Seanad Éireann

Vol. 214 Tuesday, No. 4 25 June 2013

DÍOSPÓIREACHTAÍ PARLAIMINTE PARLIAMENTARY DEBATES Seanad Éireann

TUAIRISC OIFIGIÚIL—Neamhcheartaithe (OFFICIAL REPORT—Unrevised)

Business of Seanad ��231 Order of Business ��231 Employment Equality Act 1998 (Section 12)(Church of Ireland College of Education) Order 2013: Motion 246 Electricity Regulation Act 1999 (Restricted Electrical Works) Regulations 2013: Referral to Committee ��246 Social Welfare and Pensions (Miscellaneous Provisions) Bill 2013: Committee Stage (Resumed) ��247 Request to move Adjournment of Seanad under Standing Order 30��248 Social Welfare and Pensions (Miscellaneous Provisions) Bill 2013: Committee Stage (Resumed) ��248 Health (Amendment) Bill 2013: Committee and Remaining Stages��273 Adjournment Matters ��284

25/06/2013TT01500NAMA Staff Recruitment ��284

25/06/2013UU01100Post Office Network ��287 SEANAD ÉIREANN

Dé Máirt, 25 Meitheamh 2013

Tuesday, 25 June 2013

Chuaigh an Cathaoirleach i gceannas ar 14.30 p.m.

Machnamh agus Paidir. Reflection and Prayer.

Business of Seanad

25/06/2013B00200An Cathaoirleach: I have notice from Senator Lorraine Higgins that, on the motion for the Adjournment of the House today, she proposes to raise the following matter:

In light of the recent revelations of a former employee of NAMA (details supplied), the need for the Minister for Finance to refer matters to the Garda National Bureau of Criminal Investigation, if appropriate, in the interests of transparency and accountability for the taxpayer.

I have also received notice from Senator Martin Conway of the following matter:

The need for the Minister for Social Protection to discontinue plans to put social welfare payments out to tender in order to protect rural post offices and the hundreds of jobs associated with them.

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

25/06/2013B00400Senator Maurice Cummins: The Order of Business is No. 38, motion regarding the Em- ployment Equality Act 1998 (Section 12) (Church of Ireland College of Education) Order 2013; No. 1, motion regarding the Electricity Regulation Act 1999 (Restricted Electrical Works) Reg- ulations 2013, to be taken on the conclusion of No. 38 without debate; No. 2, Social Welfare and Pensions (Miscellaneous Provisions) Bill 2013 - Committee Stage (resumed), to be taken on the conclusion of No. 1 and to conclude no later than 6 p.m.; and No. 3, Health (Amendment) Bill 2013 - Committee Stage, to be taken at 6 p.m. 231 Seanad Éireann As no Committee Stage amendments to the Health (Amendment) Bill have been submitted, and if no further amendments are proposed for Report Stage, I suggest to the House that we deal with Committee and Remaining Stages of that Bill this evening, subject to the agreement of the House. If the House has an objection to that we can have Report Stage on another day.

I know that the shocking revelations in the Anglo Irish Bank telephone conversation record- ings have caused anger and resentment and will no doubt be raised on the Order of Business. However, I ask Members to be very careful not to say anything to prejudice what is likely to be a most complex and technical case to be taken in the Irish courts. I ask Members to bear that in mind. I know the anger that people have in that regard.

25/06/2013C00200Senator Darragh O’Brien: The Leader has made a sensible suggestion for dealing with the Health (Amendment) Bill and we would have no difficulty with taking Committee and Re- maining Stages today.

I agree with the Leader. All of us are absolutely disgusted and horrified by what we heard in the recent revelations. I will not comment further on them for the very reason the Leader mentioned because we all need to be careful with regard to how future investigations are carried out. While Senator Gilroy might have a problem with this, I remember previous cases where utterances were made in the Oireachtas-----

25/06/2013C00300Senator John Gilroy: We were not in government.

25/06/2013C00400Senator Darragh O’Brien: ----- that prejudiced subsequent court cases. We need to be aware that there are ongoing investigations by the Garda, the Director of Corporate Enforce- ment and the Financial Regulator. While they are very important, we all agree that the public deserve answers.

I heard the Minister, Deputy Howlin, speak on the radio this morning. It is important that whatever investigation is established is robust and has the proper terms of reference to deal with this. We will need to discuss how that can best be done, whether it is through an Oireachtas committee or a commission of investigation. However, we need to have powers to be able to come to conclusions on this matter. This will certainly play out in the coming days. All of us are disgusted with it and the citizens deserve answers in this regard. It will move on in the next few days and I encourage the Government to establish as speedily as possible the banking inquiry in whatever guise is best to get the results and the answers we require.

I welcome the reversal of the cut in resource hours that was announced three weeks ago by the Minister for Education and Skills, Deputy Quinn. The additional 12% cut in resource teaching hours has been overturned. I was interested to note that one could overturn a cut that apparently was not actually a cut in the first place because the Government argued at the time that this was not a cut. However, what is important is that the children who require these extra resource-teaching hours will get them. I bring to colleagues’ attention that the Minister has not reversed the cuts to the special needs assistants. I welcome that the Minister was able to go to Cabinet and find the additional moneys to ensure that resource hours were given to children who need them. However, some 22,000 children have special needs assistants. That figure has increased from 20,000 last year. That cut has not been reversed. I encourage the Minister, Deputy Quinn, to ensure that children with special needs, who often have distinct and difficult learning disabilities, are not affected. While I welcome the reversal of part of this cut, which is important, I ask colleagues opposite to examine the detail of it because the cut to special needs

232 25 June 2013 assistants’ hours has not been reversed, and that must happen. The Seanad played a role in this. We raised it here first on the Order of Business last Tuesday.

25/06/2013D00200Senator Mary M. White: Hear, hear.

25/06/2013D00300Senator Darragh O’Brien: It was raised by a number of colleagues on all sides of the House, including Senator Mary Ann O’Brien and many others. This is too important an issue to let go. The Minister should go further and ensure that the cuts to special needs assistants’ hours are also reversed.

25/06/2013D00400Senator Ivana Bacik: I thank the Leader for anticipating that a great deal of concern and anger would be expressed today on the floor of the House at the revelations contained in the tapes that have been broadcast which came into the possession of the Irish Independent concerning the executives of Anglo Irish Bank. We would all share the grave concern and anger that everyone is feeling on hearing the content of those tapes but I think we all agree that it is imperative that there is a robust inquiry into the background to the tapes and the events around the tapes. It assists us now in knowing that these tapes exist and that there is this method of establishing, to a greater degree of certainty, what was really going on around the events of the dreadful bank guarantee in September 2008. If there is any positive to be taken from this it is that we may have greater assistance and there may be more objective material available to assist in proving what happened than we had previously thought. That is a positive. It is not only a robust civil inquiry we require of whatever type, be it a commission of inquiry or an Oireachtas inquiry. It is also important that the Garda and the Office of the Director of Corporate Enforce- ment are given every resource necessary to enable them investigate any criminal offences that may have been committed.

I welcome the announcement today by the Minister, Deputy Ruairí Quinn, that the level of resource teachers available to students with special educational needs will be retained at 2012-13 levels. It is a good day for special education, which is an area the Labour Party has passionately defended since coming into office. It is welcome that the Minister, Deputy Ruairí Quinn, has today secured Cabinet agreement to release 500 additional teaching posts to schools this September to cope with the unpredicted rise in the demand for these resources. I know he fought at Cabinet to ring-fence the spending in this area in line with his, and the Labour Party’s, long-standing commitment. However, he is also setting up a review, and that is important, as to the reason the rise in demand for special needs resources of 12% is so much greater than the rise in the school population of 1.3%. The review group is to report in a timely fashion in Sep- tember, and that will be very useful to us in terms of allocation of future resources.

I ask the Leader for a debate on patronage and on increased provision of multidenomina- tional schooling. I know others have called for that previously, and that we have had some debate on this. In that context I want to welcome the announcement by the Minister, Deputy Ruairí Quinn, of a premises for the Portobello Educate Together national school, a new multi- denominational school opening in the Dublin 8 area. I have been very involved with that. I am chair of the interim board, and we are delighted that we have a premises secured at Harcourt Terrace for that school.

25/06/2013D00500Senator Mary Ann O’Brien: To take up Senator O’Brien’s comment about the special needs assistants, SNAs, and the resource teaching hours, which I welcome, am I right in assum- ing that SNAs help people with special needs to be there to be educated? It is wonderful that we have the resource teachers in place but the SNAs help those people in great need to take part 233 Seanad Éireann in the education. The Minister has made a mistake. He has one half of the jigsaw in place, and I was excited when I heard about it, but unfortunately a big part of the jigsaw is missing. I ask that he might put the other piece of the jigsaw in place at next week’s Cabinet meeting.

I congratulate Crumlin and Temple Street hospitals on the world-class fund-raising initiative they have just launched, which I am sure all Members have seen. It is called Heaven Cent. It is a wonderful website and wonderful marketing, which I am sure is costing them a fair deal of money. This is instead of having the much-needed children’s hospital which was promised by 2014. It now looks like it will be 2018, and if I were a betting person judging on the track record so far I would say it might be 2020 before we get our new hospital. Three hospitals, in Tallaght, Crumlin and Temple Street, must maintain front-line services in children’s medicine. Metaphorically speaking, the hospitals in Crumlin and Temple Street must fund-raise and pay for marketeers and websites to pay for fixing the leaks in the roof. Between 1996 and 1998 my sick child was in Crumlin many times and I used to sleep under the bed. The father of a seven year old boy, who was nursed by the Jack and Jill foundation when he was a baby and is in Crumlin again told me things have not improved in the hospital. The child was in a two-bed room and the mother of the little girl who was also in the room was sleeping under her bed. This boy’s father, Declan, is 6 ft. 2 ins. tall and could not fit under the bed so had to sleep opposite the bed with his head under the sink.

The hospital in Crumlin is outstanding but this is happening in 2013. The Cathaoirleach will ask me what is my point. I would like the Leader to seek assurance and an update from the Minister. In business we use the phrase “critical path” to mean having certainty about dates when things will happen. What is the Minister’s strategy and what are his clear plans for the children’s hospital?

With regard to the Anglo Irish Bank tapes, my company, Lily O’Brien’s, had a problem with the bank a few years ago. I know every conversation is taped. Why on earth did it take so long for us to hear these tapes?

25/06/2013E00200Senator Martin Conway: Hear, hear.

25/06/2013E00300Senator Mary Ann O’Brien: I hope I am not saying anything incorrect but can we make certain there are consequences and that those responsible for this end up where they should?

25/06/2013E00400Senator John Crown: I will preface my request for an amendment to the Order of Busi- ness that the Minister for Finance come to the House today and outline not only the timing but the terms of reference of the clearly much-needed banking inquiry, by reminding colleagues of one or two facts. Recently we spoke about drugs for malignant melanoma and we estimated treating every patient in the country would cost €3 million or €4 million. Senator Mary Ann O’Brien has just spoken about the national children’s hospital, the cost of which is estimated to be approximately €700 million. The cost of running St. Vincent’s Hospital for one year is approximately €170 million. Every day for the next five years, if the repayments are amortised over that period, we will pay €30 million a day in compensation for the obligations we assumed with the bank debts. This equates to €600,000 or €700,000 an hour. One can do the arithmetic oneself. We could buy the drug for everybody who requires it for melanoma every day for the next five years with one day of the expenditure we pay on the bank. We would pay for the cost of the national children’s hospital with three weeks of repayments. We all know this and I am probably not being very original when I say it but it is important that while everybody is very fixed on outrage, justice and, perhaps, revenge, people must understand the consequences of the 234 25 June 2013 bank problem are real, palpable and affect many people throughout the country. I am not even speaking about the social welfare implications, lost lives, emigration or lost businesses.

25/06/2013E00500An Cathaoirleach: Does the Senator have a question for the Leader?

25/06/2013E00600Senator John Crown: I have called for a debate today. I compliment good Leitrim man Paul Williams for unearthing the story. Why did it take five years?

25/06/2013E00700Senator Marie-Louise O’Donnell: Hear, hear.

25/06/2013E00800Senator John Crown: If everybody knew these tapes exist why did it take five years? We heard statements from senior Government officials stating they did not even know the tapes existed. We need an inquiry. The reason for my typical quixotic tilting at windmills attempt to have a debate on the subject today is not because I am fixated on the punishment. People may have to be offered degrees of immunity from certain aspects of the consequences of prosecution to get to the bottom of the story. There is a much more important thing we need to do. We need to work out how we can lessen the harm that has been occasioned by this. I am told by people who know much more about economics than I do, and basically we are a nation of expert economists at this stage, that we cannot actually get the money back. That said, are we in a position to use it as a moral negotiating tool when asking the ESM to look at the interest rate it is charging us, which is costing us millions per week, for the recapitalisation of our banks retrospectively. The question we must ask is-----

25/06/2013F00200An Cathaoirleach: Those are points the Senator can make during the debate. I call Senator Burke.

25/06/2013F00300Senator John Crown: -----if we have an inquiry, whether we can subpoena Mr. Trichet and the members of the European Central Bank? Can we get the equivalent of a freedom of information request to the ECB to get all of their documents because we need to know what they knew about the true state of the Irish banks and whether they brought pressure to bear on our Minister and Government at the time to undertake a guarantee which they knew and we did not know was going to handicap us for between 30 to 50 years. For that reason, I am asking that we amend the Order of Business and ask the Minister for Finance to come to this House. I will be pressing that.

25/06/2013F00400Senator Colm Burke: I welcome the report from the National Perinatal Epidemiology Centre in Cork which deals with the management of maternity care in 19 of the 20 maternity hospitals throughout Ireland. The report quite clearly shows that Ireland is up among the best as regards the standard of care internationally. Over the past 12 months the debate on maternity services was such to infer maternity care was not of a high standard in Ireland. The report is very important in regard to dealing with this issue. I ask the Leader to request the Minister for Health to make the information in this report widely available to the public. We need to rebuild confidence in the maternity services. The figures produced show that the perinatal mortality rate is 6.6 per thousand, which is a very good international standard. The report highlights that the perinatal mortality rate among ethnic minorities is higher and the maternity services will need to deal with this issue. This report provides good information that should be made widely available to rebuild public confidence in the maternity services, given debates on the area over the past 12 months, and I ask that this be done.

25/06/2013F00500Senator Marie-Louise O’Donnell: In 2009, I wrote an article about the banks entitled “A person of no consequence” for The Irish Times. I am telling Members about it today because 235 Seanad Éireann the article is more relevant than ever at this time. I believe we are people of no consequence as the tapes of the conversations among bankers have comprehensively revealed. We know now, with a certain outstanding evidence, that the Anglo Irish Bank financial swindle, the reckless national deceit, the appearance and reality sham, and the collar and tie financial disloyalty is that of an Anglo Irish Bank kind of financial subversion. I am not surprised, and how could I be, because all of the banks, Anglo Irish Bank, Allied Irish Banks, Bank of Ireland, Irish Life and Permanent and Irish Nationwide Building Society rank first and top of a hooligan pile. None is exempt. They have been paid for operating publicly and yet in the shadows, and, especially when it was done over recent years, fraudulently, abusively, recklessly, without proper governance, without internal or external regulations and without profit limitation. For me, as a Senator in this country in 2013, it ranks as the greatest, the most revolting, the most offensive and probably the most immoral travesty of our time, because it is financial power perverted.

If I were to ask the question, “Who runs the country?”, the answer is the banks. The banks run the country. Everyone else is either a boy, a monkey or a person of no consequence. Un- less this seat of power, the Seanad, and the seat of power, the Lower House of the Dáil does something about it, as Senator Crown has suggested, we will remain, as we have done for the past five years, people of no consequence. Will the House bring the Minister for Finance into the Seanad in order that we can ask him what he will do about out this matter?

3 o’clock

25/06/2013G00100Senator John Kelly: We were all disgusted and flabbergasted by the revelations of what went on within Anglo Irish Bank. To a certain degree, I have sympathy for the previous Min- ister for Finance, Brian Lenihan, who was an honourable man, but it is clear that he and the Central Bank were being manipulated by the bankers. In light of all of that, and with the benefit of hindsight, we enacted into law a Personal Insolvency Bill which gives the banks a veto over the proposals and recommendations of a personal insolvency practitioner. Before it is operational and, therefore, too late, we should revisit the Bill. My gut instinct tells me that if we had been privy to what we have been privy in the past two days, we would not have voted to give the bankers that veto. I propose that we discuss this issue with the Minister for Finance and suggest that we introduce a further Bill that would propose to take away the veto we gave to those bankers before it is too late. That is very important and must be dealt with immediately.

25/06/2013G00200Senator Sean D. Barrett: I second Senator Crown’s motion on the suspension of Standing Orders. The Minister for Finance should come to this House to tell us the terms of reference for the inquiry. Mr. Jean-Claude Trichet should also come here. We need to know what the accountants and auditors were up to during all of this and why the traditional reticence of civil servants in Ireland in regard to spending and husbanding the nation’s resources was suspended on an evening when €64 billion walked out the front door of Government Buildings. This has taken far too long. I commend whoever found the tapes and gave them to the media because it has put an urgency into this matter. We always knew Anglo Irish Bank was a bank for about 18 people. I was never able to figure out how it exercised an inordinate control over the Depart- ment of Finance and the Central Bank and why it became the role model for banks which, since 1783, had been run sensibly. It is time to draw all this affair into an inquiry and find out what caused so much damage to this country.

25/06/2013G00300Senator Paul Coghlan: I congratulate our Leader on the election of his son to the historic office of mayor of the ancient city of Waterford and I wish the new mayor well.

236 25 June 2013

25/06/2013G00400Senators: Hear, hear.

25/06/2013G00500Senator John Gilroy: I did not know about that.

25/06/2013G00600Senator Martin Conway: This is the first I have heard of it.

25/06/2013G00700Senator Marie-Louise O’Donnell: The Independents did not know about it.

25/06/2013G00800Senator Paul Coghlan: It was reported.

I agree with the Leader and with Senator Darragh O’Brien, leader of the Opposition, in regard to their words of caution lest any of us might prejudice any case that might arise from both the Garda inquiries and those of the Director of Public Prosecutions, which I understand are continuing in many cases, regarding the revelations made in these tapes. We must ask why did the leak occur now, so many years later. Who is at work behind the scenes and for what reason? Of course the public deserves answers. We need to establish why there was a failure to explain the facts surrounding our banks’ collapse, and the need for the guarantee. It looks now as though the Government of the day was codded, hoodwinked and lied to. Very serious matters are involved regarding Anglo Irish Bank and Irish Nationwide, and perhaps others.

As the Taoiseach stated, he has no paperwork to inform or advise him as between the banks of the time and the Government of the time. Perhaps there are more tapes. We need a proper inquiry and I support the calls made in that regard, as I always have. It is coming very late but is still needed. We have had the reports of Watson, Regling and others. Perhaps what we have had will be able to serve as a book, or books, of evidence, in regard to that inquiry. It will need tight terms of reference. We have been guaranteed that the Government is dealing with it, will continue to do so, and will have in place legislation before we rise for the summer recess. I wish that work well.

25/06/2013H00100Senator David Cullinane: I join with other speakers in again calling for a debate on the banking system and the need for a banking inquiry. The vast majority of people in the State would not be at all surprised about what is on the Anglo tapes, and the matter reaffirms what people already knew. It angers people and the public is disgusted by it. People are galled by this and they see it as a travesty, as was noted earlier. What happened in the banks was criminal. What really angers people is that those responsible for not only collapsing the banking system, but also the economy - with all the impact this had on the quality of life of ordinary people - have not been held to account or been before the courts. They have not spent a single night in a jail cell.

