

An Cathaoirleach: Please allow Senator Ó Domhnaill to continue without interruption.

Senator Brian Ó Domhnaill: It is not yet 24 hours since the budget was announced and already the Government has done a U-turn. There will be many more U-turns because people will not stand for some of the cuts being imposed on them. Teacher numbers are being cut in 89 Order of 7 December 2011. Business

[Senator Brian Ó Domhnaill.] second level schools, while rural areas, including farmers, face a multitude of cuts. The cost of school transport has increased and rural Garda stations will close. The decision to reduce funding for materials in community employment schemes from €1,500 to €500 is a disgraceful attack on community groups which no one has mentioned.

An Cathaoirleach: Does the Senator have a question for the Leader?

Senator Brian Ó Domhnaill: I second the amendment proposed by Senator Leyden and propose my own amendment to the Order of Business, namely, that the Minister for Education and Skills attend the House and explain how secondary school guidance teachers will be in a position to provide guidance to pupils if their posts are subsumed into classroom teaching roles. For example, in the case of a school in my local area which has 870 pupils, its 36 hours of guidance teaching per week will be subsumed into teaching responsibilities, with the result that guidance will no longer be available to students. This is a disgraceful attack on young people who are seeking to better themselves through third level education and so forth. I call on the Minister to attend the House today.

Senator Michael Mullins: I join Senators in welcoming the changes to the disability element of the budget. The measures in the budget prove to all of us that we are in difficult times and the country is in a crisis. Yesterday, all the commentators and the Minister noted that without job creation we will not be able to emerge from the crisis. The Leader has brought about some innovative developments in the House in recent months and I ask him to consider another proposal. This Chamber contains a great deal of wisdom and its 60 Members have a wide range of life experiences and talents. We could make a fantastic contribution if we were to have a major debate on ideas for job creation. I ask the Leader to provide three or four hours for such a debate in the new year. Every Member should be given equal time, perhaps five minutes, to make one or two good proposals for job creation.

Senator Martin Conway: Well said.

Senator Michael Mullins: We should then collate their ideas, invite the relevant Ministers before the House, present a set of proposals for their consideration and ask them to respond within a short timeframe. This would be a positive development and I ask the Leader to give it serious consideration. I hate to see much of the talent in this House wasted on negative bashing of each other. If we were to pool our collective wisdom, we could do enormous good for the country.

Senator Marc MacSharry: I second the amendment proposed by Senator Ó Domhnaill. A photograph on the front page of my local newspaper in Sligo this week shows people collecting home heating oil in small containers that are for sale in suppliers these days. That is how difficult people are finding it to cope and keep themselves warm. On that basis, I propose an amendment to the Order of Business to invite the Minister for Social Protection, Deputy Joan Burton, to the House to discuss the implications of the cut in fuel allowance. Such a debate would be timely given the photograph on the front page of The Sligo Weekender showing how people in rural areas have been reduced to buying home heating oil in small quantities. The Minister’s decision is callous in the extreme and will have a significant impact. While no one doubts the challenges that faced the Minister for Finance and other Ministers in trying to secure savings of €3.8 billion, the European Union and International Monetary Fund were not prescriptive and Ministers have many options available to them. There were many options, however, that were not prescribed precisely by the EU-IMF. There were other options. I am 90 Order of 7 December 2011. Business sure Senators Comiskey, Henry and O’Keeffe and others from the north west of Ireland will agree that other measures show this budget to be highly anti-rural, anti-farming, anti-elderly and anti-those most in pain. Other issues could have been embraced for people who are better placed and equipped to deal with cuts, not those on whom we focus. Not least is the callous cut in fuel allowance for the elderly. I hope another Member, perhaps from the other side of the House, will second my proposed amendment today.

Senator Mary Moran: Every day in this Chamber it amazes me to hear Fianna Fáil blame everybody else for the cuts when we are in this position because of that party’s work during the past 14 years.

Senator Ivana Bacik: Hear, hear.

Senator Mary Moran: It is dreadful. That is the reason we are in this position and why we have had to make the cuts we did. Nobody likes to do that. I agree wholeheartedly with Senator Mullins it would be a fantastic idea to arrange a debate on job creation in the new year. I also agree with and welcome the news from the Taoiseach that the proposed cuts for disability will be reversed. I am delighted at this. It goes to show how in touch our Government is, that Ministers from both Fine Gael and the Labour Party can listen to each other and be willing to meet with us, as they did last night, listen to our concerns and be prepared now to act upon them. That is what real politics is about.

Senators: Hear, hear.

Senator Mary Moran: I welcome that and the fact we are working together, leading, and that we will do what we can for the poor and vulnerable in this country. I ask for a debate and review on the whole issue of disability and disability allowances. The problem is that people tend to place all disabilities into the one basket. That cannot be done because there are multiple layers of disability. The people who would have been affected by these cuts were those who are most vulnerable, who have a disability, will never be able to go to work and will always need long-term care. Supervision for those in this group who are aged over 18 years must be reviewed.

Senator Tom Sheahan: I thought for a while I was on a yellow card. Yesterday I sought to bring the attention of the House to the beds allocation in Cork University Hospital. I asked the Leader to invite the Minister for Health to come to the House to debate that issue. When the centres of excellence were set up, the centre in CUH had a defined allocation of beds for patients from County Kerry. I do not believe that is how beds should be allocated. I refer to the poor man whose case I raised yesterday, who was involved in a car accident seven days ago. I thank the Leader. Through his good offices he helped me yesterday by making telephone calls. That young man was transferred last night and was operated upon. I maintain my call for a debate on the allocation of beds in CUH.

Senator Michael D’Arcy: I will touch on one small issue, namely, the tone that is sometimes set in debate. Last night the tone in the debate on the budget was set correctly, in my view. I would use only one word in regard to the change to disability payments — result. We are in a results game. Every Member who participated last night got the tone correct and underlined there was only one message, namely, we wanted that matter to be changed. Everybody concerned should be commended. 91 Order of 7 December 2011. Business

Senators: Hear, hear.

Senator David Cullinane: I wish to second the amendment to the Order of Business tabled by Senator Marc MacSharry in regard to the cutting of fuel allowance from 32 weeks to 26 weeks, and the impact that will have, especially on many older people. We know from Age Action Ireland that 2,000 older people die every year because of cold. Reducing the number of weeks of fuel allowance from 32 to 26 will increase that number. I support the amendment calling on the Minister to come to the House for a discussion on the impact that cut will have on the people concerned.

An Cathaoirleach: I call the Leader.

Senator Maurice Cummins: Yesterday on the Order of Business Senator O’Brien rightly raised the question of the disability allowance and many other Members have raised it since then. As was stated, in the other House today the Taoiseach announced that the Minister for Social Protection has paused the disability measure until Ms Ita Mangan, the chairman of the taxation and social welfare advisory group, has carried out a review of entitlements to domiciliary care and allowances. That is welcome.

Senators: Hear, hear.

Senator Maurice Cummins: It is a response to the wishes of Members on all sides of this House and shows a caring Minister who is willing to respond to requests from Members of her own and all parties. The Minister, Deputy Burton, is to be commended on that. There has been a request to amend the Order of Business in the shape of four or five amendments. No, there are six.

Senator Jim Walsh: There are nine.

A Senator: There are eight.

Senator Maurice Cummins: There are eight. That is totally unreasonable. Effectively, we are requesting the entire Cabinet to come to the House today to debate. There will be two or three days of debate on the Social Welfare Bill next week during which Members will have ample time to make many of the points they wish to raise and which were raised today. I ask Members to be reasonable, to confine their remarks and deal with these issues under the Social Welfare Bill, rather than disrupt the House. It is their right to amend the Order of Business and I do not suggest they should not do so. However, I ask for consideration, especially in regard to social welfare points——

Senator Jim Walsh: There was not much consideration last night.

An Cathaoirleach: The Leader, without interruption.

Senator Maurice Cummins: There seem to be constant interruptions from Senator Walsh, for whatever reason.

Senator Jim Walsh: The Leader does not run the business of the House properly.

An Cathaoirleach: The Leader, without interruption.

Senator Martin Conway: On a point of order, that remark is completely outrageous.

(Interruptions). 92 Order of 7 December 2011. Business

Senator Maurice Cummins: We will treat such remarks with the contempt they deserve. In her comments on the proposal to move to Central European Time, Senator Bacik complimented Senator Quinn. As the Senator mentioned, the relevant committee dealt with the issue. It may be possible to have a debate on that matter in the new year and its implications for business and for all walks of life. We should do that. I reiterate the Social Welfare Bill will be before the House and we will have a comprehensive debate on it. The issue of increments was raised, along with the saving of €300 million thereby. The vast majority of increments paid go to lower-paid civil servants at clerical officer grade who have already taken very serious cuts in their wages in recent budgets. The unions stated 12 o’clock that increments are part of the pay structure and it would be considered a breach of the Croke Park agreement if they are not paid. That is how the situation stands. I am sure all these points will be raised for consideration for another budget but increments were not touched in this budget. Senator Ó Murchú spoke about the Minister for Justice, Deputy Shatter, and the closure of Garda stations. The Minister will be in the House practically all day and part of the night on Friday to deal with three different items and Bills. This could provide an opportunity for Senator Ó Murchú to raise these matters with the Minister. Senator O’Keeffe raised the prohibitive interest rates charged by moneylending and debt resolution companies. At this time of year, many vulnerable people fall into the trap of borrowing this way and, consequently, are in repayment difficulties for years. Legislation should be introduced around these companies, particularly the advertising of their products. It is very true that in many of these cases the advertising looks much better than the product. Senator Mac Conghail raised the issue of a broader consultation process on legislation against prostitution as promised by the Minister of State, Deputy Kathleen Lynch. I will inquire as to how this is coming along and revert to the Senator on it. Senator Brennan referred to several honorary fellowships awarded at Dundalk Institute of Technology last night and complimented our colleague Senator Quinn on his one. Senator Quinn raised problems experienced by several high-tech companies located here in recruiting Irish graduates with skills in computer coding. There will be a chance for a debate on this with the Minister for Education and Skills in the new year. Senator Paul Coghlan and Reilly raised this weekend’s EU summit at which serious decisions on the euro will be made. It is imperative a report on this is presented to the House. I will endeavour to have the Minster of State, Deputy Creighton, attend the House next week for statements on the Council meeting. Senator Burke raised the matters of young doctors leaving the country and nursing qualifications. We can have a debate with the Minister for Health on these matters in the new year. We can also have a debate on the future of the House. Senator Leyden raised the VAT increase passed last night in the Dáil. It was part of the EU- IMF deal

Senator Darragh O’Brien: The deal stated the rate should rise 1% in 2012 and another 1% in 2013, not 2% in one year.

Senator Maurice Cummins: If Senator Leyden wanted an amendment to this, he should have raised it last year when his Government signed up to it.

Senator Darragh O’Brien: The Leader is incorrect and he knows that. The deal stated the rate should rise 1% in 2012 and another 1% in 2013, not 2% in one year. 93 Order of 7 December 2011. Business

Senator Maurice Cummins: Senator Mullins called for an all-Member debate on job creation in which each Member could provide two or more proposals, a good suggestion. One of the first items scheduled for when the House returns after Christmas is a discussion on the report of the advisory group on small businesses. The debate will take place on 11 January 2012. Members now have plenty of notice to come up with ideas for job creation and small businesses for this debate on 11 January. Senator Moran also raised the matter of disability allowances. I agree with her that the Government parties are working together in a cohesive manner. I am glad the gentleman referred to by Senator Sheahan yesterday has now had his operation and I wish him a speedy recovery.

An Cathaoirleach: Senator Darragh O’Brien has moved an amendment to the Order of Business: “That a debate on health matters, particularly the increase in the cost of private health insurance and the closure of public nursing homes be taken today.” Is the amendment being pressed?

Senator Darragh O’Brien: Yes, it is.

Amendment put.

The Seanad divided: Tá, 15; Níl, 34.

Tá

Cullinane, David. Ó Domhnaill, Brian. Daly, Mark. Ó Murchú, Labhrás. Leyden, Terry. Power, Averil. MacSharry, Marc. Quinn, Feargal. O’Brien, Darragh. Reilly, Kathryn. O’Donovan, Denis. Walsh, Jim. O’Sullivan, Ned. White, Mary M. Ó Clochartaigh, Trevor.

Níl

Bacik, Ivana. Higgins, Lorraine. Bradford, Paul. Keane, Cáit. Brennan, Terry. Kelly, John. Burke, Colm. Landy, Denis. Clune, Deirdre. Mac Conghail, Fiach. Coghlan, Eamonn. Moloney, Marie. Moran, Mary. Coghlan, Paul. Mulcahy, Tony. Comiskey, Michael. Mullins, Michael. Conway, Martin. Noone, Catherine. Cummins, Maurice. O’Brien, Mary Ann. D’Arcy, Jim. O’Keeffe, Susan. D’Arcy, Michael. O’Neill, Pat. Gilroy, John. Sheahan, Tom. Harte, Jimmy. van Turnhout, Jillian. Hayden, Aideen. Whelan, John. Heffernan, James. Zappone, Katherine. Henry, Imelda.

Tellers: Tá, Senators Terry Leyden and Ned O’Sullivan; Níl, Senators Paul Coghlan and Susan O’Keeffe.

Amendment declared lost.

An Cathaoirleach: Senator Ó Murchú has moved an amendment to the Order of Business: “That the debate on the proposed closure of rural Garda stations be taken today.” Is the amendment being pressed? 94 Order of 7 December 2011. Business

Senator Labhrás Ó Murchú: Yes.

Amendment put.

The Seanad divided: Tá, 17; Níl, 33.

Tá

Cullinane, David. Ó Domhnaill, Brian. Daly, Mark. Ó Murchú, Labhrás. Leyden, Terry. Power, Averil. MacSharry, Marc. Quinn, Feargal. O’Brien, Darragh. Reilly, Kathryn. O’Brien, Mary Ann. Walsh, Jim. O’Donovan, Denis. White, Mary M. O’Sullivan, Ned. Zappone, Katherine. Ó Clochartaigh, Trevor.

Níl

Bacik, Ivana. Henry, Imelda. Bradford, Paul. Higgins, Lorraine. Brennan, Terry. Keane, Cáit. Burke, Colm. Kelly, John. Clune, Deirdre. Landy, Denis. Coghlan, Eamonn. Mac Conghail, Fiach. Coghlan, Paul. Moloney, Marie. Comiskey, Michael. Moran, Mary. Conway, Martin. Mulcahy, Tony. Cummins, Maurice. Mullins, Michael. D’Arcy, Jim. Noone, Catherine. D’Arcy, Michael. O’Keeffe, Susan. Gilroy, John. O’Neill, Pat. Harte, Jimmy. Sheahan, Tom. Hayden, Aideen. van Turnhout, Jillian. Healy Eames, Fidelma. Whelan, John. Heffernan, James.

Tellers: Tá, Senators Terry Leyden and Ned O’Sullivan; Níl, Senators Paul Coghlan and Susan O’Keeffe.

Amendment declared lost.

An Cathaoirleach: Senator Mac Conghail has proposed an amendment to the Order of Busi- ness: “That a debate on the proposed cut in disability allowances for young persons be taken today.” Is the amendment being pressed?

Senator Fiach Mac Conghail: Yes.

Amendment put.

The Seanad divided: Tá, 19; Níl, 30.

Tá

Coghlan, Eamonn. O’Donnell, Marie-Louise. Cullinane, David. O’Donovan, Denis. Daly, Mark. Ó Domhnaill, Brian. Leyden, Terry. Ó Murchú, Labhrás. Mac Conghail, Fiach. Power, Averil. MacSharry, Marc. Quinn, Feargal. O’Brien, Darragh. Reilly, Kathryn. O’Brien, Mary Ann. van Turnhout, Jillian. 95 Order of 7 December 2011. Business

Tá—continued

Walsh, Jim. Zappone, Katherine. White, Mary M.

Níl

Bacik, Ivana. Heffernan, James. Bradford, Paul. Henry, Imelda. Brennan, Terry. Higgins, Lorraine. Burke, Colm. Keane, Cáit. Clune, Deirdre. Kelly, John. Landy, Denis. Coghlan, Paul. Moloney, Marie. Comiskey, Michael. Moran, Mary. Conway, Martin. Mulcahy, Tony. Cummins, Maurice. Mullins, Michael. D’Arcy, Jim. Noone, Catherine. D’Arcy, Michael. O’Keeffe, Susan. Gilroy, John. O’Neill, Pat. Harte, Jimmy. Sheahan, Tom. Hayden, Aideen. Whelan, John. Healy Eames, Fidelma.

Tellers: Tá, Senators Fiach Mac Conghail and Katherine Zappone; Níl, Senators Paul Coghlan and Susan O’Keeffe.

Amendment declared lost.

An Cathaoirleach: Senator Daly has moved an amendment to the Order of Business: “That a debate on the system of increments in the salary scales of public sector workers be taken today.” Is the amendment being pressed?

Senator Mark Daly: Yes.

Amendment put.

The Seanad divided: Tá, 16; Níl, 31.

Tá

Cullinane, David. Ó Domhnaill, Brian. Daly, Mark. Ó Murchú, Labhrás. Leyden, Terry. Power, Averil. Quinn, Feargal. Mac Conghail, Fiach. Reilly, Kathryn. MacSharry, Marc. van Turnhout, Jillian. O’Brien, Darragh. Walsh, Jim. O’Donovan, Denis. White, Mary M. Ó Clochartaigh, Trevor.

Níl

Bacik, Ivana. D’Arcy, Michael. Bradford, Paul. Gilroy, John. Brennan, Terry. Harte, Jimmy. Burke, Colm. Hayden, Aideen. Clune, Deirdre. Healy Eames, Fidelma. Coghlan, Eamonn. Heffernan, James. Coghlan, Paul. Henry, Imelda. Comiskey, Michael. Higgins, Lorraine. Conway, Martin. Keane, Cáit. Cummins, Maurice. Kelly, John. D’Arcy, Jim. Landy, Denis. 96 Order of 7 December 2011. Business

Níl—continued

Moloney, Marie. O’Keeffe, Susan. Moran, Mary. O’Neill, Pat. Mulcahy, Tony. Sheahan, Tom. Mullins, Michael. Whelan, John. Noone, Catherine.

Tellers: Tá, Senators Terry Leyden and Denis O’Donovan; Níl, Senators Paul Coghlan and Susan O’Keeffe.

Amendment declared lost.

An Cathaoirleach: Senator Jim Walsh has proposed an amendment to the Order of Business: “That the debate on the proposed increase in the contribution requirement for widow’s contributory pension be taken today.” Is the amendment being pressed?

Senator Jim Walsh: Yes.

Amendment put.

The Seanad divided: Tá, 16; Níl, 33.

Tá

Cullinane, David. Ó Domhnaill, Brian. Daly, Mark. Ó Murchú, Labhrás. Leyden, Terry. Power, Averil. Quinn, Feargal. MacSharry, Marc. Reilly, Kathryn. O’Brien, Darragh. Walsh, Jim. O’Brien, Mary Ann. White, Mary M. O’Donovan, Denis. Zappone, Katherine. Ó Clochartaigh, Trevor.

Níl

Bacik, Ivana. Henry, Imelda. Bradford, Paul. Higgins, Lorraine. Brennan, Terry. Keane, Cáit. Burke, Colm. Kelly, John. Clune, Deirdre. Landy, Denis. Coghlan, Eamonn. Mac Conghail, Fiach. Coghlan, Paul. Moloney, Marie. Comiskey, Michael. Moran, Mary. Conway, Martin. Mulcahy, Tony. Cummins, Maurice. Mullins, Michael. D’Arcy, Jim. Noone, Catherine. D’Arcy, Michael. O’Keeffe, Susan. Gilroy, John. O’Neill, Pat. Harte, Jimmy. Sheahan, Tom. Hayden, Aideen. van Turnhout, Jillian. Whelan, John. Healy Eames, Fidelma. Heffernan, James.

Tellers: Tá, Senators Terry Leyden and Denis O’Donovan; Níl, Senators Paul Coghlan and Susan O’Keeffe.

Amendment declared lost.

An Cathaoirleach: Senator Leyden has proposed an amendment to the Order of Business: “That a debate on the proposed increase in the rate of VAT be taken today? Is the amendment being pressed? 97 Order of 7 December 2011. Business

Senator Terry Leyden: Yes.

Amendment put.

The Seanad divided: Tá, 15; Níl, 34.

Tá

Cullinane, David. Ó Murchú, Labhrás. Daly, Mark. Power, Averil. Leyden, Terry. Quinn, Feargal. MacSharry, Marc. Reilly, Kathryn. O’Brien, Darragh. Walsh, Jim. O’Donovan, Denis. White, Mary M. Ó Clochartaigh, Trevor. Zappone, Katherine. Ó Domhnaill, Brian.

Níl

Bacik, Ivana. Henry, Imelda. Bradford, Paul. Higgins, Lorraine. Brennan, Terry. Keane, Cáit. Burke, Colm. Kelly, John. Clune, Deirdre. Landy, Denis. Coghlan, Eamonn. Mac Conghail, Fiach. Moloney, Marie. Coghlan, Paul. Moran, Mary. Comiskey, Michael. Mulcahy, Tony. Conway, Martin. Mullins, Michael. Cummins, Maurice. Noone, Catherine. D’Arcy, Jim. O’Brien, Mary Ann. D’Arcy, Michael. O’Keeffe, Susan. Gilroy, John. O’Neill, Pat. Harte, Jimmy. Sheahan, Tom. Hayden, Aideen. van Turnhout, Jillian. Healy Eames, Fidelma. Whelan, John. Heffernan, James.

Tellers: Tá, Senators Terry Leyden and Denis O’Donovan; Níl, Senators Paul Coghlan and Susan O’Keeffe.

Amendment declared lost.

An Cathaoirleach: Senator Ó Domhnaill has proposed an amendment to the Order of Busi- ness: “That a debate on the budget provisions on career guidance teachers be taken today.” Is the amendment being pressed?

Senator Brian Ó Domhnaill: Yes.

Amendment put.

The Seanad divided: Tá, 17; Níl, 32.

Tá

Cullinane, David. Ó Domhnaill, Brian. Daly, Mark. Ó Murchú, Labhrás. Leyden, Terry. Power, Averil. Mac Conghail, Fiach. Quinn, Feargal. MacSharry, Marc. Reilly, Kathryn. O’Brien, Darragh. Walsh, Jim. O’Brien, Mary Ann. White, Mary M. O’Donovan, Denis. Zappone, Katherine. Ó Clochartaigh, Trevor.

98 Order of 7 December 2011. Business

Níl

Bacik, Ivana. Heffernan, James. Bradford, Paul. Henry, Imelda. Brennan, Terry. Higgins, Lorraine. Burke, Colm. Keane, Cáit. Clune, Deirdre. Kelly, John. Landy, Denis. Coghlan, Eamonn. Moloney, Marie. Coghlan, Paul. Moran, Mary. Comiskey, Michael. Mulcahy, Tony. Conway, Martin. Mullins, Michael. Cummins, Maurice. Noone, Catherine. D’Arcy, Jim. O’Keeffe, Susan. D’Arcy, Michael. O’Neill, Pat. Gilroy, John. Sheahan, Tom. Harte, Jimmy. van Turnhout, Jillian. Hayden, Aideen. Whelan, John. Healy Eames, Fidelma.

Tellers: Tá, Senators Terry Leyden and Denis O’Donovan; Níl, Senators Paul Coghlan and Susan O’Keeffe.

Amendment declared lost.

An Cathaoirleach: Senator MacSharry has proposed an amendment to the Order of Business: “That a debate on the implications of the changes in the fuel allowance scheme be taken today.” Is the amendment being pressed?

Senator Marc MacSharry: I am afraid it must be. Amendment put.

The Seanad divided: Tá, 17; Níl, 31.

Tá

Cullinane, David. Ó Murchú, Labhrás. Daly, Mark. Power, Averil. Leyden, Terry. Quinn, Feargal. Mac Conghail, Fiach. Reilly, Kathryn. MacSharry, Marc. van Turnhout, Jillian. O’Brien, Darragh. Walsh, Jim. White, Mary M. O’Donovan, Denis. Zappone, Katherine. Ó Clochartaigh, Trevor. Ó Domhnaill, Brian.

Níl

Bacik, Ivana. Henry, Imelda. Bradford, Paul. Higgins, Lorraine. Brennan, Terry. Keane, Cáit. Burke, Colm. Kelly, John. Clune, Deirdre. Landy, Denis. Coghlan, Paul. Moloney, Marie. Comiskey, Michael. Moran, Mary. Conway, Martin. Mulcahy, Tony. Cummins, Maurice. Mullins, Michael. D’Arcy, Jim. Noone, Catherine. D’Arcy, Michael. O’Brien, Mary Ann. Gilroy, John. O’Keeffe, Susan. O’Neill, Pat. Harte, Jimmy. Sheahan, Tom. Hayden, Aideen. Whelan, John. Healy Eames, Fidelma. Heffernan, James.

Tellers: Tá, Senators Terry Leyden and Denis O’Donovan; Níl, Senators Paul Coghlan and Susan O’Keeffe.

99 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage

Amendment declared lost.

An Cathaoirleach: Is the Order of Business agreed?

Senator Terry Leyden: No.

Question put: “That the Order of Business be agreed to.”

The Seanad divided by electronic means.

Senator Terry Leyden: Under Standing Order 62(3)(b) I request that a division be taken by other than electronic means.

Question put.

The Seanad divided: Tá, 35; Níl, 13.

Tá

Bacik, Ivana. Keane, Cáit. Bradford, Paul. Kelly, John. Brennan, Terry. Landy, Denis. Burke, Colm. Mac Conghail, Fiach. Clune, Deirdre. Moloney, Marie. Coghlan, Paul. Moran, Mary. Comiskey, Michael. Mulcahy, Tony. Conway, Martin. Mullins, Michael. Cummins, Maurice. Noone, Catherine. D’Arcy, Jim. O’Brien, Mary Ann. D’Arcy, Michael. O’Keeffe, Susan. Gilroy, John. O’Neill, Pat. Harte, Jimmy. Quinn, Feargal. Hayden, Aideen. Sheahan, Tom. Healy Eames, Fidelma. van Turnhout, Jillian. Heffernan, James. Whelan, John. Henry, Imelda. Zappone, Katherine. Higgins, Lorraine.

Níl

Cullinane, David. Ó Clochartaigh, Trevor. Daly, Mark. Ó Domhnaill, Brian. Leyden, Terry. Ó Murchú, Labhrás. MacSharry, Marc. Power, Averil. O’Brien, Darragh. Reilly, Kathryn. O’Donovan, Denis. Walsh, Jim. O’Sullivan, Ned.

Tellers: Tá, Senators Paul Coghlan and Susan O’Keeffe; Níl, Senators Terry Leyden and Denis O’Donovan.

Question declared carried.

Financial Emergency Measures in the Public Interest (Amendment) Bill 2011: Second Stage

Question proposed: “That the Bill be now read a Second Time.” Minister of State at the Department of Finance (Deputy Brian Hayes): The primary purpose of this Bill is to apply the Financial Emergency Measures in the Public Interest Act of 2009 to serving members of the Judiciary in line with the positive outcome of the recent referendum on the 29th amendment to our Constitution. This amendment, approved by both Houses, amended 100 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage

Article 35(5) of the Constitution in relation to judicial remuneration. The referendum on judicial pay was passed by a significant majority, 79%, of the people on 27 October last. The Bill provides for the application to the Judiciary, equally and proportionately, of the public service pension related deduction and the same salary reductions as were applied to other public servants in 2009 under the last Government. The intention of the Bill is not to generate significant cost savings to the Central Fund — indeed, it is estimated that some €5.5 million cost savings will arise from the application of the 2009 Acts to the Judiciary — but rather to ensure pay policy is applied on a fair and equal basis to all public servants. Senators will be aware that a Committee Stage amendment to the Financial Emergency Measures in the Public Interest Act 2010 is being proposed by the Government. The provisions of that Act reduce public service pensions in payment and for those who retire before the end of the “grace period”. The proposed amendment will introduce a higher reduction rate of 20% on public service pensions above €100,000. Pensions in excess of €60,000 are currently being adjusted by 12%. It is estimated that a reduction in public service pensions above €100,000 such as that proposed would potentially affect pensioners who were formerly office holders, such as the Pres- ident, taoisigh, senior members of the Judiciary such as chief justices or members of the High and Supreme Courts, heads of universities, Civil Service Secretaries General, chief executives of non-commercial State bodies, some hospital consultant doctors, Garda Commissioners and Chiefs of Staff of the Defence Forces. It is estimated that this measure will give rise to savings in the region of some €400 million in a full year.

Senator Darragh O’Brien: The Minister wishes.

