Leaders’ Questions

Wednesday, 11 January 2012

Dáil Éireann Debate
Vol. 751 No. 1

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Deputy Micheál Martin: Information on Micheál Martin  Zoom on Micheál Martin  Without any warning or preparation, 150,000 pensioners received letters from the Revenue Commissioners to inform them they had underpaid their taxes due to a failure on their part to include their State pension when calculating their tax liability. It is very difficult to comprehend how the issuing of 150,000 letters of this nature to pensioners was not known to the Government or to any Minister, particularly when the records of up to 560,000 pensioners were sent by the Department of Social Protection to the Revenue Commissioners last November. There was a provision in the recent budget targeting savings of €45 million in the area of compliance.

The Taoiseach has called for clarity and certainty in order that pensioners will know where they stand. Surely it is the Taoiseach’s responsibility and that of his Government to provide that clarity and reassurance to people. When that provision for savings of €45 million was being discussed at Cabinet, the underpinning of that €45 million must have been discussed with the question of where that €45 million would come from, as otherwise it could not have been [36]included in the budgetary figures. It seems to me that a very cynical exercise has been undertaken and it has caused anger, confusion and great distress to thousands of pensioners. Was the Taoiseach personally aware that 150,000 letters were being issued to pensioners? Will he explain the reason for the absence of any political leadership or accountability with regard to this issue? It is clear there has been a conscious concerted effort to collect moneys without any political accountability on the part of the Government, either by the Minister for Social Protection or the Minister for Finance.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  The Deputy has finished where he started by talking about political accountability, the absence of which was very evident for a very long period. Deputy Martin is aware that the power to transfer information has been available since 2005. He is also aware that the Revenue Commissioners are not subject to diktat from the Government with regard to any particular sector. I am sure he also accepts the principle — as should everybody — that where tax is due and liable to be collected, it should be collected. If the country did not have an Office of the Revenue Commissioners tax collection system, we would be in very poor shape.

I accept that the handling of the communication of this matter could have been better. The Chairman of the Revenue Commissioners, an exceptionally competent person, has been before the Joint Committee on Finance, Public Expenditure and Reform, and has clarified the whole issue. It is perfectly evident that there was no attempt by the pensioners to be involved in tax evasion. It is important to say that were we to have a different system, we would have had 500,000 persons concerned or anxious about what is involved here. It is true that the Revenue Commissioners would have advised the Department of Finance of its capacity to collect €45 million as a result of the information given to it from the Department of Social Protection under the Act and to do that without great difficulty. Pensioners accept that if there is a liability, it should be paid. As the Deputy is aware, there are four categories involved and the letters spelled those out. I am glad that a representative from the Revenue Commissioners has gone before an Oireachtas committee today to spell out exactly what was involved.

Furthermore, in the budgetary announcement made by the Minister for Finance, the reference to the €45 million being collected was in the supporting documentation to the budget and that would be a matter for the Revenue Commissioners to implement as it does normally. As Deputy Martin is well aware, the Revenue Commissioners are not subject to direction or diktat from the Government, but are independent in the performance of their duties and over the years have certainly improved the collection of taxes that are due under the law of the land.

I am glad that as a result of this, we will have improved communication and certainty for pensioners who are involved. Those who may have a liability will know what that liability is. Those who do not have a liability will now be clear about that and for those who may have some small liability , an assessment will be made by the Revenue Commissioners as to whether it is worth while pursuing that liability. I have heard mention of amounts as low as 20 cent of a liability per year, which clearly would not be worth pursuing.

Deputy Micheál Martin: Information on Micheál Martin  Zoom on Micheál Martin  The Taoiseach did not answer the questions I asked as to whether he was personally aware that 150,000 letters were going out to pensioners. He also did not answer as to why there was no political accountability or responsibility for the decision to send out those letters. The Revenue Commissioners have confirmed to the Oireachtas committee that when they realised the scale and implications of this issue were so great, they decided to enter into discussions with the Department of Finance to ensure it was aware of the scale of it and the impact it would have. The Taoiseach and the Minister for Finance must have been aware of that.