Senator Kelly spoke about people’s gut instinct and how, in retrospect or with the benefit of hindsight, it was wrong to support the bank veto in the insolvency legislation. My gut instinct when the Bill came before the House was not to give the banks a veto. My gut instinct when these issues arose was not to pay the bondholders in full and with interest. My gut instinct was not to allow a position where banking debt would become sovereign debt. I remind Senators who are now very concerned about what is happening with Anglo Irish Bank that not so long ago, in the early hours of the morning, they voted to turn €30 billion of toxic Anglo Irish Bank debt into sovereign debt by way of promissory notes. That decision was taken by people in this House and I stood against that, along with my party.

25/06/2013H00200Senator John Gilroy: The Senator’s party supported it.

237 Seanad Éireann

25/06/2013H00300Senator David Cullinane: It has again been proven-----

25/06/2013H00400Senator Ivana Bacik: Sinn Féin supported it.

25/06/2013H00500Senator David Cullinane: -----that the only parties which supported-----

25/06/2013H00600An Cathaoirleach: Is there a question for the Leader?

25/06/2013H00700Senator David Cullinane: -----turning the Anglo Irish Bank debt into sovereign debt were Fianna Fáil - which was no surprise - and Fine Gael and Labour, along with some Independents in the House.

25/06/2013H00800An Cathaoirleach: Is there a question?

25/06/2013H00900Senator David Cullinane: I support the need for-----

25/06/2013H01000An Cathaoirleach: Is there a question for the Leader?

25/06/2013H01100Senator David Cullinane: I ask that we have that debate on banking and the need for a banking inquiry.

25/06/2013H01200An Cathaoirleach: Are you proposing an amendment to the Order of Business?

25/06/2013H01300Senator Darragh O’Brien: It has been made.

25/06/2013H01400Senator David Cullinane: I thought one had been proposed but, if not, I propose an amendment.

25/06/2013H01500Senator Catherine Noone: I join other Senators in expressing my outrage at the revelations on the tapes. Caution is required as in a year or whenever it comes to pass that these people come before the courts, there will be senior counsels arguing that prejudice will arise from the amount of information in the public domain. We must be very careful about the level of detail with which we discuss these matters. I appreciate Senator Crown’s point that the issue of getting the information out there is important, but we must hope that at least one good thing will come from the publication of the tape transcripts, and there will be pressure to have an inquiry. The question is why it has not happened before now.

The Office of the Director of Corporate Enforcement is vastly under-resourced, and this is perhaps highlighted by the fall in the number of convictions for white collar crimes. The number fell to just 178 in 2010, compared with 579 in 2003, although the number of white collar cases increased in that period. It is a startling statistic and although the director is trying to do the best job possible, one wonders if the office needs much more resources. One also wonders whether with further foresight legislative provisions should have been created to oblige executives to disclose any material facts before any State intervention could take place, and if material facts were not disclosed by these criminals, this could be punishable by conviction.

If people were unfortunately injured because of a train crash, an inquiry would be carried out. People have been seriously injured, not least in a psychological sense, because of the de- mise of the economy.

25/06/2013H01600An Cathaoirleach: The Senator has gone beyond her allotted time.

25/06/2013H01700Senator Catherine Noone: I appreciate the indulgence. Why has the process taken so long 238 25 June 2013 and could we please have the Minister for Finance before the House to let us know when the inquiry will take place?

25/06/2013J00100Senator Feargal Quinn: Could the Leader tell us what progress has been made in respect of the two Seanad Bills we debated here last month? The Seanad Bill 2013 passed Second Stage last month and concerned reform of the Seanad. Yet we will introduce a Bill tomorrow to abolish the Seanad. Should we not be taking the Bill to reform the Seanad ahead of the one that aims to abolish it? Could the Leader tell me where we stand on that?

I support Senator Crown and others who have spoken about the need for a timeline with regard to the terms of reference for the banking inquiry that we assume will take place. Sena- tor Mary Ann O’Brien touched on the topic that has frustrated me over the years, namely, the length of time it takes to get something done in this country. It has been almost five years since that night in September 2008. It takes so long to get things done. I look at the commercial world where things happen much more quickly. I look at the US where things happen much more quickly. Can we not find some way to at least move things along much more rapidly than we do at the moment? I cannot believe it takes so long to do these things and I believe that, on this basis, Senator Crown’s call for the Minister to come to the House to explain-----

25/06/2013J00200Senator Marie-Louise O’Donnell: And calls from other Senators.

25/06/2013J00300Senator Feargal Quinn: Yes, other Senators have called for it as well but Senator Crown put down an amendment to the Order of Business supported by Senator Barrett and many others. Can we move the timeline along much more quickly than we have done in the past and make sure that it will not be months before we get the terms of reference for the banking inquiry?

25/06/2013J00400Senator John Gilroy: I have two points to make regarding the controversy in the media surrounding Anglo Irish Bank. Of course, I agree with Senator Darragh O’Brien that we should be responsible in what we say. There is no question about that. However, when ordinary people on our streets and in workplaces, pubs, homes, the media and talk shows are discussing the recent revelations with particular outrage, one cannot say that this House should not have an opinion on it. This House should have a very robust opinion on it. When we are discussing this, let us do our job properly as Senators and leave the parties outside the door while we deliberate on this matter. I say that as a Labour Party Senator whose party’s hands are particularly clean on this matter but I will not labour that point.

We have heard much discussion about inquiries and investigations into the situation that evolved. This is an iconic moment in Irish democracy. Twenty years ago, there was significant concern about the apparent impunity with which organised crime operated culminating in the death of journalist Veronica Guerin. After that, the response of our Government was not an ordinary one. It was an extraordinary response where the authorities moved beyond the group- think in which we seem to be caught with regard to this. When we are talking about Oireachtas inquiries and commissions, perhaps we are not going far enough and are not being ambitious enough. Perhaps we should front-load resources into the criminal area or think completely outside the box and devise a new agency with the absolute powers it needs to investigate this matter. This iconic moment will determine what kind of democracy we want to live in. Does the same law apply to a young fellow who might steal one’s car from outside one’s door and a banker who might steal one’s country? The answer to that must be “Yes”.

239 Seanad Éireann

25/06/2013J00500Senator Mary M. White: I extend my congratulations to Councillor Ian McGarvey and his wife Marjorie. Councillor McGarvey is 82 years of age and has been elected chairman of Donegal County Council. I suggest we all send him a note of congratulations. I am honoured to be a friend of Councillor McGarvey and his wife.

This morning I had the privilege to attend a fascinating conference on child care. Also in attendance were national and international experts. There was shock and horror in Ireland following the RTE “Prime Time” programme on crèches in Ireland. It is forgotten that the children of this country are the leaders of the future. We need to prioritise much more our vision of children in society. That television programme showed a lack of care and love for the children in the crèches. After 26 weeks of maternity leave, many women return to work, but they want their children to be loved. Love is more important than an academic education. Children learn from birth. If they are to avoid going into badly managed crèches which have poorly trained staff, we need to set high standards for those who work in our crèches. I am honoured to have been part of the Fianna Fáil group which took the initiative on the free preschool education. I am honoured also to have been part of the effort to put a Minister for child care in place. There is 95% take up of free preschool child care in the country. I call on the Leader to arrange for an urgent debate on the issue of child care. Those children are the leaders of the future.

25/06/2013K00400Senator Martin Conway: I, too, share the sentiments expressed by all speakers on the banking situation. I sincerely hope that action to deal with it can be fast-tracked.

I welcome the announcement today of the reversal of resource teaching hours cuts. I agree with Senator Darragh O’Brien on the need for a reversal of special needs assistant, SNA, cuts also. As a matter of fact, there is a need for a reversal of the cuts that have taken place in the past couple of years because there is nothing more important than ensuring everyone has equal access to education. I regret the manner in which this issue has been handled by the Minister. It is extraordinary that an announcement such as this can be made on a Thursday and back- tracked on the following Tuesday. In essence, the announcement should not have been made. I regret also the scenes on the plinth where back bench Deputies flanked the Minister for obvious political gain in making that decision. That is the type of politics that took place in previous Governments. It is in the past and should be in the past. It is regrettable that SNA and resource teaching hours cuts, above all issues, should be politicised in that appalling manner.

25/06/2013K00500Senator Lorraine Higgins: The contents of the Anglo Irish Bank tapes which have emerged in recent days are not only outrageous but insulting to the people. The effect of those details on taxpayers’ lives is almost matched by the arrogance dripping from Bowe, Drumm and Fitzgerald. It is outlandish that these people were able to-----

25/06/2013K00600An Cathaoirleach: I ask the Senator to refrain from mentioning names on the record of the House.

25/06/2013K00700Senator Lorraine Higgins: I will not mention them again. In any case, it is outlandish that these people were able to dupe the regulatory authorities of this country and the taxpayers to such an extent. The question that arises is whether there are further tapes. Are there tapes similar to what we have heard, where bankers act and behave in a cavalier manner towards the taxpayers of this country? We should demand that the taped conversations from Bank of Ireland, AIB, Permanent TSB and Irish Nationwide, among others, should be made available in the public interest from one month before the bailout to one month after the bailout. These tapes should be supplied immediately to the Joint Committee on Finance, Public Expenditure 240 25 June 2013 and Reform in the interests of transparency and accountability in order that any further action that may be necessary will be taken.

25/06/2013K00800Senator Terry Brennan: I acknowledge the fact that tourism figures have continued to rise for the first half of this year. The number of holiday visitors is up 19% and revenue is up 12%. There is no doubt that The Gathering will be a great success and is working well in many communities across the country. We must encourage all communities and all tourism agencies to keep up the good work. This will be a great year for tourism in Ireland and we all must continue to play our part.

I support Senator Quinn’s questioning of the Bill to reform the Seanad. The legislation has reached a certain stage and is now being held in abeyance by the Bill to abolish the Seanad that will reach us in the next couple of days. That is putting the cart before the horse and I ask the Leader if there is a specific reason for that to be the case.

25/06/2013L00150Senator Trevor Ó Clochartaigh: Ba mhaith liom tacú leis an moladh atá molta ag mo chomhghleacaí, an Seanadóir Cullinane, go mbeadh díospóireacht againn maidir le cúrsaí baincéireachta. I second the amendment to the Order of Business proposed by my colleague, Senator Cullinane.

25/06/2013L00200An Cathaoirleach: Senator Crown has already proposed an amendment.

25/06/2013L00300Senator Trevor Ó Clochartaigh: Okay. I shall third it because we need a debate on the banking sector. I was unaware that Senator Crown had seconded the proposal which is fine.

Sinn Féin’s record in the House on these issues has been very clear. We have not supported the bailout, we did not support the Personal Insolvency Bill and we did not support turning of bank debt into sovereign debt even though we had to sit through the night to debate it here.

The revelations over the past couple of days are appalling but unsurprising to many people because it was part of banking culture. A number of questions need to be asked. Why was such a culture allowed to develop in the first place? What was happening from a regulation point of view? Why was a decision made without documentation or further information being made available? Was either available? If so, why was it not acted on? How did the tapes get into the public domain? People want to know why people have not been brought before the courts and if there are issues that can lead to prosecution then why have people not been prosecuted.

The Seanad still exists and is the perfect forum to discuss and debate these issues in great detail. It is important that we do so.

25/06/2013L00400An Cathaoirleach: Before the Senator resumes his seat I wish to clarify a matter. Senator Crown’s amendment concerns the Minister for Finance and refers to the timeframe and orders of reference for the proposed banking inquiry to be taken today. His amendment is similar to Sinn Féin’s proposal. Is that the case?

25/06/2013L00500Senator Trevor Ó Clochartaigh: Yes.

25/06/2013L00600Senator Michael Mullins: I want to join in the words of congratulations extended to the Leader on the occasion of his son, John, being elected Mayor of Waterford. I also congratulate my colleagues in Galway on their success. Councillor Pádraig Conneely has been elected Mayor of Galway City and Councillor Liam Carroll has been elected Mayor of Galway County.

241 Seanad Éireann I applaud journalist Paul Williams and the Irish Independent for the fantastic service that they have done the State in blowing open the Anglo Irish debacle. They have exposed and informed the public about the contents of the taped conversations. The public is rightly angered and I met some of them in my local newsagent this morning before I left Ballinasloe. They are angry about the contents of the tapes. As Senator Crown has said, they are angry about the consequences that stemmed from the actions of those bankers. I call for the immediate establishment of a robust and cost-effective inquiry that will examine every aspect of the banking debacle over the past decade. We have all seen the effects of light touch regulation when it comes to possible criminality and how close bankers are to the political system. The issue needs to be thoroughly investigated but quickly. I renew my call on the Leader to arrange a debate with the Minister for Finance but I accept that he will not be available today. However, it would be important for the Minister to have a debate with Members on current practices within the banking sector because I have been inundated with complaints from customers about the level of charging within the banks. Such customers are paying for the misdemeanours of bankers in the past and small businesses are being absolutely crucified with banking charges and poor levels of service within the banking system. Customers and small shops that deal with a lot of coins and currency cannot get the level of service from banks they had come to expect but are being charged outrageous amounts of money and are being obliged to present themselves at a time that suits the bank and not a time that suits them.

25/06/2013M00200An Cathaoirleach: The Senator is over time.

25/06/2013M00300Senator Michael Mullins: Members must consider this issue before the grinding of small businesses into the ground goes any further. The Leader should organise such a debate as a matter of urgency.

25/06/2013M00400Senator Jim D’Arcy: Although James Gandolfino, also known as Tony Soprano, died last week, what I listened to on the tapes published yesterday and today was straight out of “The Sopranos”.

25/06/2013M00500Senator Mary M. White: Hear, hear.

25/06/2013M00600Senator Jim D’Arcy: I also agree with Senator Mullins that while investigating the outrageous happenings of the past in banking, an eye also must be kept on what is happening at present, whereby small and medium-sized businesses are unable to get loans. Dean Swift wrote an essay called “A Modest Proposal” in which the Irish people who were poor ate their own young, perhaps to keep going. Small and medium-sized enterprises seeking loans must take out personal loans to such an extent that they must mortgage everything they possess and Members must examine this practice.

In addition, as Fine Gael spokesperson for education in the Seanad, I was appalled to read over the weekend that the Garda is to probe reports that pupils were handcuffed and beaten on a school trip. One parent has stated:

Over four days... my son was subjected to assaults and abuse; he was dragged from his room, handcuffed, beaten, punched and kicked, had obscene things written on his arm, and this happened many times throughout the day.

I congratulate Deputy Keating on his efforts to bring this matter into the public domain and support him in seeking either an independent inquiry or at least an inquiry undertaken by the Department of Education and Skills into such outrageous happenings. 242 25 June 2013

25/06/2013M00700Senator Mary Moran: I echo Senator Conway’s welcome of the announcement made at lunchtime today by the Minister for Education and Skills, Deputy Quinn, concerning his reversal of a decision. Despite the same number of teachers and special needs assistants being available and despite the provision of €1.3 billion out of the education budget of €8 billion, there were perceived cuts which would have resulted in students having fewer hours of resource teaching. Consequently, I welcome the Minister’s announcement and agree with Senator Conway that children must be our priority. They must be given the best facilities and opportunities it is absolutely possible to give. The Minister, Deputy Quinn, must be commended on going back to the Cabinet, on listening to the concerns my colleagues and I have raised with him during the week and on listening to the concerns of parents and those who would be affected by it. It takes a certain amount of courage to stand up and admit one should ascertain what can be done and I welcome that decision. It is a good day for special education and for the Government.

25/06/2013M00800Senator Diarmuid Wilson: I join colleagues in welcoming the reversal of the cut to the special education grant that was announced last week. As my leader has observed, he does not know how one could reverse a cut that was not a cut, because it was not only the Minister for Education and Skills who stated there was no cut to the budget. The Tánaiste repeated on a number of occasions in the Dáil last Thursday that there was no cut but obviously there was a cut. I welcome the fact that it has partially been reversed. I call on the Minister to finish the job now and to increase the budget for special needs assistants.

25/06/2013N00200Senator Mary M. White: Hear hear.

25/06/2013N00300Senator Diarmuid Wilson: I join colleagues in calling on the Minister for Finance to come to the House to outline clearly to us what plans the Government has to carry out an investigation into what happened five years ago.

I support Senator Lorraine Higgins’s call for the tapes from the other banks to be handed over. It was as a result of the Garda Síochána raiding Anglo Irish Bank that the tapes happened to come into the hands of a journalist, albeit five years later. I very much welcome the fact that the tapes came into the hands of Paul Williams. It is in the public interest. The tapes of other banks should be voluntarily handed over by the other banks that have been guaranteed by the State so that an investigation could be carried out.

25/06/2013N00400Senator Maurice Cummins: As I predicted, the vast majority of Members of the House have spoken about the need for a banking inquiry and discussed the shocking revelations of the tapes from Anglo Irish Bank. People ask why it has taken five years to address the matter. The Government put a referendum to the people on inquiries, which was rejected. The Houses of the Oireachtas (Inquiries, Privileges and Procedures) Bill is currently in the other House and Report and Final Stages will be taken early next week. I assure Members that we will facilitate the passage of the Bill in this House in the current session, despite our workload, before the summer recess.

An important principle embodied in the legislation is the responsibility assigned exclusively to the Houses themselves for determining the requirement of an inquiry, initiating it and agree- ing its terms of reference as well as the procedural and organisational aspects of the inquiry. Prior to the initiation of a banking inquiry a number of steps must be carried out by both Houses. They include the approval of the draft commencement order of the Bill, putting in place rules and standing orders to govern the establishment of an inquiry, and drafting necessary guidelines and standing orders to ensure the effective and efficient operation of such an inquiry. They are 243 Seanad Éireann the procedures we must follow. We will have ample time to discuss the Bill in the House before the summer recess. I hope that will pave the way for a banking inquiry early in the autumn.

I have outlined the procedures involved prior to the setting up of a banking inquiry, which has been sought by the majority of speakers in the House this afternoon. I fully agree that this is a very serious matter that must be addressed. I thank Members for bearing in mind in their comments the need to be careful in what they say because these matters will be before the courts as well, I hope in early course.

I welcome Senator O’Brien’s acceptance of my suggestion. I presume the House will accept that we will now deal with Committee and Remaining Stages of the Health (Amendment) Bill this afternoon.

Special needs assistants was another matter raised by a number of speakers in the House today. I remind Senator O’Brien, as I did last week, that the provision for special needs assistants for the coming school year will remain at the same level as this year. We must all be clear about this point to avoid any unnecessary distress for parents. The number of special needs assistants remains at 10,575. As there has not been a significant rise in the demand for special needs assistants’ support this year, there has been no policy change required to stay within the capped number. The NCSE has indicated demand for resource teachers has risen over the past year. The overall number of children in the system has risen by 1.3% in the past year but the number of applications has risen by 12% for next year. The Minister for Education and Skills, Deputy Quinn, has made it clear we must explore the reasons for this unprecedented rise in applications. Our response to this demand cannot simply be to continue increasing spending in an unsustainable manner, an approach adopted by the last Fianna Fáil Government.

Eamon Stack, a former chief inspector of schools, has been appointed chairman of the group with a mandate to report to the Minister for Education and Skills by the end of September with preliminary views on how the allocation system may be reformed. Pending receipt of that report, the Cabinet has agreed that the 500 posts which have been held in reserve for late applications will be used immediately to ensure the individual allocations will be preserved at 2012-2013 levels, while the transition to a new model of resource allocation is under way. This is further evidence that the Government remains fully committed to protecting children with special educational needs.

Senator Bacik spoke of the need for a banking inquiry and called for a debate on multi- denominational schools and we will try to get the Minister for Education and Skills to come in to discuss that.

Senator Mary Ann O’Brien called for a timescale for the national children’s hospital. I will try to get that from the Minister for Health and forward it to the Senator.