Deputy Brian Hayes: I apologise, it is €400,000. The zeroes are swimming before my eyes at present. This is the fourth financial emergency measures Bill to be put before this House since 2009. The application of these measures to public servants in 2009 and 2010 represented the first statutory reductions in public servants’ pay since 1933, and it is worth pointing out that the 1933 reductions only applied for a year. The fact that public servants’ pay has 1o’clock been reduced since early 2009 shows the difficult position we find ourselves in and the severity of the crisis faced by the State. Despite these measures, the crisis in our public finances has continued. We all heard the Taoiseach’s broadcast on national television last Sunday. On Monday the Minister for Public Expenditure and Reform, Deputy Brendan Howlin, announced the expenditure Estimates for 2012 and measures to reduce spending. The Minister for Finance, Deputy Michael Noonan, delivered his first Budget Statement yesterday, setting out taxation and budgetary measures for next year. These difficult and unpal- atable decisions are designed to contribute to rebuilding our economy and ensuring that the burden of recovery is equally shared. Over the last few days, details of the Irish public finances, including tax receipts, were discussed in detail. Tax revenue in 2011 is currently forecast at €34,175 million, some 28% below its 2007 peak, and still almost €1.5 billion less than was collected as far back as 2004. In contrast, gross voted current expenditure has grown by close to 50% since 2004, with the increase in unemployment-related expenditure having a big impact in that regard. Tax receipts have been very severely impacted upon by the sharp deterioration in economic activity, and the gap that has emerged between revenues and expenditure is not sustainable. Budget 2012 estimates the general Government deficit in 2011 at €15.6 billion or 10.1% of GDP. The Government recognises the difficulties facing the nation and has set out a framework in the medium-term fiscal statement to restore sustainability to the public finances and to reduce the general Government 101 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage

[Deputy Brian Hayes.] deficit to less than 3% of GDP by 2015. The difficult announcements of the last two days are proof of the Government’s intent in this regard. Nobody will seek to make the case that the savings generated by this Bill will make significant inroads on the fiscal crisis facing the State. However, that is not the rationale behind the Bill or the proposed amendment. The terms of the Bill reinforce the principles of fairness, ability to pay and burden sharing among all of us. It ensures those in eminent office demonstrate their leadership and, most importantly, their solidarity in a real and concrete way with the burdens faced by those most affected by the economic crisis. This Government has imposed a policy of strong pay reduction and restraint since taking office last March. All members of the Government accepted reductions in their pay on its first day in office. Since last June, a general pay ceiling of €200,000 applies for future appointments to higher positions across the public service and a general pay ceiling of €250,000 applies for future appointments to chief executive officer, CEO, positions within commercial State companies. A voluntary waiver of up to 15% was introduced for current post holders who have salaries in excess of the relevant pay ceiling and this received a positive response. In the Civil Service, new pay rates were introduced for Secretaries General of Government Departments. A maximum rate of €200,000 now applies for Secretary General Level 1, representing a 30% reduction of salary since September 2008. Therefore, over a three year period there has been a 30% reduction in salary at the top of the Irish public service. All new appointments to the public service are being made in line with the policy adopted by the Government on pay ceilings. These new reduced pay rates will also reduce Exchequer pension costs into the future for those appointees. As this is the fourth financial emergency measures in the public interest Bill, it amends and extends the previous measures. I will briefly outline their content. The first Financial Emer- gency Measures in the Public Interest Act introduced in March 2009 provided for a progressive pension-related reduction, at rates ranging between 5% and 10.5%, to apply to public servants with access to a public service pension. It also contained a number of measures designed to produce savings, which would be remitted to the benefit of the Exchequer. The Financial Measures in the Public Interest (No. 2) Act 2009 provided for the reduction in the gross remuneration of all public servants with effect from 1 January 2010. The Act provided for average reductions of 7% where the salary of the public servant was less than €125,000. Fixed reduction rates of 8%, 12% and 15% applied to salaries higher than that. Prior to the amendment to the Constitution, the President and members of the Judiciary were not subject to the provisions of these Acts. The Bill today, if passed, gives effect to the application of these Acts to the Judiciary from 1 January 2012. The Financial Emergency Measures in the Public Interest Act 2010 introduced an income- graduated reduction applied to each gross annual public service pension in excess of €12,000. That reduction already applies to retired members of the Judiciary and will apply to the pension of any public servant who retires before the expiry of the “grace period”, after which pensions will be reduced in line with the pay reductions set out in the second Act. I have already mentioned the amendment that is proposed for those on very large public service pensions. The Bill today also includes provision to extend the application of the pension reduction to Central Bank pensioners, with the consent of the Governor of the Central Bank, as was intended by the legislation. This is necessary owing to the legal position of the Central Bank as part of the euro system. In addition to the three Acts, a 10% reduction in pay from 1 January 2011 was introduced for all new recruits to the entry grades to the public service. This Bill makes provision to apply 102 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage a similar 10% reduction to new judicial appointments from the enactment of the Bill. The Bill also includes a number of legislative provisions to underpin the significant decision already taken by the Government relating to the remuneration of office holders as well as a number of technical or ancillary amendments. How much time do I have?

An Leas-Chathaoirleach: You have unlimited time but we must conclude Second Stage by 1.45 p.m.

Deputy Brian Hayes: I will conclude with that. We can go through the Bill in greater detail later. Senators wish to make a contribution on Second Stage and I do not wish to take up all their time. The Government is committed to continued sustainability in the overall cost of the public service pay bill. The provisions in the Bill are in keeping with that objective and will provide for greater equity in the application of public service pay policy. I look forward to hearing the views of Senators and to the consideration of amendments and suggestions put forward by them. I commend the Bill to the House.

Senator Darragh O’Brien: Cé mhéid nóiméid?

An Leas-Chathaoirleach: Ten minutes.

Senator Darragh O’Brien: I thank the Minister of State for coming to the House. I appreciate the allowance of contribution time for this debate. The 20th amendment to the Constitution is supported by my party and we will support this Bill. A number of amendments have been listed in the Dáil and I have some questions. With regard to the referendum, concerning which we may have an opportunity to talk to the Minister for Justice, Deputy Shatter, on Friday, on that day two referendums were slotted. The 29th amendment was passed; the 30th concerned the establishment of a committee for investigations and oversight and the giving of relevant powers to it. My question lies some way from the Bill but what is the current position of the Government in regard to reviewing that referendum and what further steps will it take to reintroduce a referendum next year or the following year——

Deputy Brian Hayes: In regard to public inquiries?

Senator Darragh O’Brien: Yes. I welcome the measures on pensions, in particular those which most people would agree are considerably above the norm, namely, pensions for senior members of former Governments, senior civil servants, members of the Judiciary, and so on. I wish the figure provided by the Minister of State’s was actually €400 million because a saving of €400,000 is minimal. I believe he will agree that, seen across the board, the reductions made to the large pensions of retirees are not enough. The Government should review that. For people who are in receipt of large pensions of more than €100,000, which are guaranteed for life unlike those most in the private sector will receive, this reduction is far too small. In its own time the Government should look to making substantial cuts in this area. I would go further than the Minister of State. On 20 January 2009, I produced a pensions paper for the then Minister for Finance, the late Brian Lenihan, and the then Taoiseach, Brian Cowen, which considered the entire pensions structure. In this Bill, there are reductions in salary for new entrants, as introduced in by the previous Government and with which I agree, but we really must examine the pensions time bomb coming down the track in the public 103 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage

[Senator Darragh O’Brien.] service. I propose, in regard to all future increases and increments to existing public and civil servants, that their requisite pension payment should be made on a defined contribution basis and that all new entrants to the public sector and the Civil Service should not be put into the defined benefit structure but into the defined contribution structure. That would create a hybrid scheme for existing public sector employees and reduce the liability to the State further down the line, which now runs into hundreds of billions of euro. The future pension liability of the State must be tackled by a government. I do not mean the State pension but the pensions of State employees. One must also remember that what I proposed in January 2009 would not affect any person’s existing entitlements. What they have they hold. It related to future increments which this Government will pay next year to the tune of €300 million. Those increments will then lead to a further increase in the projected pension payments for those who received the increments. The Minister of State has had a busy period in this House. I ask him to genuinely look within the Department of Finance, be inventive and think outside the box with regard to the future pension provision for all State employees, including Oireachtas Members. The State can no longer afford to try to fund defined benefit type, gilt-edged pensions. We should seek to move towards a defined contribution scheme. There is talk of a salary cap but those that were introduced in the Bill relate to future appointments. I note there are 18 individuals who receive more than €250,000 in remuneration. These sums were subject to ministerial sanction. Health professionals are missing from the Bill. They are entirely exempted and I do not believe that is right. I could make many arguments about this but I believe most people will agree this is not correct. If one includes universities, the Minister for Education and Skills confirmed there are 99 employees in the higher education sector who earn more than €200,000. Of that 99, some 89 are academic medical consultants who are exempted. Why are consultants exempted? An amendment is to be moved in the Dáil that would restrict these people to a salary of €200,000. That should be done. I cannot understand why those health professionals who are paid by the public purse have been left out of this measure when many other segments are not. It does not make sense. Perhaps there is a reason but if there is one, I would like to hear it. I ask the Government to review this because it is not tenable. A salary cap is also being introduced. I will not politicise the point because that has been done to death over the past week. However, the Minister of State will fully understand, as should the Government, the scepticism with which such caps are regarded when the Taoiseach can overrule the Ministers for Finance and Public Expenditure and Reform and ensure that an individual’s salary goes above the €92,000 cap approved for special Government advisers. The Government actually set the cap and I agree with it completely. However, increasing numbers of exemptions are coming through the system and as a result the whole policy begins to lack credibility. I have reams of names I could offer the Minister of State but I do not believe it is fair to mention individuals. He will know to whom I refer. There is no reason on earth that these posts of special advisers are not advertised. The post of adviser to the Minister for Jobs, Enterprise and Innovation, Deputy Bruton, was not advertised. The individual concerned should have begun at a level of €82,000, not €92,000. However, he got €92,000, was not happy with it and asked for €127,000. The Ministers, Deputies Noonan and Howlin, were right when they refused that, but the Taoiseach directly intervened in the matter. This happened in previous Governments but that does not make it right. The practice should stop. The posts of special adviser have been the trade of Governments of all hues but the trade is wrong. Effectively, these are political appointees. The Minister for Children, Deputy Fitzgerald, appointed a Fine Gael councillor to a post of special adviser. Perhaps that councillor 104 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage is qualified to be a special adviser in the Department of Children. If there must be special advisers, they must be qualified. At some stage, I would love to see the CVs of the people who have been appointed to see their qualifications. Exceptions are made and there may be exceptional cases. Some people give up jobs in the private sector as did many of us in these two Houses. We have no other job security. I have none — this is the only job I do. Yet these people are being paid double a Senator’s wage — €127,000 is effectively double our wage. What expertise do they have? Their salary may be more than double that of Senator Cullinane.

Senator David Cullinane: The Senator should not forget the expenses.

Senator Darragh O’Brien: I was coming to that. I could come into the Chamber and shout and roar at the Minister of State. However, he knows my point. This is wrong. It is wrong that these posts are not advertised. It was wrong when it was done by previous Governments——

Senator Michael D’Arcy: Expenses are very sweet.

Senator Darragh O’Brien: ——and it is wrong now.

Senator David Cullinane: We know where they go.

Senator Darragh O’Brien: There are more and more of these posts. In the Taoiseach’s office there are four such appointments, at a cost to the taxpayer of €440,000. I want to know if these people are qualified. The Bill is important. It reaffirms the wish of the people concerning the 29th amendment to the Constitution but it does not go far enough in cutting pension payments to former officeholders and former senior civil servants. I ask the Minister of State to look again at the provision in regard to any person who has a pension of more than €100,000. I wish to put on the record that contributions have been made by these individuals. However, the pension figures are too high. The Department must look again at the pension structure. I would be more than happy to send the document I wrote in January 2009 to the Minister of State. It is even more valid now. It was lamentable that it was not implemented at the time but it should be done now. Health professionals must be taken into the net. I would like some indication from the Minister of State or his Department as to why they are exempted and what will be done about that. The Bill is welcome for what it does but it does not go far enough. When we are dealing with changes to day-to-day, current expenditure, it is easy to forget about the future pension liabilities of the State and the problems in this regard coming down the track. Every year the State pension and public pension bill gets worse. We need to get to grips with this. The sooner it is changed, the sooner the State’s liabilities will be addressed.

An Leas-Chathaoirleach: I must remind Members that the Minister of State must be asked to conclude not later than 1.45 p.m.

Senator Michael D’Arcy: I will not take up my ten-minute allocation in case I cut other speakers short. Senator Darragh O’Brien raised several matters about costs and I wish to provide him with some more information on them. The Taoiseach’s office now costs 47% less than his prede- 105 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage

[Senator Michael D’Arcy.] cessor’s with a much small cadre of people advising the current Taoiseach than was the case with other taoisigh. While I agree there needs to be pay restraint, there must also be pension restraint. I recall the consternation in RTE when on the communications committee in the previous Dáil over some in the public sector receiving a defined benefit pension while others were receiving a defined contribution pension. It is a difficult issue. The Estimates stated pension provision in 2012 would cost the State €3 billion. This is a large amount of money but the majority in receipt of it have put in a good shift for the State. The judges who did not take a voluntary pay reduction were the main reason the recent referendum on judicial pay was passed. I do not agree with voluntary reductions in salaries. The State should legislate for pay reductions for everyone, not for some. We are here to legislate and we must take the consequences if people are displeased with legislation. The 20% levy on those receiving over €100,000 in public service pensions was proposed at a Fine Gael Parliamentary Party meeting by Deputy Paschal Donohoe. It was attached quickly to this legislation. While we would all like to go above the 20% rate, the Attorney General warned that, taking into account other considerations such as the universal social charge, PRSI and PAYE levies, a pension recipient could take a legal case and win. There is no point in introducing legislation that will not stand up in the courts. One concern about public sector management structures is there is no analysis of performance-related pay of individuals. The best example is the 100 or so highly paid academics who are world leaders in their fields and have magnificent contacts with industry. If they can prove they have created jobs and attracted investment, I would not be opposed to them getting more than €200,000 in an annual salary. If they cannot prove it, however, I would be more than happy to reduce their pay downwards. Senator Darragh O’Brien also raised a similar point. My main concern about the Croke Park deal is that the best public servant gets the same pay and increments as the worst. It was the unions’ objective to protect this arrangement which is not the best approach. I would prefer a performance-related arrangement like that in the private sector.

Senator Feargal Quinn: On this side of the House, we regard ourselves not as Opposition but as non-Government because sometimes we are with the Government. I welcome the Minister of State and this Bill to the House. I regard it as a rubber-stamp of the will of the people. More than 80% of us voted in favour of a reduction in judges’ pay. The obvious question is whether we can reduce the top public sector salaries even further. I accept Senator Michael D’Arcy’s point that we must compete for the best people to run our State and semi-State bodies. However, can we make further reductions in salaries? I was to attend a meeting recently in Greece on a Monday and Tuesday. I travelled over there on Sunday but there was an air traffic controllers’ strike that day, meaning I did not get in until late Monday morning. On Monday, there was a metro strike and the roads were blocked. On Tuesday, there was a bus strike and in the following days there was a taxi strike. Looking at the Greek reaction to this crisis, it is obvious that if we are going to solve this problem, we need to keep everyone, including the unions, on side. We have a strange situation where it would be more financially beneficial to the State to pay off certain heads of semi-State bodies to retire than to continue to pay them. Will the Minister introduce more pay caps in State and semi-State companies? We always try to attract the best person for the job which means commensurate salaries. Savings could be made, however, if the cuts at many of these semi-State bodies were voluntary. 106 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage

Dr. John P. Martin of the OECD stated Ireland should consider reducing public sector wages to reflect falling private sector incomes, even if it means breaking the Croke Park agreement. I hope the Government will prioritise examining the agreement as it is seriously damaging and hindering our competitiveness in the market place. In a recent Red C poll in The Sunday Business Post, 65% of those surveyed want the Croke Park deal reviewed. In this respect it is interesting to study the Lithuanian experience. I have become a fan of the Lithuanian economic approach.

Deputy Brian Hayes: I have heard the Senator speak of it before.

Senator Feargal Quinn: Lithuania had really reached a low — it was much worse than Ireland — when the IMF was called in but it has come back up very quickly. It implemented tough measures such as a straight-off reduction of top public sector salaries by more than 20%. That along with other cuts has seen Lithuania become one of Europe’s success stories. It is now one of the fastest growing economies in Europe, with an annualised growth rate of 6.6%. When one compares that to ourselves, one realises how well they are doing, and that was during the first have of this year. We must take heed of this example of how targeted cuts can be of significant benefit. I do not like to single out anyone in particular but certain chief executives of semi-State bodies are still on a basic salary of €400,000. That is not sustainable. Significant savings can be made which can then be put back into helping the most vulnerable in society. Perhaps we should also look at former Ministers and taoisigh who are in other employment. Should those who are working be entitled to pensions? The Bill also allows for a reduction in the case of the chairman of An Bord Pleanála and the Ombudsman as those posts are connected to that of a senior judge. If it is linked to it, I can understand why that happens. The Minister states that it is up to future Ministers to decide, and yet this Bill refers to current judges. Why are there different standards? Does the Minister intend to implement this and reduce their pay in the near future? The reason I ask is that the longer we wait for a decision, the more money we are losing. We should try to run the Govern- ment as a business and get down to reducing costs as the legislation allows us.

Acting Chairman (Senator Paul Coghlan): I remind Senator Quinn that he has four minutes left but there are two others offering.

Senator Feargal Quinn: I will concluded. I have made the point I want to make. I have confidence that the Minister, who has considerable listening ability, has taken into account the points I made.

Acting Chairman (Senator Paul Coghlan): I thank Senator Quinn. There are four minutes in which to fit in Senators Gilroy and Cullinane, if I can, before I am required to call the Minister at 1.45 p.m.

Senator John Gilroy: I welcome the Minister. Most of what needs to be said about the Bill has been said but I want to stress that this is the result of the referendum. The people have spoken on this. It is our firm intention that everything we do in Government will be fair and seen to be fair and this is just one small element in that step. Our intent is clear on this, that voluntary reductions in pay are not the way to go. An example of what might happen if we go that route is what happened in the presidential election, for instance, where one candidate stated he would do it for whatever price, another stated, “I would do it for less again”, then someone else even stated, “I will not take any pay at all”.It made a mockery of the system. 107 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage

[Senator John Gilroy.]

Voluntary reductions do not work. The judges have demonstrated that they are not interested in voluntary reductions and that made clear the requirement for this measure. I am glad it did. I have other points to make but I will not do so. I am want to let my colleague speak.

Senator David Cullinane: I will not waste my time, because I have two minutes. I have a number of amendments down and I am sure I will get to many of the substantive points I want to make. However, it is important to put on the record that guillotining Bills such as this, which are important and which deserve proper scrutiny, is not what the Government promised in its programme for Government. Many among the public, sometimes fairly and sometimes unfairly, are cynical about politics and the political system. When there are Bills such as this which deal with the pay of senior Ministers and which deal with the pay of senior staff in the public service——

Senator John Gilroy: This does not deal with Ministers.

Senator David Cullinane: It can. Senator Gilroy should take a look at the amendments which my party put down and he will see that it can deal with it.

Acting Chairman (Senator Paul Coghlan): Senator Cullinane should speak to the relevant amendment when we come to it.

Senator David Cullinane: We are talking about reducing pensions again for senior officeholders and Government representatives. The problem here is that people get angry when they see Bills such as this being rushed through when it is about pensions and pay for those at the very top in the public service, whether they be judges or Ministers. It is regrettable that again today we are rushing through important legislation, which is not the way to do business. It is not the way to properly scrutinise——

Acting Chairman (Senator Paul Coghlan): There will be a time on the amendments Senator Cullinane tabled.

Senator David Cullinane: ——Bills such as this.

Acting Chairman (Senator Paul Coghlan): Does Senator Leyden want to make a brief point? I must call the Minister at 1.45 p.m.

Senator Terry Leyden: The point Senator Quinn mentioned about those working taking pensions in the public service is worthy and the Minister could look at it. I made this point when I relinquished a ministerial pension. When I returned to the Oireachtas nine years ago I was surprised that the ministerial pension continued. Furthermore, there is another anomaly with respect to the Garda State drivers. They all left the job but now I understand a number are back driving Ministers. They are both on pension from the State and receiving remuneration from the State. This is a levelling out situation. Every situation must be scrutinised in a careful manner in this regard because there are those who have and those who have not. In fairness, and against our own situation, we must look at it. I commend the Minister of State, Deputy Brian Hayes, and the Government for what they are doing in this regard. I was pleased to vote for the judicial pay review in the constitutional amendment.

Acting Chairman (Senator Paul Coghlan): I welcome the Minister and call on him to respond. 108 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage

Minister of State at the Department of Public Expenditure and Reform (Deputy Brian Hayes): I will not detain the House in my reply to Second Stage because it will give us an hour and a quarter to go through the amendments that colleagues have tabled. I will make a number of general points. I thank the Senators for the contributions made. On the issue of a well paid public servant or former politician who had served for many years and who has a pension of €125,000, as a result of the accumulative reduction in his or her pension, it is now down by €13,760. The totality of the pension is down to approximately €112,000. However, when one factors in the marginal rate of tax, now at 41%, plus 11% for USC and PRSI, one can see that approximately 40% of that is now going back to the State in tax. At two levels, the totality of the pension has come down but also, because of the increase in taxation over the course of the past three years, the amount accruing to the person has substantially reduced, and that is exactly as it should be. The Minister for Public Expenditure and Reform, Deputy Howlin, has already put through legislation which will radically alter pension provision for public servants in the future in terms of career averaging. As Senators will be aware, in the past the pension point was very much determined at one’s exit point. Now it is based on a career average, and also with a later pension age. That will generate substantial savings to the public purse over the coming years. Third, next year we anticipate, as a result of reduced numbers and a reduction in the pension bill in its totality, that in net terms there will be a saving of €300 million because of the smaller public service numbers. That will continue over the course of the coming years. The total saving is €400 million in gross terms. When one factors out the net amount less pension cover, it is another €100 million. That is a significant saving that has been, and will continue to be, made over the course of the coming years. Senator O’Brien asked about health professionals and consultants. He raised an appropriate point. The view of the Minister for Health, Deputy Reilly, is that he wants to ensure much greater efficiencies within the health service and buy-in and support for his radical plans across the acute health care system. He is in negotiation with the consultants. Senator O’Brien spoke about the carrot and stick approach. It is the view of the Government that, in terms of our negotiations with the consultants, we will wait for the conclusion of those talks to see whether we get the buy-in, the efficiencies and the kind of additional reforms that we need to see in the health sector before the issue of pensions for consultants is addressed further. On the question of the Croke Park agreement and increments, implicit in the agreement is that the Government will not reduce public sector pay again in the way that it has over the course of the past three years, a reduction on average of 15%. That will not be reduced again and we will not introduce compulsory redundancies, if we get buy-in and support for our radical public sector reform plans which was launched by the Minister, Deputy Howlin, and myself only three weeks ago. Will that happen? If we do not see those changes, significant change in terms of rationalisation, shared services and an ability to move across the public sector, then the issue of increments may well come back on the agenda. However, if increments were to be frozen for a period of time who suffers most? Those who suffer most are clerical officers and others who do much of the processing of the work on behalf of the State. It is not those at the top of the tree.

Senator John Gilroy: They are younger staff.

Deputy Brian Hayes: They are younger and poorly paid staff within the public sector. Those who make the point about increments — in respect of which I understand the saving would not be €350 million, which figure is being bandied about by the press — should note the Government is clearly of the view that it needs to have buy-in and support for its reform 109 Financial Emergency Measures in the Public 7 December 2011. Interest (Amendment) Bill 2011: Second Stage

[Deputy Brian Hayes.] agenda. There are over 200 actions in the reform plan set out by the Minister, Deputy Howlin, and me. There are dates, timeframes and specific responsibilities set down. If we get sufficient buy-in and support, we can justify this process. If we do not, the issue will be back on the table again. We are to proceed from having a public service staff of approximately 320,000 in 2008 to having one of slightly over 280,000 in 2015. Over the course of the seven years, 37,500 public servants will effectively have been removed from the entire public service, representing a reduction of approximately 12%. This has an enormous impact. The pension changes we have introduced have a similar impact on the total public sector pay bill. I understand approximately 38% of the total expenditure is on public sector pay and pensions. A reduction of 12% over a period of seven or eight years is radical. If we achieve this, we will have a totally transformed public sector in terms of staff number and base, and also a transformed system for pension cover. Senator Darragh O’Brien referred to advisers. The total budget for advisers of this Govern- ment is 30% lower than that of the previous Administration owing to reductions in the number of advisers. There has been a saving of over 50% with regard to the number and cost of advisers in the Taoiseach’s office. If a person enters the public sector from the private sector to do a specific job for the Government for a minimum of three to five years, he or she should at least be expected to receive the same rate of pay earned in the private sector. This is an incentive with regard to buying in expertise and support. If one examines the reductions across the ministerial and officer class within the entire Oireachtas over recent years, one will note there have been very significant reductions in pay. The first act of Ministers of the new Government, when it took office, was to accept a further reduction in pay. We have reduced by 25% the total number of personnel in our offices. A former officeholder in my office had ten Civil Service staff. I do not have any civil servants running my constituency now, I have two staff of the kind allocated to all Deputies. Not only have we said we would take the steps we said we would take, we have taken them. We have more than halved the total cost of ministerial transport. We provide our own cars. I understand the people who work for us now receive one third of that received by the previous members of staff, who were members of An Garda Síochána. I can, therefore, point to savings. They will not make a considerable difference in making up the total deficit we face but we must lead by example.

Senator Darragh O’Brien: I agree.

Deputy Brian Hayes: I fully agree with the Senator in that regard. That this issue has arisen on four separate occasions since 2008 by way of separate Bills is an example to both Houses that this issue is under constant review. No one knows what our position will be as we enter next year and as the crisis unfolds. As other colleagues stated, we are today fulfilling the wishes of the people in respect of judicial pay. We all want to ensure this happens appropriately, and that is what the Bill is about. I wanted to reply to some of the issues raised and I would like an opportunity to debate some of the amendments.

Question put.

Senators: Vótáil. 110 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage

An Cathaoirleach: Will the Senators who are claiming a division please rise?

Senators David Cullinane, Trevor Ó Clochartaigh and Kathryn Reilly rose.

An Cathaoirleach: As fewer than five Members have risen I declare the question carried. The names of the Senators dissenting will be recorded in the Official Report and the Journal of the Proceedings of the Seanad.

Question declared carried.

Financial Emergency Measures in the Public Interest (Amendment) Bill 2011: Committee and Remaining Stages

Section 1 agreed to.

SECTION 2

Question proposed: “That section 2 stand part of the Bill.” Senator Jim Walsh: While my party has agreed to support the Bill, I am not happy with it. Section 2 repeals the provision allowing for the automatic entitlement of newly appointed judges to an usher and a crier. If new judges can do without their criers, why do existing judges need them? I ask the Minister of State to comment on the other staff put at judges’ disposal, such as drivers, and whether the regime applies to staff of the Circuit Court and District Court. I have come across complaints that solicitors making applications for licences intimated to their clients it would be prudent to make a contribution to certain staff of the Judiciary. I 2o’clock thought this was completely unethical and I raised the matter with previous Mini- sters for Justice and Equality. However, while they were aware of this practice I do not believe anything was done about it. I ask the Minister of State to outline to the House the staffing arrangements at different levels of the Judiciary. I see no reason we cannot abolish all the criers.

Acting Chairman (Senator Paul Coghlan): Is the Senator speaking on section 2?

Senator Jim Walsh: I ask the Minister of State why the provision is not being extended to existing judges. We face a financial and fiscal crisis and we should do all we can to address it, particularly in areas that will not impact on the provision of services.

Minister of State at the Department of Public Expenditure and Reform (Deputy Brian Hayes): I thank the Senator for raising this important issue. I have considerable sympathy for his argument. The Bill providing for the establishment of the judicial council is important legislation because it will allow these matters to be addressed independently. It is not right that these Houses would encroach enormously on the independent functioning of the Judiciary. The Senator asked a question about the total numbers. At present a majority of the judges of the Circuit Court and the Supreme Court are provided with an usher or a crier. A total of 44 ushers and 41 criers were employed by the Courts Service at a total cost of €3.3 million in 2010.

Senator Jim Walsh: How much?

Deputy Brian Hayes: Some €3.3 million. 111 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage

Senator Jim Walsh: That is nine times the saving we achieved by closing our embassy to the Vatican.

Deputy Brian Hayes: Over the coming years, as judges retire, their replacements will not be automatically provided with an usher or crier. Instead, following consultation with the Judiciary and the Courts Service, and in addition to the general supports already in place, alternative support posts will be provided, most likely in the form of additional judicial researchers. It is important to note that these posts can be provided on a contract basis with reduced costs, as well as providing valuable experience for newly qualified legal people. The replacement of ushers and criers with an updated support structure was recommended in 2009 in the report of the special group on public service numbers and expenditure. This will not affect the supports currently available to serving judges. My understanding is that this relates to section 43 of the Courts of Justice Act 1936, which allowed judges to have this facility. While it is important to note that new members of the Judiciary will not have automatic rights to these, Mr. McCarthy rightly pointed out a substantial expenditure on the part of the Courts Service. It is the view of the members of the Judiciary themselves that they would prefer to have a system of supports that they could call on individu- ally. It is probably a more professional and less anachronistic way of dealing with these services. That is my understanding of the total number and cost of the ushers and criers that are there.

Senator Jim Walsh: What about drivers?

Deputy Brian Hayes: I do not have a note on that, but I will find out and inform the Senator.

Senator John Gilroy: With regard to the figure of €3.3 million for ushers and criers, of which there are 44 and 41, respectively, the Minister of State is saying that that is a substantial cost to the courts system, but of course we must understand that this cannot be a saving, because even if we do abolish the posts of usher and crier, these pay costs will still accrue because the people involved will simply be relocated to another Department. They are surely permanent civil or public servants. Would the Minister of State be able to comment on that?