[37]In essence, the Taoiseach ducked the issue. The Budget Statement was the ideal opportunity to be up-front and honest with people and to state that an operation of an enormous scale, namely the issuing of 150,000 letters to pensioners, was to take place. This is an enormous operation by any yardstick and the Revenue Commissioners recognised that and sent the information to the Department of Finance. However, the Taoiseach ducked the issue and decided to let the Revenue Commissioners send the letters out and not to mention that in the context of the Budget Statement. It is pathetic for the Taoiseach to come in and say that it is hidden somewhere in the depths of the rain-forest of supporting budgetary documentation. The pensioners deserved a bit better than that. If anything should result from this from the Taoiseach’s perspective, it should be a greater degree of political accountability, honesty and transparency, which is something we are being lectured on ad nauseam by him since he came into office. What has happened is not good enough. The Taoiseach should have overseen a major communications programme on this issue, knowing, as he and the Minister for Finance did, that this would happen. He should have used the budget to do that.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  Let me answer the Deputy’s questions. The answer to the first question is “No”. I was not aware of the extent of the letters going out from the Revenue Commissioners to pensioners. The Revenue Commissioners are completely independent of Government and to attempt to either direct them or dictate to them would be unwarranted interference by the Government in what is a completely independent body with an important job to do.

Deputy Micheál Martin: Information on Micheál Martin  Zoom on Micheál Martin  The intention should have been stated in the budget.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  The Government does not discuss whether pensioners in the category where a 20 cent liability might be involved should be written to by the Revenue Commissioners.

Deputy Micheál Martin: Information on Micheál Martin  Zoom on Micheál Martin  It was a sum of €45 million.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  The €45 million was not buried away in the forests, but was in the supporting documentation to the budget, which the Deputy should have read.

Deputy Timmy Dooley: Information on Tim Dooley  Zoom on Tim Dooley  Was that adequate information for pensioners?

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  The Revenue Commissioners would have notified the Department of Finance, as is its due, to say that on the basis of the assessment of the more than 500,000 files it received, it would be in a position to collect €45 million. It was the responsibility of the Revenue Commissioners to collect that and that information was included formally and publicly in the supporting documentation given by the Minister for Finance in the House on budget day.

Deputy Micheál Martin: Information on Micheál Martin  Zoom on Micheál Martin  The Taoiseach is still not reasonably answering the questions.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  As Deputy Martin is aware from experience, there is never discussion at the Cabinet table — but perhaps he was not there — as to whether the Revenue Commissioners should be directed by the Government to go after a particular category or sector.

Deputy Micheál Martin: Information on Micheál Martin  Zoom on Micheál Martin  I was there last year.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  Notification was given by the Revenue Commissioners to the Department of Finance and it was the responsibility of the commissioners as to how to go about the matter.

(Interruptions).

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  I am glad the Chairman of the Revenue Commissioners was in before the Oireachtas committee today to clear up this issue once and for all. Everybody will understand [38]exactly where he or she stands now. I am glad that communications and any further correspondence between the Revenue Commissioners and different sectors of society will be improved as a consequence.

An Ceann Comhairle: Information on Seán Barrett  Zoom on Seán Barrett  I call Deputy Gerry Adams. May we have silence. Deputies have just returned from a break. They should give us all a break and let Deputy Adams in.

Deputy Gerry Adams: Information on Gerry Adams  Zoom on Gerry Adams  Maith thú. Athbhliain úr faoi mhaise don Cheann Comhairle agus don Taoiseach agus dá dteaghlaigh. Tá súil agam go raibh Nollaig mhaith acu. Bhí mé ag féachaint ar an teilifís ag an Nollaig ar daoine ag filleadh abhaile agus ansin ag fágáil arís. Bhí sé truamhéalach. Tá a fhios ag an Taoiseach nach gá go mbeadh orthu imeacht dá mbeadh poist á gcruthú dóibh anseo. Tá a fhios ag Sinn Féin agus ag go leor daoine eile go bhfuil slí eile, slí níos fearr, ann.