Senator Colm Burke called for a debate on maternity services and alluded to a national perinatal report that was published recently. I will raise that matter with the Minister for Health and his Department and refer to that report.

Senator Kelly called for a further Bill to amend the Personal Insolvency Act. I do not know if that can be done, although I am sure it can. The Senator will have ample opportunity to raise that with the Minister for Finance, who will be in the House to discuss the Central Bank (Su- pervision and Enforcement) Bill that we partly discussed last week.

244 25 June 2013 Senators Cullinane and Ó Clochartaigh called for a banking inquiry. Sinn Féin is on message but it has selective amnesia because it supported the bank guarantee, which it tends to forget on these occasions.

Senator Noone raised the statistics on white collar crime, which is very prevalent and relevant at this stage.

Senator Quinn spoke about the Bill to allow for a referendum on the abolition of the Seanad. The Second Stage of that Bill will commence tomorrow and will be resumed on Thursday. If it is not completed, it will be resumed again to be completed on Tuesday of next week. We will then proceed to Committee Stage of the Bill. In respect of the reforming Bills on the Order Paper, the Government’s wish is to proceed with the Bill to allow for a referendum on the abolition on the Seanad. While Second Stage of the Senator’s reform Bill was passed, it is the wish of the Government to proceed with the Bill to abolish the Seanad before dealing with the reform aspects of the other two Bills. That is the way the Government will proceed.

Senator Mary White congratulated Councillor Ian McGarvey, an 82 year old, on his election as chairman of Donegal County Council, while other speakers congratulated the mayors and chairpersons of other local authorities who were elected last evening.

Senator Terry Brennan called for a debate on tourism and suggested the number of tourists has increased this year. He is correct that the figure has increased significantly. I have asked the Minister for Transport, Tourism and Sport, Deputy Varadkar, to come before the House to address this issue. While I have not yet received a date from the Minister, he has indicated he will come to the House.

I believe I have addressed all the matters raised and apologise if I omitted any issue. I do not propose to accept the amendment to the Order of Business.

25/06/2013P00200An Cathaoirleach: Senator John Crown has moved an amendment to the Order of Busi- ness, “That a debate with the Minister for Finance on the timeframe and orders of reference for the proposed banking inquiry be taken today”. Is the amendment being pressed?

25/06/2013P00300Senator John Crown: Yes.

Amendment put:

The Seanad divided: Tá, 17; Níl, 21. Tá Níl Barrett, Sean D. Bacik, Ivana. Byrne, Thomas. Bradford, Paul. Crown, John. Brennan, Terry. Cullinane, David. Coghlan, Eamonn. Mac Conghail, Fiach. Coghlan, Paul. Mooney, Paschal. Comiskey, Michael. O’Brien, Darragh. Conway, Martin. O’Brien, Mary Ann. Cummins, Maurice. O’Donnell, Marie-Louise. D’Arcy, Jim. Ó Clochartaigh, Trevor. D’Arcy, Michael.

245 Seanad Éireann Ó Domhnaill, Brian. Gilroy, John. Power, Averil. Henry, Imelda. Quinn, Feargal. Higgins, Lorraine. van Turnhout, Jillian. Kelly, John. White, Mary M. Moloney, Marie. Wilson, Diarmuid. Moran, Mary. Zappone, Katherine. Mulcahy, Tony. Mullins, Michael. Noone, Catherine. O’Neill, Pat. Sheahan, Tom.

Tellers: Tá, Senators Sean D. Barrett and John Crown; Níl, Senators Paul Coghlan and Ma- rie Moloney.

Amendment declared lost.

Order of Business agreed to.

Employment Equality Act 1998 (Section 12)(Church of Ireland College of Education) Order 2013: Motion

25/06/2013S00200Senator Maurice Cummins: I move:

That Seanad Éireann approves the following Order in draft:

Employment Equality Act, 1998 (section 12)(Church of Ireland College of Education) Order 2013,

A copy of which Order in draft was laid before Seanad Éireann on 4th June, 2013.’’

Question put and agreed to.

Electricity Regulation Act 1999 (Restricted Electrical Works) Regulations 2013: Referral to Committee

25/06/2013S00500Senator Maurice Cummins: I move:

That the proposal that Seanad Éireann approves the following Regulations in draft: 246 25 June 2013 Electricity Regulation Act 1999 (Restricted Electrical Works) Regulations 2013,

copies of which have been laid in draft form before Seanad Éireann on 13th June, 2013, be referred to the Joint Committee on Transport and Communications, in accordance with Standing Order 70A(3), which, not later than 9th July, 2013, shall send a message to the Seanad in the manner prescribed in Standing Order 73, and Standing Order 75(2) shall accordingly apply.’’

Question put and agreed to.

Social Welfare and Pensions (Miscellaneous Provisions) Bill 2013: Committee Stage (Re- sumed)

25/06/2013S00800An Cathaoirleach: I welcome the Minister for Social Protection to the House.

Section 11 agreed to.

SECTION 12

Question proposed: “That section 12 stand part of the Bill.”

25/06/2013S01200Senator David Cullinane: We regard this section as being all about sanction and stick with no carrot whatsoever. Unfortunately we have seen far too many people in the State lose their jobs in the past five years. The majority of those people were happy to be in work and are devastated when they lose their jobs. They want to get back into employment as quickly as possible, but the problem is not enough jobs are available which is why many young people are forced to emigrate and those who do not emigrate end up on the live register.

A person, who loses his or her job in June and wants to do a course or take part in an educational programme that does not start until September or even October, will end up for a period of time on social welfare. As sections 12 to 15, inclusive, are very similar, I do not intend to come back on any of the other sections. The Independent Senators have tabled specific amendments, which are similar in effect to what I want to discuss, and I will support them.

4 o’clock

I have a problem with the words “just cause” in this section. I do not like the fact that we are not being prescriptive in this area and are giving far too much flexibility and powers of discretion to the deciding officers to decide what is just cause. We should be much more prescriptive about what we mean by “just cause” because far too often I have seen deciding officers and others make decisions based on their perceived wisdom. Even in the case of guidelines presented by the Department on a range of issues, they give their view or their interpretation of them. They have huge powers of discretion but they do not always make the right decision. Sometimes they do but sometimes they do not. Where possible, we should be as prescriptive as possible in an area as sensitive as this one where there will be sanction for somebody who does not take up a course. They may have a just cause for not doing so but the interpretation of the deciding officer might be something else. When our amendments tabled in the Dáil were ruled

247 Seanad Éireann out of order, we tabled amendments to oppose the section to again make the argument that we would prefer the Minister and the Government to set out in clear terms and simple language a set of guidelines that can be given to deciding officers on what constitutes just cause in this area. That would be far more beneficial and fairer to the people who find themselves in a position where they may be sanctioned unfairly.

25/06/2013T00200Minister for Social Protection (Deputy Joan Burton): I do not know if it has escaped Senator Cullinane’s attention but people at work pay tax and PRSI so that we can have a remark- ably decent social welfare service in this country, notwithstanding the knocks and the shocks the economy has suffered through the actions of the banks and the collapse of the construction industry. It is important, as Minister for Social Protection, that I balance my responsibility to people who have, unfortunately, lost their jobs, and we lost 350,000 jobs in the three years after the banks’ collapse - we literally fell off a cliff in terms of employment - with my responsibili- ties to the people paying for the system, that is, the people in work paying their tax and PRSI.

The section states clearly that if someone is made a reasonable offer regarding education, training or getting back to work, they have an obligation in that regard. In effect, they have a contract with their fellow citizens who are funding the system to engage. This is about failure to engage with the social welfare system.

25/06/2013T00300An Cathaoirleach: Could I interrupt the Minister to deal with a matter?

25/06/2013T00400Deputy Joan Burton: Yes.

Progress reported; Committee to sit again.

Request to move Adjournment of Seanad under Standing Order 30

25/06/2013T00700An Cathaoirleach: I have received notice from Senator Crown regarding a motion he wishes to raise under Standing Order 30. I call on Senator Crown to give notice of the motion before I give my ruling.

25/06/2013T00800Senator John Crown: I ask for an urgent debate on the topical issue of the need for a bank inquiry, its terms of reference and timelines.

25/06/2013T00900An Cathaoirleach: I have given careful consideration to the matter raised by Senator Crown. I do not consider it to be a matter contemplated by Standing Order 30. I regret, therefore, that I have to rule the matter out of order.

Social Welfare and Pensions (Miscellaneous Provisions) Bill 2013: Committee Stage (Re- sumed)

SECTION 12

Question again proposed: “That section 12 stand part of the Bill.”

248 25 June 2013

25/06/2013T01100Minister for Social Protection (Deputy Joan Burton): We are talking here about a mutual obligation, namely, the State supporting people who have, unfortunately, lost their job but the other side of that relationship is a commitment and an undertaking from the person on jobseeker’s allowance that they will engage in a meaningful way when offers are made to them in regard to various opportunities for education, training and engaging with the different schemes that have been established by the Government, including participating in service to their community or service more generally through Tús. For most people on the live register, the engagement is not only voluntary, but is actively sought. A small number of people choose not to engage, not to turn up to appointments and not to be available to discuss with social welfare officers how they might be assisted to get back to work. In the case of this small proportion of people we need to have sanctions available so if they decide to simply collect the money, but not engage with attempts by the Department on behalf of their fellow citizens and taxpayers to help them get back into education, training or work, then sanctions will be applied. This is a perfectly reasonable arrangement. The sanction is fairly limited. It is a reduction in the recipients’ personal rate and does not affect the rate of their partner or rates which might be paid to any dependants. It is with regard to the personal rate. Is the Senator stating that if young people on the live register aged 21, 23, 29 or 35, who receive the various levels of payment to which they might be entitled as jobseekers, fail to show up and engage that the social welfare system should have no way of directing their attention to help them get back to work? This is what this is about and it is a necessary feature of a social welfare system.

The Senator asked what constitutes good cause with regard to a person failing to engage with the activation process without good cause. In this context, good cause includes any number of circumstances which the social welfare offices receive and accept if they are true. These could be an illness on the day, unforeseen circumstances such as a family funeral or other commitments the person might reasonably have which would prevent him or her coming to the social welfare office and discussing the situation. If, in such circumstances, the person contacts the Department, he or she will be facilitated with an appointment to have a discussion with the social welfare office at another time. The concept of good cause is not new to these provisions. It already exists under the penalty provisions relating to failure to attend appropriate training courses. We are simply applying it to the other elements of the activation process. Where a person is not satisfied with a decision by a deciding officer to impose a penalty for failure to engage without good cause, the person can appeal this decision to the social welfare appeals office.

As I explained to Senators previously, the new Intreo system is a much faster and improved service for people who have become unemployed. Once people have registered with the service and have had their photo taken and signature verified, there will be group engagement whereby groups of up to 20 people will be invited together to the social welfare office. The Department of Social Protection will explain and go through the services available. The Senator might be surprised by this, but many people are grateful for the Department setting out what opportunities may exist, which could involve going back to education or training or getting involved and participation in important community activities through community employment or Tús. After group engagement, the person will be invited for a specific one to one interview with a social welfare officer and the person’s situation will be discussed in some detail. In countries where people go back to work quickly, particularly in the Scandinavian countries, this reciprocal contact and effort on the part of both the individual and the public employment services is what helps people who have lost their employment to get back to work. For the small number - it is a small number - of people who fail to engage with the system we need to be able to have sanctions available that compel their attention so that they will engage with the system. 249 Seanad Éireann

25/06/2013V00200Senator David Cullinane: The purpose of this and the next number of sections have not escaped my attention and I do not have a difficulty with it, although sometimes, for whatever reason, the Minister seeks to put words in my mouth and takes the most extreme example of a situation to offer as justification for her position. She also seeks to misrepresent my personal view, again for whatever reason. There is nothing in what the Minister has said that goes against what I have said. Never at any stage did I say I had a difficulty with a sanction being put in place when a person refuses to engage at any level with the system, or when he or she does not turn up for interview. Of course there must be a level of sanction and we must ensure that a sanction is in place for those who are unemployed, especially long-term, who will not engage, in spite of the best efforts put in place by the State, the Department and the Minister, or for those who simply opt out.

The Minister spoke about the fact that people who are working and paying taxes are paying for people’s social welfare. Equally, people who are out of work, who worked for a long number of years, paid into a social insurance fund, paid their PRSI and their taxes but now find themselves unemployed through no fault of their own. They are entitled to enjoy a level of support and need to be supported in respect of career paths, getting back to work, labour activation measures and so on.

However, there is an issue with just cause. The Minister stated that just cause is used in other areas of social welfare. We are inserting a new section here to impose a new sanction being put in place by the Government but it simply states “just cause”. The Minister gave some good examples, such as a person who has to attend a funeral, or whatever. That is my point. We should be more prescriptive around what we mean in regard to just cause. The Minister also stated there was established practice, something that already happens, and I acknowledge that. However, from my experience, having been a councillor for seven years and having dealt with thousands of cases of people who have made applications for social welfare on different levels, the just cause element has not always been used fairly simply because it is not prescriptive enough.

I refer to labour activation measures and the supports and pathways which the Minister stated were being used by the Department. Of course there are people who will be happy with the courses offered to them and the opportunities being made available, but equally people are being offered courses which have no relevance to them. These will not help them or offer them a career path but will be just a course for the sake of doing a course. That is not good enough, but the sanction will be in place if those concerned do not sign up for such courses. I fully support the policy that a sanction needs to be in place for people who do not engage at any level but sometimes the balance can go the other way. Although I agree with the Minister that we need to have a balance of responsibility, I believe we have gone too far in the other direction in terms of having too much stick and sanction, without having a clear view, as Oireachtas Members who are being asked to pass this legislation, of what constitutes good cause. For that reason, I cannot support the section.

25/06/2013V00300Deputy Joan Burton: I will go through the steps the Department undertakes. I very much doubt that many private firms would do what public servants do to encourage people and offer them as many opportunities as are humanly possible to engage with the system. Let us bear in mind that if they do engage, within three weeks, they will have purged their contempt and can have their payments restored.

First, a letter addressed to the person with a written invitation to a group engagement ses- 250 25 June 2013 sion issues to customers. This letter includes a warning regarding the possible imposition of penalty rates for people who fail to attend. Second, if the customer does not show up at the group engagement session, he or she is requested in writing to call to the local branch office for an interview. Is that not reasonable? Third, during this interview, a verbal warning regarding possible imposition of penalty rates is given. A second written invitation to the interview and the group engagement issues to the customer. If the customer does not attend the rescheduled engagement, the penalty rate is applied.

Over the period, four contacts have been made with the individual, at any which time he or she can pick up the telephone, e-mail or call in person to the local office and give the reason for the failure to attend. This is not some heavy hand lying in wait to trap people. This is a process of encouraging people to engage with the system. When the penalty rate has been applied, at the same time a rescheduled interview is notified to the customer so that the Department is trying to encourage the person to come and talk to the officials in order to try to get a job. At that stage, if the customer comes in, the penalty rate is lifted. The customer has many opportunities to engage. If the customer fails to engage at this point, the penalty rate remains in place and a full review of entitlements is scheduled.

I brought forward the idea of a penalty being applied for people who do not engage with the system, as they will be the beneficiaries of engaging with the system. Since I introduced this process in April 2011, a total of 2,841 penalty rates have been applied. The feedback on the ground is that most ordinary people feel this is a good idea. I would be particularly concerned about some younger people who might drift away and feel they do not have a future whereas if they talk to somebody about the educational opportunities open to them, they can actually complete or renew their education for their own sake and that of their family. They hopefully will get employment, but, if not, as Members will recall in the budget, I extended the number of community employment places by 10,000. The Tús local employment service gives people an opportunity to engage in work. I meet people all the time who have taken part in community employment schemes, who tell me how delighted they are to be working in the community sector and their hope that something will come from it. I think it is fantastic for a person to be facilitated by these schemes. It saddens me when I hear people say they sent out 200 CVs but never got an answer. People in human resource management will know that if one sends out a common CV, one is unlikely to get an answer but if one goes to a jobs club, which the Depart- ment funds all around the country, the outcome is better. I opened one recently in Kilkenny, the area in which I think the Senator lives. The people who had become involved in the jobs club gave us very positive feedback People involved in the jobs club were cut off from work, with some of them made redundant after working for 15 years through no fault of their own, as the business had just gone down. The club led to people feeling engaged and talking to other people, getting into a network and being helped back to work. Their comments were very pro- found, and such an initiative is the job of the Department. We are trying to bring such projects about. People may feel they are busy doing their own thing but one must work to get back into employment. Unless there are family connections or other networks, it takes much effort to get back to work and we want to help people in doing that.

If people are getting significant benefits from the State, I do not apologise for feeling I have an obligation to taxpayers and people who fund the tax and social welfare system. There is a small number of people that we can ask to pay attention and if they do not engage in the process, they will lose some of their money.

25/06/2013X00200Senator Michael Mullins: I am with the Minister on this issue and the proposals in the Bill 251 Seanad Éireann are realistic. The majority of unemployed people want to engage with the system and Senator Cullinane referred to people who have worked their entire lives. They would be the first people in to see how they can get assistance and training in order to help them back to work quickly. Unfortunately, a small section of the community has no interest in work and they will milk the social welfare system for all it is worth, making little or no effort to engage with either training and education or assistance in seeking employment. There should be sanctions for people who will not engage.

I heard a frightening statistic recently arising from a sixth class teacher in a primary school conducting a survey on what people would like to do when they completed their education. The main ambition of 75% of those in the class was to sign on for social welfare and draw the dole. We must break such a mindset and get people thinking about work and making a contribution to communities and society. They must know that there is no such thing as hand-outs for life. Unfortunately, in my part of the world I know two, three or four generations of people who have never worked, and they have suffered very little loss of income during the downturn. Conversely, the people who have worked all their lives, with a large mortgage and while putting their kids through education, have suffered and really lost out in recent years.

This is a reforming Minister but we are spending over €20 billion every year on social welfare. We must examine every aspect to see how we can get value for the taxpayer and people providing the funding on an ongoing basis. If there are abuses of the system, they must be stamped out, but above all we must encourage people to engage with the system and explore opportunities for work, education and other training. This will enable people to make a contribution to society, and I support the Minister in this regard. There are sufficient safeguards for people who find themselves in a difficult position because of family or other commitments, and they will not be penalised if there is a genuine reason not to engage at a certain time. They may have to engage at a future date. I support this section.

25/06/2013X00300Senator Marie Moloney: I support the Minister in this matter. Most people in the country want people who draw social welfare to be answerable to somebody in the Department. I understand what Senator Cullinane has said and sometimes courses may not suit people or an unemployed person may feel that he or she is being forced to take part in an unsuitable course. As with Senator Cullinane, I have been dealing with social welfare officers for nearly 17 years, which is a long time. I know a social welfare officer can be approached and told that a course really does not suit a person, and the officer will give a chance to see if another, more suitable course arises. They are not heartless people. We are giving the impression here that social welfare officers are heartless. They are not heartless, they listen to people and they have been engaging. The introduction of the Intreo offices, which I hope will be rolled out throughout the country, has been fantastic. One can walk off the street every Tuesday afternoon into the Intreo office in Killarney and go upstairs where one will be met by three people, one from FÁS, as we knew it, another from the Department of Social Protection and another lady who sits down with the individual to see what course best suits them.

This will cut out working in the black market. Some people do not want to go on these courses because they are working in the black market, so this is another way of stamping this out. The appeals system is open to people if they feel they are being unfairly treated. I do not think this will cause many problems for people because the majority of them want to work and will do anything to get back into the jobs market. In particular, as Senator Cullinane said, people who have worked all their lives are the first people at the door looking for a job. They do not want to be at home and drawing social welfare so they will engage with anything that 252 25 June 2013 can help them. I will be supporting this section.