Deputy Brian Hayes: My understanding — I will check this — is that the positions are specific to the appointment of a member of the Judiciary. I do not think they are employed by the Courts Service, but I will have to check that. It is recognised that this issue must be addressed by virtue of the fact that any new member of the Judiciary is not entitled to these services automatically——

Senator John Gilroy: And rightly so.

Deputy Brian Hayes: ——and rightly so. Senator Walsh has a valid point to make. There is still a substantial amount of expenditure there for last year, and, I presume, this year, in terms of those who remain. It is important, however, that we move on this in light of an agreement from members of the Judiciary. When the judicial council is established, we will have a much greater understanding of the views of members of that group. I do not want this to be seen as some kind of attack on the Judiciary by an automatic removal of these posts.

Senator Jim Walsh: I thank the Minister for his response in that regard, and I welcome the fact that he is moving in that direction. It strikes me that what we need to do throughout society is to attack abuses of privilege, of which there are many. Some of the cuts we are carrying out — I mentioned the closure of the embassy to the Vatican, but there are others on the social welfare side — will not yield €3.6 million. It comes down to what we regard as a priority. I welcome the appointment of the judicial council, but I am critical of the judges for 112 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage dragging their feet on its introduction. It is eight years since I started pushing this issue, following a visit of the Joint Committee on Justice, Equality, Defence and Women’s Rights to Canada and Boston, where we saw the systems that were in place for checking judges. Of our judges, one deserved to be sacked, and another resigned and probably should have been penalised in a different way than having to concede his job, but there was no mechanism for that. One resigned with integrity; the other did not. I urge the Minister to consider this. It should be done away with now. If it is not possible to do it for some reason, I suggest that at a minimum, as natural wastage occurs among the people who are there, they should not be replaced. That would be a minimum. If one goes to the Four Courts and looks at the medieval regalia that our judges turn out in, one can see it is an anachronism. If one goes to a court in another country, the judge arrives in his suit and is dressed like everybody else. We are a republic, for goodness’ sake.

Senator John Gilroy: Hear, hear. I agree.

Senator Jim Walsh: This is a throwback to the monarchy. These people may have their grand notions or whatever else. We need to tackle that and we need to do it in a fair and effective way. When we come to salaries, I will talk about that aspect of it also. My understanding is that all of these people also have drivers. If one goes down to the Four Courts, one will see the crier walking with his staff in front of the judge through the hallways and so on. Why, I do not know. Let us say a judge wants that; why can his driver, for example, not do it? We need to combine a number of functions that can be combined, but all of these posts should be examined and pruned. There should be no area in which people classify themselves as being above everybody else, hanging on to their privileges. At a time of crisis for many families around the country, these things should be totally eradicated.

Deputy Brian Hayes: Without wanting to labour the point, I have a note here on the relevant section of the 1936 Act, which states: “There shall be attached to every judge travelling and sitting as a judge of the High Court on Circuit and to every Commissioner of the High Court on Circuit one servant to perform such duties...” The language is historic and out of date. I will ask the Department of Justice and Equality to furnish the Senator with a note giving him the up-to-date briefing on this issue. He has rightly touched on an important matter. When the legislation was first passed in the 1930s, the moneys for the purpose of providing servants to judges came from the Oireachtas. There may well have been security issues at the time. To answer the Senator’s question on drivers, I am not sure that applies to District and Circuit Court judges, although I may be wrong. However, it certainly does apply to judges in the higher courts.

Question put and agreed to.

SECTION 3

Question proposed: “That section 3 stand part of the Bill.”

Senator Jim Walsh: I opposed this Bill on Second Stage, but my party has decided to support it, so obviously I am bound by that. Some time ago I carried out an exercise in which, as well as obtaining some information from independent sources, I asked the Oireachtas Library and Research Service — which is a very good service — to do a range of comparisons across many public service positions. I discovered, to my consternation, that our Supreme Court judges were paid €100,000 per year more than the Supreme Court judges of the United States, and our Chief Justice was paid €130,000 more than a US Supreme Court judge at that stage. I might 113 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage

[Senator Jim Walsh.] be going back two years or thereabouts, but I would say it has not changed dramatically. We are talking about a 10% cut, or whatever it is, for judges. This is insufficient. There is no reason in the wide earthly world, particularly in our current crisis, we should be paying anybody in any part of our public service this much. I admit the members of the Judiciary are very important functionaries within our system and play an important role in underpinning society and the State. I do not want anything I say to diminish that. However, that does not mean the salaries they are being paid should be anything like the magnitude they are, even after the correction. I suggest that in all probability, judges’ salaries will still be too large by around €60,000 or €70,000, based on my recollection of what the figures were at the time. That is not sustainable for a small island which is struggling and borrowing money and which is putting the cost of that, through our austerity measures, on the ordinary humble citizen who is struggling to make ends meet for himself or herself. I imagine there is probably nothing he can do about it at this stage but it should be examined. I understand the main reason for the measure is to attract people to the position. Exorbitant legal fees and costs have been charged and they have been lumped on to the public and private sectors. This is the reason for having to pay the Judiciary such exorbitant figures. I call on the Minister of State to consider the points I am making and to bear them in mind for the future if he can do nothing in this Bill. Let us consider the case of judges. A cap in pay of €250,000 has been imposed on some of the chief executives of our banks and important semi-State companies. Their performance and the quality of these individuals is so fundamentally important to us that I disagree with the placing of such a cap. We need to attract the best and brightest into these positions. They should be at the top of the pile when it comes to pay scales throughout the semi-State bodies and public service. There are far greater and onerous demands on them than on any others in our public service, including the Judiciary.

Deputy Brian Hayes: It is fair to make the point that the reason we are here today following the people’s decision is to ensure we do what we must do. I remember debating this issue on the other side of the other House some years ago. Rightly, everyone highlighted the fact that we could not take action because of the constitutional lacuna. Therefore, the Government’s absolute commitment, supported by all parties in this House and the other House, was to hold the referendum and to follow it with a positive decision in terms of changing the law that would allow us to take this action on the pensions side. The 2007 document of the review body on higher remuneration in the public sector was referred to. This set out new pay rates for members of the Judiciary. I gather that at the time one driver behind the proposals was that members of the Judiciary should be, by definition, close to the top of the tree among the lawyers. They would have built up a significant private practice and their total earnings in a year were significant. The point was to try to attract qualified, well-experienced counsel for the purposes of having these people as judges throughout the system. That was reflected in the 2007 report. Following this, the 2009 report recommended a scaling back in this regard. However, we could not do so by virtue of the fact of the constitutional position on members of the Judiciary. This has changed dramatically now. In addition, we are in a totally new position given the entire fiscal crisis that afflicts the country and this has been reflected on the pay and pensions sides. However, if we are to attract well-qualified, well-experienced counsel to the Judiciary to perform the functions we call on them to perform in the Courts Service, we must have fair and competitive rates of salary. It is correct to say that given the collapse in the property market and in other sectors, members of the legal profession have seen a radical reduction in their pay 114 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage in recent years. This has been reflected in other reports but it is worth noting that the purpose of our work today and in the other House some weeks ago is and has been to put in place the legislative powers to do what we always sought to do, that is, to ensure the pay and conditions of members of the Judiciary are fair and, equally important, in line with the times. The objective of the Bill is precisely to do so.

Senator Jim Walsh: I will be brief because I have no wish to cut across others. Sinn Féin Members have tabled several amendments and I have no wish to delay. However, I will put three points to the Minister. I have argued these points with my party in the past decade or more. We need to tackle exorbitant legal fees, which amount to profiteering on an alarming scale. This must be done because it is part of the reason that judges are paid as they are. One thing the Minister of State might consider is to change from a system whereby retired barristers who have built up millions of euro in wealth during their practice period are appointed to the Bench on a good salary for short periods. Then, as soon as they finish, they get 50% of that salary as a pension. Most of them take it for the pension. The Minister of State should consider a newer system such as that operated in other countries whereby if one wishes to be a member of the Judiciary, it is considered a profession in its own right and people come in at a younger age and have a career. Some people spend 40 years as a judge and build up service and, therefore, when they get their pension at the end of it, it has been accrued over a longer period rather than over ten or 15 years as is the case with the Judiciary now. The Minister of State could usefully consider a whole new system in this regard and I encourage him or the Minister for Justice and Equality to do so.

Deputy Brian Hayes: To use a legal term, I have no locus standi here because I have no competence in this area.

Senator Jim Walsh: The Minister of State might have some influence.

Deputy Brian Hayes: I doubt that very much but it is a useful suggestion and I will pass it on to my colleague, the Minister for Justice and Equality.

Question put and agreed to.

Sections 4 and 5 agreed to.

SECTION 6

Senator David Cullinane: I move amendment No. 1:

In page 6, to delete lines 18 to 44 and substitute the following:

“(a) in the case of the Taoiseach, a 64 per cent reduction of remuneration in lieu of a reduction of 25 per cent of remuneration;

(b) in the case of the Tánaiste, a 59 per cent reduction of remuneration in lieu of a reduction of 19.5 per cent of remuneration;

(c) in the case of a Minister of the Government, a 55.5 per cent reduction of remuneration in lieu of a reduction of 19.5 per cent of remuneration;

(d) in the case of a Minister of State, a 35 per cent reduction of remuneration in lieu of a reduction of 10 per cent of remuneration; 115 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage

[Senator David Cullinane.]

(e) in the case of a Ceann Comhairle, 55.5 per cent reduction of remuneration in lieu of a reduction of 15 per cent of remuneration;

(f) in the case of a Leas-Cheann Comhairle, a 35 per cent reduction of remuneration in lieu of a reduction of 10 per cent of remuneration;

(g) in the case of the Attorney General, a 55 per cent reduction of remuneration in lieu of a reduction of 15 per cent of remuneration; and

(h) in the case of the Comptroller and Auditor General, a 60 per cent reduction of remuneration in lieu of a reduction of 15 per cent of remuneration.”.

I welcome the Minister of State to the House. The amendment has the effect of reducing the wages of the officeholders listed to €100,000. On Second Stage, mention was made of this Bill not dealing with pay. It deals with the outworking of the referendum, which my party supported, and the current pay of judges but it also introduces a pay scale for new entrants to the Judiciary and legislates for the voluntary reductions in the salaries of the Government officeholders referred to. Let us consider the amendment and what would be necessary to reduce the pay of some of the more senior Government representatives and civil servants in the State to a salary of €100,000. It would amount to a 64% reduction in the pay of the Taoiseach, a 59% reduction in the pay of the Tánaiste, a 55% reduction for a Minister, a 35% reduction for a Minister of State, a 55% reduction for a Ceann Comhairle, a 35% reduction for a Leas-Cheann Comhairle, a 55% reduction for an Attorney General and a 60% reduction for the Comptroller and Audi- tor General. Earlier, Senator Walsh referred to privilege. We must deal with privilege in this State. Many people will be waking up today in the wake of two days of cuts in social welfare, health, education and throughout public spending. The will be asking themselves what pain was taken by those at the top. The notion of capping pay at €100,000 seems to trouble some people in Government. It is as if we are asking people to live on the bread line or to take a massive hit. In reality, we are asking people to survive on €2,000 per week. Vast numbers of people are living on the average industrial wage, below it or on social welfare entitlements. They see people at the top of the public service with their salaries and pensions earning vast amounts of money. They wonder what planet those of us in public life live on. We live in a country that is insolvent, broke and in which we must borrow vast amounts of money. We are informed that in these difficult times we must borrow money, we cannot afford to pay child benefit as before, we cannot afford to pay all the welfare payments, such as rent supplement, which have been cut in the budget, we cannot afford to pay low- or middle- income families the income they had received, people must pay a €100 flat household charge and VAT must go up despite the subsequent impact on businesses. We are informed that such decisions are being made, that the pain must be shared and that people must take some of the pain. In this State the Taoiseach earns €200,000, the Chief Justice earns €226,376, a High Court judge earns €210,206 and a Minister of State earns €130,000. We have a P. Flynn moment from a lot of Government representatives when it is put to them those amounts of money are not realistic and should not be paid to people in these very difficult times. I do not believe that it is radical to ask people in the public sector, in these very difficult times, to survive on a salary of €100,000 when one considers what many people are surviving on. Sinn Féin has proposed that we set up a commission to examine the pay of people at the top of the public service and what we should pay. I accept that we need to pay adequate and 116 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage appropriate salaries, but we should not pay excessive salaries. When the country is insolvent it is entirely reasonable to cap the pay of all Government representatives and those who work in the public sector and judges at €2,000 a week.

Senator John Gilroy: Senator Cullinane is attempting to insert this amendment into the Bill which I find a little peculiar. It is an obvious and blatant attempt at political point scoring and to be seen to be raising issues which are totally irrelevant to the Bill, which is dealing with a referendum. Any of these issues can be dealt with in another manner.

Senator David Cullinane: It would have an impact. We are entitled to table amendments.

Acting Chairman (Senator Feargal Quinn): It is relevant.

Senator John Gilroy: I understand that.

Senator David Cullinane: If it was irrelevant it would have been ruled out of order.

Acting Chairman (Senator Feargal Quinn): Senator Gilroy, please.

Senator John Gilroy: I am not in any way questioning the legitimacy of the amendment, rather I am questioning its relevance. There is a difference. Restating the entire argument proposed by the Senator for the budget, another piece of legislation, almost word for word hints at the real motivation. It is not appropriate. Everyone shares the sentiment that we should reduce costs wherever we can. I agree with reducing the salaries of Ministers, the Taoiseach, Senators and Deputies. I do not think many people would have any difficulty with that. This is not the place for such an amendment. I understand what the Senator is trying to do but legislation does not need to be introduced through a referendum to do that. All it is is ordinary point scoring.

Senator Tom Sheahan: In the interest of brevity I will use some of Senator Cullinane’s language, such as the terms “reasonable” and “appropriate.” I put it to him that it is neither reasonable nor appropriate that his party leader drew over £1 million from a parliament in which he never sat in pay and expenses. He had staff which drew £1 million in pay and expenses for Deputy Adams.

Senator David Cullinane: People talk about point scoring and then refer to the salary of a Deputy and former MP. Sinn Féin is the largest party in the North of Ireland because we are abstentionist. People vote for us on that basis. Deputy Sheahan is factually wrong——

Acting Chairman (Senator Feargal Quinn): This is not relevant.

Senator David Cullinane: If somebody puts something on the record it should be corrected. No Sinn Féin MP gets a salary, rather they get allowances. All of the allowances are spent on their constituencies to employ people and have offices. The Senator should at least get his facts right when he comes into the House. Senator Gilroy said the Bill was not appropriate.

Senator John Gilroy: The Senator’s amendment was not appropriate.

Senator David Cullinane: The amendment is appropriate. Where is it appropriate to deal with these issues? The purpose of the Bill is to legislate for some of the voluntary contributions which are being made by government officeholders. We are saying quite clearly that it does not go far enough. It is entirely reasonable for us to make that point and table an amendment. It might be 117 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage

[Senator David Cullinane.] uncomfortable for a member of the Labour Party to have to support what he or she is supporting, but we are entitled to table amendments and not point score. We genuinely believe that people at the top should shoulder their fair share of what is happening in this country. We are told day in and day out by the Leader when he answers questions and when we all raise very important issues that the country is insolvent and the IMF and ECB are in town. We all know that and that significant adjustments in our fiscal situation have to be made. It is the kind of adjustments that are being made which we do not support. It is entirely reasonable for my party to table an amendment which calls on the Government to accept that it is not acceptable for people to earn €200,000 or €220,000, or €4,000 or €5,000 a week. How could anybody on the Government benches accept such salaries? The Minister of State referred to net income. We deal in gross income because that is what all workers deal in. Different figures are used when it suits Ministers. When they want to quote what middle and low income families earn they give gross amounts but when it comes to Government Ministers they talk about the tax they pay. Everybody pays tax. We want to address the big salaries which Government Ministers and senior people in the Civil Service are getting, not to mention the Rolls-Royce gold-plated pensions which low and middle-income people in the public sector do not get, and the huge lump sum payments which people have walked away with which our party opposed when the Labour Party was in opposition. We will not accept criticism from the Labour Party or anybody else to the effect that what we are doing is not appropriate. It is entirely appropriate. It is inappropriate that the Labour Party has abandoned everything it stood for. I agree with the Senator that is inappropriate. It is inappropriate that we would cut child benefit and do all of the other things the Government did in the budget. It is inappropriate that a flat regressive charge of €100 is introduced. It is entirely appropriate for us to say that given the difficult times we are in the pay of everybody who works for the State should be capped at €2,000 a week. I do not see how anybody in this State does not consider €2,000 a week to be a very good wage.

Senator Tom Sheahan: Is it appropriate that he accepted £1 million for not going to work?

(Interruptions).

Senator David Cullinane: We will not take the oath of allegiance to a foreign parliament. Your party might do it but my party will not.

(Interruptions).

Senator David Cullinane: We will take whatever allowances we are entitled to. Sinn Féin representatives take the average industrial wage and the rest of the money goes back into the party. That is where the allowances of Deputy Adams go and the Senator knows that.

(Interruptions).

Senator David Cullinane: You cannot stand over your policies so you come in here peddling mistruths about other people’s salaries and allowances.

Acting Chairman (Senator Feargal Quinn): Senator Cullinane, sit down. The Chair is on his feet.

118 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage

Senator Jim Walsh: I support the right of Senator Cullinane to table an amendment such as this and it is appropriate that we discuss it. He is correct in focusing on issues of privilege. Those of us in this House are fortunate enough to have jobs which are fairly decently paid. Equally, we have to be balanced in what we say. The crisis means people have lost their jobs. Their livelihoods have been decimated. Those in political life have given a lead. The then Taoiseach and former Deputy, Mr. Brian Cowen, reduced his pay by 25%, the Taoiseach, Deputy Enda Kenny reduced the salary of a Taoiseach by 30% on taking office. The salary of the Tánaiste and Ministers was reduced likewise. We have taken a very significant drop in salary. The issue of suspending the payment of increments in the public service has given rise to a great deal of discussion. I fully agree with that. We lost our increments and did not have a say in the matter. They were abolished and were taken from those who had accrued them. Poli- ticians have played their part. It is a mistake to drive things into the ground. We must be fair and balanced. A significant correction has been made to the salary of politicians. Senior staff in the public service have not suffered anything to compare with the decrease that politicians at the senior level have, that is, Ministers, the Tánaiste and the Taoiseach. That should be recognised. It should be acknowledged that some people in the public service, such as some judges, are paid in excess of the Taoiseach. That is wrong. In considering the pecking order, in terms of importance to our society, the leadership of the Taoiseach — I might have a view on that — has the most important position and I do not think others should be paid in excess of the Taoiseach’s salary. I have raised this point on a number of occasions on the Order of Business. I acknowledge the fact that reductions have been made and it is correct that it has been done. If we drive down the salaries of politicians to the extent that they must have an outside income in order to do their jobs, one would then have a system that is very susceptible to influence and so on. Politicians should be paid commensurate with their duties and responsibilities, and compared to and benchmarked against the rest of society. The late Deputy Brian Lenihan, when Minister for Finance undertook a process in the second half of 2010 of benchmarking all senior office holders in the State across a range of other similar countries. I have no recollection of seeing the outcome of that benchmarking publicised. It should be published. I went to the trouble of urging the then Minister for Finance and the then Taoiseach to make corrections across all of the public service, based on an analysis l had done of public service pay in western European countries. If we do not recognise these issues, we will not make the necessary correction. The reason I am so critical of the Minister for Public Expenditure and Reform, Deputy Howlin is because of his failure to do his job and get the essential savings and make the corrections in our fiscal position. If we fail to do that we will not be able to rescue this economy. It is a very serious matter. Having said that, we must acknowledge what has been done.

Deputy Brian Hayes: I have a fair degree of sympathy with Senator Cullinane’s amendment. Under it salary would go down but it would be higher than a Cabinet Minister. In fairness, he is doing his best to hike up the salary of Minister’s of State.

Senator David Cullinane: We are in favour of pay parity.

Deputy Brian Hayes: I note under his amendment, my new salary would be €2 below that of the Tánaiste. I am sure the Tánaiste would have a view about that.

Senator John Gilroy: The Minister of State is worth it. 119 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage

Deputy Brian Hayes: Thank you, Senator. My second point on the amendment is that Senator Cullinane has excluded the Cathaoirleach, which is probably sensible on his part but it means that the Cathaoirleach would have a larger salary than the Ceann Comhairle. The Ceann Comhairle is a very reasonable man but I wonder would it go that far? In regard to the internal consistencies in the proposed amendment, because the Senator has not referred to Secretaries General, it means that their pay would be twice that of the Taoiseach’s. Their pay would remain at €200,000, whereas that of the Taoiseach would be €100,000. I am pointing out the problem with the amendment. It is not well thought out. It is not consistent and others will determine why it was tabled, but I am not going to go there. The point made by Senator Walsh is very sensible in this regard. The previous Government and this Government have taken substantial reductions in pay. The greatest reductions in pay in the Civil Service have also been across the Secretaries General grade where on a voluntary and on a real basis, significant reductions have been seen in their gross pay. The first decision this Government implemented on taking office was to reduce the salary of the Taoiseach to €200,000, with a proportionate reduction across the Cabinet and those at the rank of Minister of State. The decision we took on day one was the right decision. Will that issue be reviewed again? I do not think anybody can say with consistency that the issue is off the table, it depends on where things are. The salary of a Taoiseach has fallen from €280,000 when the former Taoiseach, Mr. Brian Cowen reduced it and it was further reduced by Deputy Enda Kenny on taking office to €200,000 with an appropriate reduction across the other grades. There has been very significant reductions in salary and that is appropriate. When I put forward the argument of take home pay, most workers do not look at gross pay because we have such a high marginal tax rate. I know that in the view of Sinn Féin, 75% of the adjustment should by way of further taxes

Senator David Cullinane: ——on high earners.

Deputy Brian Hayes: On high earners but that does not bring in the money because the numbers are——

Senator David Cullinane: The Department of Finance supplied the figures.

Deputy Brian Hayes: I know, but the model is based on salaries in 2009 because we do not have the most recent up-to-date figures.

Senator David Cullinane: We got the most recent figures.

Deputy Brian Hayes: It does not get the money in. The idea that this adjustment can be done simply by way of increasing taxation rather than by increasing tax in addition to reducing expenditure is not honest. Let anyone look at it. Let me make another point to Senator Cullinane, because his own party has put in a pre- butdget submission. We now have an independent fiscal council, comprising eminent econom- ists who are not attached to Government. The Government will put this budget to the fiscal council and it will submit a view on it at some point in the next few months. I ask other Opposition parties, the Sinn Féin Party, the Fianna Fáil Party and others to do the same and then let us hear how well those numbers stack up from the independent fiscal council. How credible is it for politicians to claim credit for their own statistics? I will wait and see what the independent fiscal council has to say about our budget and I ask the Senator to put his party’s budget to it. 120 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage

The point has been made that very substantial reductions have been implemented. That is right and proper. I am not precluding further reductions in the future but we must be proportionate and fair in terms of what has happened since 2008. Also, on what has happened on the tax side since 2008, where very substantial reductions in real take home pay has occurred across the public sector, with the introduction of the universal social charge and the pension levy, the reduction in pay plus the increase in tax. When taken together, these add up to a very substantial reduction in take home pay.

Senator John Gilroy: The Minister of State pre-empted me. I was going to draw attention to one or two of the smaller internal anomalies but the Minister of State did it in a much more extensive manner than I was able. My party is a comfort to me. The record of the House will show that Sinn Féin attempted to oppose the entire Bill and is opposed to the reduction of judges’ pay.

Senator David Cullinane: The record of the House will not show that because people will be able to read the transcripts of what we said. All we are getting from the Government representatives is nonsense. They are not dealing with the real issues, they are making disparaging comments on the amendments we have tabled.

Senator Maurice Cummins: Flawed amendments.

Senator David Cullinane: I will deal with that later. The Minister of State claimed that our amendment omitted several people, such as the Ceann Comhairle. We are working off page 6 of the Bill, which refers to a 29.96% reduction for the Taoiseach. Our amendment proposes that the reduction be 64%. The Bill refers to a 24.83% reduction for the Tánaiste; our amendment proposes a 59% cut. The Bill provides for a 24.83% reduction for Ministers; we propose a reduction of 55.5%. While the Bill provides for a reduction of 15.96% for Ministers of State, our amendment proposes a reduction 35%.

Deputy Brian Hayes: My reference was to the earlier Act.

Senator David Cullinane: The point is that I am reading from the Government’s Bill.

Senator John Gilroy: The point is that Senator Cullinane is not very sure what he is talking about.

Senator David Cullinane: The Government proposes a reduction of 24.83% for the Ceann Comhairle; we propose a reduction of 55.5%. How then can it be said that we omitted the Ceann Comhairle?

Deputy Brian Hayes: It is an amendment to the original Act.

Senator David Cullinane: As the Minister of State knows, we are trying to be consistent in this. Our position is that the salaries of those at the top of the public sector should be capped at €100,000. If he read our pre-budget submission, which I am sure he did, the Minister of State will know we have also called for a reduction in the pay of Deputies and Senators. In addition, we are seeking the establishment of a commission to examine public sector pay in order to ensure it is appropriate. I am in favour of balance. However, there is little evidence of balance in recent days in terms of how families will struggle to cope with Government measures. The Minister of State saw evidence of that last night on the television programme in which he participated. We are talking about serious impacts for the communities and individuals most affected by the cuts, whether 121 Financial Emergency Measures in the Public 7 December 2011.Interest (Amendment) Bill 2011: Committee Stage

[Senator David Cullinane.] they be carers or people requiring care, older people, students or whatever. There is no balance for these people. All they see is cut after cut, with four austerity budgets by the previous Government followed now by the first austerity budget under this Government.

Senator Martin Conway: There will be another two or three.

Senator David Cullinane: Despite all the promises made, we are simply getting more of the same. People do not see any balance or fairness in what is proposed. Despite the nonsense from Government Members about the motivations of my party in putting down these amendments——

Senator John Gilroy: The motivation is clear.

Senator David Cullinane: ——many Senators, on both the Government and Opposition side, have, over the course of many years in this House and outside it, spoken about high salaries for people in the public sector. The Minister of State’s party opposed benchmarking, for example, which served to drive up pay for those at the top of the public sector. I make no apology for seeking pay parity and insisting that those on low to middle incomes should be protected first. Instead, however, the Government is pampering those at the top, who are walking away with Rolls Royce pensions and lump sum payments. Some are retiring with lottery sums of money which most people can only dream of. That is the world in which many people inside the political system and at the top of the public sector live. It is an entirely different world for all of the people who will be affected by the budget introduced yesterday by the Minister of State’s party.

Senator Tom Sheahan: I agree with much of what my colleague, Senator Jim Walsh, said in regard to pay structures. There are chief executive officers of semi-State companies, many of whom are merely running a cog in the wheel of the semi-State sector, in receipt of €500,000 or more per year. The Taoiseach — the person responsible for the running of the country — is paid only half or even one third of what some of these people receive. Has an analysis ever been done of how much Ministers and Ministers of State are costing the State? The Minister of State, Deputy Hayes, must have done 120 hours in the last week. I saw him last night on Vincent Browne’s programme and he looked ready to fall asleep.

Senator Martin Conway: Vincent Browne would put anybody to sleep.

Senator Tom Sheahan: Has there ever been an analysis done of the effort and hours put in by politicians?

Senator David Cullinane: Senator Sheahan might get to go on Vincent Browne’s programme himself after this. We will see how he gets on.

(Interruptions).

Deputy Brian Hayes: A time and motion analysis of Ministers of State might be a task too far. The public will ultimately decide these matters. The serious issue here is that those of us who are privileged, and still enjoying very good pay and conditions even after the reductions, must lead from the front. In fairness to all politicians, there have been significant reductions in their pay in recent years. As I said, I am not ruling out the prospect of further reductions at some point in the future. The Government was 122 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage very clear on coming into office of its intent to set out a clear strategy and to lead from the front in terms of pay reductions for Ministers, the Taoiseach and the Tánaiste. We must be very conscious of the difficulties so many people are experiencing. As I said last night, the great inequality in Ireland at this time is the difference between people who are working and those who are not. All of our efforts must be focused on giving people the opportunity to get back to work, to have the dignity of employment and the opportunity 3o’clock of income generation for themselves and their families. That is our task. Petty point scoring by one side or the other, even if people feel it will give them a cheap advantage, will not solve our problems. We must be far more realistic in terms of what we can achieve.

Question put: “That the words and figures proposed to be deleted stand.”

Senators: Votáil.

An Cathaoirleach: Will the Senators claiming the division please rise.

Senators David Cullinane, Trevor Ó Clochartaigh and Kathryn Reilly rose.

An Cathaoirleach: As fewer than five Senators have risen I declare the question is carried and the amendment is lost. The names of the Senators dissenting will be recorded in the Journal of Proceedings of the Seanad.

Question declared carried.

An Cathaoirleach: As it is now past 3 p.m. I am required to put the following question in accordance with the order of the Seanad of the day: “That Government amendment No. 2 is hereby made to the Bill. In respect of each of the sections undisposed of the sections or as appropriate, the section, as amended, and the Title are hereby agreed to in committee. That the Bill, as amended, is hereby reported to the House. That the Bill is hereby received for final consideration and that the Bill is hereby passed.”

Question put.

Senators: Votáil.

An Cathaoirleach: Will the Senators claiming the division please rise.

Senators David Cullinane, David Norris, Trevor Ó Clochartaigh and Kathryn Reilly rose.