I invite the Taoiseach to make a new year resolution. I ask him to reflect on the 500,000 citizens on the dole, on mass emigration, new stealth taxes, VAT increases, the household and septic tank charges, pensioners, the distress in households and on workers on sit-in at La Senza and Vita Cortex. I also invite the Taoiseach to reflect on his support for austerity and his commitment in the fiscal compact to make austerity part of our Constitution. In particular, I would like the Taoiseach to reflect on the fact that €1.25 billion will be paid out on 25 January to unguaranteed bondholders. I invite the Taoiseach to make a new year resolution to stop this outrageous payment and instead to use the moneys to retain and create jobs and grow the economy. I ask the Taoiseach to share this resolution with the troika, who are back in town to start the new year with us. I ask him to tell them he will not invest or give away the people’s money to unguaranteed bondholders, but will invest it in retention of jobs, public services and the creation of new jobs.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  Tá clár rialtais fada leagtha amach ag an Teachta ansin. Is dóigh go raibh an Teachta é féin ar imirce óna dháilcheantar i rith na Nollag freisin. Níl a fhios agam an raibh an Teachta sa bhaile nó cén baile ina raibh sé. In any event, I want the Deputy to understand that I have already made a new year resolution, a continuation of the one I made last year——

Deputy Timmy Dooley: Information on Tim Dooley  Zoom on Tim Dooley  Before or after the election?

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  ——by Government decision, to sort out the problems of our public finances and to put our country in order that we can grow as an economy, have peace and prosperity for our people and careers and job opportunities for the next generation. Every worker who received a pay cheque in January saw no change from that issued in December——

Deputy Pearse Doherty: Information on Pearse Doherty  Zoom on Pearse Doherty  Bar the pensioners.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  ——because there was no change in the income tax levels, rates or bands, as committed to by the Government. People have said to me in their hundreds that at least they are in a position to plan their lives for this year and beyond with some degree of certainty. I agree there are issues in respect of planning in so far as charges and all that are concerned——

(Interruptions).

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  ——but we have given the people the opportunity and the choice to plan.

An Ceann Comhairle: Information on Seán Barrett  Zoom on Seán Barrett  I ask Deputies to please stay quiet and allow the Taoiseach respond.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  I do not hear the Deputy talking about, for instance, the investment——

[39]Deputy Colm Keaveney: Information on Colm Keaveney  Zoom on Colm Keaveney  What about the cuts in Northern Ireland?

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  ——of €350 million by a major US multinational in our country on Monday of this week, which is a signal internationally of American strength, competence and continued investment in this country where workers — ordinary men and women who go to work every day — and others, including subcontractors and subsuppliers, will have a future as a consequence.

The troika is back in town. It is here for ten days. There will be extensive discussions in detail about the performance of Ireland and its Government over the past three months. I expect that our team — the Minister for Finance and the Minister for Public Expenditure and Reform — will deal with all of those issues as well as the big challenges that lie ahead in 2012. We expect that, with the programme for Government, the targets that we have set out will be achieved.

The primary focus of this Government will be to do whatever we can and whatever is necessary to create and protect each and every job. Clearly, we can never have a country with an economy that is as strong as one would like unless we put people back to work. Our attempts for 2012 will be in restructuring our public finances and the way we deliver services to give every support and initiative to every proposal where jobs can be created that are credible, achievable and in the interests of our country and the people. This is my new year resolution and I will work relentlessly with my Government to achieve it. I hope in the interest of job creation that Deputy Adams will support us.

Deputy Gerry Adams: Information on Gerry Adams  Zoom on Gerry Adams  We will support the Taoiseach. We have made many positive suggestions and propositions to assist job retention and job creation. We also welcome any investment. However, this situation does not add up. Some €3.1 billion of taxpayers’ money is to be paid in March in respect of a promissory note to someone. The Taoiseach is not ag éisteacht liom. Some €3.1 billion is to be paid to a toxic criminal bank, namely, Anglo Irish Bank, in March. Some €3.8 billion in cuts will affect schools, single mothers, pensioners, the disabled, students, home owners and those in community employment, CE, schemes. A total of €4.3 billion in taxpayers’ money is to be given to criminal banks and unguaranteed bondholders.

An Ceann Comhairle: Information on Seán Barrett  Zoom on Seán Barrett  A question, please.

Deputy Gerry Adams: Information on Gerry Adams  Zoom on Gerry Adams  In this light, €20 million for job creation does not add up. The people are looking for hope. Sinn Féin is hopeful, as people are increasingly realising that the Government is on the wrong road. Will the Taoiseach reflect again instead of giving his usual stock answer? This is a new year and the Government is relatively new, although some believe it is Fianna Fáil recycled. We want a real commitment, which means putting people’s money not into bad banks or unguaranteed bondholders, but into job creation. What money will be invested in job creation in 2012? Will the Taoiseach confirm that €4.3 billion will be given to bad banks and unguaranteed bondholders?