25/06/2013Y00200Senator John Kelly: The Minister is welcome to the House. I support everything said by Senator Moloney. I know that most people who lost construction jobs as a result of the crash genuinely want to work and want to do anything it takes to get a job. I spoke to the Minister for Education and Skills in the House last week about a situation in my area where a young fellow who was on the dole for two years decided to study at night two subjects he failed in the leaving certificate. He studied at home and went to the UK to do an examination for one day to pass the two examinations that would qualify him for a course in engineering. He wanted to apply for the back to education allowance but was told that he would not receive it because he was not out of mainstream education long enough just because he went away to do one examination for one day. In effect, we are saying that we are not going to give that individual the back to education allowance but just leave him on the dole. I know that the one-stop-shop scenario is supposed to be a catch-all and a system that works and I fully support it but there needs to be less bureau- cracy attached to it. The case I cited is a clear example of where people should have the power to use their discretion. This guy wants to educate himself further and get a job, which he will eventually get if he is allowed to do it. I spoke to a social welfare officer yesterday who told me that it is a tick-box scenario. One must tick the boxes to qualify. This is just an example of where it is nonsense. I hope the Minister tells social welfare officers that they have a degree of discretion because, at the end of the day, we are not going to lose money on that.

25/06/2013Y00300Senator Paschal Mooney: I wanted to wait until everyone else had spoken because they are not directly related. I have a query regarding section 12(1)(a) regarding the substitution of “available for employment and” for “available for employment”. Could the Minister explain the reason for that? Could she also tell us the criteria used by the Department to deem a person available for employment? This revisits questions I raised about the acting profession. I know the Minister has acknowledged a letter I sent to her because I indicated on Second Stage that I would write to her about this. Anecdotal evidence suggests that social welfare officers are not being flexible when it comes to those in the acting profession who are resting between positions. They are sometimes deemed not to be available for employment. It has also been brought to my attention that there are courses run for the film industry which engage not only actors but also those in the technical professions in the film industry. This is being run by the Irish Film Board which has transferred that function from FÁS. It comes under the remit of the Department of Education and Science but the social protection dimension to the equation is that even though these courses are of short duration, I understand the Department of Social Protec- tion will not pay them unemployment assistance during that period. I am not sure whether they are available or eligible for jobseeker’s allowance. There are many questions relating to that issue but they all concern the one profession. If the Minister can shed any light on it I would be grateful but I await her more detailed reply in writing to the request I have raised.

25/06/2013Z00200Deputy Joan Burton: To which subsection is the Senator referring?

25/06/2013Z00300Senator Paschal Mooney: Section 12(1)(a).

25/06/2013Z00400Deputy Joan Burton: By substituting “available for employment and”-----

25/06/2013Z00500Senator Paschal Mooney: ----for “available for employment,”.

25/06/2013Z00600Deputy Joan Burton: It is just a technical adjustment.

25/06/2013Z00700Senator Paschal Mooney: I am curious to know if the word “and” led to something else, 253 Seanad Éireann because it has been dropped in the proposal. What was the reason for it?

25/06/2013Z00800Deputy Joan Burton: It is in regard to the language and the actual script in terms of the Bill but I will get a more detailed reply for the Senator from the Parliamentary Counsel.

25/06/2013Z00900Senator Paschal Mooney: It is just technical.

25/06/2013Z01000Deputy Joan Burton: It is technical. On the issue raised by Senator John Kelly-----

25/06/2013Z01100Senator Paschal Mooney: Sorry, will the Minister also address the questions I raised about the acting profession?

25/06/2013Z01200Deputy Joan Burton: The social welfare officers hear a great variety of explanations as to reasons people might be otherwise engaged as in the example given by Senator John Kelly. I am aware that people from many parts of the world are signing on as well as Irish people. For example, social welfare offices facilitate people if they wish to take a short holiday. I do not understand the exact circumstances that apply to the case raised by Senator Kelly but I know that people who wish to go on short holidays are facilitated, provided they get the advice and information. If the Senator provides the details I will ask the official in charge of the area the precise policy. By and large, within the social welfare offices we have a number of staff, as described by Senator Marie Moloney, some of whom are former community welfare officers and some are from the former FÁS, who are involved in the activation, interview, case management approach. There is a high level of flexibility to encourage people back. In many cases people may be working with the local employment service, if there is one in their area. The people involved in those services are, by and large, very generous and thoughtful in assisting people to make their arrangements. I am informed that section 12(1)(a) is consequential on the deletion of subparagraph (iv) which was a condition for jobseeker’s benefit, that is, the day of employment, and that is no longer required. It is a technical change to make clear what is involved.

25/06/2013Z01300Senator Paschal Mooney: I asked a question on the definition of “available for employment” as per-----

25/06/2013Z01400Deputy Joan Burton: The Senator asked that question in respect of people working in the film area.

25/06/2013Z01500Senator Paschal Mooney: In the arts.

25/06/2013Z01600Deputy Joan Burton: I have not had a reply on that issue as yet as the Senator raised it on the last occasion. When I get it I will-----

25/06/2013Z01700Senator Paschal Mooney: I am curious to know the actual definition that is used in general and what it means to be “available for employment”?

25/06/2013Z01800Deputy Joan Burton: As part of “available for employment and genuinely seeking work”, I am going back to the Senator’s example in respective of the acting profession. Suppose somebody is an actor, it is customary for such people to take part-time work elsewhere in, say, teaching or any type of work. If an actor has long spells of unemployment because he or she is unable to get work, it may be possible from time to time to suggest that, perhaps, he or she should seek other work if the acting career is not taking off. On the other hand, there is sympathy shown to a person who is routinely employed but is out of work between shows or rehearsals, although sympathy varies from office to office unless an actor can say that he or she is waiting for the next show to commence, say for a period of two weeks, and can give specific 254 25 June 2013 details. There is generally an amount of sympathy given in locations that have theatres and people involved in acting and the arts.

I shall outline what happens when suitable employment becomes available. Under the current activation mode if an actor has not worked for a long time but something suitable comes up then he or she will be greatly encouraged to take up the offer or, as I said earlier, return to education or some other activity.

25/06/2013AA00200Senator Marie Moloney: Different occupations share the same experience. For example, when a school closes, lollipop ladies or men and canteen workers must sign on for the duration of the summer. It is impractical for them to seek alternative work during the period but they can sign on. In addition, seeking employment can be made quite difficult for them due to the type of work available. One cannot take a job for just six or eight weeks in the summer, return to school and then do the same for holidays at Easter and Christmas. There must be flexibility in certain cases when it comes to being available for work and I cite the lollipop ladies and canteen workers in schools as an example.

25/06/2013AA00300Deputy Joan Burton: The issue that Senator Moloney has raised is an issue that has developed for all social welfare systems. Some employers want highly flexible labour contracts where a person is offered a very minimum number of hours yet he or she must remain available to the employer. In effect, the employer must pay for the actual hours worked on his or her premises and social welfare pays the balance. Inevitably, as people return to work, much of the work they will first encounter may be part time, contractual and atypical. What if large sectors were to become part-time employers where employers just paid people for the exact hours worked but did not give them enough hours yet social welfare had to pay the rest? We would have an enormously increased social welfare bill and employment would be extremely precarious.

Some employers are moving to zero hour based contracts. In my view, people need a living wage. We have a minimum wage in Ireland which is set at a relatively high level when compared with other European countries. What if a person only gets eight hours work at the minimum wage or continuously earns €2 or €3 above the minimum wage? Everybody can understand that during periods of downturn, like the one that we are experiencing now, some of these developments are inevitable. If zero-based contracts became the norm then the social welfare system would become extremely difficult to fund because not enough people at work would have enough hours to generate a sufficient income to be financially independent. One would then have continuing and enormous deficits in the social welfare system.

In London, the concept of a London living wage has been promoted. The aim is to have a decent rate of pay but sufficient hours to ensure that people have an income.

Senator Moloney commented on how difficult it is for workers such as lollipop ladies and canteen staff in schools to find more weeks of work. Obviously schools, because of funding issues, must let such staff go during the summer holidays and those staff must sign on for social welfare. Certainly, in most areas that issue was resolved some time ago and for those who are let go from their jobs during the summer, social welfare covers the balance. However, in a way this means that social welfare is carrying the cost of their downtime. This year, for instance, the Department of Social Protection will pay more than €220 million in family income supplement, that is, to people with children who work a number of hours but whose income still is too low and who need a top-up. Members should recall the Department is trying to design a social 255 Seanad Éireann welfare system in which work is always worthwhile and in which no one states a preference to take social welfare payments rather than work. However, as we return to recovery, many of the initial jobs are likely to be part-time and the statistics show this. We certainly must work at trying to provide people with sufficient hours to have a living wage, which is quite important.

Question put and declared carried.

Sections 13 and 14 agreed to.

SECTION 15

25/06/2013BB00500Senator Katherine Zappone: I move amendment No. 9:

In page 30, between lines 18 and 19, to insert the following:

“ ‘days’ refers to working days for the purposes of this Act.”.

I welcome the Minister to the House. This first amendment is a simple and straightforward amendment, which has been tabled by Senator van Turnhout and me, to clarify the meaning of “days” within this section of the Act. We simply seek to ensure the social welfare recipient is fairly treated by having adequate time to deal with such a serious matter that could easily affect his or her standard of living in a negative way. It also is to give adequate time to the Minister.

25/06/2013BB00600Deputy Joan Burton: I thank Senators Zappone and van Turnhout. On this amendment, it basically is introducing a facility for a notice of attachment for the recovery of social welfare overpayments in respect of, and I stress this point, people who have substantial overpayments outstanding but who no longer are in receipt of social welfare benefit, assistance or any other payment from which the overpayment could be recovered directly by the Department or who have other sources of incomes, such as earnings, deposits or debts due. Where there is a reason to believe that a third party, including a financial institution, has an amount of money due to an overpaid person, the Minister can direct it to recover the overpayment. The reason for this is that we have a problem in the Department, as I explained in the context of the Second Stage debate, whereby successive reports of the Comptroller and Auditor General have stated the Department should have mechanisms in place to recover amounts that are overpaid through error, fraud, misstatements or mistakes. Consequently, we can do that and did that by way of amendment in last year’s legislation to recover it from social welfare payments. The purpose of this provision is to attach it to other payments, such as in the case of someone who is employed.

This process is based on the Revenue process of recovery and it will be set out in regulations. The Revenue regulations are extremely detailed and I stress this is a last resort because when approached about overpayments, many people make reasonable arrangements with the Department of Social Production and with the Revenue Commissioners to refund or repay such overpayments. In total, the Department has overpayments outstanding, which we should be able to recover, of approximately €350 million. The timeframes specified are similar to the timeframes that are applied by the Revenue Commissioners, which are considered reasonable, especially having regard to the fact that there will have been communication with the overpaid person on a number of occasions prior to any notice of attachment being initiated or undertaken. For instance, if someone is deemed to have an overpayment, there is a process for the Depart- ment of Social Protection, as there is with the Revenue Commissioners, where the overpayment is identified and the person is notified that there is an overpayment. The person has a right to appeal the overpayment and to maintain that they do not owe the money and that a mistake has 256 25 June 2013 been made. In practice, the Revenue Commissioners and the Department rarely make a mistake with the numbers. We have all handled situations where a person was hopeful a mistake had been made but that was not the case. However, the individual concerned has the right of appeal. Once an overpayment is determined, a person can enter into negotiations with the Department on how to arrange for the repayment. That negotiation can take some time. In response to Senator Zappone, until we achieve the power set out in the Bill, the only alternative the Depart- ment has is to take civil court proceedings. One can understand that the process is extremely cumbersome and expensive. Accordingly, we have decided to copy the procedures of the Rev- enue Commissioners so as to be able to make attachment orders to recover the earnings.

Senators will recall that with overpayments from the Department of Social Protection, it is 15% of the principal individual social welfare payment of the person who has been overpaid. It does not relate to payments to a partner, spouse, dependent children or other dependants. The approach in this case will be similar. Once the legislation is passed, we will develop regulations which will set out the position in detail. I assure Senators that the procedure will be a very careful one. It is open to an individual to voluntarily make and enter into an arrangement with the Department. I do not propose to accept the amendment.

25/06/2013CC00200Senator Marie Moloney: Could the Minister clarify whether it is open to the Department of Social Protection to accept an offer to deal with an overpayment? For example, I am aware of a lady who was drawing a non-contributory old age pension but who had shares that were not of value at the time she applied for a pension, but when the shares rose in value she did not inform the Department of the situation. She is now deceased and her family has been asked to pay back €115,000. Is it acceptable to the Department that a person could make an offer on an overpayment?

25/06/2013CC00300Senator Michael Mullins: She obviously did not have Anglo Irish Bank shares.

25/06/2013CC00400Senator Marie Moloney: No.

25/06/2013CC00500Deputy Joan Burton: All I can say is that approximately 11% of overpayments arise from what are called estate cases, in other words, after someone’s death when their will is being probated and their property is being distributed. It sometimes does emerge that people who claimed various payments from the Department may have had significant assets far in excess of the assets permitted by the means test. As Senator Moloney is aware, the means test for the non-contributory old-age pension is quite generous. If memory serves, it is pretty significant. It will depend on the size of the estate and what it can bear. That is why it is important to bring to the attention of the Department if the means have changed, and that must be taken into account. It might be wise to have a word at local level with the senior manager in charge but will depend on the composition and extent of the estate and the circumstances.

25/06/2013DD00200Senator Katherine Zappone: I thank the Minister for her response. This amendment and the other amendments do not question the Minister’s right to recover overpayment. It is a significant sum of money each year and it forms part of the reform agenda, which I accept. As was pointed out, that is a much better alternative to civil court proceedings.

The Minister stated that she was not accepting the amendment because a significant period of time will pass, with correspondence back and forth, prior to the decision to attach a notice. The Minister is rejecting the amendment because the number of days stipulated are not necessarily working days in light of the fact that a lengthy negotiation has already taken place. I can

257 Seanad Éireann accept that.

There is one question in light of the Minister’s response. She indicated that people have a right to appeal the overpayment.

25/06/2013DD00300Deputy Joan Burton: They can appeal the assessment of the overpayment. That provision already exists in social welfare legislation.

25/06/2013DD00400Senator Katherine Zappone: People would therefore have the right to appeal the assessment of the overpayment.

25/06/2013DD00500Deputy Joan Burton: This has been an issue in successive reports of the Comptroller and Auditor General. In recent years the annual amount for overpayment, some of which arises from fraud, some from mistakes, a small percentage as a result of errors by the Department and some from estate cases, is around €90 million. In the context of the very painful changes I have had to make as Minister and those made by the previous Government, Senators will appreciate this is a significant amount. I agree with the Comptroller and Auditor General that the Depart- ment should put in place serious systems to make sure as much is recovered as possible and that it is done reasonably, taking into consideration each individual’s circumstances.

If an overpayment is calculated, the person is written to and advised that an overpayment has been calculated. Often an investigating officer is involved and the case will be discussed. Perhaps someone claims for more children than there really are and it comes to light. That person is advised that he or she has misclaimed child benefit for a period of time. Perhaps a partner lives with that person while she has been claiming lone parent allowance or, as Sena- tor Moloney referred to, someone has retired and claimed a non-contributory pension without disclosing the full extent of his means to the Department. When that person’s will goes to pro- bate, the value of the estate emerges and it is clear he should not have qualified for the level of payment he received.

The amount of the overpayment is calculated in the same way as back duty would be cal- culate by the Revenue Commissioners based on the number of years and the amount per year. The person is then told how this figure has been calculated, the assessment is made and he or she has a right of appeal. Appellants may set out any circumstances that support their view that an assessment is wrong. Once the appeals process has concluded, the next step is the issue of repayment. The simplest approach is for the person in question to make a voluntary arrangement with the Department to make the repayment in weekly, monthly or annual instalments, depending on circumstances.

Until the legislation was changed last year, the law prescribed that the maximum the Depart- ment could recover from a person with a social welfare income was €2 per week. We discussed the small number of people who abuse the social welfare system. However, some people simply gave two fingers to the Department by indicating that we could recover an outstanding amount of perhaps €20,000 at a rate of €2 per week. Senators can do the calculations but what is clear is that it would take a long period to recover such a large amount with such small instalments.

In the small number of cases where the Department wishes to recover overpayments arising from fraud, including significant amounts in some cases, we refer the matter to the Director of Public Prosecutions and Garda Síochána and these types of cases are now frequently prosecuted in court. A person may make a voluntary agreement with his or her local social welfare office to pay a reasonable amount, according to his or her circumstances. Where he or she does not enter 258 25 June 2013 into such an agreement, the Department, under this legislation, will have the power to make an attachment. We took such powers last year in respect of social welfare recipients. In the case of individuals who have received an overpayment, we have the power to make an attachment in respect of 15% of their income from social welfare. If a person is on the basic rate of €188 per week, the Department may deduct up to €28 per week, depending on circumstances. If, on the other hand, the person in question is not receiving an income from social welfare but is employed, the Department will obtain the same power as that available to the Revenue to recover the overpayment through an attachment of his or her earnings, bank account or assets.

As Senators may be aware, it has emerged in a number of the fraud cases the Department prosecuted through the courts that people had substantial amounts in their bank accounts. If a person comes before the courts having defrauded the State of, for example, €10,000 or €20,000, and he or she has a healthy bank balance with multiples of this amount on deposit, we should be able to recover the overpayment. The Bill gives us the power to do so. While I do not anticipate that this power will be used frequently, it is important that the Department is able to avail of it.

It is also important that social welfare officers have the power to stop people who are entering or leaving the country through our airports. In conversations on doorsteps, one used to hear that someone’s brother who worked at Dublin, Cork or Shannon airport had observed people travelling back and forth from other countries to claim social welfare here. Thanks to the powers provided by the Oireachtas, social welfare officers now have the power to stop and question people. If a significant level of fraud is discovered, a case may be taken before the courts. This important power forms part of a suite of powers available to the Department in its efforts to in- hibit fraud and abuse of the social welfare system and recover amounts that have been overpaid.

On occasion, an overpayment is made as a result of a genuine mistake, for example, where a person did not understand the rules. Nonetheless, arising from the reports of the Comptrol- ler and Auditor General, the Department has a responsibility to recover such funds. The rules will be operated with care and the regulations will be based on those available to the Revenue Commissioners and the process I have described. The regulations under which the Revenue Commissioners operate are extremely detailed. Presuming that this legislation will be passed, the regulations will be drafted within two months of its enactment.

5 o’clock

25/06/2013FF00100Senator Marie Moloney: I will not take much time as I know we have many amendments to get through. I am a little concerned about an attachment on an account because, to the best of my understanding, if an attachment is placed on an account, it cannot be used. If that is the only money people have coming through or they cannot use the account with the attachment for daily living, how difficult is it to lift the attachment from the account? What do people have to do to have the attachment lifted?

25/06/2013FF00200Senator Michael Mullins: In my experience, the voluntary arrangement works well, and if people are realistic, the Department is fair and reasonable. I have worked a few of those cases through with people.

Senator Moloney asked about cases where the estate of deceased persons is asked to refund significant amounts of money but are officials in the Department in a position to make a full and final settlement, perhaps in cutting a deal, where there has been an overpayment to a person and where the family inheriting the estate may not be in a position to repay the full amount?

259 Seanad Éireann To get around the problems that tend to arise with people, and particularly older people, being overpaid when making an application for a non-contributory pension, for example, and later having changed circumstances not relayed to the Department, should there be a system in place where every year or second year people would get a note in the post asking if circumstances have changed or income has increased since the award of the payment? It comes as a terrible shock to families on occasions where a person dies and it is discovered that he or she was getting a certain level of incorrect benefit from the Department, and the amount has accumulated over 20 or 30 years. The family may be left with a large bill. Perhaps we should highlight in the media how people claiming non-contributory benefits must declare all income or else they run the risk of leaving a debt legacy to children.

