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 Header Item Written Answers Nos. 140-161
 Header Item Home Building Finance Ireland Establishment
 Header Item Strategic Banking Corporation of Ireland
 Header Item VAT Rate Increases
 Header Item Ministerial Functions
 Header Item Property Tax Review
 Header Item Insurance Industry Regulation
 Header Item Disabled Drivers and Passengers Scheme
 Header Item Disabled Drivers and Passengers Scheme
 Header Item Tax Code
 Header Item Departmental Contracts
 Header Item Tax Code
 Header Item Mortgage Lending
 Header Item Financial Services Regulation
 Header Item Illegal Moneylenders
 Header Item Credit Union Regulation
 Header Item Strategic Banking Corporation of Ireland
 Header Item Tax Yield
 Header Item Prize Bonds
 Header Item Tax Code

Tuesday, 4 December 2018

Dáil Éireann Debate
Vol. 976 No. 1

First Page Previous Page Page of 98 Next Page Last Page

Written Answers Nos. 140-161

Home Building Finance Ireland Establishment

 140. Deputy Joe Carey Information on Joe Carey Zoom on Joe Carey asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the status of the operation of the home building finance Ireland,HBFI, scheme; the way in which it is planned that apartment owners or management companies can apply for loans to enable them to undertake works to address latent defects in buildings; and if he will make a statement on the matter.  [50195/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe Home Building Finance Ireland (HBFI) is being established as one of a number of measures to address the housing crisis. It will provide a source of funding for small to medium sized residential developments on a commercial basis. The Home Building Finance Ireland Act passed remaining stages in the Oireachtas two weeks ago and was enacted in the past few days. Much progress has been made in preparing HBFI for launch and it is expected that HBFI will commence receiving funding applications towards the end of January 2019. HBFI will be in a position to consider applications from apartment owners and management companies for such funding at that time.

It is important to emphasise that in order for HBFI’s activities to comply with State aid rules it must operate on a commercial basis. This means, for example, that HBFI will not be in a position to offer cheap or subsidised credit. Any funding provided by HBFI will be backed by appropriate security and normal banking terms and conditions will apply.

It is important to recognise that the funding of remediation works are complex and high risk projects and pose significant issues for lenders in relation to access to appropriate security etc. While HBFI will be open to considering all residential development construction related activity, it is the responsibility of all applicants to ensure that their applications for funding are commercially viable and allow HBFI to remain compliant with State aid rules.

Strategic Banking Corporation of Ireland

 141. Deputy Michael McGrath Information on Michael McGrath Zoom on Michael McGrath asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe if there is an independent complaints mechanism for persons or companies wishing to make complaints against the Strategic Banking Corporation of Ireland, SBCI; and if he will make a statement on the matter.  [50196/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe The Strategic Banking Corporation of Ireland (SBCI) is Ireland’s national promotional institution with a mandate to deliver effective financial supports to Irish SMEs. I am advised that complaints may be made through the SBCI’s information and enquiries email address, which is info@sbci.gov.ie.

  The SBCI is a Designated Activities Company (DAC) under the Companies Act 2014 and has an independent Board of Directors. Consequently, as Minister for Finance, I have no role in any complaints that may be made regarding the SBCI or any procedure for handling such complaints.

  However, I am advised by the SBCI that, in the event of a complaint against it, the SBCI will thoroughly investigate such a complaint to confirm that it has fully complied with all its statutory obligations and other corporate governance requirements.

  Safeguards to ensure the SBCI’s compliance with its legal and corporate governance requirements are the oversight provided by Comptroller and Auditor General and the SBCI’s accountability to the Committee of Public Accounts. Additionally, the SBCI is subject to the Revised Code of Practice for the Governance of State Bodies 2016 (the Code).

The Comptroller & Auditor General is the SBCI’s statutory auditor and produces a report as part of the SBCI’s Annual Report and Financial Statements. The Chief Executive Officer of the SBCI is liable to appear before the Committee of Public Accounts, pursuant to Section 20 of the Strategic Banking Corporation of Ireland Act 2014.