An Cathaoirleach: As fewer than five Senators have risen I declare the question is carried. The names of the Senators dissenting will be recorded in the Journal of Proceedings of the Seanad.

Question declared carried.

Sitting suspended at 3.10 p.m. and resumed at 3.30 p.m.

Local Government (Household Charge) Bill 2011: Committee Stage

SECTION 1 Senator Trevor Ó Clochartaigh: I move amendment No. 1: 123 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Trevor Ó Clochartaigh.]

In page 3, between lines 20 and 21, to insert the following:

““Act of 1978” means the Local Government (Financial Provisions) Act 1978;”.

Ós rud é go bhfuil Gaeilge ag formhór a bhfuil i láthair labharfaidh mé as Gaeilge, má tá sé sin ceart go leor. Sa chéad leasú atá molta againn táimid ag iarraidh soiléiriúóthaobh na míniúchánatá luaite san mBille, mar is Bille fíor-thábhachtach é seo, ina bhfuil an Rialtas ag iarraidh costas, nó mar a deirimid-ne cáin breise, a chur anuas ar mhuintir na tíre. Ba cheart go mbéadh an Bille soiléir go hiomlán faoi na hAchtanna ar fad atá i gceist. Tugaimid faoi deara nach bhfuil Acht 1978 luaite ins an míniúchán. Sílim go bhfuil sé tábhachtach go ndéanfaí an leasú seo chun soiléiriú go gciallaíonn “Acht 1978” an t-Acht Rialtais Áitiúil (Forálacha Airgeadais) 1978. Beidh cáin breise de €100 in aghaidh an teaghlaigh in aghaidh na bliana. I gcomhthéacs na costas breise atá buailte ar dhaoine le cupla lá anuas tá sééagcórach agus iomlánmícheart a leithéid de chostas a chur anuas ar dhaoine. Tá sé i gceist againn leasaithe a chur chun cinn chun na cásanna éagsúlaamhíniúóthaobh na ndaoine atá fágtha as an áireamh maidir le díolúintí agus mar sin de. Ní mór sin a thógáil i gcomhthéacs na n-Achtanna ar fad a bhí luaite roimhe seo. Ni cosúil go bhfuil na leasaithe sin luaite in Acht 1978. Bhéadh sé tábhachtach go gcuirfeadh Acht 1978 san áireamh le gur féidir aon leasú a molfar inniu a chur san áireamh chomh maith céanna. Beimid ag moladh leasaithe a bhaineann leis an gcostas féin, leis an dream atá i dteideal an costas seo a íoc agus an dream nach bhfuil i dteideal é a íoc. Tiocfaidh mé ar aghaidh leis na pointí sin níos faide anonn nuair a pléifear na leasaithe eile. Ar an mbuncheist seo, ba cheart go mbéadh an t-Acht seo luaite ins an miniúchán.

Senator Cáit Keane: An bhfuil seo riachtanach? Tá sé intuigthe in Acht 1992. Mar sin an bhfuil sé riachtanach san mBille seo? Is it necessary?

An Leas-Chathaoirleach: Ar aghaidh leat, Minister.

Minister of State at the Department of the Environment, Community and Local Government (Deputy Fergus O’Dowd): Déanfaidh mé mo dhícheall an cheist a fhreagairt. Is maith an rud é go bhfuil an díospóireacht seo ar siúltré Ghaeilge ach níl foclóir s’agamsa maith go leor don ábhar seo. Go raibh maith ag an tSeanadóir as an leasú a chur romhainn. My officials have been in contact withthe Office of the Parliamentary Counsel. I am informed this is standard drafting procedure. The reference to the Local Government (Financial Provisions) Act 1978, appears once in the text of the Bill and once regarding the amendment of the Local Government (Charges) Act 2009. Normally, when two or more references to an Act are contained in the main text of a Bill, there is a definition of the Act concerned inserted into the interpretation section of the Bill. Sa chás seo, where there are two references to the Act concerned, one is contained in the main body of the Bill and the other is for the purposes of an insertion in the Local Government (Charges) Act 2009. As such, the reference to the 1978 Act would be in two separate pieces of legislation. I am informed by the Office of the Parliamentary Counsel that from a drafting point of view, inserting a provision along the lines suggested would indicate to a reader of the legislation that 124 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage there is another reference to the 1978 Act in the main body of the Bill. Ní féidir liom de thairbhe na comhairle sin tacú leis an rúnatá molta ag an Seanadóir sa leasú seo.

Senator Trevor Ó Clochartaigh: Táimid buíoch den Aire Stáit as ucht an soiléirithe sin. Tuigimid na pointí atá sé ag déanamh agus is ar mhaithe le soiléireacht a bhímid ag iarraidh an rud sin a chur ann mar níor mhaith linn go mbeadh doiléire ag an phointe seo mar tá sé fíor-thábhachtach ar cheist chomh tábhachtach leis seo go dtuigfeadh gach duine céard go díreach a bheadh i gceist. Glacaimid le focal an Aire Stáit agus le treoir ó na dreachtóirí parlaiminte. Ní chuirfimid an leasú chun vóta.

Amendment, by leave, withdrawn.

Section 1 agreed to.

SECTION 2

An Leas-Chathaoirleach: Amendments Nos. 2 and 9 are related and will be discussed together.

Senator Brian Ó Domhnaill: I move amendment No. 2:

In page 6, subsection (2), between lines 2 and 3, to insert the following:

“(f) homes purchased under the Affordable Housing scheme;

(g) homes on which stamp duty has been paid from January 1st 2004 up unto December 31st 2011;

(h) homes purchased through the Shared Ownership Scheme.”.

The amendment relates to the definitions set out in section 2. Its purpose is to have a number of categories of home included in the definition of properties which may exempt under the household charge legislation. While I appreciate it may have been preferable to submit the amendment to the section relating to exemptions, given the specific nature of the types of properties provided for in the amendment and the ownership pertaining to these types of properties, we concluded that section 2 would be the more relevant section to make the amendment because it includes the definition of residential property. The amendment proposes to have homes purchased under the affordable housing scheme and homes on which stamp duty was paid from 1 January 2004 up to the present day included in the subsection. These are the households experiencing most of the burden of mortgage difficulties. The issue of negative equity also arises and is addressed in later amendments. Anyone who bought or built a property from early 2004 onwards did so on the basis that credit was widely available. Having paid stamp duty, they are not in negative equity. I can cite examples of people who purchased properties for €400,000 and €500,000 and paid stamp duty of between €25,000 and €30,000. People in this category are in major financial difficulty and should be exempt from the household charge. In addition, homes purchased through the local authority shared ownership scheme should be exempt from the charge and should not be defined as residential property in this section. People purchased properties under the affordable housing scheme because local authorities allowed them to access money at a reduced cost on the basis that they could not afford housing on the open market. The three categories of housing referred to in the amendment should be exempt from the household charge and should be defined as non-residential for the purposes 125 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Brian Ó Domhnaill.] of the section. We are willing to accept an amendment under the exemption clause on Commit- tee Stage or Report Stage if the Minister is willing to accept such an amendment.

Senator David Norris: I strongly support the amendment as it addresses the position of very vulnerable people. The Minister of State was present when I made similar points on Second Stage. In particular, I addressed myself to the issue of the affordable housing schemes under which houses, homes or apartments were made available to people, including many who were in very valuable professions such as nurses, gardaí and carers. These professions have suffered considerable cutbacks in their income since it was deemed appropriate by the local authorities that housing should be made available to them at less than what was then deemed to be the market rate and on the basis of their circumstances, low income and high price of houses. The purchasers of housing under the schemes paid amounts which are now considerably in excess of the market value of their homes. They are in a very difficult position and there is a clear argument for exempting those who were deemed to be appropriate recipients of affordable housing. While I understand the Government is in financial difficulties, people who purchased homes under the affordable housing scheme should be exempt. I also accept the argument made by Senator Ó Domhnaill on the proposed paragraph (g), which refers to people who paid stamp duty during a certain period and have been badly caught in the property bubble. I also have some sympathy with those who purchased homes under the shared ownership scheme. The area about which I know most and, therefore, on which I make my strongest argument relates to those who purchased homes under the affordable housing scheme. I hope the Minister of State will be able to assume a position of some flexibility in this regard. I will certainly support the amendment. As I stated, I referred to this matter at some length on Second Stage. I hope the Minister of State has been softened up to some degree on the matter. I thank the Minister of State for facilitating our request to table amendments yesterday. This is a reasonable amendment. When I raised this matter with the former Minister of State, Deputy Willie Penrose, whose portfolio was housing, he had a clear understanding of my concern. A major mortgage arrears problem has arisen among those who purchased their homes under the affordable housing and shared ownership schemes. More than 18.5% of households in Fingal which were purchased under the affordable homes scheme are in arrears. Unfortu- nately, local authorities and the Housing Finance Agency are not covered under the statutory code of conduct on mortgage arrears. This is causing a major problem. While I do not wish to stray from the point, I hope this matter will be given serious consideration when a new Minister of State is appointed to replace Deputy Penrose. Perhaps the Minister of State will raise it with the Minister because county councils are behaving worse than the banks in many respects. As Senators Norris and Ó Domhnaill noted, those who purchased under the shared ownership and affordable housing schemes did so because their incomes were so low as to preclude them from getting on the property ladder. Those who purchased under the shared ownership scheme are already in negative equity because the equity amount in the local authority increased over the term. A major mortgage arrears problem has also arisen in this area. This may be a separate issue but it drives home the reason an exemption should be provided for the individuals referred to in the amendment. The previous Government reduced stamp duty to 1% on all property transactions. Many people missed the boat between 2004 and 2008 and paid substantial stamp duty fees. It can be easily demonstrated through the Land Registry and Revenue who paid stamp duty during the period in question. I welcome the Government announcement to increase mortgage interest relief to 30% for people who bought their first home between 2004 and 2008. Exempting this 126 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage group from the household charge would be a logical extension of yesterday’s measure. Having given out previously in the House about the Government’s failure to make good on its commitment on mortgage interest relief, I commend it on fulfilling the promise Fine Gael gave in its election manifesto. If one follows the logic of yesterday’s measure, namely, that those who purchased homes between 2004 and 2008 were, in the main, more adversely affected than others by the mortgage crisis and property crash, by extension one will exempt them from the charge. This is a logical amendment which stacks up in terms of Government policy and the changes introduced in recent days. I ask the Minister of State to accept it. Tá sé ráite againn go bhfuilimid i gcoinne an flat rate charge i bprionsabal mar nílsé féaráilte, tá sé iomlán éagórach sa chaoi go bhfuil séáchur i bhfeidhm. Ba chóir go mbeadh cáin mhaoine á baint ó dhaoine atá in ann í a íoc ach sa chomhthéacs go bhfuil sé i gceist, is cosúil, ag an Rialtas an Bille seo a chur tríd, táimid ag iarraidh damage limitation a dhéanamh go pointe áirithe. Sa chás sin táimid ag tacú leis an leasú atáámholadh. We in Sinn Féin are opposed to a flat tax, a point I made yesterday on the previous Stage. We do not promote this line but as a damage limitation exercise we support this amendment. I note it is linked with amendment No. 9 so Members might also look at that. In it we suggest the meaning given to a residential property, as outlined in section 2, “shall not be amended save by the Oireachtas”. We suggest that if any change to that definition is proposed it must come back to the Houses of the Oireachtas in order that we do not give sweeping powers to a Minister in the future, one who might not be as understanding as the present Minister, or who might decide to take certain categories out of the exemption clause category. In the current economic climate where so many families are struggling we do not know if the Government has grasped the seriousness of the situation. More people must be included in the waiver scheme — those arguments have been made. We agree that those who purchased houses under the affordable housing scheme should be taken into consideration as well as homes on which stamp duty has been paid, from 1 January 2004 to 31 December 2011, and those who purchased through the shared ownership scheme. That is very important because many of those people are in negative equity and cannot afford to pay their mortgages. Many of them have lost their jobs and will now suffer with the extra cutbacks, the water tax, the sewerage tax and all the extra charges such as that arising from losing money for school buses. We could continue. These young people who bought houses in the past ten years are really struggling. They have small familes and are suffering cutbacks in child income allowance. Their situation must be taken into account when we consider this extra tax. It is a tax — it is not fair to call it a charge. If one charges people one gives them some sort of extra service. If I go somewhere and am charged for something I expect a service. There are no extra perks for anybody who pays this extra charge, as it is called. It is really an extra tax on people and therefore we support this amendment. It is equally important, in regard to my party’s amendment No. 9 in section 4, that the meaning, as outlined, will be amended only by the Oireachtas and that any proposed change must return to the Houses for us to discuss. We do not want Ministers of State taking categories of people, willy-nilly, in or out of the scheme. There needs to be debate on this point and it is unfortunate there has not been more debate on this Bill before now. It is going through the Houses quickly. The reason my party will push amendment No. 9 is to ensure that if any changes are to be made in eligibility for the waiver the relevant proposal must come before the Houses. We might even be able to suggest extra groupings to be taken into account.

Senator Thomas Byrne: This is a positive amendment that recognises that those who paid stamp duty between 2004 and especially during 2007-08, are the people who paid for the Celtic tiger. It was from them that taxes came. Now we are to land those people with an annual 127 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Thomas Byrne.] charge of €100. This point is very important. The previous Government set the precedent for giving them some kind of rebate or increase for their mortgage interest. I was glad to see the Government enhancing that yesterday but it was my party that recognised the principle. These people paid out a great deal of money and are now being asked to pay again. It is especially galling because a person who built and owns properties that have not been sold does not appear to be liable for property tax in any way. That is completely unjust and there does not appear to be any rationale to it. A property is a property. We are looking to tax properties, as will be discussed with the relevant section. With houses bought under the affordable homes or shared ownership schemes, one is looking at very vulnerable people. Many of them are in a very peculiar and difficult form of negative equity. With all the clawbacks in place they are in a very difficult situation. Some people came after them, looked at the affordable homes scheme, decided it was too expensive and that they would buy on the open market instead or perhaps not buy at all. The Government should accept this amendment. It should accept that these people funded us for many years. They are the people who paid the taxes that brought this country to the heights it reached. We should have had a proper taxation system. There are all kinds of alle- gations about the last Government but the fundamental mistake was that taxes were not levied appropriately. We relied too much on transactional taxes such as stamp duty, capital gains and capital acquisition taxes. We reduced income tax to too low a level and we did not have a property charge. This Bill is part of the relevant correction. If we consider those people who bore the burden of taxation in those years we should give them, at least for a period, an option on the charge. I do not want the Minister of State to reply citing technical reasons. I do not know whether the word “homes” is defined in the Bill but we can return on Report Stage with a different version if that must be done. I support the spirit of this amendment.

Senator Cáit Keane: I welcome the Minister of State. I refer to section 2(h) on the shared ownership scheme. I ask the Minister of State to look at that because a reasonable suggestion has been made. In section 3, on page 6, our Bill states that where a residential property is owned by two or more persons those persons shall be jointly liable to pay the household charge. If one takes that logically it would mean that 50-50 ownership is exactly what it says. The owner is both the local authority and the client. A charge of €50 each way would provide an even keel because full ownership is not in question. I ask for the Minister of State’s opinion. The local authorities involved in shared ownership are not taking any of the brunt arising from the depreciation in value of the house. This would be one area in which we could point out the situation of a person who bought, at 50-50 status, in good faith. The value of the house has gone down while the local authority remains a bank in a way, given that the banks are now being asked to take a reasonable line on mortgages. Shared ownership may be a subject for another debate on another day in the House. In regard to this point, it would be fair if the local authorities were to waive 50%. They are owners. We are dealing with section 2 but section 3 states that where a residential property is owned by two or more persons the local authority owns the house. Therefore, it should pay half the charge.

Senator Terry Leyden: I welcome the Minister of State to the House. It is becoming evident that this charge will place a major burden on people. For example, in a non-owner-occupied house who is liable — the owner or the tenant? If the owner is liable will the tenant become liable for the charge? There is already a fee of €200 for non-residential property and now 128 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage another fee of €100 must be paid too, in addition to the septic tank charge of €50. It is becoming a very big burden for anybody who owns a house. It is only now becoming obvious what is happening. Ultimately, most landlords will transfer the money to their tenants because they will have no choice and the tenants will have that burden. Many landlords are carrying the non-residential fee and perhaps many of them will carry this charge too but it will reduce the return on houses while the cost of servicing the debt remains. I refer to people who are in negative equity — what is their position? If they bought a house or apartment in Dublin for €300,000 which is now worth €160,000, will they also be liable for this yearly charge of €100? The situation is becoming very difficult. The only fair way to assess this would be to work out the valuation process and return to a way of equity. A 4o’clock millionaire lives in Ballsbridge; a widow lives on a small farm or in a cottage in Roscommon town. Both are liable for the charge of €100. This seems to be an impossible kind of legislation. In a sense it is like the poll tax in Britain except that in that case the number of persons in each house was counted. That was a very unpopular tax. The public are really very quiet. They have been that way since Fine Gael and the Labour Party went into government. During our last period in government we were under siege.

Senator Cáit Keane: They were so fed up.

Senator Terry Leyden: Journalists in The Irish Times advocated that Leinster House be stormed like the Bastille was. We were effectively run out of office. This Government is bringing in more charges every day of the week but everyone seems to be impressed. The Govern- ment seems to own The Irish Times. It is also well got in RTE to the extent the broadcaster had to ensure Seán Gallagher would not be let into Áras an Uachtaráin but one of their own many lefties.

An Leas-Chathaoirleach: The Senator should focus on the amendment.

Senator Terry Leyden: I apologise for digressing. I am comparing the difficulties the previous Fianna Fáil Government had——

Senator Susan O’Keeffe: Will Senator Leyden please withdraw that statement?

Senator Terry Leyden: What statement?

Senator Susan O’Keeffe: The statement that we had to have one of our own in the Áras.

Senator Terry Leyden: Was he not a Labour candidate?

Senator Susan O’Keeffe: I beg your pardon, Senator Leyden. The people voted for President Higgins. I ask the Senator to withdraw that statement.

Senator Terry Leyden: I beg your pardon too.

An Leas-Chathaoirleach: We are not discussing the President.

Senator Terry Leyden: Michael D. Higgins went forward as a Labour candidate. What is wrong with that? I gave him a very high preference vote for God’s sake.

Senator Susan O’Keeffe: It is the inference made by the Senator that somehow we had to have one of our own and kept Mr. Seán Gallagher out of the Áras.

Senator Terry Leyden: I was referring to RTE. 129 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

An Leas-Chathaoirleach: We are not discussing RTE or the presidency.

Senator Terry Leyden: RTE had Pat Kenny on the “Front Line” programme making sure Seán Gallagher had a bad piece.

An Leas-Chathaoirleach: Senator Leyden is out of order and should stick to the amendment.

Senator Terry Leyden: I am only trying to raise this issue.

Senator David Norris: On a point of order, it is certainly a tradition, if not part of the order of this House, that the office of presidency is exempt from comment, particularly unfavourable comment. As someone who stood in that election, I must say we could not possibly have a greater or more gracious President than the current incumbent. I do not believe for one minute it was RTE that got him in.

Senator Terry Leyden: In the presence of veterans of the Vietnam War and Korean War and many other wars, I withdraw any inference about our President, Michael D. Higgins, of whom I am very fond. He lectured me 40 years ago and taught me much.

Senator Susan O’Keeffe: I am grateful for that.

An Leas-Chathaoirleach: We are not talking about the presidency. Is the amendment being pressed?

Senator Brian Ó Domhnaill: If the Minister is willing to accept these amendments to the exemptions from the charge, we will withdraw them and resubmit them on Report Stage. In the event we do not get a favourable outcome, we will have to press the amendment.

Deputy Fergus O’Dowd: Ba mhaith liom, i dtosach, mo bhuíochas a ghabháil le gach duine a mhol an leasú seo agus a nocht a dtuairimí air. Nuair a thagaim go dtí an tSeanad bíonn díospóireacht an-mhaith ann i gcónaí.Tá sé tábhachtach go bhfuil an díospóireacht seo ar siúl mar Bille bunúsach is ea an ceann seo. These proposed amendments to section 2 would have the effect of excluding purchasers of houses under the affordable housing scheme and those who have purchased a residential property on which they paid stamp duty between 2004 and 2011 from the ambit of the household charge. This would in effect encompass a large number of homeowners. It is not considered appropriate in this context given the wide applicability of the charge to the majority of residential property in the State and the relatively modest nature of the household charge of €100 in 2012. In any event, those who have purchased affordable units, either under the 1999 affordable housing scheme or units provided under Part V of the Planning and Development Act 2000 as amended, have received a discount on the market value of the dwelling when purchased. As such, it is difficult in the extreme to suggest such dwellings should benefit from an exemption from the household charge when owners of other residential property, some who may even be residing in the same estate are required to pay this charge. For houses purchased under the shared ownership scheme, the housing authority concerned retains an ownership stake in the house until the shared ownership purchaser purchases the dwelling outright from the authority. In the meantime, the purchase is effectively renting that portion of the dwelling that he or she does not own. As such, houses under the shared ownership scheme which remain partly owned by the housing authority are excluded from the household charge under section 2(b) as they remain vested in the housing authority until such time as the housing authority’s ownership stake ceases. 130 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

This Bill provides for several exemptions to the household charge including properties part of the trading stock of a business and have not been sold, occupied or the source of any income since their construction; properties vested in local authorities or voluntary and co-operative housing bodies for social housing, as making such properties liable would lead to a circular flow of income and be unnecessarily bureaucratic; properties owned by a Department or the Health Service Executive and used or let in the performance of their functions as, again, making such properties liable would lead to unnecessary circular administrative structures; properties to which commercial rates apply, as with the non-principal private residence. It is intended this charge would operate as an alternative to commercial rates. Accordingly, a property will be liable for either commercial rates or the household charge if it is a domestic property, but not both. Exemption also applies to where a person is forced to vacate a property because of long- term mental or physical infirmity. This exemption was included in the Local Government (Charges) Act 2009 as a compassionate measure intended to provide for elderly people who have no choice but to move out of their sole or main residence into a residential nursing home and in cases where a charity owns a property. In addition to these exemptions, two important waivers will apply to the charge. The programme for Government commits to giving consideration to the impact that such a property tax would have on the number of households in mortgage distress. The Government, therefore, proposes to exclude from the household charge households in receipt of mortgage interest supplement from the Department of Social Protection. Mortgage interest supplement provides short-term support to help eligible households pay mortgage interest payments and has, as a condition of eligibility, that the household could afford the mortgage repayments when the mortgage commenced. In excess of 18,000 households will benefit from this waiver. The Government also intends providing a waiver for households in certain categories of unfinished housing estates. The Minister for the Environment, Community and Local Govern- ment will set out the list of the estates to which the waiver will apply in regulations. This waiver will benefit residents of such estates as they work with other stakeholders in developing resolutions for these problematic developments. It is not proposed to provide for additional waivers or exemptions. Regarding Senator Ó Clochartaigh’s amendment to section 4, the Bill sets out the definition of residential property for the purposes of the household charge. Once enacted the definition cannot be amended without the obligation of amending legislation being passed. In these circumstances, it is considered the insertion of this proposed provision is not necessary. Accordingly, I cannot accept these amendments.

Senator Brian Ó Domhnaill: We welcome the exemption of shared ownership properties. We will, however, be resubmitting the amendments on Report Stage.

Senator David Norris: I hope there will be some degree of flexibility. There is just a little of casuistry in what the Minister said about the affordable housing scheme not qualifying for an exemption. While it may well be true that this scheme was intended to assist people, it has not and has actually placed many in difficulties. Those in the scheme are in possession of properties which are not worth anything like what they were when they were supposed to be affordable. The idea they have secured any permanent advantage is completely wrong. I am aware of several people in the city of Dublin who were in professions badly hit such as nursing which while social beneficial had small incomes. These incomes have already been raided by various taxes, impositions and levies. As I said on Second Stage, €100 may seem 131 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator David Norris.] small to people with black bank accounts. To those with red bank accounts, it is a very large sum of money. There is no doubt either that once this type of regime is installed, it is virtually impossible to reverse it and there is an inevitable tendency to increase such charges. No one believes this charge will stay at €100. We have another four budgets to go under the austerity scheme. Every time the Seanad returns to address this subject, the charge will have gone up. That is why we should consider, as carefully and as sensitively as possible, how we might protect the most vulnerable people. Among the latter, I include anybody who, by definition, was deemed to be an appropriate person to purchase affordable housing. The very ethos behind the scheme is that those who availed of it could not afford to buy homes without assistance. As a result of the collapse of the property market, that assistance has proven to be an encumbrance rather than an assistance. Those to whom I refer now own properties in respect of which they could get into debt if they decided to sell. I ask that consideration be given to this aspect of the matter.

Senator Trevor Ó Clochartaigh: One of the phrases used by the Minister of State in his explanation is “relatively modest”. That phrase was also used yesterday and it has been employed on a number of occasions in respect of the different fees that are being introduced. What is the meaning of the phrase “relatively modest”? To what is it relative? As Senator Norris outlined, there are many families which are on very low incomes and for which €100 is not a relatively modest sum. In fact, it is quite a large sum for many. There is a concern — with which we will deal in respect of a later amendment — that the household charge could be increased. In the context of waivers, there is a section in the Bill which stipulates that if a person dies, then the penalties will ostensibly be passed on to whomever inherits his or her estate. Will such individuals qualify for a waiver? If a parent dies, his or her house is passed on to his or her son or daughter. If said son or daughter is a member of one of the categories to which waivers will apply, will he or she automatically qualify for a waiver in respect of his or her deceased parent’s house? This relates to a person’s ability to pay. If my father, God forbid, were to pass away, his house would be passed on to me. If I were in one of the waiver categories, my income would not increase as a result of my inheriting the property because I could not sell it on. This matter may require examination because a person’s ability to pay does not improve as a result of his or her inheriting a house. In many cases, those who inherit are hit with other duties and taxes which they are obliged to pay for making a capital gain. Has consideration been given to this matter? If not, perhaps it could be examined prior to Report Stage. Would be it necessary, for example, to amend the legislation in respect of the category of people to which I refer? It is not clear, from subsequent sections, that said category is covered. I would welcome the Minister of State’s observations on this matter.

Senator Cáit Keane: If one got a house for nothing, one would subsequently be worth a great deal more.

Senator Trevor Ó Clochartaigh: Not if one could not sell it.

Senator Fidelma Healy Eames: The Senator would not——

Senator Trevor Ó Clochartaigh: If one inherits a house after one’s parent passes away, one might not be able to sell it.

Senator Cáit Keane: There is a price on everything. I accept that the value of property has decreased by 50%. 132 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

An Leas-Chathaoirleach: Is the Senator speaking to the amendment or the section. Has the amendment been withdrawn?

Amendment, by leave, withdrawn.

Question proposed: “That section 2 stand part of the Bill.”

Senator Cáit Keane: I thank the Minister of State for confirming that those involved in shared ownership will be exempt. That is even better than the 50-50 arrangement to which I referred. It will be 100%. People should be made aware of the exemption categories because the Bill does not contain information in this regard. If a property is the subject of a 50-50 ownership arrangement, it will not be 100% vested in the Minister. The position is not clear. I am of the view that reference should be made in the Bill to buildings that are either vested or part vested in the Minister. Reference should also be made to shared ownership arrangements. Information on the exemption categories should certainly be circulated to people.

Senator Thomas Byrne: I have a fundamental difficulty with trading companies — even if the properties they own are empty — not being required to pay this charge. Either it is a property tax or it is not. If such companies own properties, why are they not required to pay the charge? I accept that there are exemptions in respect of certain unfinished estates. It would certainly be galling to live in such an estate. The estate in which I live comprises 20 houses and is unfinished. However, it does not appear to be unfinished. I do not understand why the owners of empty properties should not be obliged to pay the property charge. Why should householders who are obliged to pay bills left, right and centre also be obliged to pay this charge when trading companies which own residential companies are not subject to it? I accept that such companies might not be obtaining an income from their properties. This is a form of break for those who own trading companies and we should not be giving it to them if it is not also to be made available to those in other categories. What is being done here is wrong. I ask the Minister of State to reconsider the position. I accept that some of these companies will not be able to pay. If they cannot do so, there is provision in the legislation for them to be pursued. We should at least impose a charge on properties such as those to which I refer in order that if one is every sold, the State would benefit. I do not understand the rationale in respect of what is proposed in this section. I urge the Department to re-examine what is involved. If the NPPR does not apply to those to whom I refer, then it should also be reconsidered. I am not sure what is the position in this regard.

Deputy Fergus O’Dowd: I thank Senators for their contributions in respect of the various issues raised. Senator Keane referred to clarity regarding the information relating to the charge. Such clarity will be provided in respect of those involved in shared ownership arrangements. Senator Byrne referred to houses owned by trading companies or whatever which have never been occupied and in respect of which such companies have not obtained an income. There are many such properties and thousands of them are owned by NAMA. If the charge were imposed in respect of them, NAMA would owe the State a fortune. Maidir leis na pointí a luaigh an Seanadóir Ó Clochartaigh, níl ach dhá shlí gur féidir le haon duine an díolúineafháil. Ar an gcéad dul síos, caithfidh an teach a bheith suite in eastát faoi leith. We are dealing here with estates which are in an unfinished state and these come under categories 3 and 4. If a person inherited a house located in unfinished estate, he or she would automatically qualify for the waiver. If an inheritor has already obtained a mortgage subsidy from the HSE in respect of his or her primary residence, he or she is only entitled to one such 133 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Deputy Fergus O’Dowd.] subsidy. Therefore, the subsidy would not apply in respect of a second home. I am not exactly sure of the position in this regard but the officials will clarify it for me. The only other category which might be affected comprises people who do not have mortgages and who inherit properties from deceased relatives or whatever. Such individuals would have a responsibility for the mortgages on inherited properties and if they had an inability to pay and if the HSE decided that they would be covered, then they would not be obliged to pay the charge. I hope what I have said has provided some clarity.