25/06/2013FF00300Deputy Joan Burton: It is always open to a person to speak to somebody in the Depart- ment and reach a deal and on most occasions people find the Department very reasonable, depending on what are their overall economic circumstances. My advice is that if an overpayment has arisen, the person should speak to somebody in the Department to make a reasonable arrangement. If a reasonable arrangement is made on a voluntary basis, there is no need for an attachment, and the process may be as simple as creating a standing order. One could make a reasonable payment based on the guidance of 15% of an individual’s personal income, leaving aside dependants.

Senator Mullins made observations regarding older people and we write on a continual basis to people in receipt of all kinds of different benefits in order to check if the address is valid and whether the person in question is still at the address. We also look to confirm that they are still entitled to the payment. Citizens Information and many organisations supporting older people also disseminate an amount of information about entitlements. I agree that if somebody is in doubt, he or she should call the Department or speak to an official and ask for a review. Our means tests are very generous in comparison with other countries and certainly in comparison with the United Kingdom and the recent changes implemented there. If somebody is unsure about an issue, they should check with Citizens Information or with the Department.

In reply to the Senator’s other question, it is possible to reach an agreement with the Depart- ment and the settlement would be based on resources available and the financial circumstances of the person in question. The sum in question is €92 million per year and if honest mistakes happen, they should be rectified as quickly as possible in an amenable way. The Revenue Com- missioners has an easier system because if people are in work, they simply adjust tax credits for the following year to reflect the change in circumstances. If we are dealing with a social welfare payment, it is also possible to do something similar. The Committee of Public Accounts and the Comptroller and Auditor General have certainly referenced this in reports over the past couple of years.

25/06/2013FF00400Senator Marie Moloney: What about the lifting of the attachment? Is it easily done?

25/06/2013FF00500Deputy Joan Burton: It is always possible to come to a voluntary arrangement, meaning there would not be an attachment.

25/06/2013FF00600Senator Marie Moloney: What happens if there is an attachment?

25/06/2013FF00700Deputy Joan Burton: There can be a reasonable voluntary arrangement.

25/06/2013FF00800Senator Marie Moloney: It could be lifted in that case.

260 25 June 2013

25/06/2013FF00900Senator Katherine Zappone: I thank the Minister for her response. Senator van Turnhout and I are not opposing the section, as we see it as important. Our amendments come from a concern to ensure that transparent and fair procedures are operating. The Minister has indicated an appeal for the assessment is allowed and this is stipulated in law but I have another question. The Minister has indicated that this is especially relevant where there are significant overpayments but will this process also apply where the overpayments are not as significant? The Minister also mentioned people who are employed, as distinct from unemployed people. The process will apply to both and our concerns relate to transparent procedures. The process will apply to both employed and unemployed people.

25/06/2013FF01000Deputy Joan Burton: Last year, the Seanad and the Dáil passed into law legislation applying to people in receipt of social welfare payments of any kind with an overpayment to allow for the recovery of up to 15% from the principal payment. I stress that this may apply to up to €28 per week from somebody in receipt of a personal payment of €188 per week. That is to allow for recovery, as opposed to previous arrangements, which allowed a maximum of €2 per week. That is unless, as occurs with many people, a voluntary arrangement is made. If the voluntary arrangement is reasonable and acceptable to both sides, I advise people to take it up.

The legislation we are examining today relates to people who are not receiving a social welfare income but who are in work or who have other assets, means or a business. It is to recover money from them in the same way that money is recovered from people on social welfare. The legislation we are now considering does not apply to people on social welfare but rather people who may have extensive savings, as happens in a number of cases and particularly if there is a case of fraud involved. If, for example, somebody was taking three social welfare payments by collecting money in two or three social welfare offices - this would probably be identity fraud - it would be a serious problem. One could imagine the results if these people could get €10,000 or €12,000 per year undetected for three or five years, and the amounts would build up. Recently we have detected people who have done this over a much longer period.

When we were discussing photos, I mentioned information technology with the new photo personal service cards. If somebody is collecting a social welfare payment in the Killarney office, IT will then ask whether this could be the same person who is collecting money from Ballinasloe and the office in Tallaght. IT will have discovered that it is the same individual. In that case, an investigating officer will examine the case, which may be prosecuted. It is really important that we build up a system where we recover the overpayments quite quickly. This section applies to people who are no longer being paid social welfare and are at work or have means through some other mechanism and arranges recovery from those means. We can send the Senator a copy. Once the legislation is passed, officials will be working on the regulations so we should have them available by the end of the summer and will be putting a copy in the library of the Houses.

25/06/2013GG00200Acting Chairman (Senator Paul Bradford): Can I ask Senators Zappone and van Turn- hout if amendment No. 9 is being pressed?

25/06/2013GG00300Senator Katherine Zappone: No.

25/06/2013GG00500Deputy Joan Burton: I should add one further point. The actual overpayment recovery arrangements in this section will come into effect by way of a commencement order that will be made after the enactment of this legislation and its signing by the President as soon as the necessary administrative arrangements and the guidelines to which I refer are put in place. We 261 Seanad Éireann will issue public notices through our information systems like citizens’ information boards. I anticipate that all going well, I will sign the commencement order towards the end of the summer or the beginning of the autumn.

Amendment, by leave, withdrawn.

25/06/2013GG00600Acting Chairman (Senator Paul Bradford): I am advised that amendment No. 10 is out of order as it involves a potential charge on the Exchequer.

25/06/2013GG00700Senator Katherine Zappone: We submitted a new amendment on the basis of that to the Bills Office but it did not come back so I am not sure what the problem was. We were told and resubmitted an amendment on the basis of that ruling although we could not really understand how a definition of overpayment would involve a charge on the Exchequer. I have a question about that.

25/06/2013GG00800Acting Chairman (Senator Paul Bradford): I must deal with the amendment before me, which was ruled out of order, but Senator Zappone flagged her desire to have the matter pursued by an appropriate amendment. Could I suggest that she and Senator van Turnhout attempt to introduce an appropriate amendment on Report Stage?

25/06/2013GG00900Senator Katherine Zappone: Okay.

25/06/2013GG01000Senator Jillian van Turnhout: We disagree with the ruling that the amendment is out of order because we reworded our amendment and submitted it. Perhaps we will be allowed to comment more generally on section 12 in respect of that issue?

25/06/2013GG01100Acting Chairman (Senator Paul Bradford): The Senator will appreciate that I must disagree with her opinion.

25/06/2013GG01200Senator Jillian van Turnhout: I just wanted it noted for the record. It makes it very difficult to debate social welfare issues if even when we are talking about overpayments, we are being told that it is a charge on the State. It is very difficult for us as a Senate to do it.

25/06/2013GG01300Acting Chairman (Senator Paul Bradford): The Senator could consult further with the authorities to see if her amendment could be taken on Report Stage.

Amendment No. 10 not moved.

25/06/2013GG01500Senator Katherine Zappone: I move amendment No. 11:

In page 32, line 10, to delete “person.” and substitute the following:

“person;

(h) any other debts owed by the overpaid person.”.

This amendment refers to the circumstances of the person who is overpaid and adds what we think is a significant circumstance the Department should take account of prior to making arrangements regarding how the person will repay the amount owed. We think it is a circumstance that is overlooked in the Bill. Obviously, it does list a number of circumstances in (a) through (g) that are taken into account, such as the individual’s personal and family circumstances and his or her net income or earnings. However, we believe that weight should also be given to people’s financial circumstances, particularly when they are over-indebted. The cir- 262 25 June 2013 cumstance would impact significantly on a person’s ability to repay the debt owed to the State and at a level that is still enables the person to secure an adequate income. This is why we put forward the amendment.

25/06/2013GG01600Deputy Joan Burton: As I said, in many ways the provision here is a last resort because the attachment powers will be only exercised where the person who has been overpaid has failed to discharge or engage with the Department on an outstanding overpayment. One must satisfy that a reasonable capacity to repay exists, namely: that the person has sufficient earnings or money held on deposit so that reparation can be made in full or in part; a final demand has issued to the person concerned advising them of the consequence of not repaying; the overpaid person is given the opportunity to make any representations so that any factors associated with the recovery of the overpayment can be duly considered; the overpaid person has been formally notified of the intention to issue a notice of attachment should he or she fail to respond within a defined time period; and there are no alternative recovery options available.

In respect of other debts owed by the overpaid person, there is already provision to take account of the person’s overall financial circumstances and within this framework, any other debts owed by the overpaid person can and will be fully considered. Underpinning these new provisions is the principle of the capacity of the overpaid person to repay.

For these reasons, I do not propose to accept the amendment. The principal part of the amendment concerns whether social welfare officers will take the person’s general financial situation, such as other debts, into account. The answer most definitely is “Yes”.

25/06/2013GG01700Senator Katherine Zappone: I thank the Minister for that explanation. Perhaps it is because I am still relatively new but if the answer is “Yes”, I am still not clear why the Minister would not accept spelling it out. Is she telling me it is implicit rather than explicit? Why would she not accept spelling out that other debts owed by the overpaid person will be taken into account? Are there other sections where it is spelled out explicitly?

25/06/2013GG01800Deputy Joan Burton: There is quite an amount of detail in the section. In addition, officials will spend a couple of months writing up fairly detailed guidelines modelled on Revenue’s approach to this area. I can assure the Senator that circumstances will be taken into account. The only other mechanism open to the Department at the moment is the much more cumbersome route of going to court. This will be a much easier process than taking somebody to court and will provide a much greater capacity to, hopefully, broker an agreement between the De- partment and the individual as to what constitutes a reasonable effort to repay the amounts due. The Department will be reasonable.

25/06/2013GG01900Senator Katherine Zappone: So the Minister is assuring us that it will become very clear in the regulations that the financial circumstances will be taken into account? Is that what she is saying?

25/06/2013GG02000Deputy Joan Burton: Yes. Part of amendment No. 15a states that prior to giving a notice under section 343D(1), the Minister, in determining the circumstances of the overpaid people, will take into account the following: their personal and family circumstances; any statutory deductions that may affect their earnings or income; the amount of the overpayment; the period of time for which the overpayment is outstanding; the amount of net income or earnings of the overpaid person, which is a very important point; the employment circumstances of the overpaid person; and the amount of debt due to the overpaid person. That is a very comprehensive

263 Seanad Éireann list setting out how a person’s likely financial circumstances are taken into account in assessing the overpayment.

25/06/2013HH00100Acting Chairman (Senator Paul Bradford): Is the amendment being withdrawn?

25/06/2013HH00200Senator Jillian van Turnhout: We reserve the right to bring it back on Report Stage.

25/06/2013HH00300Senator Katherine Zappone: Exactly. We will let it go for now because I hear all that is being said.

25/06/2013HH00400Senator Michael Mullins: When I looked at the Members I thought the Minister had included it, that instead of the amount of debt due to the overpaid person that she meant to include the amount of debt owed to the overpaid person. I cannot quite understand the circumstances in which debt would be due to the overpaid person.

25/06/2013HH00500Deputy Joan Burton: It can arise.

25/06/2013HH00600Acting Chairman (Senator Paul Bradford): Another interesting revelation in the Se- anad.

25/06/2013HH00700Deputy Joan Burton: The most common debt due to an individual is where a person has a deposit in a bank, the bank is holding the person’s money and that money is owed to the individual. It is implicitly moneys on deposit with institutions such as banks but it could be held by other people. If they have such moneys, they would be taken into account in the broad consideration of their capacity to repay. I am not suggesting that anybody would ever arrange that, it is in case that would happen, but it is to ensure we can take a reasonable view of what is the person’s capacity to repay.

25/06/2013HH00800Senator Jillian van Turnhout: I appreciate that but I ask the Minister to consider the amendment between now and Report Stage. Given that the Minister is explicit in all the other circumstances, why not be explicit about the debts owed by the overpaid person?

Amendment, by leave, withdrawn.

25/06/2013HH01000Senator Katherine Zappone: I move amendment No. 12:

In page 32, between lines 23 and 24, to insert the following:

“(2) The Minister shall, in deciding to give a notice under subsection (3), establish a fair and transparent procedure for examination of any

representations made by an overpaid person and ensure that-

(a ) due consideration is given to any response received from the overpaid person under subsection (1);

(b ) due process is followed;

(c ) the rules of natural justice are applied; and

(d ) the right of the overpaid person to be heard is vindicated.”.

This amendment relates to our concern in regard to transparent procedures. In this case when the Minister examines representations made to her by the person who was overpaid, the 264 25 June 2013 Bill states that the Minister shall give due consideration to any response received from the overpaid person before he or she decides to give notice. The process for considering these matters by the Minister is not outlined. Instead it would seem that this decision is entirely at the discretion of the Minister, or whomever is the Minister of the day. Consequently we offer the amendment because it is not clear to us that there is a fair and transparent procedure in place for examining these issues.

25/06/2013HH01100Deputy Joan Burton: Section 343D, the follow-on section, sets out the procedures. Guide- lines will be drafted, based on the Revenue guidelines which will set out, as does section 343D, the broad procedures on page 32 of the Bill, as amended by the Dáil.

25/06/2013HH01200Senator Katherine Zappone: The amendment refers to that section. The Minister’s response is that further regulations will be developed based on Revenue guidelines. Our amendment seeks in the context of those procedures being spelled out that due process is followed, the rules of natural justice are applied, and the right of the overpaid person to be heard is vindicated. The Minister said the procedures would be spelled out. Those are the elements of the procedures about which we are concerned.

25/06/2013HH01300Deputy Joan Burton: The procedures are set out fairly broadly in section 343D and will be augmented by regulations which will be published and laid before the House once the Bill is enacted. It will take about two months to prepare them.

25/06/2013HH01400Senator Katherine Zappone: We will not press it now.

Amendment, by leave, withdrawn.

25/06/2013HH01600Senator Katherine Zappone: I move amendment No. 13:

In page 33, line 13, after “196” to insert “whichever is the lesser amount”.

This amendment relates to the rate of reduction that one will seek to recover from the person who is overpaid, having taken into account their circumstances, as provided for in the Bill. The Minister has discretion to choose between a rate that cannot exceed 15% of the net weekly income or an amount that would cause the person to become eligible for supplementary welfare allowance. We think the rate determined should be the lesser of the two amounts. That is a fair way forward. The Minister needs to have the powers for recovery but not at the expense of the person’s ability due to inadequate income.

25/06/2013HH01700Deputy Joan Burton: Section 343E(3) sets out the parallel situation to the 15%. It reads:

The Minister, in determining the rate of periodical deductions under subsection (2), and in addition to considering the matters under section 343C shall not -

(a ) without the prior written agreement of the overpaid person, determine a rate that exceeds 15 per cent of the net weekly emoluments to which the person concerned is or becomes entitled,

In voluntary arrangements, people can decide how much they wish to pay. Sometimes people want to clear the debt quickly and may have the resources to do that and they do it. For example, older people who may have savings may decide to come in and clear the debt quickly. If that is not the case, which I anticipate in many situations, the Minister shall not determine a rate that exceeds 15% of the net weekly emoluments. That is the same principle for applies to 265 Seanad Éireann reductions from social welfare. It is the net weekly emoluments, payments of taxes, universal social charge, PRSI, that is taken into account. I think that is a reasonable basis on which to determine the rate. We had a detailed look at the issue to determine how we could strike a balance that was fair between the Department recovering moneys that are owed and taking into account the circumstances of the individual. I repeat, this is for circumstances where it has not been possible to make a voluntary agreement. The best option would be to make a voluntary agreement between the Department and the individual because that is by far the easiest procedure for everybody.

25/06/2013HH01800Acting Chairman (Senator Paul Bradford): Is the amendment being pressed?

25/06/2013HH01900Senator Katherine Zappone: I thank the Minister. We appreciate the reasons she has given especially when she said that it is possible at times where there is agreement to get more than 15%. Therefore, I can understand the reason the Minister would not accept our amendment, which proposes to add “whichever is the lesser amount”, because there are times when it could be more.

25/06/2013HH02000Deputy Joan Burton: We do not want a situation where the recovery of the amount is so onerous that the person would go on social welfare. If the person is in employment or has a business the object is not to destabilise that in any way but to reach a reasonable arrangement to recover the amounts.

25/06/2013HH02100Senator Katherine Zappone: That has been a very helpful exchange.

Amendment, by leave, withdrawn.

Section 15 agreed to.

Section 16 agreed to.

SECTION 17

25/06/2013JJ00200Acting Chairman (Senator Paul Bradford): Amendment No. 14 was tabled by Senator Mooney but it has been ruled out of order. I am sure that he appreciates the ruling.

25/06/2013JJ00300Senator Paschal Mooney: I do. I advise the Minister that I will redraft my amendment and will resubmit a more acceptable version on Report Stage. My amendment will be along similar lines but the wording will conform with the requirement.

Amendment No. 14 not moved.

Section 17 agreed to.

Sections 18 to 21, inclusive agreed to.

SECTION 22

25/06/2013JJ00700Acting Chairman (Senator Paul Bradford): Amendments Nos. 15 and 17 are related and may be discussed together by agreement.

25/06/2013JJ00800Senator David Cullinane: I move amendment No. 15:

In page 42, to delete line 4 and substitute the following:

266 25 June 2013 “ “ ‘An Chomhairle na Pinsean’, or in the English language, ‘Pensions Council’ means the body established by section 26B;”.”.

I will be brief because I know the matter has been discussed at Dáil level. We believe, certainly when it comes to Government agencies, that we should use the Irish language equivalent first and not the English language version, where possible. That is why my colleagues and I have opted for “An Chomhairle na Pinsean” instead of the “Pensions Council”, and similarly for amendment No. 17. We should give the Irish language its proper place. It is our first language and for that reason we should refer to all State bodies in the first language and not in English.

25/06/2013JJ00900Deputy Joan Burton: I understand the point of view shared by the Senators and confess to tabling similar amendments. However, I am not in a position to accept the amendment. The amendment proposes that the premier title be “An Chomhairle na Pinsean”. The English version is being used again because, in this particular case, it will be easier for the majority of the public to recognise and identify the organisation. The Irish name of the organisation will be used in context. The name “Pensions Council” reflects the purpose and composition of the body which is to give stakeholders with relevant expertise a forum to provide pensions policy advice to myself and the Department.

Amendment put and declared lost.

Section 22 agreed to.

Sections 23 to 25, inclusive, agreed to.

SECTION 26

25/06/2013JJ01700Senator David Cullinane: I move amendment No. 16:

In page 42, lines 19 to 21, to delete all words from and including “, in” in line 19 down to and including “Pinsean.” in line 21 and substitute “as An tÚdarais Pinsean or, in the English language, the Pensions Authority.”.

The amendment is similar to the previous one so I shall not speak again.

Amendment put and declared lost.

Section 26 agreed to.

Sections 27 and 28 agreed to.

SECTION 29

25/06/2013JJ02200Senator David Cullinane: I move amendment No. 17:

In page 43, lines 21 to 23, to delete all words from and including “, in” in line 21 down to and including “section.” in line 23 and substitute the following:

“as An Chomhairle Pinsean or, in the English language, the Pensions Council to perform the functions assigned to it by this section.”.

Amendment put and declared lost.

25/06/2013JJ02400Acting Chairman (Senator Jillian van Turnhout): Amendments Nos. 18 and 22 are 267 Seanad Éireann related and may be discussed together by agreement.

25/06/2013JJ02500Senator Paschal Mooney: I move amendment No. 18:

In page 43, between lines 26 and 27, to insert the following:

“(3) The Pensions Council shall advise the Minister as to how pension fund costs can be reduced.”.

My amendment is self-evident. It refers to advice the Minister can be given by the Pensions Council on how pension fund costs can be reduced. We dealt with its context and background on Second Stage. The Minister has some sympathy with its aim. There is continuing public disquiet over the manner in which pension funds are administered, particularly the high cost charges imposed on various pension funds. Perhaps she will address the issue before we discuss amendment No. 22.