  I pleased to inform the Deputy that the SBCI is currently preparing both a customer charter and finalising a formal internal complaints procedure. The customer charter will be published on the SBCI website this month.

  This customer charter will identify small business borrowers and its bank and non-bank on-lending partners as the SBCI’s primary customers. It will also outline the services the SBCI provides as the provision of long term liquidity to support the provision of lower cost finance products and portfolio guarantees, which facilitate access to finance for small businesses.

  In addition to encouraging feedback and providing contact details, the Deputy may rest assured that the customer charter will set high standards against which SBCI’s performance in delivering its mandate and acting as an effective custodian of European and taxpayer funds can be measured.

VAT Rate Increases

 142. Deputy James Browne Information on James Browne Zoom on James Browne asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the position regarding the VAT increase and its expected negative impact on small businesses here; and if he will make a statement on the matter. [50224/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe The 9% VAT rate was introduced as a temporary measure in Finance (No. 2) Act 2011, to cease at the end of 2013. This period was subsequently extended but during last year’s Finance Bill a commitment was given to undertake a review of the 9% VAT rate. This review was published in July 2018 and the Budget decision to increase the VAT rate was made following that analysis, which indicated that the majority of activity at the 9% VAT rate is driven by income growth more than price and that the retention of the rate provides little additional benefit relative to its cost.

The Review of the 9% VAT rate found that tourism expenditure is more sensitive to income growth and the economic cycle than to price changes. The economy is currently performing well, with high levels of employment and strong demand in the tourism sector. Growth is also expected to continue in the medium term. This positive economic outlook means that the income channel of demand is likely to ensure that economic activity within the sectors to which the 9% VAT rate applies remains strong.

In this context, it is believed that the VAT rating applied to the tourism sector should not greatly impact demand, or employment, in the sector.

Ministerial Functions

 143. Deputy Niall Collins Information on Niall Collins Zoom on Niall Collins asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the public events he attended, by county, since 1 May 2018 and to date in 2018; and if he will make a statement on the matter.  [50283/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe I wish to advise the Deputy that details of public events I attend are available in my diary which is published on my Department's website at www.finance.gov.ie.

Property Tax Review

 144. Deputy Maureen O'Sullivan Information on Maureen O'Sullivan Zoom on Maureen O'Sullivan asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the status of the review of the local property tax; and when homeowners can expect changes in their liability. [50301/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe The report of the review of the LPT is currently being finalised in conjunction with the Departments of the Taoiseach, Public Expenditure and Reform, Housing Planning and Local Government, and the Office of the Revenue Commissioners. I will of course carefully consider the conclusions and recommendations of the report when it is presented to me.

The purpose of the review is to inform me in relation to any actions I may recommend to Government concerning the LPT having regard to, inter alia, the residential property revaluation date which will arise on 1 November 2019. The Government will make its position clear so that households will know well advance what its plans are for LPT.

Insurance Industry Regulation

 145. Deputy Michael McGrath Information on Michael McGrath Zoom on Michael McGrath asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe if the next payment to claimants of a company (details supplied) will be in February 2019; and if he will make a statement on the matter. [50307/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe Setanta Insurance was placed into liquidation by the Malta Financial Services Authority on 30 April 2014. As it was a Maltese incorporated company, the liquidation is being carried out under Maltese law.

The Deputy will be aware that the Insurance (Amendment) Act 2018 (Act 21 of 2018) was signed into law in July this year. Section 12 of the Act provides that the State Claims Agency may, from time to time but not more frequently than once in every three month period, apply to the High Court for approval for payments from the Insurance Compensation Fund in respect of claimants of an insolvent insurer authorised in another EU Member State. Setanta Insurance falls under this section of the Act.