Senator Thomas Byrne: An alternative to applying the full charge to the houses to which I refer would be to apply a charge to the property. In such circumstances, the €100 would build up each year until a house was sold and then the solicitor involved would be obliged to hand over the total amount at the end of the sale process. There is no good reason trading companies are being excluded. We are introducing an across-the-board property tax but we are excluding certain types of property. This matter should be reconsidered because the question of fairness arises. People, both rich and poor, are being hit and I do not understand why traders in residential properties — which is what builders and developers are — should be exempt from the charge. After all, they are not exempt from many other charges. If these traders state that they cannot afford to pay, then the charge should become one in respect of their properties. The latter is, of course, the position when it comes to other citizens. If the houses to which I refer were sold at some point in the future, the State would realise a return. The Minister of State referred to NAMA. However, there is an exemption in respect of properties to which a statutory receiver has been appointed under NAMA. That is correct because if it were not the case, the money would just be coming into the State system and going straight back out again. However, the position with regard to the houses in question is different and I am of the view that the State should apply the charge to everyone across the board and not just to those who live in their own homes or whatever. It appears that ordinary people are continually being hit.

Senator David Norris: I agree with my colleague. One must be sympathetic to companies which are in serious difficulties or whose affairs are being administered by NAMA. However, the principle the Minister of State enunciated is that they are deriving no financial profit.

Deputy Fergus O’Dowd: I said they never obtained an income from the properties in question, which were never occupied.

Senator David Norris: If one puts aside the question it was never occupied, I am not sure that in the current circumstances it could be argued that persons in affordable housing derived a profit. They did not. In fact, they received a financial disadvantage because they were seduced by advertising and by a campaign. I was well aware of it because I had a number of friends, and, in fact, I think a distant member of my family, who got affordable housing.

Senator Thomas Byrne: Will Senator Norris be looking for one? I hope not on George’s Street.

Senator David Norris: I was well aware of the fact that there was a sustained advertising campaign which stated it was to their advantage. The argument the Minister of State has advanced, that one should exempt companies because they derive no financial advantage from it, should also extend to those who got affordable housing. Whereas it was originally envisaged that they would receive a financial advantage, in much the same way no doubt as property developers envisaged that they would make a profit out of it, they both were wrong. What is 134 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage sauce for the goose is sauce for the gander. The affordable housing scheme must be looked at again. The Minister of State stated it is a financial argument. He was fishing around as hard as he possibly could — he is a decent man — to look for financially sustainable arguments. At the end of the day, the crucial political element was that this was a significantly large proportion of the population who would be exempted and, for that reason, it would so substantially reduce the income from this that it would create some kind of budgetary difficulty. That is a different argument, one that should be suspended in light of the difficulty that could plainly occur for those within affordable housing who have suffered already through taking up affordable housing in addition to having their income substantially reduced. I am glad my colleagues on this side of the House have decided to withdraw their amendment in this area and that it could be argued again on Report Stage tomorrow.

Senator Trevor Ó Clochartaigh: I do not want to labour the point. I am merely thinking of scenarios, in particular, in rural areas, where there are houses from pre-mortgage times where persons would have built their homes bit by bit and would not have taken on large mortgages, or would have possibly paid off their mortgages and where there might be older parents living in those houses. There could be many in those rural areas who are in difficult financial circumstances. If a parent is deceased or passes away and the house reverts to someone through succession, it might be worth looking at a waiver if the person is in a situation where he or she cannot afford to pay an extra tax and the person does not have any extra income. It certainly is worth looking at. It should not be connected to having a mortgage on the house or an inability to repay a mortgage because there could be a scenario where there was never a mortgage on the house because it was built bit by bit in the 1960s and 1970s, or it might be an older house. It is an area to consider. I have referred to rural areas but it need not necessarily refer to rural areas. I could refer to urban areas. Specifically, I am merely thinking of examples in my area where I could imagine that happening. There are households that really cannot afford to take on an extra charge like this, which is €100 a year to begin with. We do not know where it is going from there. Possibly, they would have one on their own house and then be lumbered with one on a second house, which they will not be able to sell and which might not be in great repair. They might be too strapped. It is certainly worth looking at a waiver in that situation.

Senator Brian Ó Domhnaill: On the general context of the Bill, the €100, to which Senator Leyden referred correctly, would appear to be unfair. I accept it relates more to section 3, which we will come to in a moment. It is inequitable for a person in a bed-sit in west Donegal to be charged €100 the same as those in mansions in any part of country valued at far in excess of €1 million. That was acknowledged, even by the Fine Gael and Labour parties, before the election. There is a different scenario now and we will go through that at the next stage. Regarding properties that are under the control of NAMA which may be in liquidation or in bankruptcy proceedings and where the developers may be in financial difficulty, etc., these developers and the banks that gave the money are the cause of where we are at in this country. Whether they are in receivership, bankrupt or whatever else, we cannot justify socially on the basis of equity making those properties exempt but charging those on social welfare payments, medical cards, etc. It is incomprehensible to consider going down that road, . I appreciate where the Government is coming from on the exemptions listed in section 2(3)(a) and (b). I appreciate the State saying that it will not get the money anyway or it is charging itself in the long run, but it sends out the wrong message. Even if those companies that own the properties are in examinership, receivership, liquidation or are bankrupt, the 135 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Brian Ó Domhnaill.] charge should follow the individuals who are culpable and responsible as part of the other proceedings that are being taken against them. I would have no sympathy for many of those, some of whom made irresponsible decisions, because banks were giving extra money and bank- rolling properties that would never be viable financially. These same banks had the economic forecasts to know, prior to giving the money, that it was never going to work in the first place. Those who gave the loans for those properties, and the individuals who took out the loans on those properties and who find themselves in difficulty, need to be held accountable. If that means the State charging individual bank managers under this legislation, then I would have no difficulty supporting the Government if it came forward with amendments in that regard. We are going down the wrong road if we are saying that if one is under NAMA and one sticks one’s property and stuff into bankruptcy or into liquidation, which is convenient for many out there at present, then there is no charge. Socially and morally, it sends out the wrong message. Even from a political point of view, it is something the Government should consider.

An Leas-Chathaoirleach: Does the Minister of State want to respond? Has he any more to add?

Deputy Fergus O’Dowd: The arguments made are certainly worth considering, but we are sticking by our attitude to the points made. We are not accepting the amendments, but I would make one point. A company does not go into liquidation to avoid a debt of €100. In fairness, that is not the reason.

Senator Brian Ó Domhnaill: I know that.

Senator Thomas Byrne: It is the message.

Deputy Fergus O’Dowd: I am not disputing some of the points made, but that is the reality. This is an interim measure. Senator Ó Domhnaill spoke of fairness in the case of the million- aires’ property worth whatever in Dublin and the person in the bed-sit in Donegal. We will be bringing in a full property tax. This is an interim measure which will be in place probably for two years. We will be addressing all of the other issues. We expect to raise €160 million from this charge. That is why it is happening in this way. We do not have a full property tax assessment system in place at this time. It is part of the IMF deal that we have a charge now and that is why we are doing this.

Senator Thomas Byrne: No doubt the IMF calls for a charge., and we support it in principle as well, but the IMF does not force the individual details. The Minister of State stated that we made reasonable points. Perhaps some Members on his side will agree with some of the points we made. I urge the Minister of State and the Government to consider those points between now and whenever the Bill goes to the Dáil, or even on Report Stage here.

Question put and agreed to.

SECTION 3

An Leas-Chathaoirleach: Amendments Nos. 3, 4, 6 and 8 are related. Amendment No. 7 is also related and an alternative to amendment No. 6. Amendments Nos. 3, 4, 6, 7 and 8 may be discussed together by agreement. Is that agreed? Agreed.

Senator Brian Ó Domhnaill: I move amendment No. 3: 136 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

In page 6, subsection (2), line 28, to delete paragraph (a) and substitute the following:

“(a) €100, and shall not exceed €100 without an amendment to this Act,”.

This relates to the €100 charge that is being imposed by the Minister and the subsequent powers under regulation to amend the charge, but let us look at the fee of €100 before we discuss the amendment specifically. Before the last general election, the Fine Gael Party stated: “The initial flat rate charge means that owners of houses in standard neighbourhoods will pay as much as the owners of mansions.” It went on to state: “It will be difficult to pay for asset- rich but income poor households, particularly the elderly and the unemployed.” That was said by the Fine Gael Party before the election. Our amendments give the Minister of State the opportunity to support those points. We are trying to facilitate the Government. The Fine Gael Party also stated that “it will be deeply unfair for a young generation that paid exorbitant amounts of stamp duty and VAT on the purchases on over-valued houses, many of whom now find themselves in negative equity” to pay those charges. Prior to the general election Fine Gael agreed with our amendments, therefore, I appeal to the Minister to examine his conscience and our amendments and step up to the mark and let us all work together. We would have no difficulty in working with the Minister from his standpoint of last January and February. At that time, the Fine Gael Party proposed, instead of the introduction of the €100 charge on households, that additional revenues be taken from inherited wealth through the following measures, as addressed yesterday in the budget: a cut in the capital acquisitions tax threshold by at least 20%, now reduced to €250,000, and an increase in the rate from 25% to 30%. That is the first step of the pre-election promise. There would be an increase in the holiday home or second home tax to €300, bringing in the additional €100. I appreciate the current economic difficulties which the country is facing. Before the general election it appeared that those who were unemployed and in negative equity, having paid stamp duty, should be exempted from the household charge but it appears the position is now different. On the other hand, the Labour Party, prior to the general election, was opposed to the introduction of a household charge on the basis that it was unfair and inequitable. In January 2011, the Minister for Social Protection, Deputy Joan Burton, stated that a flat charge, where two, three and four bedroom properties from all around the country, pay the same charge is the unfairest possible way of all to introduce a property tax. A number of months on, power appears to bring changes and we are in a position where a €100 charge is being introduced in respect of all properties. We have no difficulty in supporting the principle of widening the tax base but we cannot support the principle of penalising those who cannot afford to pay. Our later amendments will refer to that issue. In regard to the amendment, section 3(2) and (3) states:

(2) The sum specified in accordance with this section shall be -

(a) €100, or

(b) where a sum stands prescribed for the time being under subsection (3), that sum.

(3) The Minister may from time to time review the sum specified in accordance with this section and, having regard to any change in the consumer price index -

(a) since the commencement of this section, or

137 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Brian Ó Domhnaill.]

(b) where a sum stands prescribed for the time being under this subsection, since the date on which that sum was prescribed,

What that means is that the Minister, from time to time, having regard to the consumer price index, could increase the fee, depending on inflation and other forces from outside the State. We are not willing to support that section because it provides for a regulation to introduce a household charge at €100. I appreciate what the Minister said in respect of a €100 charge in 2012 and 2013. However, a property based tax may be fairer on the less well off and those who may not own a high profile property. If we approve the legislation in its current format, we are giving the Minister for the Environment, Community and Local Government the power to increase the €100 household charge at any time to a figure of his own reckoning. That is unacceptable. We find it hard enough to accept the €100 fee for those who can afford to pay but we cannot support a position where the Minister has been given the power under regulation to make those changes. A couple of amendments which are related are being taken together, one is in the name of Senator Trevor Ó Clochartaigh which we support. They all relate to the consumer price index. Section 3(6) reads:

In this section “change in the consumer price index” means the difference between -

(a ) the All Items Consumer Price Index number last published by the Central Statistics Office before -

(i) the commencement of this section, ...

We are giving too much power to the Minister, including the power under regulation to increase the fee. We cannot support that. The public need to know that if there is €100 household charge in 2012 and 2013, painful as it is for those who should pay it, the people we have identified should not pay it. The people who would pay it need to plan their finances in the next two years. We cannot have a situation where people are living in fear that the Minister for the Environment, Community and Local Government could change the fee to €150, €200 or €220 by way of regulation without coming before the Oireachtas. We cannot support that.

Senator Cáit Keane: I cannot support the amendment. Standing Orders should be amended if a Bill proposes to take out X amount of funds. The onus would be on one to identify where one would get the funds to replace it.

Acting Chairman (Senator Pat O’Neill): Will the Senator please deal with the amendment?

Senator Cáit Keane: I am dealing with the amendment. We all know that this is not the ideal way to introduce a property tax and nobody has said it is. While the initial charge of €100 per property is not value based, the Minister and the Government are firmly committed to introducing a valuation based property tax to replace the household charge. That is what we said then, that is what we are doing now and that is what we are admitting to now. Nobody said it was ideal. Senator Ó Domhnaill and Senator Norris said it is not fair for the people in Blackrock who have mansions to pay the same. That is the reason the Minister has indicated that work is to commence early in the new year on the development of a fairer property tax. 138 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Senator Brian Ó Domhnaill: That is not what I said.

Senator Cáit Keane: That is exactly what was said.

Senator Trevor Ó Clochartaigh: Is dócha go dtéann an leasú go dtí croí na ceiste inár dtuairim. Mar a dúirt mé cheana féin, tá Sinn Féin i gcoinne flat tax den chineál seo, tá sí iomlán éagórach, níl an pobal ansin in ann aige; nílsé féaráilte mar a luaigh an Seandóir Ó Domhnaill romham. Bhí páirtí amháin sa fhreasúra a bhí i gcoinne cánacha den chineál seo roimh ré. Phioc mé suas ar an phointe a bhí ag an Seanadóir Keane ansin. Bhí neart roghanna eile, go deimhin chuir Sinn Féin ráiteas réamhbhuiséad amach a léirigh go leor roghanna eile le go bhféadfaí airgead a thabhairt isteach. Tá an Rialtas ag caint faoi €160 milliúnathógáil isteach mar thoradh ar an cháin seo. Dúirt an tAire féin gur cáin áitreabhach í go dtí go mbeidh an cháin mhaoine mar is ceart curtha ar fáil. Cénfáth nár ghlac an Rialtas cáin de chinéal éigin eile nach gcuirfeadh an t-ualach ar gach saoránach, iad siúd ar ioncam íseal san áireamh?

Senator Cáit Keane: Níl cinéal éigin eile ann. Cén cineál éigin eile?

Senator Trevor Ó Clochartaigh: Táim díreach chun insint leis an Seanadóir má fhanann sí soicind. Mhol Sinn Féin rud nárthóg an Rialtas san áireamh inné go gcuirfaí cáin mhaoine ar ráta 48% orthu siúdatá ag saothrú os cionn €100,000 agus mhol muid cáin mhaoine 1% orthu siúd a bhfuil sealúchas os cionn €1 milliún acu. Sin dhá rud go bhféadfadh an Rialtas seo a chur i bhfeidhm ach níor ghlac sé an rogha sin. Sin an difríocht idir na Seanadóirí ar an taobh sin Tí agus muidne. Is dócha go mbeadh éagsúlacht idir sinn agus an páirtí eile atá lenár dtaobh anseo ar an gceist sin ach bhí roghanna eile ann agus níor ghlac an Rialtas na roghanna sin. Tá sé ag tógáil rogha, agus seo an fhadhb bhunúsach atá againn leis an chuid seo den Acht, a chuireann an t-ualach anuas scun scan ar gach duine, orthu siúd nach bhfuil in ann a íoc agus orthu siúdatá breáábalta a íoc agus b’fhéidir níos mó ná sin a íoc. Níl sin ceart agus níl sin cóir. It is important to state that Sinn Féin is opposed to the flat rate tax, which is inequitable. This was stated previously by the Labour Party. Our amendment No. 6 is related. When we discussed the waste water Bill we saw that this Minister, apparently, likes to have carte blanche regarding fees. The Bill states the fee will be €100. If we do not accept these amendments, we are giving carte blanche to the Minister to change that fee in the future. If we take past experience on these issues, for example, in regard to the plastic bag levy, charges have increased over time, as could this charge. It is already too much for those who cannot afford it. There should have been a much more equitable way of approaching this issue. We do not agree to the flat rate tax. As a damage limitation measure, we are supporting the amendment put forward by Fianna Fáil that the fee should not go over €100. The Minister should not be given carte blanche to change this without coming back to the Houses of the Oireachtas, which is what we suggested in amendment No. 6. I am not sure what is meant by the term “relatively modest”. I would like the Government to explain to what is meant by “relative”. Is it relative to a pensioner in Connemara or a person on social welfare——

Senator Thomas Byrne: It is relative to the salary of the Minister of State, Deputy Brian Hayes?

Senator Trevor Ó Clochartaigh: Yes, or any of the salaries of former taoisigh.

Senator Thomas Byrne: He had his own P. Flynn moment.

Senator Denis Landy: Or relative to Gerry’s expenses. 139 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Senator Trevor Ó Clochartaigh: I notice Senator Landy did not mention Gerry’s wages because he is on the average industrial wage, as the Senator knows well.

A Senator: That should cover his holiday home here.

Senator Cáit Keane: He is not saving the Exchequer any money.

Acting Chairman (Senator Pat O’Neill): Senators should speak through the Chair, please.

Senator Trevor Ó Clochartaigh: As Senator Landy knows, Deputy Gerry Adams is on the average industrial wage.

Acting Chairman (Senator Pat O’Neill): That is not relevant to the amendments.

Senator Trevor Ó Clochartaigh: It is relevant. It is about the ability to pay. The comparison is being made——

Senator Cáit Keane: He is not saving the Exchequer any money. The Exchequer is paying out the money and funding his party.

Senator Trevor Ó Clochartaigh: The point being made here is about the people in this country——

Senator Denis Landy: The Senator believes it himself; that is the worrying thing.

Acting Chairman (Senator Pat O’Neill): Order, Senator Landy.

Senator David Cullinane: Senator Landy is getting very worried. His Dáil aspirations are gone.

Senator Trevor Ó Clochartaigh: The point is the ability of the people in this country to pay. There are people who are in a position to pay a tax like this but, as we have said, we have already seen families losing children’s allowance, paying extra for school buses and they will have to pay septic tank charges and so on. The Government might not have increased the standard rates of tax but it has certainly put its hands in their pockets in a lot of other ways, and it is taking left, right and centre out of those pockets. This is why we do not agree with this €100 charge and we certainly do not agree with giving the Minister blanket powers to increase it at any stage, when he wants to.

Senator Denis Landy: I need some clarity from the last speaker in regard to the request to not have everybody penalised at the same rate of €100 because it is inequitable, while, at the same time, the Senator does not want it increased at any stage. The whole basis of this process is that we will have to carry out a property valuation assessment on which the tax will then be based. The Senator cannot have it both ways. He can agree that people who can afford to pay more will pay. He cannot say he does not want it increased beyond €100 and, at the same time, say he is opposed to the whole charge. I need clarity in that regard.

Senator Trevor Ó Clochartaigh: I explained that.

Acting Chairman (Senator Pat O’Neill): Order, please. Senator Landy has the floor.

Senator Denis Landy: On another point, much has been made of the word “modest” in regard to the charge and the promise the Minister has made. I am a little puzzled in regard to amendment No. 5, which states “This section shall not apply to those who own a residential 140 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage property, and whose annual income is less than €75,000”. Is Senator Ó Clochartaigh suggesting €75,000 is a modest income? He has already said his own party leader is on half of that, namely, the average industrial wage. We might achieve something today but, at the moment, these amendments are being put forward in a totally contradictory way.

Senator Thomas Byrne: Roimh an olltoghcháin bhí Fine Gael agus Páirtí an Lucht Oibre díreach in aghaidh an mhuirir seo. Dúirt Fine Gael go raibh siad chun an cháin ar áit chónaithe phríobháideach neamhphríomha a árdú go €300 in aghaidh na bliana agus dúirt Páirtí an Lucht Oibre go raibh siad chun an cháin sin a árdú go €500, in ionad an costas seo a leagadh. Bhí siad in aghaidh an chostais seo. Ní féidir leo a rá anois nach bhfuil aon rogha acu agus nach féidir leo aon rud eile a dhéanamh mar go ndúirt an IMF leo é adhéanamh.

Senator Cáit Keane: Ta €300 i bhfad níos mó ná €100.

Senator Thomas Byrne: Cénfáth ar chuir na páirtithe na geallúintí sin ina bhforógraí?An raibh siad ag insint bréaga le muintir na hÉireann? Sin a cheapann na daoine. Why did the Government parties go before the Irish people prior to the election and say——

Acting Chairman (Senator Pat O’Neill): Senator Byrne should speak to the amendments.

Senator Thomas Byrne: I am speaking to the amendment and the section, which is about the charge of €100 that Fine Gael and Labour said they would not introduce. They not only said they would not do it, they said there was another way of doing it.

Senator Catherine Noone: We have to do it.

Senator Thomas Byrne: They do not. They said before the election they would not do it, and they showed a way to raise a similar amount of money, but they will not do that because they are bringing it in on everybody else. It is not true to say they have to do it. Ministers, including the Minister, Deputy Howlin, in this Chamber and the Minister, Deputy Noonan, in the Dáil, have said repeatedly that the IMF does not care what the Government does as long as the targets are reached. Senator Landy has an alternative but he intends to spread it around to everybody. He will be lashed by Deputy Seamus Healy and by Mattie down in south Tipperary because this is an unfair tax.

Senator Denis Landy: The Senator should not worry about that. He should worry about getting back his seat.

Senator Thomas Byrne: I am going to be lashed as well——

Acting Chairman (Senator Pat O’Neill): Senators should speak through the Chair.

(Interruptions).

Acting Chairman (Senator Pat O’Neill): Order, please.

Senator Thomas Byrne: Senator Noone can correct me if I am wrong. It is a long time since I studied constitutional law, so I will not claim to have any particular knowledge or expertise in the area, as I do not. However, I did not understand that a Minister could raise the amount of tax through delegated legislation or through statutory powers. If a Minister were able to do that or if that were the practice, all of the financial resolutions of the Dáil last night could be done by ministerial order. Why would we need the Oireachtas to raise motor tax, carbon tax or VAT if a Minister could get a statutory power like this provision to allow him to do it? 141 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Thomas Byrne.]

The provision does not state the Minister must increase it by the amount of the consumer price index, as it is defined here, although it states that the Minister must have regard to it, as I read the section. I do not mind if there is a statutory provision that states it must go up or go down in line with the consumer price index. Let us not forget in recent years there was a negative consumer price index, so does this mean it would go down? I believe the Minister is allowed to do that. The raising of taxation is a matter for the Oireachtas, the Dáil in particular. I do not know why we are giving that power to a Minister or why a Minister would want that power. It seems fundamentally undemocratic. I would like the Minister of State to explain why the Minister needed to go to the Dáil last night to raise carbon tax and all those other taxes but it is proposed in this section that he does not have to do that. It is too much power and it should not be allowed.

Senator David Cullinane: I have a number of points. I like to enlighten people from the Government parties when they have queries and questions. They sometimes make it very easy for us.

Senator Catherine Noone: There is humility.

Senator Fidelma Healy Eames: Honest to God.

Senator David Cullinane: The first point I would make on the amendments under discussion is that we cannot table a simple amendment which calls for the complete abolition of the €100 charge because it would be ruled out of order. That is why we have looked at mitigating the worst excesses of the charge and ways in which we can protect people on welfare, including old age pensioners, and those who earn under €75,000 a year. When we get to that amendment, Senator Landy will get a full, clear and frank explanation as to why that is the case.

Senator Denis Landy: It would need to be clear and frank. The Senator is living in a different world.

Senator David Cullinane: I appreciate it is very painful and difficult for Labour Party members at present as they are in very real trouble given they are trying to defend the indefensible and have broken so many promises in regard to their own manifestoes——

Senator Denis Landy: The Senator is a bit flaky himself regarding Deputy Gerry Adams.

Senator David Cullinane: ——that they were reduced to clutching at straws, and picking up on this misinformation in newspapers to throw at the Sinn Féin representatives. I know they are scraping the bottom of the barrel but——

Senator Denis Landy: The newspapers are all wrong in that case.

Senator David Cullinane: ——with respect, they should not make it that easy for us. On another point, the whole purpose of this charge is to raise revenue. Why are people being asked to pay this €100? The Government said there was to be no increase in income tax and that an increase in income tax would hurt people. Yet, many people are being asked to pay this €100 charge, which is €2 per week. It is a flat charge and they are not paying for any service or for extra services which will be provided to their homes. They are being taxed €100. It is a €100 tax, or €2 per week. 142 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Just before I came to the Chamber, I took a telephone call from an old age pensioner and homeowner who wanted to know if the charge would apply. The pensioner said that if it is the case, it represents a cut of €2 per week, yet the Government states it is not cutting social welfare.

Acting Chairman (Senator Pat O’Neill): The Senator is making a speech rather than dealing with the amendment.

Senator David Cullinane: I am dealing with the charge of €100.

Acting Chairman (Senator Pat O’Neill): The Senator is not dealing with the amendmentts, he is making a speech.

Senator David Cullinane: I am dealing with the €100 charge. The Government is saying anybody on mortgage interest relief is okay. In the budget, it increased the mortgage interest relief to 30% for certain people who are in very real difficulty with their mortgages. While the Government is affording them this welcome relief, it is also taking €100 per week from them. There is no logic to this. The point I am making to the Minister of State, which is in keeping with all the amendments to which I refer, begs the question as to why the charge is being imposed. What do people get for it? What is the return? If it is a tax, it should be called a tax. The Government should not be saying to the people in the State that it is not increasing taxation when it is very clear that it is.

Senator Marie Moloney: It is stated income tax is not being increased.

Senator David Cullinane: Is the €2 per week coming from the trees?

Senator Marie Moloney: The Senator just said that €100 per year is €2 per week.

Acting Chairman (Senator Pat O’Neill): The Senator should address the Chair.

Senator David Cullinane: Where does the money come from?

Senator Marie Moloney: The Senator stated we said we——

Acting Chairman (Senator Pat O’Neill): Senator Moloney will have her chance in a minute.

Senator Marie Moloney: We are not increasing income tax.

Senator David Cullinane: The problem is that nobody is buying what the Government is selling. People who are to pay the €100 are saying the weekly €2 must come from their income. When I hear the nonsense from Fine Gael and the Labour Party that people are not paying any more income tax, I contend I am paying more taxes. This is a tax.

Deputy Fergus O’Dowd: Tá díospóireacht mórarsiúl inniu agus caithfidh mé cuid des na ceisteanna a fhreagairt. An rud bunúsach atá Seanadóirí Shinn Féin ag rá ná go bhfuil siad i gcoinne gach rud agus nach bhfuil siad i bhfábhar rud ar bith. An fáth go bhfuil an táille seo á leagadh ná nach bhfuil go leor airgid ag teacht isteach ón ghnáth cháin chun an tír a choimeádslán. Bhí ar an Rialtas roimhe seo a lán airgead a fháil on IMF. Tá sé ráite, ag Sinn Féin ach go háirithe, nárchóir aon chuid den airgead sin a aisíoc agus go gcaithfear stop a chur leis sin láithreach. Seo an cheist do Sheanadóirí Shinn Féin. Más rud é nach n-aisíocfar an t-airgead sin beidh ar an tír seo €20 billiúnafháil láithreach chun an 143 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Deputy Fergus O’Dowd.] tír a choimeádslán. Dá dtarlódh sin, thitfeadh an córas oideachais, an córas sláinte agus an córas leasa shóisialaigh as a gcéile. Sin an fáth go bhfuil an rud seo ag teacht isteach. Níl aon dul as againn. Caithfear é adhéanamh. Níl anseo ach tús. Taobh istigh de dhá bhliain beidh táille a chur ar gach teach, bunaithe ar luach an tí agus rudaí eile. Ó thaobh an €100 de, ní bheidh sé ann ach ar feadh dhá bhliana. Más rud é go bhfuil árdú san phraghasinnéacs tomhaltóirí beidh an méid ag árdú. Sin toil an Aire. Caithfear an t-airgead a fháil agus, inár dtuairim, seo an slí is córa chun é adhéanamh. I thank everybody who contributed on this amendment. Subsection 2 of the Bill provides that a charge will be set at €100 for 2012. The amendment proposed by Fianna Fáil seeks to state specifically that the household charge shall not exceed €100 without an amendment to the Act and proposes to delete the provisions for amending the quantum of the household charge, having regard to changes in the all-items consumer price index, CPI. The provision to amend the charge, having regard to the CPI, is far from being a mechanism to allow for large or substantial increases of the charge. I assure the Senators that it does not provide a mechanism for the Minister for the Environment, Community and Local Government to increase disproportionately the quantum of the household charge in future years. Rather, it is a standard provision that is also contained in the Local Government (Charges) Act 2009, which provides for the charge on non-principal residences. The Bill before the House is largely based on the provision contained in the 2009 Act. The CPI provisions of the Bill simply provide that the Minister may have regard to inflation in any decision on the level of the household charge for future years. Any future change in the quantum of the charge will be limited to the change in the CPI since its level was last determined. Therefore, there is no question of increases of the kind to which the Senator referred. It would not be possible under these provisions to increase disproportionately the household charge in the future. Any proposal to increase the charge in excess of the CPI would require the Oireachtas to pass amending legislation. I thank Senator Ó Clochartaigh for his proposed amendment to delete subsection 3(3) of the Bill. I dealt with the matter in my response earlier. For the reasons set out, ní féidir linn glacadh leis an leasú seo.