25/06/2013JJ02600Deputy Joan Burton: The Senator will be aware that I published the first comprehensive Government report on charges attached to pension provision in Ireland last October. The purpose of the pension charges report was to gather information on the level of pension charges levied in Ireland, to assess whether charges are reasonable and transparent, to report on the findings and to make recommendations. The report obtained information from occupational pension scheme trustees, pension providers, pension advisers and investment managers. It highlighted a wide range of issues related to pension charges and identified a number of serious problems. While it was fully recognised that the provision of pension schemes cannot be cost free, it was clear that there are major challenges to be addressed in two main areas: reasonableness and transparency of charges.

With regard to reasonableness, the report concluded that there is a considerable variation in the range of charges imposed. Some schemes and individuals appear to be paying excessive fees. Smaller occupational schemes and individual pension arrangements appear to be com- paratively expensive.

With regard to transparency, the report concluded that there are deficiencies and inconsis- tencies in current practice and that a culture of providing clear information in a simple manner is not evident. A move towards greater clarity and transparency of pension charges is needed, in particular so that consumer can understand that a modest charge can have a very large impact on the final pension. In recent years people, many of whom are public servants, who invested in an additional voluntary contribution, AVC, were often very shocked, and continue to be shocked, when they see the value that the AVC achieves as they approach retirement and wish to avail of it.

The report discusses the optimum means of capturing all charges. It assesses the different measures, including reduction in yield and total expenses ratio. These were the two approaches used to capture the data. There have also been discussions about alternative ways to capture charges data. Total expense ratios are relevant to investment management costs and incorporate the additional operational costs of investment funds, such as fund administration and audit fees. However, commission costs such as administration and distribution costs can also impact on pension charging structures. These costs are not reflected in total expenses ratios. It is important that any comparator provides full and complete information on all the charges to achieve full transparency for the consumer. The report recommends monitoring developments in the area. 268 25 June 2013 Following the publication of the report last October, I invited interested parties to submit comments and observations regarding the report within a three month period and 19 submis- sions were received during the consultation period. Last April, having regard to the submis- sions made on the report, the Government approved the implementation of the recommendations in the report. I am now proceeding with the implementation of the recommendations contained in the report.

Each of the Department of Social Protection, the Pensions Board and the Central Bank has a core role to play in enhancing transparency and understanding of such charges. In order to initiate actions that follow up on the recommendations of the report, these organisations will continue to co-operate and co-ordinate activity. The primary change to occupational pension provision, which I am introducing in the Bill, is to give effect to the recommendations of the critical review undertaken by the Pensions Board and the Pensions Ombudsman as part of the public service reform plan. In this regard, section 29 of the Bill provides for the establishment of a pensions council, as we just discussed, to advise the Minister for Social Protection of policy matters on its own initiative or on request by the Minister. I look forward to the new pensions council bringing a fresh perspective to the formulation of pension policy.

The first task I am giving to the new council will be to monitor the implementation of the recommendations in the report on pension charges and to advise me of what further actions are needed. This will be the first job for the new council. It is very important that we have a clear structure of charges. At the moment people in small pension funds and individual pension funds can incur significant charges. The second task for the council will be to examine transparency. People should get regular reports and be able to access regularly the total charges for their particular pension structure. I refer to a variety of charges such as fund charges, administration charges and commission charges. People must be empowered through information to able to compare and contrast what is available or business journalists could further communicate what schemes and structures are particularly expensive and advise consumers of the facts.

25/06/2013KK00200Senator Paschal Mooney: I thank the Minister for her comprehensive reply. As she is aware, charges are excessive. In fact, the main bugbear is that the pension industry has been getting away with unacceptable practices for too long. I could not say at the moment what private pension charges I am incurring because I do not know. That is one of the reasons the second amendment has been tabled, as it would ensure that the total expense ratio of a pension scheme shall be a maximum of 2% of the scheme funds in any one year. My understanding is that in some cases it goes as high as 4% but, on average, it is approximately 1.5% to 2%. I am keen to put that on record. I am grateful to the Minister for indicating that one of the first tasks of the new pension board will be to inform people of the facts. The reason we tabled the amendment was to ensure that there would be that advice on a continual basis.

When the Minister is making recommendations I urge her to ensure there would be an obligation on pension funds to inform people every step of the way. I do not just refer to charges; I am talking about where they invest their money and the justification for the investment. I remember at the height of the building boom Irish pension funds in the main exclusively invested equity-based funds in Irish banks. They did not even bother informing themselves. They could not care less. The fund managers were so lazy. In fact they did nothing during the boom time. One did not need much expertise because the banks were flying. They did not even bother re- searching what other equity markets were delivering or what other options there could be for in- vestors. In many cases we saw what happened as a result of the downturn. Pension funds went through the floor because most of the money invested was in Irish equities and banks. In some 269 Seanad Éireann cases there were links between pension funds and banks and brokers were also linked to banks. I believe the latter practice still exists. There is a murky area involved in pension funds and I am pleased to hear the Minister intends to address it. I wish her well in that regard because she is dealing with sophistry. The Pensions Board bears a heavy responsibility to protect consumer interests. If the Minister did nothing else but that, it would be a big achievement.

25/06/2013KK00300Deputy Joan Burton: We have an existing Pensions Board, which was established in the early 1990s. While it does have consumer interests, representatives of trade unions and employers on the board, there is a large complement of people from various sectors of the pensions industry. I am anxious for the new council to have a strong consumer orientation. Younger people are, by and large, entering into defined contribution schemes and they need to know when they are going to pay and whether they will be able to look up information on their account, whether it is a fund or an AVC, on a website and see what exactly they are being charged. That is critical.

The report also highlights some practices that emerged which can result in additional charges being made. For instance, a practice emerged of what is called rebrokering where, understand- ably, from time to time the people managing the investment fund of the pension would decide, perhaps, to change some of the investments of the fund. Extensive rebrokering could give rise in certain circumstances to further additional charges. The report explains that in some detail. That is something that ought to be advised. Our pension coverage in this country is poor. It is less than 50%. The contributory retirement pension and the non-contributory retirement pension are very high by the standards of most European countries. They are in the top three to five even after all that we have been through in economic terms. For many retired people the total package is worth approximately €14,000. That is not a huge income to provide for the kind of retirement a lot of people anticipate.

One of the things I have spoken about, in particular as the economy recovers, is that we might have a supplementary pension, such as auto-enrolment or a mandatory provision. The OECD recommended it. I do not think we would be able to do that at the moment because, as we have heard, lots of people are struggling with debt. We must wait until the economy recovers a bit. Countries such as Australia, New Zealand, and more recently the United Kingdom have increased the level of pension provision through, in the case of the United Kingdom and New Zealand, the development of an auto-enrolment system. If that, for instance, enabled people to provide a supplementary pension that brought the pension level up to double the retirement pension plus the supplementary pension, it would give people an income in retirement of €24,000. For many, that would enable them to live to a standard of decency in retirement.

The other pension-related issue is that the tax reliefs and capacity to invest, as Senator Mooney said in property was so large, upfront, that people were often blinded to the charges because the tax relief was so attractive. Pension tax relief is paid as one invests but one then pays tax at the end and if what emerges is a reduced sum and then one takes the tax on the pension product one must have one’s eyes wide open as one provides a pension.

25/06/2013KK00400Senator Paschal Mooney: I wish to put on record that it is also incumbent on the Minister and her colleagues in government to ensure that the key issue is about improving coverage. It has already been put on record that a large number of people do not contribute to a pension. One aspect of it is that employers are obliged by law to offer employees access to a pension but 43% of those interviewed by researchers acting on behalf of the Pensions Board had never been offered access and, of those, 93% had never asked an employer about access to a pension. The 270 25 June 2013 key is about improving coverage. We believe this should be done through a combination of incentives and compulsion. The Minister referred to New Zealand. Among OECD countries, only Ireland and New Zealand do not have compulsory pension saving. It may come down to that.

What choice will the Minister have? The pension fund that was set up by Charlie McCreevy has now been dismantled and any residual legacy will be gone. Admittedly, and hopefully, it will be invested in productive areas that will stimulate the economy. I support that in principle but the pension timebomb has now become more rather than less acute, which the Minister knows better than most, because she deals with the statistics on a regular basis. This is a challenge for Government to see how it will get more people engaged in saving for a pension, particularly young people, because the younger an investor is, the greater the returns. I spoke earlier about the sophistry involved in many of the pension funds and their investments. I have no involvement in the company but Acorn Life based in Galway is returning very good growth for those interested.

Amendment, by leave, withdrawn.

25/06/2013LL00300An Cathaoirleach: Amendments Nos. 19 and 20 are related and will be taken together.

25/06/2013LL00400Senator David Cullinane: I move amendment No. 19:

In page 43, to delete line 29 and substitute the following:

“(b) not fewer than 9 and not more than 12 ordinary members, not less than one third of which shall be female and two thirds male, or not less than one third male and two thirds female.”.

Both amendments have two sentiments behind them and are in respect of the Pensions Board and the new pensions council. The first relates to a gender balance on the board and an increase in members from nine to 12 ordinary members. We are appointing ordinary members to boards so we should, where possible, seek to have a proper gender balance. We had a good discussion with the Minister for the Environment, Community and Local Government not long ago on gender quotas for general elections. I hope to see similar quotas in place for local elections, although that was not the case on that occasion and we will continue work towards it. In the case of appointees to boards, it is important we get a representative view from across society and, unfortunately, we do not have gender balance on many boards. That is unfortunate so where we can, we should put in place gender quotas, and that is what we seek to do in amendment No. 19.

Amendment No. 20 allows for a minimum number of people to represent those who would be affected by changes. We are talking about older people, those with disabilities, women and vulnerable groups. We should be able to get the view from advocates of those groups who are dependent on pensions. They are experts in many cases.

25/06/2013LL00500Deputy Joan Burton: The Department of Social Protection has only three boards and representation of women on those boards is exceptionally strong. The Department contributes extensively to the Government meeting the overall requirement of 40% in gender representation of either gender. We will advertise the positions on the pensions council under the Public Appointments Service as vacancies on the Citizens Information Board have been advertised. We are looking for people with relevant skills and some people with specialist knowledge, ex- 271 Seanad Éireann perience or expertise to enable them to carry out their functions. I anticipate these would be the sort of people who would have the relevant experience the Senator indicated.

It is not necessary, however, to provide in law for particular stakeholder representation. The Pensions Board has always met Government policy on gender balance on State boards and this will be a priority consideration. The new pensions council will not be a paid body so there will be savings of up to €100,000 by the replacement of paid board members with unpaid representatives.

We will seek a board with a good balance, particularly those who are interested in achieving the sort of outcomes referred to by Senator Mooney, namely: transparency; value for money in pensions; and strong information about the necessity for people to have a supplementary pension, that simply relying on the State pension, good as it is in Ireland compared to other juris- dictions, particularly Britain, should be discouraged to allow people when they retire to enjoy a standard of living that allows for comfort and decency.

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

25/06/2013LL00700Senator David Cullinane: Votáil.

6 o’clock25/06/2013MM00100

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

Senators David Cullinane and Trevor Ó Clochartaigh rose.

25/06/2013MM00300An Cathaoirleach: As fewer than five Senators rose the question is declared carried. In accordance with Standing Order 61 the names of the Senators dissenting will be recorded in the Journal of the Proceedings of the Seanad.

Question declared carried.

Amendment declared lost.

25/06/2013MM00500An Cathaoirleach: As it is now 6 p.m. I am required to put the following question: “That section 29 stand part of the Bill, and in respect of each of the sections undisposed of, the section is hereby agreed to in committee, the Schedule and Title are hereby agreed to in committee and the Bill is reported to the House without amendment.”

Question put:

The Committee divided: Tá, 24; Níl, 4. Tá Níl Bacik, Ivana. Cullinane, David. Bradford, Paul. Mooney, Paschal. Brennan, Terry. Ó Clochartaigh, Trevor. Coghlan, Eamonn. Wilson, Diarmuid. Coghlan, Paul. Comiskey, Michael. Conway, Martin. Cummins, Maurice. 272 25 June 2013 D’Arcy, Jim. Gilroy, John. Henry, Imelda. Higgins, Lorraine. Kelly, John. Mac Conghail, Fiach. Moloney, Marie. Moran, Mary. Mulcahy, Tony. Mullins, Michael. Noone, Catherine. O’Donnell, Marie-Louise. O’Neill, Pat. Sheahan, Tom. van Turnhout, Jillian. Zappone, Katherine.

Tellers: Tá, Senators Paul Coghlan and Marie Moloney; Níl, Senators David Cullinane and Diarmuid Wilson.

Question declared carried.

25/06/2013NN00200An Cathaoirleach: When is it proposed to take Report Stage?

25/06/2013NN00300Senator Maurice Cummins: Tomorrow.

Report Stage ordered for Thursday, 27 June 2013.

Health (Amendment) Bill 2013: Committee and Remaining Stages

25/06/2013NN00600Acting Chairman (Senator Michael Mullins): I welcome the Minister of State, Deputy Alex White, to the House.

Sections 1 to 3, inclusive agreed to.

SECTION 4

Question proposed: “That section 4 stand part of the Bill.”

25/06/2013NN00900Senator Trevor Ó Clochartaigh: Sinn Féin is opposed to many of the sections in Part 2 of this Bill, largely connected with the adjustments to the fair deal scheme, many of which 273 Seanad Éireann are excessively punitive and could disadvantage many patients. They could also lead to the outsourcing of functions, which we are opposed to because it is inappropriate in this context and is not in the longer-term interests of the HSE or those persons availing of the scheme. We should not be allowing such key functions to be carried out by the private sector, particularly given the staff at the disposal of the HSE. We note that workers are concerned that this will be a forerunner of privatisation.

On the scheme in general, it is not perfect but it is better than nothing. The scheme is currently run by the HSE and provides financial support for approximately 22,000 people in long- term residential care. Currently individuals contribute 80% of their income and 5% of their assets per year, fixed at a maximum of three years or 15% for their principal private residence and, in some circumstances, farm or business. However, this Bill seeks to increase the maximum proportion of a person’s assets payable from 5% to 7.5% and on that basis, my party is opposed to this section.

25/06/2013NN01000Minister of State at the Department of Health (Deputy Alex White): Part 2 of the Bill provides for four amendments to the nursing home support scheme. In brief, these relate to outsourcing the HSE’s functions under the scheme, abolishing the requirement to backdate State support to the commencement of the scheme for those who were in nursing home care prior to the scheme commencing, and increasing the asset contribution under the scheme from 5% to 7.5%, as mentioned by Senator Ó Clochartaigh. The programme for Government makes a commitment that a Government-wide review will be carried out to identify and eliminate non- priority programmes and outsource, where appropriate, non-critical functions. The proposed outsourcing provision will enable the HSE to outsource its functions under the scheme but does not oblige the HSE to outsource anything. However, should it be deemed appropriate or desir- able in the future to outsource any elements of the scheme, this provision would facilitate that process. This provision would facilitate that process. As stated, there are no specific functions under consideration for outsourcing at this time.

With regard to the abolition of the backdating provision, this was originally inserted in anticipation of a large volume of applications in the initial months of the scheme. It ensured that if any backlogs occurred at that time applicants would not be disadvantaged. Only those who were in private nursing homes when the scheme commenced can have their State support backdated. This group has had almost 4 years to apply, which is more than reasonable. This amendment would not prevent anyone who has been in long-term nursing home care since before October 2009 from applying for the scheme.

It was announced in budget 2013 that the asset contribution under the scheme would be increased from 5% to 7.5%. Put simply, the funding available for services for older people is not increasing at the same rate as the population. The budget for the nursing home support scheme this year is €974 million. The State has limited resources. However, the demands being made of these resources continue to increase. The increase to the asset contribution is necessary to support the sustainability of the scheme. The increase will only apply to new entrants to the scheme after the enactment of the Bill. Anybody who is already in receipt of financial support under the scheme will not be affected by the amendment.

The scheme contains several safeguards which ensure that the person in the nursing home and his or her spouse or partner, if applicable, are adequately provided for. They are unaffected by the provisions of the Bill. For those reasons, I cannot accept the amendment.

274 25 June 2013

25/06/2013OO00200Senator Martin Conway: This section is tidying up and enabling the HSE, when necessary, to be able to outsource. In a modern society and in doing business professionally, we should be able to at least remove the levers which prevent the HSE from doing things professionally and efficiently. This amendment is very important.

As the Minister of State quite correctly pointed out, people have had four years to apply for any backdating. There comes a point where one has to be sensible about things. The amendment is sensible. A period of 48 months has been available to people, which is a more than reasonable timeframe.

I welcome the commitment of the Minister of State to a continuous review of the scheme. Any good scheme is never perfect and will need to be tweaked. We could be presented with a different set of circumstances in two or three years’ time and will have to react to them. It is very reasonable for an asset contribution to increase from 5% to 7.5%. Any fair-minded person or persons would have to acknowledge it is a modest increase in the overall scheme of things.

25/06/2013OO00300Senator Trevor Ó Clochartaigh: We are on section 4. I will not come to backdating until we come to the relevant section. I and those who work in the HSE do not take much comfort from the reassurances of the Minister of State that outsourcing is being introduced. The concern that we are heading towards a privatised model is very real.

I do not agree with Senator Conway that an increase from 5% to 7.5% is modest. For older people who are dependent on services like these it is a large amount to have taken from their pockets. Such people have already had enough taken from them. We will oppose the section.

25/06/2013OO00400Deputy Alex White: Senator Ó Clochartaigh suggests this presages a privatised model. It is very important to have some sense of proportion when we debate these issues. It is not a question of introducing a privatised model. I do not accept that is the implication of what is being done. It is an enabling provision to allow the HSE, in circumstances which might arise in the future, to enter into an arrangement with a person under which that person may perform any part of its functions.

Often when we debate the public provision of health services, the extreme ends of the debate and certain commentators are inclined to think anything provided in the public sector is bad and that private sector provision is always superior. I profoundly and strongly disagree with that. Equally, there is no point in suggesting there are no circumstances in which it is pru- dent or efficient to have something provided in the private sector.

We have to have a sense of proportion. There are circumstances in which it makes sense. I say this as a social democrat, and somebody who believes in strong funding for public provision. We cannot say there are never circumstances in which services could prudently and efficiently be provided in the private sector. That is simply not sustainable.

25/06/2013OO00500Senator Trevor Ó Clochartaigh: The Minister of State, in fairness to him, is misconstru- ing my comments. The fear comes from the road down which home care has gone and the shambles it is in. In some cases older people have seen their home care times cut to a 15 minute visit per day during which somebody has to be washed and cleaned. People have seen we have gone down the private route with those types of services and are fearful of the same happening in this type of scenario. The Minister of State knows that and can understand why we are opposing the section on that basis.

275 Seanad Éireann

25/06/2013OO00600Senator Martin Conway: I do not agree. I do not question the Senator’s genuine motiva- tion for highlighting the issues.

I dealt with a person in my constituency clinic recently who is in receipt of a reasonably good public service pension, as is his wife. His wife is currently in full-time care and he has been left with €250 per week to live on, compared to significantly more than that previously. He would prefer to see 10% or 15% of his property value taken into consideration and have money now to have a relatively decent lifestyle, while ensuring his wife is properly looked after, as she is. Unfortunately, he is suffering because the percentage is not high enough.

There have been issues with elderly care over the years and cutbacks are not appropriate. We would prefer not to have to implement them. We have to try to do our best with the meagre resources we have until such time as buoyancy returns to the economy.