A Deputy:  It was Sinn Féin’s bailout.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  I did not know that Deputy Adams was colour blind. The colour here is blue and red.

Deputy Gerry Adams: Information on Gerry Adams  Zoom on Gerry Adams  What about the white in between?

Deputy Ciara Conway: Information on Ciara Conway  Zoom on Ciara Conway  We are not French.

[40]The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  We will talk about green, white and gold later. I have already made the point about the promissory note for which he and we were not responsible but which is the subject of serious technical discussions at the level of the European authorities and the IMF to negotiate an alternative to the promissory note as set out in the first place. I will not go beyond that except to say that there is an intense level of discussion about the negotiation of an alternative to the promissory note.

Deputies:  Hear, hear.

Deputy Pádraig Mac Lochlainn: Information on Pádraig MacLochlainn  Zoom on Pádraig MacLochlainn  The Government Deputies are saying “Hear, hear” yet the Taoiseach did not give an answer. He is in safe hands with that crowd. He will never have a problem with leadership challenges again.

An Ceann Comhairle: Information on Seán Barrett  Zoom on Seán Barrett  Will Deputy Adams ask his rowdy Deputy to remain quiet, please?

  5 o’clock

Deputy Joe Higgins: Information on Joe Higgins  Zoom on Joe Higgins  Does the Taoiseach agree that, for many of us, it is deeply disappointing to hear today that whatever reflection he did over the Christmas break, he has not recognised in the Dáil’s first meeting of 2012 that the austerity policy is an absolute disaster economically and socially? Does he not see the significant contradiction in a supposedly sovereign Dáil meeting when, 100 metres from here, the EU, IMF and ECB are in Government Buildings enforcing the diktat of private institutions and European financial markets to the effect that their speculators must be repaid tens of billions of euro by the Irish people for gambling private debts and demanding that the Government channel these tens of billions of euro while it shreds jobs, living standards and health and education services? Does the Taoiseach not accept that the Government is not much more than a puppet government? Does he not see that its decision to continue almost identically the bailout and austerity policy of its predecessor is poisoning every aspect of life in the State? Is it not clear that Revenue, for example, felt under considerable pressure when it sent thousands of letters scarifying pensioners to beat out the €45 million that the Minister for Finance secretly, quietly and sneakily included in the budget?

An Ceann Comhairle: Information on Seán Barrett  Zoom on Seán Barrett  A question, please.

Deputy Joe Higgins: Information on Joe Higgins  Zoom on Joe Higgins  When the Government and its colleagues in Europe continually abase themselves in front of the market speculators and show not a glimmer of fight against the markets railroading economies and Europeans’ living standards, is it any wonder that charlatans like La Senza or vulture capitalists like Lion Capital can abuse 120 female workers by telling them on a Monday night after they have left work that they should not return in the morning because their jobs are gone and that they will need to go to the taxpayer in 12 months time for their statutory rights? Does the Taoiseach not see the link?

In saying that the Taoiseach is championing jobs, does he not recognise that the Government’s austerity programme of taking billions of euro out of the economy is slaughtering the domestic economy, including the retail and other sectors, and will lead to an ongoing disaster unless the Government changes course?

Deputy Bernard J. Durkan: Information on Bernard Durkan  Zoom on Bernard Durkan  Happy new year, Deputy. Cheer up.

The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  I should wish Deputy Higgins a happy 2012. As he is aware, over the past two years the concept of dealing with unsubordinated bond investors has resulted in €15 billion being taken out of that category. The Deputy appreciates that this country is in a programme. He will also appreciate that, between January and October of last year, there was a movement of 125,000 people off the live register. Unfortunately, they were replaced by others, but it [41]shows the extent of movement of labour. There was a reduction, admittedly a slight one, in unemployment numbers towards the end of 2011.