Senator Trevor Ó Clochartaigh: Go raibh míle maith ag an Aire. Tá mé buíoch dó as a chuid freagraí.Dúirt sé ins an bhfreagra go raibh Sinn Féin i gcoinne gach rud. Tá a fhios ag an Aire nach bhfuil sé sin fíor, beag nó mór. Níl a fhios agam an bfhuil Route to Recovery, aighneacht Shinn Féin, léite ag an Aire.

Deputy Fergus O’Dowd: Tá sé léite agam.

Senator Trevor Ó Clochartaigh: Fair play don Aire. B’fhéidir go dtabharfadh sé cóipeanna dá chomhleacaithe.

Deputy Fergus O’Dowd: Ach ní thuigim é.

Senator Trevor Ó Clochartaigh: Níl muid i gcoinne gach rud——

Senator David Cullinane: It is in German also.

Senator Trevor Ó Clochartaigh: Níl muid i gcoinne gach rud. Táimid ar son rudaí go leor. Luaigh mé sin leis an Seanadóir Keane.

Senator David Norris: The Sinn Féin German was not convincing in the Dáil. 144 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Senator Trevor Ó Clochartaigh: Mein Deutsch ist nicht so gut. Ich verstehe ein Bisschen.An rud atáimid ar a son, agus is cosúil nach bhfuil an Rialtas ar a son, ná an cháin a leagadh ar na daoine a bhfuil maoin acu.

Acting Chairman (Senator Pat O’Neill): Could the Senator return to the amendment?

Senator Trevor Ó Clochartaigh: I am speaking on the amendment because it relates to the ability to pay. Tá roghanna eile ann, agus bhí roghanna eile ag an Rialtas. Nílsé ró-dheirean- nach fós. Tá Sinn Féin ar son cáin a chur ar dhaoine a bhfuil airgead acu. Níl muid i gcoinne sin. Táimid i bhfábhar cáin a chur ar dhaoine a bhfuil €1 milliún de mhaoin acu, cáin ioncaim ar ráta 48% a chur ar dhaoine ata ag saothrú os cionn €100,000 sa bhliain agus caidhp €100,000 a chur ar thuarastail Airí Rialtais agus stát seirbhísí sinsearacha. D’fhéadfaí an t-airgead seo a fháil ón dream a bhfuil sé acu. Ta an Rialtas ag caint ar €160,000 a phiocadh suas.

Acting Chairman (Senator Pat O’Neill): The Senator said all that in his previous contribution.

Senator Trevor Ó Clochartaigh: Phioc an t-Aire suas air agus tá mé ag iarraidh é a cheartú. Tá sé an-thábhachtach go mbéadh sé ceartaithe. Tá an Rialtas i gcoinne na rudaí sin. Tá an t- Aire ag rá go bhfuil Sinn Féin i gcoinne rudaí.Tá seisean i gcoinne breathnú ar na rudaí sin nó iad a chur i bhfeidhm. Sin an náire, go bhfuil an Rialtas sásta an cháin seo a chur anuas ar dhaoine bochta, ar dhaoine saibhre, ar phinsinéiri agus ar dhaoine atá ar ioncaim ísle. Tá sé sin náireach agus scannalach.

Senator Cáit Keane: Tá an Rialtas ag breathnú ar gach rud.

Senator Trevor Ó Clochartaigh: Bhí sé soiléir inné céardabhí sa bhuiséad.

Senator Brian Ó Domhnaill: I fully appreciate what the Minister said ins an freagra a thug sé,goháirithe i dtaca leis an dóigh a bhreathnódh an t-Aire Comhshaol, Pobal and Rialtas Áitiúil ar an táille €100 agus a intinn a dhéanamh suas maidir leis an táille a árdú,agdéanamh tagairt don phraghasinnéacs tomhaltóirí, CPI. We cannot accept the position of the Minister of State, unfortunately, and we will be pressing the amendment on the basis that subsection 3(3) states, “The Minister may from time to time review the sum specified [€100] in accordance with this section and, having regard to any change in the consumer price index”. While it refers to “having regard to changes 5o’clock in the consumer price index”, it does not mean the Minister must accept what is being said in this regard. We feel the charge should remain at €100 over the next 24 months and that, thereafter, the Government should make every effort to ensure a fairer system of taxation for those who can afford to pay after 2014.

Deputy Fergus O’Dowd: On that very point, I understand the wording is exactly the same as in the Local Government (Charges) Act 2009, and that is why we argue it must stand. Fianna Fáil, when in government, introduced that legislation.

Senator Cáit Keane: In 2009.

Deputy Fergus O’Dowd: Yes. That is why we say it must stand. It was brought in by Fianna Fáil in 2009.

Senator Brian Ó Domhnaill: That was on the holiday homes. 145 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Deputy Fergus O’Dowd: The words are the same.

Senator Brian Ó Domhnaill: It is a totally different matter.

Deputy Fergus O’Dowd: It is the same principle.

Senator Thomas Byrne: Tá an prionsabal anseo an-difriúil ar fad. An prionsabal atá i gceannas anseo ná an prionsabal an táille a leagan ar ghach teaghlach sa tír, gnáth daoine na tíre. Séard a a bhí sa chostas a chuir Fianna Fáil i bhfeidhm i sa bhliain 2009, ná costas ar daoine a bhí infheistíocht acu i dtithe saoire nó i dteach eile seachas teach an teallaigh. Nílsé cothrom ná ceart go mbeadh na forálacha céanna i bhfeidhm maidir le gnáth daoine. Tá an Rialtas ag iarraidh certainty a thabhairt do ghnáth daoine na tíre agus bheadh sé níos cirte gan an €100 a chur sa reachtaíocht. B’fhearr fanacht agus féachaint an dtiocfaidh an Rialtas isteach roimh ré agus an athróidh sé an figiúr. Nílsé ceart go mbeadh na forálacha céanna ann do gnáth daoine agus do daoine eile a bhfuil infheistíocht acu i dtithe.

Senator David Cullinane: Amendment No. 6 provides that the sum may be revised by the Oireachtas. This is an important amendment and I ask the Minister of State to consider it. We are arguing that the Houses of the Oireachtas should in the first instance decide whether to increase the charge. It should not be the prerogative of a Minister to increase the charge. I will not rehearse all the issues arising because I am aware that people will ask us why we are now arguing that the charge should stay at the same rate given that we opposed it. We oppose the measure but we accept the reality that the Government intends to introduce a charge of €100. However, the Members of this House should debate the merits or otherwise of future increases to the charge. That is a fundamental principle for my party in terms of democracy and the relevance of the Oireachtas. Whenever we seek to raise further revenue from people who are struggling, we should hold a proper debate about the social consequences of our actions. Irrespective of the position we take on this charge, everybody accepts it will create difficulties for some families. The Minister of State will argue that the decision has to be taken because of our economic situation. While I accept his bona fides, it should not be the prerogative of a Minister to increase charges set out in legislation whenever he or she sees fit to do so.

Senator Brian Ó Domhnaill: I acknowledge what was said regarding the 2009 Act and second or holiday homes. These properties were purchased for investment purposes and often they were rented out. One cannot compare the second home levy to the household charge because the latter will affect every family in this country. We cannot support legislation that empowers the Minister to increase the charge by way of regulation and we will be pressing our amendment for that reason.

Deputy Fergus O’Dowd: This Bill is no different to the 2009 Act. The wording is exactly the same even if the issues are different. It is a standard process and we do not see any basis for the Senators’ concerns.

Senator Thomas Byrne: It is not exactly the same with social welfare. The Minister for Social Protection cannot increase or decrease social welfare payments without reference to the Oireachtas. There is nothing to prevent this charge being changed by means of a Financial Resolution on budget day. I do not see why it cannot be subject to the democratic will of the people. I ask the Minister of State to reconsider the amendment.

Question put: “That the words proposed to be deleted stand.”

146 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

The Seanad divided: Tá, 30; Níl, 15.

Tá

Níl

Byrne, Thomas. Ó Murchú, Labhrás. Cullinane, David. O’Brien, Darragh. Daly, Mark. O’Sullivan, Ned. Leyden, Terry. Power, Averil. MacSharry, Marc. Reilly, Kathryn. Norris, David. Walsh, Jim. Ó Clochartaigh, Trevor. White, Mary M. Ó Domhnaill, Brian.

Tellers: Tá, Senators Paul Coghlan and Susan O’Keeffe; Níl, Senators Terry Leyden and Ned O’Sullivan..

Question declared carried.

Amendment declared lost.

An Leas-Chathaoirleach: Before we move on to amendment No. 5, I acknowledge the presence in the Visitors’ Gallery of a former Minister and Member of the House, Michael J. Noonan, from Limerick. Tá fáilte romhat. Amendments Nos. 5 and 29 are related and may be discussed together.

Senator Trevor Ó Clochartaigh: I move amendment No. 5:

In page 6, between lines 30 and 31, to insert the following subsections:

“(3) This section shall not be commenced until such point as the Social Inclusion Division of the Department of Social Protection have had carried out a poverty impact analysis study. Such a study will have regard to—

(a) the impact of the household charge on the household’s income,

(b) whether the charge would be likely to cause deprivation,

(c) whether the effect of the charge would be such as to cause people to be deprived of two or more goods or services considered essential for a basic standard of living from the following 11-item index developed by the ESRI—

(i) two pairs of strong shoes, 147 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Trevor Ó Clochartaigh.]

(ii) a warm waterproof overcoat,

(iii) buy new not second-hand clothes,

(iv) eat meals with meat, chicken, fish (or vegetarian equivalent) every second day,

(v) have a roast joint or its equivalent once a week,

(vi) has not needed to go without heating during the last year through lack of money,

(vii) keep the home adequately warm,

(viii) buy presents for family or friends at least once a year,

(ix) replace any worn out furniture,

(x) have family or friends for a drink or meal once a month, and

(xi) have had a morning, afternoon or evening out in the last fortnight, for entertainment,

(d) whether a charge on households which would have regard to the income of a person may be more appropriate.

(4) This section shall not apply to those who own a residential property, and whose annual income is less than €75,000.”.

Téann an leasú seo go croí an scéil arís, ó thaobh an chumas atá ar dhaoine chun táillí agus eile a íoc, in gcomhthéacs na cána breise seo a bhfuil an Rialtas ag iarraidh brú ar mhuintir na tíre. Táimid ag moladh nach leanfaí ar aghaidh leis an rannóg seo go dtí go bhfuil torthaí na hanailíse curtha i bhfeidhm. This goes to the heart of the story of the fee that is to be imposed on all the households of this country. This flat-rate tax is very inequitable because it does not take into consideration the financial situation of the people or families in question. Sinn Féin is suggesting in this amendment that section 3 shall not be commenced until such a time as the social inclusion division of the Department of Social Protection has carried out a poverty impact analysis study which takes account of the impact of the household charge on the income of the households concerned. Sin an slat tomhais atá ag an Institiúid Taighde Eacnamaíochta agus Sóisialta agus ag an Aontas Eorpach. Sin iad staitisticí na n-eagraíochtaí sin ar chaighdeán maireachtála. Sin a úsáideann siad maidir le bochtanas agus is mar sin a dheiseann siad bochtanas. Táimid ag rá nárchóir go mbéadh ar dhaoine bochta an táille breise seo a íoc. These are the ESRI and European Union statistics on income and living condition standards to measure consistent poverty. The amendment provides that anybody who is within the criteria outlined here is in consistent poverty and therefore should not have to pay an extra €100 tax. If this section relating to the charges is passed, it should not be commenced until the study has been carried out by the Department and the social inclusion division. The amendment provides that the charges should not be imposed on households unless there is regard to the income of the person. Again, we are taking account of the income of those families. It also provides that the section shall not apply to those who own a residential property and whose annual income is less than €75,000. Senator Landy found this laughable earlier, which is very serious. We are saying that anybody who has an income of €75,000 or less and has a family and so forth is not 148 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage very wealthy by any means, and anybody who has an income above that is in a better position to pay an extra charge. Our argument is, first, that we do not agree with a flat rate tax. We would have opposed it but we would have been ruled out of order, as the Minister is aware. We suggest therefore that if the Government proceeds with this, it must be on the higher income earners whom we consider to be those on incomes above the €75,000 threshold. That is the reason we put forward this amendment. It is extremely important. These are the standard measuring tools used by the ESRI and the European Union to assess whether a family or person is living in consistent poverty. There are many people in Ireland suffering from consistent poverty at present and they should not be obliged to pay this extra €100 tax.

Senator Paul Bradford: Due to the time restriction I did not have an opportunity to speak on Second Stage, so I apologise for arriving rather late to the debate. This amendment is part of the broader debate on where we are proceeding with taxation from the point of view of fairness and equality. The Senator who moved the amendment will have to recognise the fact that every consideration of the Irish tax and economic situation points towards the broadening of the tax base and that some type of property tax or household charge must be part of that equation. One could say the amendment is worthy. I often wonder about the role and the worth of the ESRI and its definition of the poverty index. It is quite interesting. I never thought we would be debating two pairs of strong shoes, a warm waterproof coat and eating meals of meat and so forth. If we were to apply that to every charge, levy and tax in a very strict fashion, about 95% of taxpayers in the country should not be paying tax. I am unaware of what Senator Landy said about the demand that persons with an annual income of less than €75,000 should be exempt from this tax. I have occasionally tuned into the debates initiated by Sinn Féin on taxation and have heard the party’s catch-all phrase about taxing the greedy, not the needy so I am relieved that under the new Sinn Féin agenda an annual income of €75,000 is deemed to be low. However, we must be realistic. We live in a financially bankrupt country. We are borrowing hundreds of millions of euro every week to keep our economy ticking over and, sadly, the money must come from somewhere. There is no perfect or fair taxation system because there will always be people who suffer excessively. I do not see how we can accept this amendment. The €100 charge is not excessive. Of all the taxes and charges introduced over the past number of years the one that succeeded in bringing in more money than expected, was easy to collect and over which there was little public outcry was the tax on second houses. Many of my constituents reported to me that while they could have challenged the tax and argued that the second house was not eligible to be taxed, the fact that the amount was small and it was possible to pay it on-line meant that they did pay it. Taxation must be easy to pay and to administer. The more exemptions that are put in place, the more difficult it will be to collect. I am not sneering at the amendment or what the ESRI deems to be the basis for deciding whether a person is poor or rich.

Senator David Cullinane: It is not just the ESRI. I hope the Senator is not sneering at people in poverty.

Senator Paul Bradford: No. In fact, this week’s budget was all about trying to assist——

Senator David Cullinane: It was about putting more people into poverty. The Senator is right. 149 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Senator Paul Bradford: ——people, look after the most needy in the difficult circumstances in which we find ourselves and not reducing core social welfare payments.

Senator David Cullinane: Which the Government did.

Senator Paul Bradford: It was about not increasing taxes and, above all, trying to ensure that the majority of people on social welfare and those on the lower end of the income spectrum can aspire to a job and a future in this country. There are political parties and politicians whose existence would finish if the poverty industry disappeared and if we could lift people out of poverty. That is what the Government is attempting to do. It is trying to bring a degree of certainty to the economic management of the country——

Senator David Cullinane: Is the Senator saying that if somebody aspires to end poverty, they have a vested interest and should not aspire to it because they might lose politically?

Senator Paul Bradford: I will try——

Senator David Cullinane: That is an extraordinary statement.

Senator Paul Bradford: I will try to respond, through the Chair, to the misguided interpretation of my earlier comments by the Senator. Our aspiration in this country should be to move people out of the poverty zone——

Senator David Cullinane: Absolutely.

Senator Paul Bradford: ——back to work. However, we must also recognise that resources are exceptionally limited and we must raise money to pay social welfare and provide medical and educational services, particularly for those most in need. I wish there was a magic wand. The Senator’s party colleagues in Northern Ireland spent many years on the margins and I welcome the fact that they have come in from those margins. However, like me, the Senator is as aware of the difficult measures they are introducing, with relish——

Senator David Cullinane: Is the Senator speaking to the amendment? I was ruled out of order for raising the North earlier.

Senator Paul Bradford: They are introducing taxes, charges and property taxes and levies, as well as closing hospitals and schools. That is part of the Sinn Féin agenda——

Senator David Cullinane: Will I have a chance to respond? I was ruled out of order for setting the record straight.

Senator Paul Bradford: It is part of the Sinn Féin agenda in Northern Ireland.

Senator David Cullinane: We wish to respond but we were ruled out of order. Impartiality should be shown by the Acting Chairman.

Senator Paul Bradford: I will have to seek the protection of the Chair from the Sinn Féin onslaught.

Acting Chairman (Senator Aideen Hayden): The Senator should speak to the amendment.

Senator Paul Bradford: The amendment is a piece of political gamesmanship, and Opposition parties will always do that. When the debate was about water and service charges no party was 150 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage stronger in its opposition to such charges than the Senator’s, yet his party colleagues are introducing all of these charges. It is important that we can expand the tax base. If we are to try to keep income taxes low and taxes and levies on work low, we must broaden the tax base. This modest charge is helpful in that regard. I look forward to hearing the Minister’s view on this poverty index. If we were strict in applying it to every tax and levy and to every application for social assistance, medical card and so forth, 95% of the people would be covered by it. In the real world it is not possible to accept the Sinn Féin amendment, but perhaps the Minister will comment on this index and whether he considers €75,000 a fair figure. In my view a person with an income of €75,000 is reasonably well off, to put it mildly.

Senator Trevor Ó Clochartaigh: Would the Senator agree with €50,000? We can amend it to €50,000 if the Senator agrees.

Senator Paul Bradford: I look forward to the Minister’s response in the first place. We must be realistic. The country is in the current position because politicians played politics and were not realistic for the past ten years. If we are to have any hope of turning the country around, getting rid of poverty, getting people back to work and growing the economy again, we must have real politics. Real politics is generally difficult politics. It is not about easy choices and slogans.

Senator David Cullinane: This is a very good Second Stage speech.

Senator Paul Bradford: The legislation is realistic. Never in my years here have I seen perfect legislation brought forward. There are always difficulties and, unfortunately, there are always people on the margins who fall outside the scope of a scheme or idea but it is a reasonable attempt at expanding our tax base in a reasonably fair fashion and at a modest level. That is the reason this amendment is not acceptable or realistic, and I do not think its proposers believe it is realistic or fair.

Senator David Cullinane: We will get a chance to respond.

Senator Paul Bradford: If they are, as proof of their sincerity they should try to get their Northern colleagues who are in Government to introduce similar legislation.

Senator David Norris: First, I support this amendment in principle. It is a very good one. Second, I always listen with great interest to what Senator Bradford says because he says it in such a calm, measured and reasonable way but that does not always mean the ideas he enunci- ates are as calm and reasonable as the tone. The first point I would make is that I do not believe this country is bankrupt. It would be much better if it were because if it were bankrupt under certain conditions that would mean we would have debt forgiveness, and we do not. We are still struggling with a degree of international poverty. A number of our banks are obviously useless but that would not necessarily qualify the country for a definition of bankruptcy. The second point is that it is a rather astonishing assertion that if this table of criteria were applied, 95% of the people of this island would be found to be covered by it. We are talking about fairly basic needs such as warmth, food and shelter and however misgoverned this country has been over the past 90 years, not just ten, I do not believe there has been a period in 151 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator David Norris.] my life time where 95% of people would be excluded from the tax net because they did not meet these criteria. That is political hyperbole.

Senator Paul Bradford: A €75,000 income limit.

Senator David Norris: That would be a different matter but the Senator was talking about the criteria. When I said it is not just in the past ten years, I was greatly struck by the fact that we are now in the anniversary of the treaty, which is a significant historical event but if one examines the bills that came in from Harrods and Fortnum & Mason one can see that the delegates did not go to the cheapest shops. I do not think we would find too many of them without two pairs of strong shoes, warm overcoats or an extraordinary supply of high quality mints and alcoholic beverages of any kind. I read some of the bills that came in from the top shops in London to that delegation with considerable interest. They did not stint themselves, and they certainly would not have been covered by this list. The list is interesting and is worthy of a certain amount of scrutiny because it is a bit motley. One of the criteria is two pairs of strong shoes. Can anybody honestly say that it is not appropriate that people should have two pairs of strong shoes? It would be shocking if people could object to that. Another is a warm waterproof overcoat. With the kind of climate we have that is essential. I have some reservation about buying new and not second-hand clothes. I do not see anything wrong with second-hand clothes. Many people are very glad that there are shops where one can get second-hand clothes.

Senator David Cullinane: People cannot afford to buy a new overcoat. There is nothing wrong with buying second-hand.

Senator David Norris: Okay. I recently got a Giorgio Armani overcoat from a charity shop which we valued at about €2,000. It was Multiple Sclerosis Ireland. I had given them a donation and they told me there was something in the back of the shop in which I might be interested, which they had priced at €50. I know many people from various walks of life, and some professional people who have experienced financial difficulties, who get very good clothes in second-hand shops. I am not worried about whether clothes are new or second-hand as long as they are adequate and protect people. I would have less of a concern about that, but that is just me. The question of food is important. It is a basic requirement that people should have a diet that would sustain them physically. That is No. 4 on the list. No. 5 is to have a roast joint or its equivalent once a week. I could take or leave that but perhaps there is nothing wrong with that. It is desperately important to emphasise No. 6 — adequate heating. We have already cut the fuel allowance from 32 to 26 weeks, and that affects people in different ways. Obviously, it affects the poor very seriously but with different degrees of seriousness because there are people, for example, with conditions which mean that throughout the year they must be kept at an even temperature. Otherwise, they are exposed to serious health risk. It is reasonable to expect that people should be allowed sufficient income to keep themselves warm. Keeping the home adequately warm is a similar requirement. Nobody with good conscience could possibly deny that is important. Buying a present for family or friends at least once a year is a lovely thing to do and it is enriching but I would not be quite as concerned about that. With any list there are some difficulties. People can make presents, and sometimes they 152 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage are the best presents one gets because people have taken time and trouble to make them. That is what I prefer to get. Another on the list is to replace any worn out furniture. That is a little loose. I understand the reason for it but there is a looseness of expression in that regard. I do not know about having family or friends for a drink or a meal once a month or having a morning, afternoon or evening out once a fortnight for entertainment. That is very humane but there have been many fortnights when I have not had that and I have survived with reasonable good humour. This is a useful start but it is not a litmus test. If this amendment is not accepted I would respectfully suggest to my friends in Sinn Féin that they resubmit it, argue the case and perhaps select out the ones that are indefensible such as heat, warmth, clothing and diet. If they want to have this amendment accepted they must concentrate on the things that are inarguable. I do not believe a decent person of conscience could say it is appropriate that people should be charged an extra tax, and it is an extra tax, if they cannot afford a pair of shoes because it is necessary for their health or if they cannot afford proper heating, a proper diet or proper clothing. I respectfully suggest that they should separate that out on Report Stage and I will support it. I would vote for it even as it is. That would make it more embarrassing for anybody to object to. They should select out the ones that nobody in this country could possibly justify retaining and take out the other ones. They should take out the reference to €75,000 and put it in another amendment if they wish but if they focus sharply on this one not only will I support it but I would be happy to second it.

Senator Cáit Keane: I hope I would be regarded as one of the caring Senators — I cannot remember the other adjectives — Senator Norris mentioned.

Senator David Norris: Certainly so far. The Senator is on probation.

Senator Cáit Keane: I support the ESRI and the surveys it undertakes. The group will be established to examine value based property tax but we are not saying that is ideal. I have absolutely no objection to the ESRI analysis being used by the group set up by the Minister to look at poverty impact studies. However, I object to the part of the amendment which states that it shall not be commenced until such point as the social inclusion division of the Depart- ment of Social Protection carries out a poverty impact analysis study. That is putting it on the long finger. We have said time and again that the introduction of the €100 charge is not ideal, but we are doing this in the interim because of the legacy left to us. We have to find the money. If the Senator had come up with ways of finding the money, I would remind him——

Senator Trevor Ó Clochartaigh: The Senator should read our pre-budget submission.

Senator Cáit Keane: There are exemptions in this Bill for local authority houses. There are people in poverty who are living in local authority houses. There are people in poverty who are paying high mortgages. There are exemptions for such people who receive mortgage interest supplement. There are exemptions for people who would fit in all the categories in the amendment. I have no argument at all with the ESRI survey. I have an argument with the category which states “have a morning, afternoon or evening out in the last fortnight, for entertainment,” because there are many people caring for the disabled who do not have a morning, an afternoon, an evening or any time off at all. We have to be realistic. Has the Senator costed the part of the amendment that relates to the €75,000 provision? We are targeting €160 million to be raised. If the people who are earning €75,000 are taken out of 153 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Cáit Keane.] the equation, we would lose about €100 million from that. Where will the Senator find that? Until he comes up with alternatives, I cannot accept this.

Senator David Cullinane: I think people should understand clearly what this motion is calling for. We are calling for the social inclusion division of the Department of Social Protection to carry out a poverty impact analysis study. We are essentially calling on the Government to start poverty proofing policies. There is nothing wrong with that. We could have a whole raft of anti-poverty organisations — people who advocate on behalf of those who live in poverty — before this House and there would be no end of Senators who would come in and tell them how great they are, how great their work is, how they empathise with them, how people should not live in poverty and so on. Yet when we call for a policy to be poverty proofed, then there is something wrong with that. We are essentially saying that if a Government brings in a charge and that charge is likely to lead more people into poverty, then we have a difficulty with that. Senator Norris had some concerns and I accept almost all of what he said. He went through the full list in the amendment very well, but the list is not of Sinn Féin’s making. It is from the list provided by the ESRI and it is supported by a broad range of anti-poverty agencies. I believe everybody in this House is concerned about those living in poverty. We are simply stating the measurement of poverty. These are not our words or our measure. We are accepting the measure according to the baseline in Europe, the ESRI and all those organisations.

Senator Cáit Keane: I accepted that.

Senator David Cullinane: I am just making the point that this is the purpose of what we are trying to do. Senator Bradford asked whether Sinn Féin was serious about this amendment. We are absolutely serious about it. We are absolutely serious about dealing with poverty.

Senator Paul Bradford: I referred to the €75,000 threshold.

Senator David Cullinane: It is the main reason I got involved in politics. I can see people, including children, who are living in poverty. I deal with it every single day of the week and it motivates me to come into this House when I know that people are struggling out there. I hear politicians say that €100 is only €2 per week but that may be the case for somebody on €70,000, €80,000, €100,000 or €150,000——-

Senator Paul Bradford: Or €75,000.

Senator David Cullinane: Or €75,000. That is a separate issue and I will deal with that in a moment. For people living in poverty, €2 per week is a huge amount of money. In a previous debate today, we had a discussion about the pay and pensions of very senior civil servants and Ministers. I made all those points about difficult times, the hard decisions that had to be made and that we had to find the money somewhere, but I was dismissed. We were calling for pay to be capped at €100,000, but we were dismissed. The same people who dismissed those arguments come into this House, do not accept our amendment to poverty proof this policy on the €100 charge and tell us that we are in difficult times, that tough decisions have to be made, that we are bankrupt and so on. On the one hand, they use that excuse to hammer people who are in poverty, and on the other hand, they do not accept it when it comes to dealing with the lottery sums in pay which many politicians and people at the top of the public service have 154 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage walked away with. That is why I will continue to table motions and amendments like this which deal with poverty issues. This is a very serious amendment and although it only deals with the €100 charge, we would rather the Government moved towards poverty proofing all of its policies on health, education, taxes and so on. If we were serious about eradicating poverty, that is what we would do. Do we believe that poverty can be eradicated overnight? No. Do we believe that poverty can be eradicated completely? Maybe not. We can certainly do an awful lot better than what we are doing. What is wrong with poverty proofing policies? I fail to see what is wrong with it.

Senator Brian Ó Domhnaill: I fully appreciate the context of this motion. I agree with the Sinn Féin Senators that legislation which has a financially negative impact on households should be poverty proofed. All legislation should be poverty proofed and perhaps that has happened in this situation. I am not sure, but I doubt that the Department of Social Protection has poverty proofed this Bill. Last night the Minister for Finance stated that the Minister for Social Protection consulted widely before she made the decision to reduce the disability allowance from €188 to €77. I wonder how wide that consultation was, because I know, from talking to the representatives of a number of disability organisations, that they were not consulted, nor were families consulted. We have to get serious. That is not a criticism of this Government. It refers to any Govern- ment, whether it is made up of Sinn Féin, Fianna Fáil, Fine Gael or the Labour Party. In challenging economic times, we have to look at who we are targeting with taxation measures that impact on individuals. In particular, we should look at this when a taxation measure contains very little discretion in respect of exemptions and waivers, as is currently outlined in this Bill. Senator Norris has gone through the 11 item index from the ESRI criteria. Many of them make sense. There are many families out there who would struggle to meet some of those requirements, be they the two pairs of shoes or the warm overcoat. I am glad to hear that Senator Norris got a very good deal. If we are looking out for a deal, it is good 6o’clock to know we can consult him. Let us take the example of nos. (vi) and (vii) of the amendment, which refer to going without heating during the last year through lack of money, and keeping the home adequately warm. These examples are more justified today than they were this day last week. The person who is in receipt of fuel allowance will be losing about €100 per year on that payment as a result of Monday’s budget, as the window for such a payment is being reduced from 32 to 26 weeks. That person is now being asked to pay the €100 household charge, so the net loss to such a person is €200. We have to take this kind of thing into consideration. We have gone down a different route with our amendments, which contain specific categories of people who are exempt, such as those who are in receipt of the old age non-contributory pension, those on jobseeker’s allowance, supplementary welfare and so on. We will get to those categories in a later section. I agree with the principle of this amendment. We should consider what is happening to families under great financial pressure at the moment. I find it difficult to extend agreement to the level of income referred to, €75,000, because Senators earn approximately €60,000. This would mean we would be exempt and that would not be right. If one had ten children and vast borrowings and negative equity it would be a different issue. We have discussed the issue of negative equity. An income of €75,000 or €60,000 for a single person with one property and no financial outgoings in terms of family and so forth, is fine. It 155 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Brian Ó Domhnaill.] would be unfair to expect that person to receive a waiver while others under more pressure do not. I suggest revisiting that part of the amendment but we should consider the rest of it, which, in principle, we have no difficulty in supporting.