  The State Claims Agency on 19 November, obtained High Court approval for payments from the Fund in respect of the fourth tranche of payments to Setanta claimants. This tranche of claims is comprised of approximately 1,500 separate payments with a value of approximately €21 million, and will comprise of (a) newly settled claims requiring 100% payment, (b) all those cases where 65% was previously paid and where the balance of 35% is due and (c) a number of third party legal costs payments.

  It should be noted that the process of settling claims is still ongoing and is subject in some cases to court procedures. However, the liquidator estimates that the process of settling the vast majority of these outstanding claims should be completed by end-2019.

  Finally, as the next application to the High Court is subject to the three-month rule, it is hoped that court approval for the next batch of payments can be made at the end of February. However, as this a matter between the liquidator and the State Claims Agency, I am not in a position to give an absolute commitment on this at this stage.

  I should, however, have a better insight into the timing details closer to the end of this three month period.

Disabled Drivers and Passengers Scheme

 146. Deputy Robert Troy Information on Robert Troy Zoom on Robert Troy asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the number of applications received for the disabled drivers and disabled passengers tax concessions scheme in each of the past seven years; and the number of successful and unsuccessful applications, respectively, in each of these years, in tabular form.  [50330/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe I am advised by Revenue that the following table includes the total number of applications received, approved (successful) and rejected (unsuccessful) under the Disabled Drivers and Disabled Passengers scheme for the years 2014 to 2018 (year to date). Revenue has also confirmed that for years prior to 2014, the only records retained relate to ‘approved applications’. Consequently, the ‘total number of applications’ and the number of ‘unsuccessful applications’ for those years are unavailable.

Year Total Applications Successful Unsuccessful
2011   4,773  
2012   4,936  
2013   4,357  
2014 5,060 4,997 63
2015 5,494 5,440 54
2016 6,506 6,490 16
2017 6,080 6,052 28
2018 6,256 6,248 8 (Nov 2018)

Disabled Drivers and Passengers Scheme

 147. Deputy Robert Troy Information on Robert Troy Zoom on Robert Troy asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe his views on the eligibility criteria for the disabled drivers and disabled passengers tax concession scheme; and his further views on whether the qualification criteria for the scheme are outdated. [50331/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe As you may be aware, the Disabled Drivers and Disabled Passengers (Tax Concessions) Scheme provides relief from VAT and VRT (up to a certain limit) on the purchase of an adapted car for transport of a person with specific severe and permanent physical disabilities, payment of a fuel grant, and an exemption from Motor Tax.

  To qualify for the Scheme an applicant must be in possession of a Primary Medical Certificate. To qualify for a Primary Medical Certificate, an applicant must be permanently and severely disabled within the terms of the Disabled Drivers and Disabled Passengers (Tax Concessions) Regulations 1994 and satisfy one of the following conditions:

- be wholly or almost wholly without the use of both legs;

- be wholly without the use of one leg and almost wholly without the use of the other leg such that the applicant is severely restricted as to movement of the lower limbs;

- be without both hands or without both arms;

- be without one or both legs;

- be wholly or almost wholly without the use of both hands or arms and wholly or almost wholly without the use of one leg; and

- have the medical condition of dwarfism and have serious difficulties of movement of the lower limbs.

  The Scheme represents a significant tax expenditure. Between the Vehicle Registration Tax and VAT foregone, and the fuel grant, the scheme cost circa €65 million in each of 2016 and 2017. This figure does not include the revenue foregone in respect of the relief from Motor Tax provided to members of the Scheme.

  Given the scale and scope of the scheme, I have no plans to amend the qualifying criteria at this time.

Tax Code

 148. Deputy Pearse Doherty Information on Pearse Doherty Zoom on Pearse Doherty asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the specific professions that had their flat rate expenses regime reviewed recently; if the proposed changes are due to come into effect as of 1 January 2020; if all professions are under review; if not, his plans to review them in the future; and if he will make a statement on the matter. [50341/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe I refer the Deputy to my replies to recent Parliamentary Questions from him on this matter (Nos. 164 and 158 of 13 November, No. 7 of 22 November, and No. 179 of 20 November). The review of flat rate expenses is ongoing, and Revenue have indicated that the effective date for implementation of any changes to particular flat rate expense categories will be 1 January 2020.