25/06/2013OO00700Senator John Gilroy: I wish to comment on the call of the Minister of State for some proportionality. The language being used by my colleague and friend is the most extreme one could find. The health service is about health service provision and confidence in our health service. To say draconian cuts, privatisation and all sorts of other terrible things are happening is irresponsible. When we were in opposition we were critical of the nursing homes support scheme but are big enough to turn around and say it is one of the most successful schemes we have in the entire service. For Sinn Féin to try to plant cynical doubts in the minds of the public is irresponsible. I support the Minister of State in his call for proportionality.

25/06/2013OO00800Senator Colm Burke: I raised the structure of elderly care and the need to plan for the future on the initial Stages of the Bill. By 2021 we will need to have an additional 13,000 beds if everyone with certain disabilities or health issues are put into nursing homes. We need to work together in a more comprehensive manner. I discussed it with the Minister of State, Deputy Lynch, and had an Adjournment debate on it. The Irish Nursing Homes Organisation, INHO, and the INMO want a forum to be set up, comprising groups like the INHO, the INMO, those providing home care packages, HIQA, the HSE and the Department of Health. The major complaint among these organisations is that their representatives go into the Department of Health on separate days and are never in there together. The INMO and the Irish Nursing Homes Organisation have both highlighted this matter. If either of them raises an issue with the Department, it is taken on board in a comprehensive manner. However, there is no sharing of information among the groups. This matter does not relate to developing policy or anything of that nature, it is about ticking all the boxes and ensuring that everyone is working together. There may be other groups which should also be involved.

If one considers the figures relating to the care of the elderly, by 2030, which is only 17 years hence, in excess of 900,000 members of the population will be over the age of 65. One size does not fit all and it is extremely important that we should carry out forward planning. Cognisance must be taken of that. What existed previously will not necessarily be applicable in the future and that must be taken into account in the context of the Bill. That is the reason the legislation was introduced. It may contain some provisions which I may not like but I must be a realist in the context of existing demands and also those which will arise in the next five to 15 years.

Question put and agreed to.

SECTION 5

276 25 June 2013 Question, “That section 5 stand part of the Bill”, put and declared carried.

SECTION 6

Question proposed: “That section 6 stand part of the Bill.”

25/06/2013PP00700Senator Trevor Ó Clochartaigh: As Sinn Féin understands it, section 6 abolishes the requirement to backdate State support to the commencement of the nursing home support scheme for those who were in nursing home care prior to that scheme commencing. That is particularly unfair. The digest to the Bill states that it is not known how many people this will affect. How- ever, approximately 700 people are still in receipt of payments under the previous subvention scheme. This gives some indication of the overall picture and it seems a considerable number. What is being done is unjust because it places at a disadvantage those persons in care over a longer period, which is regrettable. In such circumstances, Sinn Féin will be opposing the section.

25/06/2013PP00800Deputy Alex White: The existing nursing home support scheme provides that a person who was in nursing home care when the scheme commenced in 2009 shall have his or her State support backdated to 27 October 2009. This provision was originally inserted in anticipation of a large volume of applications in the initial months of the scheme. It ensured that if any backlogs occurred at that time, applicants would not be disadvantaged. Given that, as I pointed out earlier, the scheme has been in operation for almost four years, it is considered appropriate and not unreasonable to abolish this provision because this cohort of residents has had ample time to apply. However, the section does not preclude anyone who has been in nursing home care since prior to October 2009 from making an application in respect of the scheme.

25/06/2013PP00900Senator Colm Burke: By abolishing the provision, are we opening an avenue in respect of people who are in nursing home care and who are not fully competent in the context of providing instructions as to what should be done regarding their affairs? I was involved in a case eight years ago in respect of someone who was a ward of court and who was in nursing home care. I applied to the wards of court office to issue proceedings on behalf of that person and I received a direction from that office to the effect that while I could issue a High Court writ, I was not entitled to move proceedings forward any further. I was obliged to wait until the individual had died before I could move proceedings forward and take instructions from the executor of the estate. Have scenarios of that nature been taken into account when section 6 was drafted? I accept that I am approaching this matter from a legal standpoint but I wish to discover whether circumstances such as those to which I refer are contemplated by the section.

25/06/2013PP01000Deputy Alex White: The Senator is a distinguished lawyer and I am sure he was well able to give the best advice to his then client.

25/06/2013PP01100Senator Diarmuid Wilson: He is the only one in the House now.

25/06/2013PP01200Deputy Alex White: One of the things we cannot do from our position in these Houses is provide legal advice. However, I am of the view that the point the Senator raises is covered by the section. In that context and for the purposes of the scheme, a specified person - as defined in the existing legislation - is able to act on behalf of another individual. The scenario to which the Senator refers is, therefore, already contemplated within the provisions relating to the scheme. I could not possibly give a view in respect of specific individual cases.

Question put and agreed to.

277 Seanad Éireann SECTION 7

Question proposed: “That section 7 stand part of the Bill.”

25/06/2013PP01600Acting Chairman (Senator Michael Mullins): I call Senator Cullinane.

25/06/2013PP01700Senator Trevor Ó Clochartaigh: I think the Acting Chairman meant to say Senator Ó Clochartaigh. Perhaps it is the fact that I am wearing glasses.

25/06/2013PP01800Acting Chairman (Senator Michael Mullins): It has been a long day.

25/06/2013PP01900Senator Trevor Ó Clochartaigh: Senator Cullinane would be a great deal more belliger- ent than me.

Section 7 amends Schedule 1 to the Nursing Home Support Scheme Act 2009 to increase the asset contribution from 5% to 7.5% for people who enter nursing home care after the enactment of the Bill. We are of the view that the bulk of the provisions in this part of the Bill will have considerably negative consequences for individuals who rely on them. In my opinion, they will place further financial pressure on such people and will undermine the entire premise and purpose of the scheme. As a result, Sinn Féin will be opposing the section.

25/06/2013PP02000Deputy Alex White: The asset contribution is to be increased from 5% to 7.5% for new entrants to the scheme following the enactment of the Bill. Anyone who is already in receipt of financial support under the scheme will not be affected. The asset contribution will be capped at 22.5% - or three years in total - in the case of the principal private residence. In the case of a couple, the cap on that residence will be 11.25% where one member of the couple enters long-term nursing home care. The weekly average contribution under the nursing home support scheme is currently in the region of €280. It should be noted that the scheme contains several safeguards which ensure that both the person in the nursing home and his or her spouse or partner, if applicable, are adequately provided for. These safeguards are unaffected by the provisions of the Bill.

The points I have made deal with the issue raised by the Senator who cannot be criticised for regretting the fact that this increase is being introduced. If we were not obliged to make this change, I am sure everyone would be happy. However, it is not possible to continue to operate the scheme without amending it.

Question put and agreed to.

Sections 8 to 10, inclusive, agreed to.

SECTION 11

Question proposed: “That section 11 stand part of the Bill.”

25/06/2013PP02500Senator Trevor Ó Clochartaigh: Section 11 extends the provisions contained in section 53A of the Health Act 1970, which currently apply to certain persons in acute hospitals, to certain persons in public nursing homes. It provides that persons residing in public nursing homes may be charged based on the average cost of long-term care in such homes in situations where they do not co-operate with the application process relating to the nursing home support scheme when long-term residential care becomes appropriate to meet their needs. This section relates to the residential support service, which is being introduced under section 19 and with

278 25 June 2013 which we will deal later. For the intervening period, suffice it to say that what is being done is essentially supplementary to the fair deal scheme and is largely defined by who does not rather than who does qualify for it. Section 11 relates to that and to persons who do not qualify for the fair deal scheme. It is an extra lever to take money from patients. The section will largely affect those persons who are taken into respite care and who end up staying for longer than was originally envisaged. These individuals will be placed under pressure financially to participate in the nursing home support scheme when that scheme may not be appropriate in the context of meeting their needs. The Bill allows that anyone in a public nursing home in need of long-term care who has not applied to the scheme may be charged up to the full economic cost of their care, approximately €1,400 per week. In Sinn Féin’s view, this is a punitive measure and we are opposed to it.

25/06/2013QQ00100Deputy Alex White: Are we dealing with the Senator’s second amendment?

25/06/2013QQ00200Acting Chairman (Senator Michael Mullins): No. There are no amendments. We are on section 11.

25/06/2013QQ00300Deputy Alex White: I understand that but I had thought there were amendments that proposed to delete sections. I suppose I misread my instructions. I apologise.

Section 53A of the Health Act 1970 enables the HSE to charge a person in an acute setting if he or she is no longer receiving medically acute care and treatment. The charge applicable is the average cost of long-term residential care in public nursing homes. This amendment will extend the provision to public nursing homes. Where a person enters a nursing home for services other than long-term residential care, for example, respite or rehabilitation, and has subsequently been deemed by a registered medical practitioner to require long-term residential care services, the HSE may charge the person the average cost of care in public nursing homes. It is important to note that this is an enabling provision and will only apply where an individual refuses to co-operate with the application process for the nursing home support scheme. The HSE resources are limited, regrettably, and we need to ensure they are used effectively. That is the basis for these amendments.

Question put and declared carried.

SECTION 12

Question proposed: “That section 12 stand part of the Bill.”

25/06/2013QQ00700Senator Trevor Ó Clochartaigh: Section 12 inserts into the Health Act 1970 the new sections 53B and 53C. Section 53B is a technical amendment resulting from the repeal of section 53 of the Health Act 1970. Section 53C provides for charges to be raised for acute public inpatient services in public hospitals at a rate of €80 per day, an increase of €5 per day. We are concerned that the maximum amount can be varied by the Minister under this section. The Minister may make regulations specifying the amounts of charges and the maximum number of days within a range of seven to 15 days. The charges will apply for a period of 12 consecutive months. Clearly, the Minister can increase the maximum sums involved. Most patients in acute hospitals without medical cards are charged €75 per day as well as maintenance charges for inpatient care up to a maximum of €750 per year. This charge is to be increased to €80 per day to an €800 maximum over ten days. However, the Minister will be allowed to regulate for the maximum number of days per year in a range of seven to 15 days. If the Minister were to regulate for a 15-day maximum, it would result in a maximum charge of €1,200 per year, a 279 Seanad Éireann significant sum.

This is, however, difficult to square with the reality of our public health services. The reality is that the Minister is imposing increased charged for shrinking public health services. The Irish Nurses and Midwives Organisation has reported that an average of 79 patients each day are being placed in overcrowded and inappropriate environments on inpatient wards above the stated bed complement of those wards. That is in addition to those on trolleys and chairs in emergency departments. This is not good enough and in reality there is no justification for the Government’s decision to increase charges for services that are worse than before. We are opposing the section.

25/06/2013QQ00800Deputy Alex White: Under section 53B there is provision for charges for long-term residential care services under the Nursing Home Support Scheme Act 2009. This is a technical amendment resulting from the repeal of section 53 of the Health Act to which the House has agreed. The new section 53C provides for charges to be raised for acute public inpatient services in public hospitals at a rate of €80 per day; for certain categories of people to be exempted from the charges, for example, medical card holders and others currently exempted; for the Minister for Health, with the consent of the Minister for Public Expenditure and Reform, to make regulations specifying the amounts of charges and the maximum number of days, within the range of seven to 15 days, that the charge may apply in a period of 12 consecutive months; and for the factors the Minister for Health must have regard to in making such regulations.

Under the new legislation the Oireachtas is being asked to set out clear limitations on how much and on whom the Minister for Health may impose charges for public acute inpatient services. Currently there are no limits on what the Minister for Health may charge public patients in terms of the rate and the daily charges and the number of days they can be levied. In fact, the Oireachtas is getting more control over this and creating a statutory basis for delimiting these charges. In these circumstances, I commend the amendments to the existing legislation proposed by the Government to the House.

25/06/2013QQ00900Senator Sean D. Barrett: I welcome the Minister of State to the House as always. The new section 53C(4)(b), inserted by section 12, states that “the Minister shall ensure that the amount prescribed does not exceed the amount which is 25 per cent of the average daily cost of providing acute in-patient services to a patient.” Presumably that is where the €80 charge came from and the cost of €320. However, there is no number remotely near €320 in Sched- ule 1 although there is reference to the product being sold on for €1,122, €860 or €730 and so on. I appreciate that the Minister of State has said that this will put controls on the ability of the Minister for Health to charge, but it is the type of charging policy that is far above what is specified in the legislation. A charge of €80 is 25% of the cost but we are charging 14 times the cost. That sounds rather like exploitation, to put it mildly. The problem is that the section does not distinguish between a citizen of the country who has paid his taxes and a passing martian who has health insurance. The HSE could charge him €1,400 per day, and to say that the €80 charge is one quarter of the cost and then charge a person €1,122 sounds rather extortionate. It is a strange provision. The give-away is in the end of the explanatory memorandum. It refers to the object of raising €120 million rather than any interest in issues of efficiency or equity.

25/06/2013QQ01000Deputy Alex White: I am advised that the actual or economic cost involved is approximately of the order of €1,000 per day. We are asking that the citizen involved would make a co- payment, essentially a contribution to that cost. Under the Bill we are setting an absolute ceiling of one quarter of the cost, which will be approximately €250. That is the absolute ceiling. 280 25 June 2013 I reiterate to the House that the policy of the Minister and the Government that the co- payment should be of the order of €80 per day. I am offering three figures: the economic cost of approximately €1,000 per day, the absolute ceiling set at €250 and the policy of the Minister that the cost should be set at €80. That serves to put the legislation in context. Further, there is the additional safeguard being introduced that the charges should be subject to the consent of the Minister for Public Expenditure and Reform.

Question put and declared carried.

Sections 13 to 18, inclusive, agreed to.

SECTION 19

Question proposed: “That section 19 stand part of the Bill.”

25/06/2013QQ01500Senator Trevor Ó Clochartaigh: This is a complicated section dealing with several aspects of the residential support services scheme. Section 19 provides for the insertion in the Health Act 1970 of a series of new sections which change how the scheme is administered. It introduces a definition for residential support services as services other than outpatient, acute, inpatient or long-term residential care services provided by or on behalf of the HSE to a person residing in a hospital, convalescent home, nursing home or residential accommodation for persons with physical, sensory, mental health or intellectual disabilities and where that person’s accommodation is provided by or on behalf of the HSE.

This scheme is essentially to supplement the fair deal scheme for certain categories of persons who do not, or, more correctly, will not qualify for the scheme. We are concerned about this scheme. The services that are to be provided under the residential support services scheme are in no way comprehensive enough to deal with the considerable demands for high-quality residential care and, in reality, it is rather unclear how this will work in practice. We are also of the view that this complex section could operate to the disadvantage of some who are seeking to avail of residential support services. One of the new sections inserted by section 19, section 67C, provides that the HSE shall collect a contribution towards the cost of maintenance and accommodation from a person who is receiving residential support services if the person has previously received specified services on at least 30 days within the 12-month period ending on the day in question. It also provides that the Minister for Health, with the consent of the Minister for Public Expenditure and Reform, may make regulations specifying the amounts of the contributions required from persons or classes of persons within certain limits. This means the contributions could rise and it is not clear what the contributions would amount to. As I understand it, the section was not originally meant to form part of the Bill. Why has the Minister sought fit to insert the section now and why are there not more details on the operation of this?

We are seeing a reorganisation with regard to this area, with this scheme supplementing the fair deal scheme. However, there has been insufficient discussion on this. The Bill is separat- ing out things that had previously been together meaning that people who were not charged will now be charged for residential support services. It is hard to understand why medical cardhold- ers will also need to pay. This section disadvantages certain categories of people who wish to avail of residential support and will affect some of the most vulnerable in our society. The Bill heaps further pressure on people who are elderly, disabled or unwell and their families at a time when they can least afford it and therefore we oppose it.

25/06/2013RR00200Deputy Alex White: The Bill will update and replace existing arrangements for charging 281 Seanad Éireann for long-stay inpatient services other than acute hospital care or services covered under the fair deal nursing home support scheme. The Bill essentially continues existing arrangements for people in a range of residential settings who contribute towards the cost of their maintenance. The Bill is putting these arrangements into a modernised and simplified legal framework, which is not designed to generate any additional revenue.

When the Bill was introduced in the Seanad the following key points about this modernised framework were highlighted. There will be a continuing requirement to pay an appropriate and affordable contribution which would be in line with current long-stay charges towards the maintenance of accommodation costs to the State of providing such services. The maximum level of the current long-stay charge is just below 80% of the non-contributory State pension and the maximum contribution will remain at this level. The actual contribution will depend, as now, on the individual’s income level. The exemptions that currently apply to long-stay charges will continue to apply to residential support services, maintenance and accommodation contributions. The HSE will continue to have discretion to reduce the level of contribution required to avoid undue financial hardship depending on individual circumstances, the extent to which they provide to their own maintenance and their assessed needs. These contributions will apply to all those provided with residential care by or on behalf of the HSE other than those covered by the nursing home support scheme and other acute hospital care.

Section 19 will essentially put various existing arrangements into a more simplified, modernised legal framework and there is no proposal to generate any additional revenue in that regard.

25/06/2013RR00300Senator Colm Burke: I support the Minister of State in what he is saying. While this is no criticism of the Minister of State or the Department, we need to do more long-term planning on hospital charges and elderly care. The history of this involves the 1970 legislation followed by the Supreme Court decision in 1976 which found that nursing home care came under the definition of medical care and therefore came under the jurisdiction of the medical card. We then had the Ombudsman’s report in 2001 and the subsequent challenge to charges in public nursing homes and in contracted beds in private nursing homes in 2004. The fair deal system was then established in 2009. It is a very long dragged-out process of developing a structure for nursing home care.

While this legislation deals with the here and now, perhaps it is time for us to establish a 20-year plan to cover the problems that may exist in 15 or 20 years. Rather than introducing legislation when the problem arises, we should ensure we have the legislation in place before the problem arises. I am not sure we are doing that. I believe the Department should consider doing so at this stage. I envisage us revisiting the whole area of charges for nursing home care within the next five years. We need to sit down and look at it at this stage.

Question put and declared carried.

SCHEDULE 1

Question proposed: “That Schedule 1 be Schedule 1 to the Bill.”

25/06/2013RR00700Senator Sean D. Barrett: The only good part of this is that a person feeling sick should go to Swinford District Hospital. It charges €260 for a private room, €222 for a shared room and €193 for day charges. I do not know where the other charges came from. The €80 to be charged for a public bed is a quarter of the cost. Amazingly section 13(1) provides that a person who 282 25 June 2013 waives his or her entitlement to services as a public patient must pay what is specified here. I do not know how the figures of €1,122, €860 or €730 were arrived at. I am concerned that these will drive people away from private health insurance. A person can waive his or her rights to get a bed for €80 and could be charged up to €1,122, which is why the numbers are falling. The Department needs to address these costs. The Minister, Deputy Reilly, has eloquently said he is in favour of reducing the costs and cutting the average length of stay.

An bord snip nua claims that if we got the right range of services outside hospitals, the 12,000 acute beds could be reduced to approximately 8,000, but I see no progress in that direction. These costs are beyond most people’s means and there should at least be some justification for them given that they are so large - apart from Swinford District Hospital. This is why the numbers of people with private health insurance are plummeting. Loyal and compliant taxpayers find there is a jump from €80 to the kind of numbers specified in the schedule.

25/06/2013RR00800Deputy Alex White: I take the points the Senator has raised. The costs that are set out in the schedule are the economic costs of the provision of the service. It is not unreasonable to look at some of them and gasp. However, I am instructed they represent the economic cost of the provision of the service. Everybody is concerned about the issue, not least the Minister. To- day the Minister announced the establishment of a consultative forum to involve all the insurers. There is concern across the board, including on the part of the insurers. Most importantly we need to consider the citizens and the consumer. That is the concern that preoccupies us and cost is a major issue here. Today the Minister announced the establishment of a consultative forum to address many of these concerns, involving the insurance companies under the chair- manship of Mr. Pat McLoughlin.