Senator Denis Landy: With regard to the €75,000 provision referred to by the previous speaker, Senator Ó Domhnaill, I too cannot support it. What is the basis for it? I would prefer not to doubt the bona fides of Senator Cullinane’s sincerity but his own party has put itself forward as being the Thirty-two County party, yet we note what Sinn Féin is implementing north of the Border where there are only two groups of exemptions and there is no poverty- proofing whatsoever as regards the property tax. Also, a cap on payment applies whereby any house over £400,000 in value does not pay any extra tax. This is not equitable. I said yesterday I could not go along with something which in the longer term would charge the tenant purchaser of a council house the same as a person living in a house worth a couple of million euro. I accept this is an interim measure until a system for rating properties is introduced but I could not go along with it. North of the Border a person with a house worth £3 million will pay the same tax as a person with a house worth £400,000. There is no equitable system in place in Northern Ireland and yet we are given to believe that the concerns of Sinn Féin south of the Border are as listed by Senator Cullinane and his colleagues in this amendment. Again we see the hypocrisy of putting forward what would be termed here a passionate concern for the poor but, 100 miles up the road, we see that all of these people are disregarded and no effort is being made by his party in government in Northern Ireland to implement the same type of scheme.

Senator David Cullinane: The social development fund, the social inclusion fund.

Senator Denis Landy: I ask the Senator not to interrupt me, please.

Senator David Cullinane: They opposed water charges. I was interrupted.

Senator Denis Landy: If the Senator can resist interrupting me I would appreciate it. I understand his difficulty.

Senator David Cullinane: I am not in difficulty.

Senator Denis Landy: It is very difficult for us to sit here and listen to these so-called passionate speeches about people and poverty when the opportunity is given to the same party to govern in Northern Ireland and yet it has adopted a completely different attitude towards property tax there. These things need to be said. It is important to be honest with the people. Who is to say if the same party were in government down here that it would not implement the policy it currently follows in Northern Ireland?

Senator Trevor Ó Clochartaigh: I welcome the opportunity to clarify the situation in Northern Ireland because it is often misconstrued by members of the Labour Party and Fine Gael who obviously do not know what they are talking about when it comes to the Northern Ireland situation. This is due to the lack of interest they seem to have in it. One cannot compare apples with oranges and the situation is completely different in Northern Ireland. Senator Landy should know that the funding situation in the North of Ireland is that the Administration has no powers to raise fiscal moneys and it is subject to a block grant from Westminster which was cut by a number of billion pounds this year. The Senator should know that the Admini- stration has no control over this decision. 156 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Sinn Féin has taken measures to introduce a social development fund, the social inclusion fund. The property charges to which Senator Landy referred were put in place before Sinn Féin was ever in government in Northern Ireland. It would be important if we are having that discussion——

Senator Denis Landy: That is an excuse.

Senator Trevor Ó Clochartaigh: It is not an excuse. On a number of occasions we have called for a debate on the policies in Northern Ireland, of which this is a part, and we would welcome such a debate in the future. To clarify the thinking behind the figure of €75,000, it is Sinn Féin’s policy — we are very consistent about it — that the wealthier in our society should be paying extra taxes. Senator Landy and the Minister described this as an interim measure to last for two years. If this is the case, why did the Government not introduce an interim measure which would take 1% of the wealth off the people who have capital in excess of €1 million? That would have been an interim measure which would hit the more wealthy. However, instead the Government chose to introduce an interim measure which the Senator agreed his party had campaigned against prior to the general election. His party said it was unfair because it hit everybody equally and it was also unfair to the person on a very low income compared to a person living in a mansion. The logic behind the figure of €75,000 was to push this extra tax which is being forced through by the Government, onto those who are in the higher bracket, as opposed to those in the lower bracket. Sinn Féin has consistently stated that people earning more than €100,000 should be charged a third rate of income tax at 48%. The logic behind the figure of €75,000 is to make the people who are earning in excess of this figure, the people with more disposable income, pay this type of charge. We made this argument previously and if the Senator had been in the Chamber he would have heard it. We will be pressing this amendment. The important point is that this is about poverty- proofing. We are not saying that all these criteria have to be absolutely adhered to but rather the committee which will examine the poverty-proofing study should take these points into account. This would be part of the process of examining who are the people on whom this charge impacts and whether they are in a position to pay. It is also a case of asking whether we fully realise what is meant by poverty and what will be the cumulative impact of all these extra charges. The Government is crowing about not increasing income tax but this does not mean that people’s disposable income is not reduced because it will be. Income tax is not being increased but the Government is putting its hands in the pockets of poor people. It is taking more money out of their pockets and it will not be in their bank accounts at the end of the year. As a result, more people will be in a position of poverty because of measures such as this. We argue that every legislative measure should take into consideration all those in the poverty trap. These measures being introduced by the Government will result in more people being in that situation.

Senator Thomas Byrne: Sinn Féin made a mistake by not having separate amendments because we can certainly support the first part but not the second part as it would be wrong to exclude Senators from the measure. The figure of €75,000 is approximately twice the famous average industrial wage. One must have some sympathy for people on the average industrial wage who might own two or three properties such as Deputy Gerry Adams. I feel sympathy 157 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Senator Thomas Byrne.] for him because he owns a house and a holiday home in Donegal. He has a family home in Belfast——

Acting Chairman (Senator Marie Moloney): That has nothing to do with this amendment.

Senator Thomas Byrne: The Minister can enlighten me as to whether he has bought a house in County Louth yet. He will get a massive bill for property tax——

Acting Chairman (Senator Marie Moloney): Please stick to dealing with the amendment, Senator Byrne.

Senator David Cullinane: Can Senator Byrne name the property?

(Interruptions).

Senator Thomas Byrne: I certainly feel sorry for him.

Senator David Cullinane: Name the property, Senator.

Senator Thomas Byrne: He has acknowledged on my local radio station that he owned a holiday home in Donegal.

Acting Chairman (Senator Marie Moloney): The Senator should stick to the amendment and he should address the Chair. Senator Byrne knows the rules and he should please address the Chair.

(Interruptions).

Senator Thomas Byrne: There are people who claim to be on the average industrial wage, who own two or three properties. They certainly should be given some consideration.

Senator David Cullinane: Now we are dealing with hypothetical properties.

Senator Thomas Byrne: It is in his constituency.

Acting Chairman (Senator Marie Moloney): Please allow Senator Norris the opportunity to speak.

Senator David Norris: I find myself having a great deal of sympathy for what Sinn Féin members have said and with the motivation behind their amendment. The principle of good government would be to poverty-proof legislation. I also said at the time — it was recommended by the Irish Human Rights Commission — that one function of those who undertake research would be to be employed by the Oireachtas to ensure that legislation is at its best. The Irish Human Rights Commission offered to proof legislation from a human rights standpoint but its offer was rebuffed by a previous Government. However, it is a very good principle. If excellent legislation is the ambition then it should be proofed to ensure that the poor, the vulnerable and the weak are protected and also that human rights are protected. If we have the institutions in the State, such as the ESRI and various other groups and also the Irish Human Rights Commission, then let us employ them. Let us bring them in as adjuncts to the political system in order to make legislation more effective, fairer, more just and in the interests of the vast majority of people in the country. I am fully in agreement with that. 158 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

With regard to the amount of money involved, a good point was made by Senator Ó Domhnaill and his colleague that it might be wise to separate the issue of the €75,000, which can be debated, and address it on Report Stage, if that is what is decided. We should also sharpen the focus by going for the most clear of those criteria with the support that this is the bare bones of what is recommended by the ESRI. I heard a very reasonable woman on the radio today. She gave a breakdown of her income and after she had paid the various impositions, taxes and modest essential household outgoings she was left in mortgage arrears and with €5 to spend. If people have a margin of €5 to spend €5 a week is quite significant. I am glad Senator Ó Domhnaill reinforced the point I made earlier on the question of changes in the fuel allowance which are very serious for people on the margins. We are very comfortable and privileged as elected Members of the Oireachtas and we should remember that comfort and privilege does not extend to all citizens of this State. I was impressed by what Senator Cullinane said about his motivation for getting into politics. It is what gives energy to some of the members of his party. I do not agree with his party. I have never supported it and it has not supported me. Let us have an end to the fantasy about the different application of government North and South of the Border. I say this as somebody who engaged with that fantasy. I thought it was extraordinary that the Administration in Northern Ireland was imposing certain measures in the North of which it was critical of the southern Government. This matter was effectively resolved, as far as I am concerned, on “The Frontline” when I heard a Member of the other House, Deputy Mary Lou McDonald, make the very good point that the budget was not set in Belfast but in an office in Carlisle in northern England.

Senator David Cullinane: It was Newcastle upon Tyne.

Acting Chairman (Senator Marie Moloney): I ask the Senator to stick to the amendment.

Senator David Norris: I am addressing a matter that was raised. I am sure the Acting Chair- man will give good guidance on this because I have noted her wisdom and it is as if she was born to the role. I am making the point for which she is reproving me. Discussion of the difference in application between the North and South is a partisan argument which does not address the principle of the amendment. I would find it tiresome to have to listen to it any more.

Senator Cáit Keane: Our budget is bound by the IMF agreement. Our hands are tied.

Acting Chairman (Senator Marie Moloney): Without interruption, please.

Senator David Norris: I hope we can progress and discuss as much of the Bill as possible before the guillotine, which we will see again this evening, is operated. Perhaps we might even succeed if we co-operate. The Minister of State is usually a co-operative and decent person. We might deal with the entire Bill.

Senator Cáit Keane: We might if we did not repeat things so often.

Senator David Norris: I do not believe I have repeated myself too much.

Acting Chairman (Senator Marie Moloney): The Minister of State has been here for three quarters of an hour and has not made any observations. I ask Senator Bradford to wait until after he has—— 159 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Senator Paul Bradford: The contributions are very interesting. If this index was applied to car tax a huge number of people in gainful employment in the country who are driving to work every day would not pay it. I suspect and fear that hundreds of thousands of people in this country are not in a position to invite friends for a meal once a month. I suspect tens of thousands of people in this country are not in a financial position to buy presents. That is very regrettable and it should be our political aim to reverse that situation but I am trying to be practical. If the poverty index was applied to motor tax, college fees, health levies——

Senator David Norris: If the Senator found himself down to the three or four most basic items he might be persuaded to agree.

Senator Paul Bradford: We have to debate the amendment before us. I take on board what Senator Norris said. The list will have to be refined before it receives further consideration. It will also have to exclude the €75,000 figure. As has been said, all of us are on reasonably good salaries but significantly less than €75,000. This is an interesting philosophical debate. Everybody aspires to ending poverty in this country and we all know that will happen by getting people back to work. Levies, charges and taxes are difficult burdens on the public but in the overall context of where we find ourselves the household charge is as easy as we can make it. Somebody has to fund the country to pay pensions every week, teachers and people in receipt of social welfare, disability allowance or whatever. We have to be fair.

Senator David Cullinane: People are in consistent property. That is the only point we are making.

Senator Paul Bradford: The Senator referred to Sinn Féin’s pre-budget submission, which I read with interest as I did last year. I was taken by what I thought was a reasonable view of the wealth tax situation. We are all aware of people who have assets worth hundreds of thousands of euro who would also fail this test. People might live in fantastic old houses but cannot light a fire or go out for any entertainment. The list is quite arbitrary. I thank the Senator for bringing forward the concept. I debated the application of the poverty index with him when I was on the other side of the House. I do not think we will reach agreement on it. It is a worthy debate but we must aspire to try to rid the country of poverty by regenerating economic activity and getting people back to work. That is the only real insurance against poverty.

Senator David Cullinane: The wealth tax is income linked. One could be asset rich but if one’s income is not sufficient one will not be subject to it.

Senator Paul Bradford: I take the Senator’s correction.

Deputy Fergus O’Dowd: Some very useful ideas have been mentioned and clarity has been brought to the proposition before us and the amendments. I want to discuss what this charge is all about and who will pay it. The Bill states anybody who lives in a house rented from a local authority will not pay the charge. The more likely person to fall into this category, to use it as a broad definition, would be living in a local authority house which he or she does not own and will not pay the charge. If a person does not have a local authority house and is on 160 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage the housing list, is in rented accommodation under RAS or cannot afford to buy a house he or she will not pay the charge.

Senator David Norris: That is a very good argument for excluding affordable housing.

Deputy Fergus O’Dowd: I am happy to respond to the Senator. Those who own their own homes but cannot pay the mortgage and are getting assistance under the definition of poverty of an exceptional need as used by a community welfare officer will not pay the charge. People living in housing estates which do not have the proper infrastructure, as defined under categories 3 and 4, will not pay the charge. Therefore, there are clear and significant exceptions under which people who, by any recognised measure, are living in poverty will be excluded. Such people will not have to pay this charge. Senator Norris spoke about moving the debate forward. Although it is not referenced in these amendments, I draw Members’ attention to section 12, subsection (1) of which states:

All household charges, late payment fees and late payment interest payable to a local authority pursuant to this Act are placed under the care and management of the local authority concerned.

In other words, local authorities will have the power to remit some or all of the charge in what they deem to be exceptional circumstances. What this proposal is all about, and what the budget is all about, is keeping this country free of absolute and abject poverty. If we did not have the funding from the EU and IMF to meet the shortfall in our income, that is what we would be facing. Sinn Féin can talk about people earning less than €75,000 being exempted from the charge, but the reality is that if we do not have the money to run this country, if the €18 billion shortfall is not made up, everybody will be in an extremely difficult place. Without that funding, our schools, hospitals and local authorities will be unable to function. It is important to bear in mind that this charge is ring-fenced for local authorities and is not going into the general Exchequer. The moneys collected will allow local authorities to provide services locally, such as maintaining footpaths and street lighting and fixing potholes. It is about maintaining local infrastructure. It is about allowing local authorities to continue to provide services to designated areas of low income and significant deprivation under the RAPID programme. These moneys will be used specifically to meet those requirements. The EU-IMF programme of financial support for Ireland commits the Government to the introduction of a property tax in 2012. The programme reflects the need, in the context of the State’s overall position, to put the funding of locally-delivered services on a sound financial footing, improve accountability and better align the costs of providing services with the demand for such services. The drop in State income since 2006 has been in the order of €16 billion. We are spending €18 billion more per annum than we are receiving in taxes. As such, we are in an extremely serious financial place which will require us to take billions out of the economy again next year and for several years thereafter. That is the reality we are facing and the context in which this debate is taking place. In light of the complex issues involved, a property tax requires a comprehensive property valuation system, which would take time to introduce. Accordingly, to meet the requirements of the EU-IMF programme, the Government is introducing a household charge as an interim measure. The charge is being set at the relatively modest level of €100 for 2012. To mitigate the impact on home owners, the Bill provides that payment of the charge may be effected by 161 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

[Deputy Fergus O’Dowd.] four instalments over the course of a year. In addition, provision is made for several exemptions and waivers, which I outlined in detail on Second Stage and again today. A full property tax will be put in place by the Government in due course. A more detailed examination and consideration of the issues involved, including those raised by Senators today, and the potential impacts on different household tenures and employment circumstances will have to take place in advance of its introduction. In this regard, my colleague, the Minister for the Environment, Community and Local Government, Deputy Phil Hogan, will establish an expert interdepartmental group early in the new year tasked with designing a property tax which is equitable and is informed by previous work in the area. The group will be asked to consider options for the property tax, including assessment criteria, applicability of exemptions and waivers and how the tax should be paid and collected. The group will be assisted in the completion of its work by the Departments of Finance, Public Expenditure and Reform, and the Environment, Community and Local Government. The group will be required to complete its work and make recommendations to the Minister for the Environment, Community and Local Government by mid-2012. Following consideration of its recommendations, the Minister will bring proposals to Government on a full property tax as soon as possible. Regarding the proposal by the Senator to delay the implementation of the charge until 2013, the EU-IMF programme of financial support commits the Government, as I said, to the introduction of a property tax next year. Accordingly, the household charge will be applied next year as an interim measure. As announced on Monday by the Minister for Public Expendi- ture and Reform, Deputy Brendan Howlin, the Exchequer contribution to the local government fund will cease this year and will be replaced by the proceeds of the household charge in 2012. As such, it is imperative that the charge is implemented in order to ensure the funding of locally delivered services is continued on a sound financial footing. This will ensure local authorities are appropriately resourced to deliver the wide range of service which the public needs and expects. In these circumstances, I cannot agree to the Senator’s proposal that implementation of the charge be delayed until 2013.

Senator Trevor Ó Clochartaigh: I thank the Minister of State for his sincere reply. I also thank all Senators who contributed to what has been a useful debate on a very important issue. I remain concerned that the groups to which the Minister of State referred do not encompass all of those who will be in a difficult position if this charge is introduced. Take, for example, the case of a person living in a family home without a mortgage. That is not uncommon in rural areas where properties are passed down through generations. Even where such a person is on a very low income, he or she would not be included under the exceptions referred to by the Minister of State.

Deputy Fergus O’Dowd: Section 12 makes provision for such circumstances.

Senator Trevor Ó Clochartaigh: That may be so. However, our amendment No. 5 seeks to provide certainty in this regard by providing a broad definition of poverty which would encompass all of the possibilities. That is why we suggested that a study be done before a charge is introduced. We stand over the basic principle that a system whereby somebody earning €3,000 per week pays the same charge as somebody earning €300 is very inequitable.

Deputy Fergus O’Dowd: That is why we are introducing a property tax in due course. 162 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Senator Trevor Ó Clochartaigh: Nevertheless, we appreciate the input from all sides of the House. We are willing to withdraw the amendment on the understanding that we may bring forward an alternative on Report Stage. I thank Senators for their very positive contributions on the issues we raised.

Senator David Norris: I am very pleased that my Sinn Féin colleagues have taken this sophis- ticated approach to the issue. They will be more successful in so doing and I will certainly support them strongly. I would be honoured to have my name added to their revised amendment. The Minister of State has been clear and honest with us in his responses. A hint of what is at issue here was given by an earlier speaker who referred to the imminent examination of building ratings. What we are facing now, no matter what pretence is made about it — there has been very little pretence, in fairness — is the reintroduction of rates. This is the preparatory move in that regard. There have been many arguments about that, with many authorities being of the view that it is justifiable. That is what we are moving towards; I have absolutely no doubt about it. The Minister of State appears to me to be nodding, although it is perhaps unfair to put that on the record. I expect he will be open in acknowledging that we are moving towards the introduction of rates and that this charge is part of the process. I welcome the Minister of State’s indication, and it is important that the principle be main- tained, that any moneys derived from this tax, which will certainly go through, because the Government has the numbers, will be ring-fenced solely for the provision of local authority services. This is very important. I will not deal in any great length with the other arguments but there are other methods of raising substantially more money with a lot less pain and one of them would be to put, at least, a temporary block on automatic increments in the public service. I am not a person who is naturally antagonistic towards the public service but it seems to me this could provide a lot more money with a lot less pain. I hope the Government will take this suggestion into consideration.

Senator Jimmy Harte: On a point of clarification, as I was in my office, Sinn Féin seemed to propagate the perception that the taxes collected in Northern Ireland are set by some——

Senator Trevor Ó Clochartaigh: On a point of order, we are withdrawing the amendment at this stage so I suggest we should be moving on to discuss the next amendment.

Acting Chairman (Senator Marie Moloney): Yes, the amendment is being withdrawn.

Senator Jimmy Harte: It was a point of clarification for all Members.

Senator David Cullinane: The Senator can hold on to his single transferable vote speech and we may hear it on the discussion of the next amendment or else next week and the following week and perhaps the week after that. How about that? We have heard it all before.

Senator Jimmy Harte: Is Senator Cullinane finished?

Senator David Cullinane: Yes.

Senator Jimmy Harte: It is on a point of clarification for Members——

Acting Chairman (Senator Marie Moloney): The amendment has been withdrawn.

Senator Jimmy Harte: My point is to do with the household charge. 163 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Senator Cáit Keane: It is to correct the record of the House.

Senator Jimmy Harte: It is to give the correct information, to correct the record of the Seanad. This is a very important issue because it relates to information given to Members that the rates for household charges in Northern Ireland——

Senator Trevor Ó Clochartaigh: On a point of order, we have discussed the amendment and the amendment is being withdrawn at this stage.

Acting Chairman (Senator Marie Moloney): Senator Harte was not in the Chamber when it was discussed and we have now moved on.

Senator Jimmy Harte: The rates are set by the local council which——

Acting Chairman (Senator Marie Moloney): Senator Harte, the amendment has been withdrawn.

Senator Jimmy Harte: Sinn Féin has given the impression that——

Senator David Cullinane: The fiscal powers.

Senator Jimmy Harte: The average charge——

Acting Chairman (Senator Marie Moloney): Senator Harte, you are out of order.

Senator Jimmy Harte: ——in the city of Derry is £1,000.

Acting Chairman (Senator Marie Moloney): Senator Harte, you are out of order. Amend- ment No. 5 has been withdrawn by leave of the House. Is that agreed? Agreed.

Amendment, by leave, withdrawn.

Acting Chairman (Senator Marie Moloney): Amendment No. 6 has already been discussed with amendment No. 3.

Senator Trevor Ó Clochartaigh: I move amendment No. 6:

In page 6, lines 31 to 41, to delete subsection (3) and substitute the following:

“(3) The sum may be amended by the Oireachtas.”.

Question put: “That the words proposed to be deleted stand.”

The Committee divided: Tá, 30; Níl, 15.

Tá

Bacik, Ivana. D’Arcy, Michael. Bradford, Paul. Gilroy, John. Brennan, Terry. Harte, Jimmy. Burke, Colm. Hayden, Aideen. Clune, Deirdre. Healy Eames, Fidelma. Coghlan, Paul. Heffernan, James. Comiskey, Michael. Henry, Imelda. Conway, Martin. Higgins, Lorraine. Cummins, Maurice. Keane, Cáit. D’Arcy, Jim. Kelly, John. 164 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Tá—continued

Landy, Denis. Noone, Catherine. Moloney, Marie. O’Keeffe, Susan. O’Neill, Pat. Moran, Mary. Sheahan, Tom. Mulcahy, Tony. Whelan, John. Mullins, Michael.

Níl

Byrne, Thomas. O’Sullivan, Ned. Cullinane, David. Ó Clochartaigh, Trevor. Daly, Mark. Ó Domhnaill, Brian. Leyden, Terry. Ó Murchú, Labhrás. MacSharry, Marc. Power, Averil. Mullen, Rónán. Walsh, Jim. Norris, David. White, Mary M. O’Brien, Darragh.

Tellers: Tá, Senators Paul Coghlan and Susan O’Keeffe; Níl, Senators David Cullinane and Trevor Ó Clochartaigh.

Question declared carried.

Amendment declared lost.

An Cathaoirleach: Amendment No. 7 cannot be moved as amendment No. 6 has been agreed.

Amendment No. 7 not moved.

Senator Trevor Ó Clochartaigh: I move amendment No. 8:

In page 7, lines 5 to 19, to delete subsections (6) and (7).

Question put: “That the words proposed to be deleted stand.”

The Committee divided: Tá, 29; Níl, 14.

Tá

Bacik, Ivana. Henry, Imelda. Bradford, Paul. Higgins, Lorraine. Brennan, Terry. Keane, Cáit. Burke, Colm. Kelly, John. Clune, Deirdre. Landy, Denis. Coghlan, Paul. Moloney, Marie. Conway, Martin. Moran, Mary. Cummins, Maurice. Mulcahy, Tony. D’Arcy, Jim. Mullins, Michael. D’Arcy, Michael. Noone, Catherine. Gilroy, John. O’Keeffe, Susan. Harte, Jimmy. O’Neill, Pat. Hayden, Aideen. Sheahan, Tom. Healy Eames, Fidelma. Whelan, John. Heffernan, James.

Níl

Byrne, Thomas. Leyden, Terry. Cullinane, David. MacSharry, Marc. Daly, Mark. Mullen, Rónán. 165 Local Government (Household 7 December 2011. Charge) Bill 2011: Committee Stage

Níl—continued

Norris, David. Ó Domhnaill, Brian. O’Brien, Darragh. Ó Murchú, Labhrás. O’Sullivan, Ned. Power, Averil. Walsh, Jim. Ó Clochartaigh, Trevor.

Tellers: Tá, Senators Paul Coghlan and Susan O’Keeffe; Níl, Senators David Cullinane and Ned O’Sullivan.

Question declared carried.

Amendment declared lost.

Question proposed: “That section 3 stand part of the Bill.”

An Leas-Chathaoirleach: Senator Byrne indicated he wished to speak on the section. I ask him to wait for the Minister to return to the Chamber.

Senator Thomas Byrne: We should speak to the section when the House is full.

An Leas-Chathaoirleach: Please wait for the Minister.

Senator Thomas Byrne: The import of the section is that the charge of €100 may be increased by ministerial fiat. If Fine Gael and Labour Party backbenchers are prepared to accept such uncertainty and hand the powers of the Oireachtas over to a Minister, let them do so. As I state almost daily, if they are happy to turn the Dáil and Seanad into rubber stamp Chambers, let them do so.

Senator Tom Sheahan: Fianna Fáil handed over the sovereignty of the country to strangers.

Question put: “That section 3 stand part of the Bill.”

The Committee divided: Tá, 29; Níl, 14.

Tá

Bacik, Ivana. Henry, Imelda. Bradford, Paul. Higgins, Lorraine. Brennan, Terry. Keane, Cáit. Burke, Colm. Kelly, John. Clune, Deirdre. Landy, Denis. Coghlan, Paul. Moloney, Marie. Conway, Martin. Moran, Mary. Cummins, Maurice. Mulcahy, Tony. D’Arcy, Jim. Mullins, Michael. D’Arcy, Michael. Noone, Catherine. Gilroy, John. O’Keeffe, Susan. Harte, Jimmy. O’Neill, Pat. Hayden, Aideen. Sheahan, Tom. Healy Eames, Fidelma. Whelan, John. Heffernan, James.

Níl

Byrne, Thomas. Mullen, Rónán. Cullinane, David. Norris, David. Daly, Mark. O’Brien, Darragh. Leyden, Terry. O’Sullivan, Ned. MacSharry, Marc. Ó Clochartaigh, Trevor. 166 Business 7 December 2011. of Seanad

Níl—continued

Ó Domhnaill, Brian. Walsh, Jim. Ó Murchú, Labhrás. Power, Averil.

Tellers: Tá, Senators Paul Coghlan and Susan O’Keeffe; Níl, Senators Ned O’Sullivan and Trevor Ó Clochartaigh.

Question declared carried.

SECTION 4

Senator Trevor Ó Clochartaigh: I move amendment No. 9:

In page 7, between lines 19 and 20, to insert the following:

“(4).—(1) The meaning given to a residential property, as outlined in section 2, shall not be amended save by the Oireachtas.”.

Amendment put:

The Committee divided: Tá, 14; Níl, 30.

Tá

Byrne, Thomas. O’Brien, Darragh. Cullinane, David. O’Sullivan, Ned. Ó Clochartaigh, Trevor. Daly, Mark. Ó Domhnaill, Brian. Leyden, Terry. Ó Murchú, Labhrás. MacSharry, Marc. Power, Averil. Mullen, Rónán. Walsh, Jim. Norris, David.

Níl

Tellers: Tá, Senators Ned O’Sullivan and Trevor Ó Clochartaigh; Níl, Senators Paul Coghlan and Susan O’Keeffe.

Amendment declared lost.

Business of Seanad Senator Trevor Ó Clochartaigh: On a point of order, will the debate be guillotined? 167 Local Government (Household Charge) 7 December 2011. Bill 2011: Committee Stage (Resumed)

An Leas-Chathaoirleach: Your question is——

Senator Trevor Ó Clochartaigh: We have only discussed nine amendments.

An Leas-Chathaoirleach: Your question is slightly premature, but when it comes to 7.30 p.m. I am obliged by the order of the day to put the question to conclude Committee Stage.

Senator Thomas Byrne: I ask the Leader to increase the amount of time allowed for the debate. We will be discussing the impact of the household charge on social welfare recipients, and if he stops the debate about the poorest of the poor, shame on him.

An Leas-Chathaoirleach: That is not a point of order.

Senator David Norris: This guillotine is appalling. I regret the fact that my friends on the other side of the House have now employed the guillotine on a greater proportion of our debates than Fianna Fáil ever did. I never thought I would see this happen. I appeal that at least the time should be extended to allow discussion of the non-Government amendments. We can accept the Government amendments as passed.

Senator Maurice Cummins: I propose an amendment to the Order of Business that we resume Committee Stage at 5.30 p.m. tomorrow, when it had been agreed that we would take Report Stage.

Senators: Hear, hear.

An Leas-Chathaoirleach: Is that agreed? Agreed.

Senator David Norris: Well done. Congratulations to the Leader. That was an honourable gesture.