All 53 employment categories which benefit from the regime are being reviewed.

Departmental Contracts

 149. Deputy Kate O'Connell Information on Kate O'Connell Zoom on Kate O'Connell asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the number of contracts and-or tenders that have been awarded to a company (details supplied); the amount the company has been paid; the services the contracts were for; and the number of public sector and-or publicly funded catering facilities being run by the company.  [50363/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe In response to the Deputy’s question, my Department has not awarded any contracts or tenders to the company in question.

Tax Code

 150. Deputy Pearse Doherty Information on Pearse Doherty Zoom on Pearse Doherty asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the estimated cost of indexing all tax thresholds and credits by each band or credit based on wage inflation of 3.8% for the next five years. [50550/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe As indicated in my previous reply to the Deputy in response to Parliamentary Questions 54 and 55 on 22 November 2018, the Revenue Ready Reckoner presents, on page 10, a table showing the estimated cost to the Exchequer of a 1% indexation of credits, rate bands and exemption limits for Income Tax and the Universal Social Charge.

  Increases greater than 1% can be estimated on a straight-line or pro-rata basis from the information shown.

  Revenue does not provide cost estimates beyond the tax year 2019.

Mortgage Lending

 151. Deputy Michael McGrath Information on Michael McGrath Zoom on Michael McGrath asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe further to Parliamentary Question No. 152 of 27 November 2018, the number of principal dwelling home loans for first-time buyers, FTBs, and second and subsequent buyers, SSBs, for each month since the introduction of the Central Bank mortgage measures that were issued above either the loan-to-value or loan-to-income limits based on mortgage approval rather than mortgage drawdown; and if he will make a statement on the matter.  [50619/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe The Central Bank advises that the macro-prudential mortgage lending rules are formulated on the basis of housing loans made by mortgage lenders. Therefore, lenders are required to report to the Bank, and are being monitored by the Bank, on the basis of mortgage drawdowns as opposed to mortgage approvals/sanctions. The Central Bank does not collect data on mortgage approvals for the purposes of the mortgage lending macro prudential measures.

Financial Services Regulation

 152. Deputy Fiona O'Loughlin Information on Fiona O'Loughlin Zoom on Fiona O'Loughlin asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the number of illegal moneylenders that have been prosecuted in the past ten years; and if he will make a statement on the matter. [50637/18]

 154. Deputy Fiona O'Loughlin Information on Fiona O'Loughlin Zoom on Fiona O'Loughlin asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the number of authorised moneylenders; the number in each of the years 2014 to 2017; the name of each and the counties in which they operate; and if he will make a statement on the matter. [50640/18]

 155. Deputy Fiona O'Loughlin Information on Fiona O'Loughlin Zoom on Fiona O'Loughlin asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe his plans to legislate to place a cap on the rates that can be charged by moneylenders; the way in which to ascertain the interest rates they charge; and if he will make a statement on the matter. [50641/18]

 156. Deputy Michael McGrath Information on Michael McGrath Zoom on Michael McGrath asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the number of cases in which a licensed moneylender was found to be charging an APR in excess of the associated maximum APR in the Central Bank's moneylender register; if the maximum APR in that register places a restriction on the amount the moneylender can charge by way of interest or if it is only indicative in nature; and if he will make a statement on the matter.  [50658/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe I propose to take Questions Nos. 152 and 154 to 156, inclusive, together.

  The Central Bank regulates the licensed moneylender sector. It is, of course, a criminal offence for an unauthorised firm/person to provide financial services in Ireland that would require an authorisation under the relevant legislation which the Central Bank is the responsible body for enforcing.