I cannot disagree with the tenor of much of what the Senator has said. I believe the forum will assist us to understand the parameters of what is happening with cost. Cost must be driven down. Real efforts are being made to do so but they need to be redoubled and that is the view of the Minister for Health.

25/06/2013RR00900Senator Sean D. Barrett: I thank the Minister of State. I presume this is the same Mr. Pat McLoughlin who carried out a thorough report on local government.

7 o’clock

If he is assisting the Minister of State, Deputy White, and the Minister, Deputy Reilly, it is to be commended and is a positive development.

Economists had hoped that competing health insurance companies would drive down the cost in the model with which the Department is closely connected, the provision of health services. The patient is too sick to do it. We have made health insurance competition impossible with the rules by which the companies are required to operate. I look forward to seeing what Mr. McLoughlin makes of it. Policy has been going wrong and we have been losing cases in the High Court here and in Europe. It must be sorted out. I assure the Minister of State of my support for all endeavours in this regard.

Question put and agreed to.

Schedules 2 to 4, inclusive, agreed to.

Title agreed to.

283 Seanad Éireann Bill reported without amendment.

Question put: “That the Bill be received for final consideration.”

25/06/2013SS00700Senator Sean D. Barrett: Votáil.

25/06/2013TT00100An Cathaoirleach: Will the Senators claiming a division please rise?

Senators Sean D. Barrett, John Crown and Trevor Ó Clochartaigh rose.

25/06/2013TT00300An Cathaoirleach: As fewer than five Members have risen I declare the question carried. In accordance with Standing Order 61 the names of the Senators dissenting will be recorded in the Journal of the Proceedings of the Seanad.

Question declared carried.

Question put: “That Fifth Stage be taken now.”

25/06/2013TT00600Senator Trevor Ó Clochartaigh: Votáil.

25/06/2013TT00700An Cathaoirleach: Will the Senators claiming a division please rise?

Senators Sean D. Barrett, John Crown and Trevor Ó Clochartaigh rose.

25/06/2013TT00900An Cathaoirleach: As fewer than five Members have risen I declare the question carried. In accordance with Standing Order 61 the names of the Senators dissenting will be recorded in the Journal of the Proceedings of the Seanad.

Question declared carried.

Question, “That the Bill do now pass”, put and declared carried.

25/06/2013TT01200An Cathaoirleach: When is it proposed to sit again?

25/06/2013TT01300Senator Maurice Cummins: At 10.30 a.m. tomorrow.

Adjournment Matters

25/06/2013TT01500NAMA Staff Recruitment

25/06/2013TT01600Acting Chairman (Senator Michael Mullins): I again welcome the Minister of State, Deputy Alex White to the House.

25/06/2013TT01700Senator Lorraine Higgins: I thank the Minister of State, Deputy White for coming into the House this evening, but I am a little disappointed that the Minister for Finance is not here, given that the issue I raise on the Adjournment is a matter of national importance and of particular concern and interest to the taxpayer. This matter relates to the recent revelations regarding a former employee of NAMA who secured employment in the private sector immediately following his employment with NAMA. 284 25 June 2013 I raised with the Minister for Finance in the House a related issue, relating to the lack of a proper non-compete clause in employment contracts with the agency. The lack of such a clause leaves the taxpayer unprotected. I am concerned about the fact that, in Ireland, there is a record of financial institutions having no morals or scruples in dealing with their customers and the taxpayer. I highlighted some of the terrible treatment that Irish customers of Ulster Bank faced last year. We also have evidence of the widespread mis-selling of financial products. We are now also privy to the tapes of conversations between executive of the former Anglo Irish Bank.

I am particularly concerned by a situation relating to the individual in question, which was raised with me last week. I received damning information that the same individual had communication with third parties in respect of a customer’s business with NAMA, which possibly contravene sections of the Data Protection Act, the Official Secrets Act, the National Asset Management Agency Act, the National Treasury Management Agency Act, and which may be prejudicial to NAMA’s customer in question. The information can be substantiated and con- firms to me that there has been continual and ongoing communication between a Paul Hennigan and a third party in respect of a customer’s business affairs in NAMA.

25/06/2013TT01800Acting Chairman (Senator Michael Mullins): Will the Senator please refrain from nam- ing persons in the House.

25/06/2013TT01900Senator Lorraine Higgins: I apologise. It will not happen again. This communication may be prejudicial to NAMA’s customer and has left the State and the taxpayer exposed to a potential claim for damages for hundreds of millions. It is quite clear to me that NAMA did not act in the best interest of its customer in this instance. My concern is that this may very well be the tip of the iceberg. Will the State be left exposed to other potential claims as a result of how NAMA conducts its business? That is of utmost concern to me.

This is not the only incident regarding this individual. It was reported in the Sunday Inde- pendent only last week that the individual in question also dealt with a property transaction at St. James’ Square in London which was bought by a company, of which he became a partner immediately after leaving NAMA. I wonder at the level and manner of contacts there were between this individual and the people of Prime London Partners while the negotiation process was in train. What contracts were there between the London property investment company and the former NAMA employee since the deal’s completion? Did they have contact regarding other potential or actual deals between the completion of the St. James’s Square deal and his departure from NAMA?

We must remember that this is the very same individual involved in the sale of a property to another NAMA employee who was the subject of an internal investigation, and all these com- bined actions are possibly significantly undermining NAMA’s ability to recover the optimum amount for its assets and return for the Irish taxpayer. The individual I speak of is the same person who tried to silence me on an issue by threatening me with legal action when I mentioned non-compete clauses in contracts for NAMA employees. I wonder if he telephoned my office and left the voicemail because of the details I have submitted to the House this evening and if he was afraid of them coming in to the public domain. In view of the seriousness of the matters I have brought before the House, I request the Minister for Finance to instruct the Garda Commissioner in what I would consider a most serious issue of misconduct, particularly in respect of potential offences under the Data Protection Acts, the Official Secrets Acts, the National Treasury Management Agency Act and the NAMA Act. This investigation should not be restricted just to the legal aspects of these issues and should largely incorporate examina- 285 Seanad Éireann tion of the potential risks of possible future claims against this State arising from the actions of employees or former employees of NAMA.

The board of NAMA should be directed to implement a risk management policy to incorporate all the issues I have brought before the House. Ultimately, we must protect the family sil- ver and we cannot have practices like this being facilitated for possible personal gain by people who are very conflicted. It is clear the agency and the taxpayer remains vulnerable to abuse by the actions of employees past and present, which is why I have raised the matter this evening. I look forward to the response of the Minister for Finance.

25/06/2013UU00200Minister of State at the Department of Health (Deputy Alex White): The Senator has raised the matter of referring to the Garda national bureau of criminal investigation the fact that an ex-employee of NAMA has now taken up employment with a private sector entity with which NAMA has previously engaged in a business transaction. It is unclear on what basis the Senator believes that this is a matter that the Minister for Finance should refer to the bureau. The remit of the national bureau of criminal investigation includes the investigation of crimes such as murder, serious and organised crime and other serious assaults. Accordingly I am unclear as to what role there may be for the Minister to refer this matter to the bureau in this instance. If the Senator has information which suggests that wrongdoing has occurred, I know she will bring it to the immediate attention of the Garda Síochána.

In the response by the Minister for Finance to a similar Adjournment debate topic proposed by Senator Higgins two weeks ago, the Minister pointed out that the National Treasury Man- agement Agency, NTMA, model, which applies to staff assigned to NAMA, is based on the free movement of staff from the private sector to NTMA and vice versa. It is important that the NTMA’s ability to attract private sector employees is not in any way disrupted. Mobility with the private sector is a critical component of the NTMA model and if it is to be successful we have to accept that it can be a two-way street.

The key issue relates to the safeguards in place to protect the confidentiality of information held by NTMA employees, including those assigned to NAMA, who may leave the agency to take up employment in the private sector. The Minister’s response of 11 June referred specifi- cally to the statutory prohibitions on the release of confidential information by employees and former employees of the NTMA, including those assigned to NAMA. Employees assigned to NAMA by the NTMA, as is the case with all other NTMA staff, are subject to section 14 of the National Treasury Management Agency Act 1990, which prohibits an employee from disclosing any information obtained while carrying out duties as employees of the NTMA. Employees assigned to NAMA are also subject to a prohibition on release of confidential data under sections 99 and 202 of the NAMA Act 2009. NTMA employees, including those assigned to NAMA, are subject to the Official Secrets Act. Contravention of these prohibitions is a criminal offence, and these protections do not cease at the point of resignation but rather apply indefinitely and extend to former employees.

The Minister for Finance advised the House on 11 June that the notice period for NTMA employees assigned to NAMA is typically three months and that, in line with employers in the private sector, NTMA contracts for employees assigned to NAMA have a provision entitling the NTMA to place the employee on garden leave at any point during the notice period during which time the employee may not work for another employer. Arising from a review conducted by Matheson for the NTMA, the Minister advised that the NTMA is implementing a number of changes to its employment contracts, including the introduction of longer notice periods of 286 25 June 2013 three to six months, up from one to three months, for middle and senior NTMA management employees and garden leave provisions to be included in all employment contracts. These changes will be introduced immediately for new NTMA employees and for existing NTMA employees as they are promoted. As pointed out, the three-month notice period and garden leave provisions already apply to NTMA staff assigned to NAMA.

In addition, the Minister advised that additional post-termination restrictions on employment will be considered on a case-by-case basis in respect of senior NTMA management employees in particular. However, the imposition of such restrictions will need to be carefully balanced against the NTMA’s need to recruit good candidates for whom such restrictions may act as a significant disincentive to taking up employment with the NTMA. The Minister or Fi- nance also noted that because of its finite life staff assigned to NAMA are recruited on specified purpose contracts, and their period of employment lasts for as long as their function is required by NAMA. Unlike other public sector employees, their contracts do not extend to the normal retirement age and there is clearly a risk that if specialist staff are offered specified-purpose contracts with rigorous clauses limiting their freedom to return to their sector of expertise after- wards so as to earn a living, it would become very difficult to recruit staff.

The Senator’s matter implies that some form of wrongdoing may have occurred in this instance but the Minister for Finance is not aware of any such wrongdoing. Unless there is evidence to substantiate such a claim, it is deeply unfair to persons outside of this House, who do not enjoy parliamentary privilege, to have their name questioned in this manner. I reiterate therefore that if the Senator has evidence to suggest wrongdoing, she should bring it to the immediate attention of the Garda Síochána.

25/06/2013UU00300Senator Lorraine Higgins: I thank the Minister of State for his response and it is unfortunate that the Minister for Finance is not here this evening to address the issue. It is regrettable that he pre-empted my submission this evening.

I am a qualified barrister and I have an understanding of the law. I spent quite a number of years at King’s Inns and in practice thereafter. I make it clear that the issue is not limited to the individual in question taking up employment with Prime London Partners, of which he is now a partner. This relates to a more serious issue of him accepting correspondence, replying to it, liaising with third parties and - if one likes the term - being lobbied and allowing himself to be lobbied, contrary to section 221 of the NAMA Act and the Data Protection Act.

25/06/2013UU00400Acting Chairman (Senator Michael Mullins): Is there a question?

25/06/2013UU00500Senator Lorraine Higgins: It is also a breach of privacy and confidentiality agreements, as well the European Convention of Human Rights. These details are on public record and they were part of-----

25/06/2013UU00600Acting Chairman (Senator Michael Mullins): The Senator has made her submission and she may only ask a question now.

25/06/2013UU00700Senator Lorraine Higgins: I understand but it is very important to clarify the matter.

25/06/2013UU00800Acting Chairman (Senator Michael Mullins): We must follow procedure.

25/06/2013UU00900Senator Lorraine Higgins: I have a right to clarify the issue when the ministerial reply intimated I was abusing parliamentary privilege. I want to make it very clear that I am not.

287 Seanad Éireann There are serious issues that must be addressed and I will furnish the Minister with the details.

25/06/2013UU01000Deputy Alex White: I do not think I can advance the matter any further.

25/06/2013UU01100Post Office Network

25/06/2013UU01200Senator Martin Conway: This issue has troubled me greatly and it troubles significant tranches of rural Ireland, which has felt significantly under threat in the past two decades because of the removal of many services. We have seen the decline of rural pubs because of a myriad of changes, including the smoking ban and drink-driving legislation, all of which have been very appropriate. There has also been the downturn in the economy and we have seen the removal of local Garda stations in many small rural villages. It has been painful and difficult to defend the issue, it was probably necessary to close many of these stations.

The post office network is a completely different issue. A post office is vibrant and provides a comfort zone for the type of vulnerable people we spoke of earlier, including older people. It provides a link for them to communicate and a facility for information gathering. It provides a community service and community activity. A post office in west Clare held a cake sale on Friday of last week to raise funds for a local charity. It held other activities a number of weeks previously. The post office is a very important element of community life in rural Ireland. The State should be putting more services into the post office. If the facility for paying the house- hold charge had been available through the post office, the compliance rate would have been much higher. Many other services, such as dog licences and other licences and the payment of road fines and parking charges, should be available through the post office. The facility to pay utility bills is available at the moment but, again, these are semi-State companies availing of a useful service.

What troubles me greatly is the threat posed by the outsourcing or tendering out of the social welfare contract. I understand that social welfare and pension payments constitute up to 50% of the weekly business of some post offices in west Clare. It is not necessary to outsource this because it is being done perfectly well by post offices. I contend that one will not get a better service in terms of paying pensions and social welfare payments than one will get at the post office.

The citizens in receipt of social welfare and pension payments feel more comfortable collecting them from the post office than they would from any other type of private institution that may succeed in tendering for this contract. Many generations do not trust the banks but I am talking to older people who certainly do not trust them and would not want their pensions to be paid through them.

The postmasters, postmistresses and staff in the many rural post offices keep an eye on old people and, if they do not turn up for their pension, a red flag will be raised. This is a vital community service. We can look at the bottom line far too often. We must get value for money and have an obligation to do so but we always have a social responsibility as a Government. The Acting Chairman should bear with me because it affects his constituency as well. The Govern- ment has a social responsibility in respect of this issue that must be acknowledged and on which a price cannot be put. The threat that has been presented by the speculation surrounding this contract is appalling. The Minister is wrong in trying to save money in this way. If the system needs to be improved and efficiencies achieved, negotiations with An Post management should 288 25 June 2013 be entered into. Putting out to tender a contract as significant as this one that probably affects the largest number of vulnerable people is simply wrong. The Government has reversed decisions in the past that were wrong. It did so today in terms of the cuts to the number of special needs assistants and resource teaching hours. There would be nothing wrong with reversing this decision as well.

25/06/2013VV00200Acting Chairman (Senator Michael Mullins): I thank Senator Conway. I gave him a bit of leeway.

25/06/2013VV00300Deputy Alex White: The Department of Social Protection is a key player in the payment services sector in Ireland. The manner in which payments are made to customers impacts on the State, notably in respect of costs. As with all of its activities, the Department is compelled to look at any scope for efficiencies in how it makes payments to ensure it provides value for its customers and for the economy at large. As consumer behaviour shows a very high movement towards online and electronic payments, the Department must look for opportunities to provide better and more secure customer service while also continuing to serve those who are more vulnerable in our society. Therefore, as part of the payment strategy to be brought to Gov- ernment shortly, the Department envisages using more modern approaches in the future where payments, ultimately, will be delivered to customers electronically. This goal is in line with wider Government policies and objectives. It is based on the objective of better public services and more effective electronic payments, as set out in the public service reform plan and the e-Government strategy 2012-2015. It is aligned to the objectives of the Government’s Action Plan for Jobs, the national digital strategy and the recently published national payments plan.

The progression to electronic payments is a critical element of the wider national payments plan aimed at removing the very high levels of cash usage in the economy and will contribute to improved national competitiveness. The Department’s strategy is contingent on the roll-out of the standard bank account, SBA, which is being driven by the Department of Finance. The combination of the national payments plan, the SBA and the Department’s payment strategy can, as three interdependent initiatives, realise tangible benefits in delivering a more efficient payments landscape in Ireland and can grow opportunities and benefits for consumers and business alike over the medium term.

At the moment, some 50% of all transactions are being paid in cash through the post office network. The current contract with An Post expires at the end of 2013. The award of public sector contracts with a significant financial value is subject to various EU directives. Due to the financial value of this particular service, the Department is required by law to publicly in- vite tenders for any new contract to deliver social welfare payments. This ensures the taxpayer receives value for money and ensures all potential suppliers are given the opportunity to put forward the most efficient, effective and competitive solutions for consideration and evaluation.

Therefore, as part of the payment strategy, the Department is undertaking two procurements which will reform the payment arrangements for the delivery of welfare payments. The first procurement for over-the-counter cash services for social welfare customers commenced in December 2012 and is now well advanced. This will replace the existing service contract with An Post and will ensure continuity in the delivery of cash payments to the Department’s almost 1 million cash payment customers. It is anticipated that a contract for these services will be signed over the coming months and will provide services to customers similar to those they currently enjoy.

289 Seanad Éireann The Department will be advertising a second procurement later this year for an e-payment solution. This solution will supplement existing levels of payments made directly by electronic funds transfer into customer accounts in financial institutions. It is anticipated that the noti- fication regarding this procurement will be published shortly. The payment programme will contribute to strengthening the Department’s approaches to fraud and control through ensuring high risk customers will not be migrated to an electronic payment until appropriate and robust measures are defined and fully implemented to mitigate any increased risk of fraud with an electronic payment.

The transition to new payment approaches will require a significant effort to assist and support our customers. The Department will work energetically to help customers and their representatives in the transition period. The Minister for Communications, Energy and Natural Resources referred to the programme of capital investment and work in recent years which has resulted in the computerisation of all post offices, recognising the inevitable movement towards lower levels of cash in society. The Minister for Social Protection and the Minister for Com- munications, Energy and Natural Resources, together with the rest of the Government, are very conscious of the important role of the post office throughout the country, notably the extent to which it is now a one-stop-shop where people can pay bills, purchase mobile phone top-ups, use the passport application facility, pay the local property tax and carry out a range of banking and other financial services. The concerns raised here are understandable, particularly in respect of the impact the Department of Social Protection’s plans to move to e-payments may have on An Post. However, I reassure the House on behalf of the Minister for Social Protection that the Government has stated and upholds its commitment to maintaining the post office network as set out in the programme for Government.

25/06/2013VV00400Senator Martin Conway: I appreciate the fact that the Minister of State is delivering this reply on behalf of his senior Government colleague. I would describe it as a very glossy reply. It certainly ticks a lot of boxes in terms of IT and modern communications and ways of doing business. It also states very clearly that we are probably the most compliant Europeans in Europe. Sometimes it would be good not to be such good, compliant Europeans. We do not necessarily have to uphold the law in this area. I am concerned about the thousands of jobs within the post office network that hinge on this contract, the social exclusion that will result from An Post losing this contract and the fact the loss of this contract will be another nail in the coffin of rural Ireland. I stress that it is not all about the bottom line. This decision has serious social consequences. I ask the Minister of State to advise his senior Government colleague that people will not take this lying down and that rural Ireland will fight this head on because it cannot be allowed to happen.

25/06/2013VV00500Deputy Alex White: Senator Conway raises an important issue. I agree with him when he says that not everything is about the bottom line. The post office has a crucial role to play, not just in rural Ireland, although it is most important in rural Ireland, but also in urban centres and provincial towns.

There is no suggestion or intention on the part of the Government to do anything other than uphold the commitments in the programme for Government which commits to the maintenance of the post office network. Post offices have shown themselves to be adaptable to changing circumstances. I have no doubt the service which An Post provides throughout the network of post offices will continue into the future.

The Seanad adjourned at 7.40 p.m. until 10.30 a.m. on Wednesday, 26 June 2013. 290 25 June 2013

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