I am quite sure that, from the Deputy’s own leadership of his party, he accepts that, where tax liability is due, taxes should be collected. I have already made the point that, if the Government got involved in some sort of communications plan arising from the transfer of data from the Department of Social Protection to the Revenue Commissioners, which they have had the power to do so since 2005, some 500,000 people would have been very upset about this. Pensioners fully understand that, if there is a liability, it should be paid. Clarity is being brought to those who received letters but where there is in fact no liability. I am quite sure that the Chairman of the Revenue Commissioners has confirmed the position where a very small liability is or may be due.

The Deputy talked about fighting against the plan and the troika. It is not a case of all-out war — it is a case of negotiating for a better position where the plan that this country is in is concerned. That meant being able to negotiate a substantial interest rate reduction, which was a substantial saving to the Irish taxpayer. It meant being able to renegotiate the conditions of the plan for the minimum wage and resulted in acceptance of Government proposals to exempt 330,000 people from the universal social charge. It also allowed for negotiation whereby the Ministers for Finance and Public Expenditure and Reform can discuss the question of how proceeds from any disposal of State assets will be used and achieve clarity of that so it can be dealt with on a case by case basis.

If the Deputy believes there is a better way the country can function given the extent of our borrowings every day because of the circumstances we are in, he must have been away for Christmas. The Government is focused on achieving the targets in the programme that runs for a further two years, achieving the targets set out in the budget presented by the Minister for Finance in December and focusing on the creation of jobs and job opportunities wherever and whenever possible. I am sure the Deputy would want to assist in that work.

Deputy Joe Higgins: Information on Joe Higgins  Zoom on Joe Higgins  The diktats from the austerity policy and the troika are overriding Government responsibility and allowing Ministers to duck their responsibilities and hide. In the past week, the Poor Clares could not have been more silent on the pensions controversy than the Minister for Social Protection.

An Ceann Comhairle: Information on Seán Barrett  Zoom on Seán Barrett  That is not exactly a supplementary question.

Deputy Jerry Buttimer: Information on Jerry Buttimer  Zoom on Jerry Buttimer  I thought Deputy Higgins had no faith.

Deputy Joe Higgins: Information on Joe Higgins  Zoom on Joe Higgins  I can imagine if the Minister, Deputy Burton, had been in opposition, she would have brought an orchestra in to accompany her wails of distress for the pensioners who are being scarified by the Government.

Did the Taoiseach not see just down the road from him at Knock Airport after Christmas the heartbreak these policies are causing, with young people leaving? Is it not clear to him that this is a disastrous policy for jobs; that it is slaughtering them? Has the Taoiseach heard there will be a shocking announcement of more job losses from a financial institution in a short period? How can he say his policies have enjoyed any success when there are still 440,000 people unemployed, a half of whom are long-term unemployed who have been out of work for more than a year? In two weeks time, will the Taoiseach not pay €1.25 billion to Anglo bond holders for private gambles and put the money instead into investment of jobs, creating tens of thousands of jobs in public infrastructure projects that would revive and regenerate the economy? That is the only way we will come out of this morass.

[42]The Taoiseach: Information on Enda Kenny  Zoom on Enda Kenny  If we were not in a programme, given the circumstances that apply to the country, we would be expected to do in a year what is envisaged over three years in the programme. That would have brought the Poor Clares out in public with a clear break in their silence, although I am not sure if Deputy Higgins would have joined in the chorus. We must look at what the commentators and economists all say. None of them have to make decisions and the decision here must be balanced between rectifying the structural defects and deficiencies in the way our country is run, in our public finances, and growing our economy while providing sufficient for day to day services to operate in our country. That is the balance that must be achieved and it will only be achieved by the Government making decisions that are in the best interests of the country and our people.

The airport the Deputy mentioned is not a State airport and has been held out as the kind of model others should follow in terms of their increases in passenger numbers and the way it conducts its business. I invite the Deputy to come down there on many occasions during the summer to see the excited people who will come from mainland Europe and our main tourism markets to see, understand and appreciate the wonderful opportunities for people to enjoy themselves in a country like ours.

A financial institution was mentioned by the Deputy. Financial institutions will have to change their own structures because of the requirement for a leaner, more efficient, more competent and smaller banking sector. I remind the Deputy that whatever happens in those sectors, it will be of a voluntary nature.

The Government is focused on dealing with the reality we face every day, that we must deal with and that we will deal with in the best interests of our people and country to rectify the morass and mess we have inherited. We are not afraid of the challenge; we will meet it successfully.


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