  The Central Bank has no power or regulatory role in respect of illegal moneylenders. Illegal moneylenders fall within the remit of An Garda Síochána. The Central Bank is statutorily required to report any suspicions of illegal moneylending to An Garda Síochána and does so when it becomes aware of suspected cases of illegal moneylending. Members of the public and licensed moneylenders are encouraged to report any suspicions of illegal moneylending to An Garda Síochána.

  As at 31 December 2014 there were 38 moneylenders licensed by the Central Bank.

  As at 31 December 2015 there were 39 moneylenders licensed by the Central Bank.

  As at 31 December 2016 there were 39 moneylenders licensed by the Central Bank.

  As at 31 December 2017 there were 40 moneylenders licensed by the Central Bank.

  As at 29 November 2018 there are 39 moneylenders licensed by the Central Bank.

  The Central Bank’s public register of moneylenders sets out the District Court districts in which each licensed moneylender is permitted to operate. Currently, 28 moneylenders are permitted to operate in all districts. S.I. 172/2013 (available on www.irishstatutebook.ie), sets out the up to date list of District Court districts and their related areas.

  Each moneylender’s licence (which can be found on the Central Bank’s Register of Moneylenders, available at the following link: http://registers.centralbank.ie/LenderSearchResultsPage.aspx?searchEntity=MoneyLender&searchType=Name&searchText=&registers=14&lenderType=MoneyLenders&court=All&aprMin=0&aprMax=0&costofcreditMin=0&costofcreditMax=0&termMin=0&termMax=0) includes details of the duration, maximum APR, maximum cost of credit and the collection charge (if any) of the loans which can be offered by a licensed moneylender. Licensed moneylenders are prohibited from applying additional charges (other than a collection charge) to a moneylending agreement and are also prohibited from applying any additional charges in the event of a default in the payments due under the agreement (i.e., the total amount repayable by a consumer is limited to the amount specified in the moneylending agreement).

  The Consumer Credit Act 1995, the legislation under which moneylenders are licensed, does not provide for an APR/interest rate cap. Nor does the European Communities (Consumer Credit Agreements) Regulations 2010. Therefore, the Central Bank has no statutory power to impose a market wide cap on rates. Any legislative proposals in this regard would have to be careful to achieve an overall reduction in the cost of credit and ensure that it did not have unintended consequences in terms of financial exclusion.

  The legislation provides that the Central Bank can refuse to grant a licence to a moneylender if it is of the opinion that the cost of credit to be charged is excessive. Since the Central Bank assumed responsibility for the licensed moneylending sector in 2003, it has not permitted an increase to the maximum APR charged in the sector. During the Central Bank’s engagements with new or potential applicants, it examines, on a case-by-case basis, if the proposed costs of credit are excessive and it has successfully challenged firms in this regard. Nor has the Bank licensed any moneylender to provide the ‘pay-day loan’ services that exist in other jurisdictions such as the UK and the Bank will continue to pursue this policy.

  The Central Bank has stated its view publicly that the introduction of an interest rate ceiling may not achieve the objective of lowering the total cost of credit, for example if the licensed moneylender chose instead to extend the duration of the loan. Any legislative proposals in this regard would therefore have to be careful to achieve an overall reduction in the cost of credit. Lower interest rate ceilings could be ineffective and counterproductive in this regard and may result in excluding low income households that have repayment capacity from accessing such credit, even at the high rates charged by licensed moneylenders.

Illegal Moneylenders

 153. Deputy Fiona O'Loughlin Information on Fiona O'Loughlin Zoom on Fiona O'Loughlin asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the steps he is taking to tackle the problem of illegal moneylenders; and if he will make a statement on the matter. [50638/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe The Central Bank regulates the licensed moneylender sector. As of 27 November 2018, 39 firms are included on the Moneylender register with the Central Bank. This can be viewed from http://registers.centralbank.ie/DownloadsPage.aspx.