An Leas-Chathaoirleach: I ask the Leader whether he intends to adjourn the debate now, as we are so close to the concluding time.

Senator Maurice Cummins: We will adjourn at 7.30 p.m.

Local Government (Household Charge) Bill 2011: Committee Stage (Resumed)

SECTION 4 An Leas-Chathaoirleach: Amendments Nos. 10 and 12 are related and may be discussed together by agreement. Is that agreed?

Senator Trevor Ó Clochartaigh: Not agreed.

An Leas-Chathaoirleach: Senator Ó Clochartaigh.

Senator Trevor Ó Clochartaigh: I move amendment No. 10:

In page 7, after line 43, to insert the following subsections:

“(3) Residents of a building vested in a Minister of the Government, a housing authority (within the meaning of the Act of 1992) or the Health Service Executive shall not be liable for the household charge.

(4) Recipients of Unemployment Benefit, Unemployment Allowance, and Single Parent Allowance, shall not be liable for the household charge.”. 168 Flood 7 December 2011. Relief

Táimid ag teacht ar ais go ceann des na bun cheisteanna a bhaineann leis an mBille seo. Tá deifir ar chuid dár gcomrádaithe sa bhFreasúra imeacht as an Teach, ach tá sé tábhachtach go bhfanfaidís chun éisteacht leis an díospóireacht ar na leasaithe seo. Táimid ag moladh go dtogfaí san áireamh dream nach bhfuil tógtha san áireamh i ndáiríre, nó ad’fhéadfadh titim tríd an eangach sa Reachtaíocht seo maidir leis an táille atá le n-íoc. Daoine iad atá ar íocaíochtaí leasa shóisialaigh, socair dífhostaíochta, liúntais dífhostaíochta agus íocaíochtaí tuismitheoirí aonair. Táimid ag iarraidh go gcuirfí san áireamh iad san. Tuigim, ónméidadúirt an t-Aire roimhré go bhfuil súil aige go mbeidh go leor den dream seo a bhéas clúdaithe faoin díolúine atá luaite aige cheana. Tréaslaím leis an Aire agus aontaím leis sin. Ach d’fhéadfadh cuid acu titim tríd an eangach mar sin féin. Níor mhaith linn go dtarlódh sé sin. Ba mhaith linn go dtógfaí san áireamh na daoine seo agus nach mbeimid ar cur ualach breise ar dhuine atá ar aon cheann des na híocaíochtaí leasa shóisialaigh seo. Tógaimís, mar shampla, duine ata ina chónaí ina theach muinteartha, nach bhfuil morgáiste tógtha amach air, agus é ag maireachtáil go huile is go hiomlán 7o’clock ar liúntas leasa shóisialaigh. D’fhéadfaí go mbéadh ar an duine sin an táille breise sin a íoc . Muna bhfuil morgáiste ar an teach d’fhéadfadh sin a tharlú.Tá a fhios agam féin daoine i gConamara a bhuil an teach tógtha le fada an lá agus gan aon morgáiste air ach cinnte tá siad ar cheann des na híocaíochtai leasa shóisialaigh seo. De réir an méid atá ráite go dtí seo, ní fheicim go mbéadh na daoine sin clúdaithe. Bhéadh sé fíor-thábhachtach gan eisceacht ar bith a scaoileadh tríd an eangach ar an gceist seo. Táimid ag moladh go dtógfadh ant-Aire na moltaí atáimid ag déanamh maidir leis an dream seo ar bord.

An Leas-Chathaoirleach: As it is now 7.30 p.m., I ask the Leader to propose the adjournment of the debate.

Progress reported; Committee to sit again.

Adjournment Matters

————

Flood Relief Acting Chairman (Senator Michael Mullins): I welcome the Minister for Finance, Deputy Michael Noonan, to the House after his busy few days. I call Senator Deirdre Clune to raise her matter.

Senator Deirdre Clune: I am glad to have the opportunity to raise the issue of the need for negotiations with insurance companies, in particular in the light of my experience dealing with constituents during the past two years. There was severe flooding in Cork just over two years ago, in November 2009. After that, vulnerable individuals saw their homes destroyed as a wall of water came through the city. Flooding is and has been common in Cork which is built on marshland by a river. There are occasional floods due to the combination of high tides, river flow and high winds. However, this occasion was completely different. There was a low tide and the cause of flooding related to the Inniscarra dam further up the River Lee. Insufficient warning was given and it is my view that insufficient monitoring was in place prior to the occasion. As a consequence, many homes and small businesses were destroyed. Some have pulled it back together, 169 Flood 7 December 2011. Relief

[Senator Deirdre Clune.] while others have not yet received sufficient compensation to get back to their previous position. My particular point is that when many individuals in the region seek quotes from insurance companies in Cork they are told the companies will not reinsure them or provide them with cover. This is in spite of the fact that areas in which these homes are located may never have flooded and lie away from the flood plain. I contacted the Irish Insurance Federation on the matter of flooding and was told by Mr. Michael Kemp, chief executive of IIF, that in regard to flooding in general: “We are working with the OPW and with Minister Hayes to improve the flow of information between insurers and the OPW and that this should help to prioritise areas where flood defences can usefully contribute to improved insurability of our members.” The federation is also discussing with the Minister of State a possible enhancement to this service by putting in place agreed procedures for the reconsideration of cases where flood cover has been restricted or withdrawn, notwith- standing remedial works being carried out, if the works have altered the risks appreciably. I would like the conversation between the Department and the Insurance Federation to take place in order to reassure insurance companies that flooding will not take place again and that sufficient warning systems have been put in place. Only last week Cork County and City Councils and the ESB agreed to work together to monitor the flow of the river, rainfall and the level of the upriver reservoir. There will be three authorities involved in monitoring in an effort to ensure that such a situation will not arise again. That is positive action. A great deal of information could be transferred to the Irish Insurance Federation that would give it some comfort. There are many innocent bystanders in this situation, which can be rectified by dia- logue and communication.

Minister for Finance (Deputy Michael Noonan): I am responding on behalf of the Minister of State, Deputy Brian Hayes, who has responsibility for the OPW. He is involved in the budget debate in the Dáil. I thank Senator Clune for raising this important issue. The Government is well aware of the hardships suffered by families in Cork and elsewhere as a result of the severe flooding in 2009. It must be stated at the outset that the decision to provide any specific form of insurance cover and the price at which it is offered is a commercial matter for individual insurance companies, based on an assessment those companies make of the risks involved. The Irish Insurance Federation has informed the Department of Finance that approximately 98% of households that currently hold household insurance have flood cover. The federation points out that insurance companies examine the claim’s history of the individual risk when deciding what underwriting action to take. They also look at any flood protection measures implemented by the local authority or the Office of Public Works in the area. They say that where the flood risk is higher than normal people will generally pay a higher premium. As I stated in a reply to a parliamentary question on 8 November 2011, neither the Central Bank nor I have the power to compel insurance companies to quote for business. The Minister has no power to impose a maximum level of premium that the insurance company may charge. The structured arrangement put in place last year between the OPW and the Irish Insurance Federation with a view to improving the exchange of information between both bodies is critical in order that insurance underwriters are aware of what has been done in different parts of the country to address flooding problems. Such arrangements also help the OPW to prioritise its remedial works which, in turn, provides greater reassurance to the industry that the problem 170 Flood 7 December 2011. Relief areas are being addressed in a structured way. This progress should lead to a greater willingness to offer cover in marginal areas. In this regard, the OPW has provided information on works carried out under the 1945 and 1995 Arterial Drainage Acts and capital works carried out nationally since 1996. In addition, the OPW has updated the Irish Insurance Federation on details of areas where works have been carried out on the minor works scheme initiated in 2009. Most recently, the Office of Public Works shared with the IIF the national data set arising from preliminary flood risk assessment. The OPW has held a number of discussions with the federation during 2011 and has proposed a mechanism whereby the scope and causation of difficulties in obtaining flood insurance cover could be quantified and co-analysed with the federation. The federation is to respond to this proposal. I turn to the Cork area, to which Senator Clune referred in her statement. An important initiative is the draft Lee catchment flood risk management plan which includes recommendations for the management of flood risk for Cork city and a number of other areas in the River Lee catchment. A tender short list of consultants to take forward the detailed design of the recommendations for Cork city has been established. In 2010, the Office of Public Works, OPW, expended approximately €6.9 million in the Cork area between construction and development of major flood relief schemes and also several commitments under the minor works scheme. The 2011 figure has remained steady and approximately €12 million is profiled for 2012 for the Cork area. In 2010, at the request of the OPW, interim measures were put in place for the operation of the Lee dams for winter 2010-2011. This involved reduced spill levels at both the Inniscarra and Carrigadrohid dams. The interim arrangements will continue for the winter 2011 and 2012 while the ESB will keep them under review to determine their effectiveness. The ESB attended an emergency management exercise in Cork at the end of June, at the request of Cork City Council. This was also attended by the Garda, Health Service Executive, HSE, fire brigade staff, army and various council officials. The communications protocol that had previously been developed as part of the interagency group discussions in Cork was used during this exercise. I referred earlier to the minor flood mitigation works scheme. Under this scheme, the OPW provides funding to local authorities to undertake minor flood mitigation works or studies to address localised flooding in their administrative areas. The scheme generally applies to relatively straightforward cases where a solution can be readily identified and achieved in a short timeframe. Under the scheme, applications are considered for projects that are estimated to cost not more than €500,000 in each instance. Funding of up to 90% of the cost is available for approved projects, with the balance being funded by the local authority concerned. Local authorities submit funding applications which are then assessed by the OPW having regard to the specific economic, social and environmental criteria of the scheme, including the cost- benefit ratio. The commencement and progression of all funded projects is a matter for the respective local authority. In 2010, Cork County Council was allocated over €1.3 million under the minor flood mitigation works scheme for measures to address localised flooding problems. Cork City Council was allocated €900,000 to upgrade and undertake repairs to the quay walls in the city. Consider- able investment has taken place and co-operative structures are working well, with a view to mitigating any home insurance issues arising from flooding in the Cork area.

171 Higher Education 7 December 2011. Infrastructure Funding

Senator Deirdre Clune: I welcome the fact that a proposed mechanism is in place whereby the scope and causation of difficulties in obtaining flood insurance cover would be quantified and analysed. I look forward to the insurance federation’s response to this.

Higher Education Infrastructure Funding Senator Susan O’Keeffe: St. Angela’s College, Sligo, is a fine college that has developed from a traditional home economics college built originally for a small number of students. In the past 20 years, it has extended its business. Now it has 1,000 students with a wide variety of interesting courses including nursing, child care, its traditional home economics core, textiles, fashion and design, food and business management along with a variety of postgraduate courses in subjects such as special needs education, youth and family studies and religious studies. The college has been to the fore not just in the innovation of the sorts of courses it offers, but it has been tailoring courses specifically looking for niches in the education market. It has also invested in the necessary technology and equipment required to run courses with a technologi- cal base. It has an extremely dedicated and hard-working team headed by Dr. Anne Taheny. As a consequence of all its efforts, in 2010 the college received an allocation of €4.3 million for remedial and health and safety work on the campus, not for some cosmetic project to make students more comfortable or give them a cushier life. Parts of the roof, for example, are seriously dilapidated and access to it for vital maintenance works is dangerous. Insulation in some of the buildings, which date from the 1970s, is either poor or non-existent. Some of the windows are broken. I must concede that Sligo, a bit like Cork, is one of the damper parts of the country and, as a result, the energy costs for the buildings are higher than normal. New ramps and stairways are required and the current lift does not comply with National Disability Authority guidelines for such structures. Another lift is required for the number of students and the potential for students with disabilities. Fire regulations in some parts of the buildings are not up to scratch and some of the office accommodation is overcrowded and falls short of health and safety guidelines in the workplace. In short, these remedial works are essential. The college, in response to the €4.3 million allocation, is tender ready and the buildings science report is complete with all plans and so forth in place. The team at the college has worked away without complaint. The college has a fine future. The irony is that it needs this building work to secure that future. It is not appropriate for either a student or staff member to be carried up or down a stairs in the event of an emergency. Neither is it appropriate that people are working and studying in a place in which fire regulations are falling short of necessary standards. What is the status of the allocation of €4.3 million to the college?

Minister of State at the Department of Education and Skills (Deputy Ciarán Cannon): Iam replying to this Adjournment matter on behalf of my colleague, the Minister for Education and Skills, Deputy Ruairí Quinn. I thank the Senator for giving me the opportunity to address the House on this matter. On 10 November, the Government published details of its capital spending plans for up to 2016. Due to the difficult budgetary situation, the level of capital funding available for investment in higher education infrastructure provides only for funding higher education projects where legally binding contractual commitments exist. A project in design at St. Angela’s College, Sligo, has not reached the point of being a legally binding contractual commitment with the result that apart from funding for fees incurred to date on the project, there are no resources available to fund the project at this time. 172 School 7 December 2011. Staffing

Soaring birth rates are putting unprecedented demands on our schools infrastructure. Recent birth rate data for the first quarter of 2011 alone show that 19,950 births were registered. It is vital the schooling system is prepared to cope with these increased numbers. Accordingly, it has been necessary for the Department of Education and Skills to focus the capital investment available on ensuring every child has access to a physical school place. The result is that there remains only sufficient funding to deal with contractual commitments arising in the higher education sector. The overall capital needs of St. Angela’s College, Sligo, were quantified in 2006 at €17.5 million. For a higher education institution with a student population of less than 1,000 this represents a substantial investment. A more modest proposal emerged more recently which aims to provide lifts to address access for all issues and to tackle some refurbishment works. The all-in costs of the more recent proposal amounted to €6.5 million with the works split into two phases. Approval was given to commence design for works valued at €4 million in October 2010. However, the project had not reached the point of being a contractual commitment when the curtailment on spending in the higher education sector became effective earlier this year coinciding with the Government’s announcement. There is funding available to meet design costs incurred to date on this project. These will be paid when the relevant details are submit- ted. The Minister realises the serious impact that not proceeding with this project at this time is likely to have on St. Angela’s College and the additional challenges it will present. In light of the constraints on capital funding regretfully there are no alternatives at this time, however. Any potential future commitment to such works will have to be considered in the context of the national strategy for higher education, that is, the Hunt report. Despite this difficult news, I would point out that St. Angela’s College has been the benefici- ary of investment of almost €2 million dating back to 1999. This investment has enabled the carrying out of a range of works including the renovation of food laboratories at the college, the removal of asbestos, and addressing health and safety concerns. In addition, the Health Service Executive invested close to €9 million in delivering new nursing facilities at the college which were opened in 2007. As I said earlier, I acknowledge and regret the impact that this decision will have for this college and the additional challenges that it will present, but in light of the capital allocations available for investment in higher education infrastructure generally up to 2016, there is no other option available at this time. I thank the Senator once again for raising this matter.

Senator Susan O’Keeffe: It is most disappointing in light of the fact that, as I stated, the project in hand is not a vanity one. On the legal requirements, it is puzzling to find a building which pays staff and invites students to come in where there are difficulties with fire and health and safety aspects. I do not know what the ramifications of that are. Obviously, the college will take the response and will look to the potential of the Hunt report. Perhaps there is scope, through the Hunt report, for the viability of the college to be reconsidered. I thank the Minister of State.

School Staffing Senator Thomas Byrne: I wish to share two minutes of my time with Senator Ó Domhnaill, if that is acceptable. 173 School 7 December 2011. Staffing

[Senator Thomas Byrne.]

One of the more worrying aspects of the announcement of the budget was the information leaflet circulated by the Minister for Education and Skills, Deputy Quinn, related to the staffing schedules for one, two, three and four teacher schools, that is, schools with fewer than 86 pupils. Apparently, and we do not have the full information, the adjustments in the budget will increase the minimum number of pupils required for the allocation of teaching posts, and the Minister has stated that this will affect 100 posts next year. I want clarify on the following. Will 100 posts be dropped from these small schools? Where are these small schools? Why is the Government targeting small schools? Why was a spokesperson for the Department of Education and Skills on the Six One News the other evening asking small schools to consider their future? What consultation was done with small schools before this announcement? Does the Minister know that even in what might be called a commuter belt county such as Meath, there are at least 27 such schools? There are another 25 barely above the threshold. There are a number of parishes where there is more than one small school but where the schools are geographically dispersed and not beside each other. For example, in the parish next to mine, the parish of Dulleek, there is at least one small school, and maybe two, in that area. If, as the Government seems to want, these were closed down, there would be a massive capital bill to build a new school at Dulleek, not only to cater for those schools but also to cater for the expansion that is already needed at Dulleek school if small schools are forced to be amalga- mated. I do not see how this proposal makes any financial sense. I do not know why this is being done and how money will be saved. Níl a fhios agam cénfáth go bhfuil an t-Aire ag déanamh an chinnidh seo. Beidh tionchar na bearta seo i bhfad níos crua ar na ceantair Gaeltachta i gContae na Mí agus i gcontaetha eile. Beidh a lán daoine míshásta ins na ceantair sin. Is ionsaíéseo ar shaol tuaithe na hÉireann.

Senator Brian Ó Domhnaill: Tá lúcháir orm go bhfuil deis agam an t-ábhar tábhachtach seo a árdú anocht. Baineann sé leis an cinneadh a rinneadh sa cháinfhaisnéis ísliú stádais a thabhairt do scoileanna a bhfuil níos lú ná 86 dalta iontu. Má glactar sampla mo chontae féin, cé go bhfuil 180 scoil i gContae Dhún na nGall, tá 42 des na scoileanna náisiúnta sin i nGaeltacht Dhún na nGall. As an 42 scoil sin, tá 32 a bhfuil níos lú ná 86 dalta iontu. Tá láir na scoileanna beaga i gceantair tuaithe sa Ghaeltacht ag cur na Gaeilge, agus oideachas tré mheán na Gaeilge, chun cinn. De réir mar atá leagtha amach ag an Roinn Oideachais agus Scileanna agus ag an Aire, an Teachta Ruairí Quinn, beidh postanna á chailleadh. Tá sé i gceist go mbeidh 100 phost á gcailleadh i scoileanna beaga an bhliain seo chugainn agus beidh thart fá 250 post á gcailleadh ins na scoileanna sin thar cupla bliain, suas go dtí 2014. Is buille trom é sin. Tá an Rialtas ag rá go beidh sábháil de €1.5 milliúnarfáil an bhliain seo chugainn, ach sábháil é sin a chuirfidh isteach ar an teanga agus ar scoileanna beaga agus is mó an náire é adhéanamh. Impím ar an Aire Stáit éisteacht a thabhairt dos na múinteoirí agus do Eagraíocht na Scoile- anna Gaeltachta. Labhair príomh fheidhmeannach na heagraíochta sin inniu agus dúirt sí go gcuirfeadh seo isteach go mór ar cheantair Gaeltachta. I appeal to the Minister of State to review this decision. There are 180 primary schools in Donegal, 42 of which are in the Gaeltacht. Of those 42 schools, 32 have fewer than 46 pupils. All of those will be affected. On the objective to remove 100 teachers from their posts with a 174 School 7 December 2011. Staffing saving of €1.5 million, it is the wrong way to do it by attacking small rural schools. I would appeal to the Minister to rethink these proposals.

Deputy Ciarán Cannon: I am taking this Adjournment matter on behalf of my colleague, Deputy Ruairí Quinn, Minister for Education and Skills. At the outset, I thank both Senators for raising the matter as it affords me the opportunity to outline policy on small primary schools. First, I will deal with the context of the expenditure measures announced on Monday. The requirement to achieve savings in the Department’s 2012 budget necessitated difficult decisions to be made, particularly at a time when the school-going population is increasing. Difficult choices had to be made in every programme of expenditure. It was a key priority of the Minister to shield, to the greatest extent possible, front-line services in schools. This is evidenced by the fact that there has been no increase in the general average of 28:1 for the allocation of classroom teachers at primary level for 2012-13. Nevertheless, the increase in the number of children to be accommodated in our schools meant that making some adjustment to teacher numbers was unavoidable given the budgetary constraints. As small schools benefit disproportionately from lower class sizes, the fairest way to achieve the required adjustment was to increase the thresholds for allocation of classroom teachers in small schools so that they would be more closely aligned to the thresholds in the larger schools. The budgetary measure was simply achieving the required savings by distributing the available resources as equitably as possible. This re-alignment is being done on a phased basis over a three-year period. The phasing of these measures provides the schools concerned with time to consider their future staffing levels and to explore the potential for amalgamation with other schools where this is feasible. It is important to emphasise that no small schools will be closed due to the changes that have been announced. There are a significant number of small schools across the country. Last year 836 schools had less than 100 pupils. Interestingly, County Galway is the county with the most small schools. The existing staffing schedule acts as a disincentive for small schools to consider amalgamation and the Minister wants that disincentive removed. This is about ensuring the valuable but limited resources available in the system are used in the best and fairest way across the entire system. Separately, an exercise involving a value-for-money review on small primary schools has been under way in the Department for the past year. This is part of the normal review processes undertaken by all Departments on an annual basis on selected areas of expenditure. The review will attempt to explore the general policy options for re-organisation of small schools including the sharing of resources and clustering arrangements towards small schools. The terms of reference acknowledge the important role that primary schools play in their local communities. In considering any policy change on small schools, the Minister is conscious that there is a wider dimension to be considered in addition to the simple cost of maintaining small schools. Among the issues that will need to be taken into account are questions such as availability of diversity of provision, ethos of schools, parental choice, the language of instruction, travel distances, transport costs and the impact of schools on dispersed rural communities. The review will examine the locations of small schools relative to each other and to other schools of a similar type. It will also examine the costs of running small schools and the educational outcomes associated with small schools. Educational quality for the students must be one of the main criteria in any consideration of primary school size. We must also consider the needs of local communities and wider social 175 Libyan 7 December 2011. Government

[Deputy Ciarán Cannon.] and cultural factors. The value for money review is simply about ascertaining all the facts to inform future policy in this area. Work on the review is well advanced and the Minister expects that the report of the review should be available to him early in 2012. He then must consider its outcomes and proposals. I thank the Senator for raising this matter.

Senator Thomas Byrne: There goes Fine Gael again, succumbing to the ideology of the Labour Party. It has a value for money review under way and yet it has taken the decision and put the gun to the head of small schools to consider their futures. It is absolutely 8o’clock outrageous that ideology and an anti-rural agenda come before a value for money review. It has put its ideology before the costs. It is terrible that a decision has been made and the gun has been put to the head. Is uafásach an rud atá déanta ar na scoileanna beaga ar fud na tire, agus go háirithe ar fud na Gaeltachta, áit ina bhfuil a lán scoileanna beaga. Roghnaigh an tAire tuairimí Pháirtí an Lucht Oibre thar cionn na costais agus an athchóiríú atáádhéanamh faoi láthair.

Senator Brian Ó Domhnaill: Tá mé buíoch don Seanadóir Byrne as deis a thabhairt dom am afháil ar seo. Mar a dúirt an Seanadóir, ta sé seo ag cur an rud atá ráite roimh an ceart. Níl réamhobair déanta anseo. Tá an cosúlacht ar an scéal go bhfuil na scoileanna beaga tuaithe á bhualadh ag Aire atá bunaithe i mBaile Átha Cliath, gan aon deis a bheith aige measúnú a dhéanamh ar an obair iontach atáádhéanamh ag múinteoirí agus scoileanna beaga i gceantair beaga tuaithe. Is croílár na ceantair tuaithe iad na scoileanna náisiúnta seo agus is ábhar masla é má tá an Rialtas anois ag smaoineamh ar múinteoirí a ghearradh, scoláirí adhíbirt as scoileanna agus cónascadh a dhéanamh fá choinne cúpla pinginí. Is sa bhealach contráilte atá sé ag dul.

Situation in Libyan Acting Chairman (Senator Michael Mullins): I welcome the Minister for Jobs, Enterprise and Innovation, Deputy Richard Bruton.

Senator Jim D’Arcy: I welcome the Minister and thank him for coming to the House after a busy week. His contribution to the budget has been immense. I attended a briefing breakfast this morning in Dundalk with Enda Jordan of Ernst and Young, hosted by the chamber of commerce, where the reaction was that it was a pro-business budget. There is an onus on me to convey those sentiments to the Minister. Well done to him. In light of the new situation in Libya and the opportunities it provides for Irish companies, particularly given the position in the building industry, and the chance for builders and architectural and engineering firms to take part in the reconstruction, what structures are the Govern- ment and State agencies putting in place to take advantage of the situation? A case study of a reputable architectural company in the public and private sector from Dundalk shows it has offices in Tripoli. It is in contact with various members of the Libyan National Transitional Council and the newly appointed Government Ministers, most notably with its legal representa- tive, Dr. Giumma Atigha. I refer to him because I know his first cousin. They are likely to be involved in project management and design for a major amount of rebuilding in Libya which will lead to significant recruitment of construction professionals based in Ireland and working on the ground in Libya. We need to benefit from the rebuilding and growth of Libya as well as external investment. We need a co-ordinated and proactive approach between Irish Govern- ment organisations and Libyan Government bodies. I use that as a case study but I know there 176 Libyan 7 December 2011. Government are other companies. I am not convinced these companies have been successful in their attempts to get that proactive engagement from ourselves and our State agencies. Given the current situation there is a massive opportunity for us. An Irish construction company based in England, which is building six hospitals for Beacon in Iraq, received a letter asking it to express an interest in and arrive at a proposal for the building of 250 schools in Iraq. The letter was brought to the attention of a Government agency and the company was told — so far as I can say given that I was not present — that we were doing enough business as it was in the Middle East. We have to look at this situation as a release valve for our under-employed construction sector.

Minister for Jobs, Enterprise and Innovation (Deputy Richard Bruton): I thank the Senator for his words of encouragement and also for raising this matter. The appointment of two current Irish residents to the new Libyan Government is welcome and an indication of long-standing links between our two countries, especially in the medical and education sectors. Dr Fatima Hamroush, who was a consultant ophthalmologist in Drogheda, was appointed as Libya’s new Minister for Health, and Dr. Fathi al-Akkari, a lecturer in electronic engineering at Tallaght Institute of Technology, has been appointed deputy Minister for higher education. We wish them both every success in their challenging new roles and I hope they will retain their links with Ireland. Following the lifting of western sanctions on the country in the recent past, Libya is potentially a very exciting market for several reasons. Libya’s isolation exacerbated its significant infrastructural deficit. Its oil wealth provides significant resources to fund reconstruction and development. It has an immediate need for external expertise to deliver on its ambitions. Ireland is well placed as a provider of services. Enterprise Ireland visited the country in 2008 and organised a market study visit in 2009. This was followed by two trade missions — one led by the Minister of State with responsibility for trade and commerce in May 2010 and another in the education sphere in October 2010. Given the advent of the uprising and the unstable security position in the country for much of this year, activity by Irish companies has been badly affected. While the position has improved it would still be premature to initiate a strong promotional activity in the short term. We continue to monitor the situation there, and will be guided by the advice of the Department of Foreign Affairs and Trade on the issue. When a normal business environment resumes, educational and construction services will remain high on the list of focus sectors, but there is also potential in areas such as health care, telecommunications and e-government. In 2010, before the uprising, the EU was an important trading partner for Libya, accounting for 70% of its total trade which amounted to approximately €35.5 billion. Negotiations on an agreement between the EU and Libya started in November 2008. The EU is ready to restart those negotiations as soon as the Libyan authorities request it. I understand there has been no further progress in that regard. Concluding an EU free trade agreement with Libya would increase the coherence of the EU’s trade policy in the region, closing a gap in the Euromed free trade zone. This is because Libya is the only Mediterranean country — with the exception of Syria — which has not concluded a free trade agreement with the EU. Ireland naturally supports the free trade agreement negotiations. The EU has begun talks on similar agreements with Libya’s neighbours, Egypt, Jordan, Tunisia and Morocco. In time we would hope for the opportunity to develop a similar free trade agreement with Libya. Libya is not a member of the World Trade Organisation but negotiations for its accession started in 2004. 177 The 7 December 2011. Adjournment

The negotiation of the framework agreement on trade was due to pave the way for Libyan WTO accession, which will enhance trade opportunities. I hope these talks can resume shortly.

In conclusion, I can assure the Senator that we are fully conscious of the opportunities opening up in the Libyan market. In our efforts to pursue export-led growth, every opportunity is sought to diversify our markets, especially involving a potentially high-growth market such as Libya, with its oil wealth and desire to modernise its economy. Our trading record with that country and our good standing with key officials who have been educated here in previous decades will be very good levers in that quest. We all look forward to a stable society emerging from the recent turmoil. Enterprise Ireland and Irish companies will work towards participating in its development.

Senator Jim D’Arcy: I understand the Minister, whose comments confirm what I have been hearing, namely, Enterprise Ireland is not yet ready to engage with the National Transitional Council on these matters. I urge the Minister to use whatever influence he has in this regard, not as a persuader but in order to keep raising the point with Enterprise Ireland that if we do not move now, we will lose out. The Minister is correct that there are other opportunities. Our pharmaceutical companies are losing market share worldwide at present and there is a massive opportunity for such Irish- based, foreign direct investment companies to increase market share. We should be seeking a trade agreement with Libya as well as seeking to build health centres. I understand the frus- tration of the companies which are out there, some of which have been there for two years, although their work was interrupted. They have not made a bob yet, despite having offices there and having people involved. I urge the Minister to get that message across to Enterprise Ireland. I was at school with the head of Enterprise Ireland and know he is a gentleman. I do not believe this opportunity should be missed.

The Seanad adjourned at 8.15 p.m. until 10.30 a.m. on Thursday, 8 December 2011.

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