  It is, of course, a criminal offence for an unauthorised firm/person to provide financial services in Ireland that would require an authorisation under the relevant legislation which the Central Bank is the responsible body for enforcing. The Central Bank has no power or regulatory role in respect of illegal moneylending. The activities of anyone undertaking moneylending without the appropriate authorisation falls under the jurisdiction of An Garda Síochána, who are the most appropriate State body to investigate criminal matters.

  Where the Central Bank becomes aware of the suspected provision of unauthorised moneylending services to the public, it refers the matter to An Garda Síochána for criminal investigation. My colleague, the Minister for Justice and Equality has oversight of An Garda Siochana.

  Questions Nos. 154 to 156, inclusive, answered with Question No. 152.

Credit Union Regulation

 157. Deputy Michael McGrath Information on Michael McGrath Zoom on Michael McGrath asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe if he has the power to increase the 1% per month interest limit for the credit union sector; if this power is vested in the Central Bank; his plans to increase the limit to 2% to better enable credit unions to provide smaller short-term loans to members; and if he will make a statement on the matter. [50659/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe Section 38 1(a) of the Credit Union Act 1997 prescribes that the interest on a Credit Union loan shall not at any time exceed 1% per month. I can confirm that the power to increase this cap has not been vested in the Central Bank and therefore whether the 1% per month interest limit for the credit union sector should be increased is a matter for the Minister for Finance, Government and the Oireachtas.

As the Deputy may be aware the interest rate ceiling on Credit Union loans has been subject to recent discussion in a number of fora.

Firstly, the Credit Union Advisory Committee (CUAC) - the statutory committee whose function is to advise the Minister for Finance in relation to matters relating to credit unions - published a policy paper on this issue in December 2017 following a survey of credit unions. In its policy paper on the loan interest rate cap the CUAC recommended that credit unions should be permitted to charge an interest rate on loans greater than the present ceiling of 1% per month, and proposed that the cap be raised to 2% per month. This change would provide credit unions with greater flexibility to risk price loan products and in so doing may create an opportunity for new product offerings. It is important to note that CUAC's recommendation to increase the loan interest rate ceiling would not mean that credit unions are required to raise their loan interest rates, rather they could apply their own interest rates within the parameters allowed. The policy paper is available on my Department's website.

Secondly, the CUAC Report Implementation Group - a group established to oversee and monitor the implementation of recommendations from the CUAC report - has also considered the issue of increasing the interest rate cap as recommended in the CUAC policy paper. This group is chaired by my Department and is made up of one member from each of the credit union representative bodies - the Irish League of Credit Unions, the Credit Union Development Association, the Credit Union Managers’ Association and the National Supervisors Forum - and a member from the Central Bank. The Implementation Group is currently in the process of finalising its Final Report which will be published shortly. Following publication of the Final Report, I will review the Implementation Group's recommendation on the loan interest cap, along with the CUAC recommendation already received, and consider if any legislative changes are required.

Finally, I should also note that the CUAC recommendation on the interest rate cap is aligned with a similar recommendation that has been put forward recently in the "Interest Rate Restrictions on Credit for Low-income Borrowers" report, compiled by the Centre for Co-operative Studies University College Cork on behalf of the Social Finance Foundation.

Strategic Banking Corporation of Ireland

 158. Deputy Sean Fleming Information on Seán Fleming Zoom on Seán Fleming asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the funding available for loans and credit insurance, respectively, by strategic banking Ireland; the number of applications received since its establishment in respect of each of the categories; the number and value of applications that have been approved; the funding and insurance provided; the timeline for applications to be dealt with; and if he will make a statement on the matter. [50687/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe I presume the Deputy is referring to the Strategic Banking Corporation of Ireland, the SBCI. The SBCI is Ireland’s national promotional institution for SMEs. The SBCI does not provide financing directly to SMEs, rather, it uses an on-lending model and works with both banks and non-bank finance providers to make lower-cost finance available to eligible enterprises. The SBCI currently has 3 bank and 3 non-bank on-lenders.

The strategic mission of the SBCI is to deliver effective financial supports to Irish SMEs. The SBCI achieves this through the provision of low cost liquidity and risk-sharing activities, which involve the provision of guarantees. To date, none of the SBCI’s funding has been used to support a specific credit insurance product; rather, as I mentioned, it provides guarantees to and engages in the sharing of risk with its partner finance providers, as well as the State and European partners.

In respect of the figures sought by the Deputy, I am advised that the SBCI does not obtain details of the number of applications for loans made to its on-lending partners and does not receive loan applications directly from SMEs, due to its on-lending model. Instead, the SBCI only obtains information from its on-lending partners in respect of the number of loans to SMEs that have been sanctioned.

At the end of March 2018, the total volume of SBCI supported lending activity through eight on-lending partners, including loans made under the SBCI’s risk-sharing guarantee schemes, was €972 million to over 24,000 SMEs supporting 129,300 jobs.

The Agriculture Cashflow Support Loan Scheme and the Brexit Loan Scheme are the SBCI’s two major risk-sharing guarantee Schemes.

Under the Agriculture Cashflow Support Loan Scheme, which has now concluded, a total of approximately €145 million of loans were drawn down by over 4,200 SMES. These loans were made available through AIB, Bank of Ireland and Ulster Bank. SMEs applied directly to those banks for loan approval and these applications were subject to the banks’ normal credit assessment processes.

Up to €300 million of funding to SMEs and small MidCaps is currently available under the Brexit Loan Scheme. There is a two-stage application process for this funding. First, businesses must apply to the SBCI to confirm their eligibility for the Scheme. As part of the process, businesses must submit a business plan, demonstrating the means by which they intend to innovate, change or adapt to meet their Brexit challenges. The SBCI has advised me that it deals with these eligibility applications within 24 hours. Then, loans are subject to the finance providers' own credit policies and procedures. The Scheme is available through the AIB, Bank of Ireland and Ulster Bank.

Since the launch of the Brexit Loan Scheme on 28 March 2018 to 23 November 2018, the SBCI has received 307 applications. Of these, 270 have been deemed eligible to proceed to one of the participating finance providers for a loan under the Scheme. In total, 54 SMEs have progressed to sanction at partner finance provider level to a total value of €12,510,000.

The SBCI also operates the Credit Guarantee Scheme on behalf of the Minister for Business, Enterprise and Innovation. In the last two years, loans of €28.7 million have been supported under the Scheme providing funding to 190 SMEs.

The Central Bank of Ireland’s “Code of Conduct for Business Lending to Small and Medium Enterprises” applies to applications made to the SBCI’s on-lenders that are regulated entities by the Central Bank of Ireland. This Code requires the finance providers to set out their timelines for dealing with loan applications, which vary depending on the size of the loan.

Tax Yield

 159. Deputy Catherine Martin Information on Catherine Martin Zoom on Catherine Martin asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the estimated full-year cost of the increases to the standard rate cut-off point to €50,000 over the next five years (details supplied).  [50692/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe I am advised by Revenue that the estimated full year cost of increasing the standard rate cut off point for all income tax bands by €14,700 which would bring it to €50,000 for a single person and €100,000 for a couple in a single year, would be approximately €2.3 billion.

This estimated figure has been generated by the Revenue cost model by reference to projected 2019 incomes, calculated on the basis of actual data for the year 2016, the latest year for which returns are available, and adjusted for income, self-employment and employment trends in the interim. The estimate is provisional and may be revised.

Revenue does not provide cost estimates beyond the tax year 2019.

Prize Bonds

 160. Deputy Brendan Howlin Information on Brendan Howlin Zoom on Brendan Howlin asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the prize fund available under the national prize bond scheme; his plans to increase the prize fund; and if he will make a statement on the matter. [50755/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe The National Treasury Management Agency (NTMA) has informed me that they set the variable percentage rate used to calculate the prize fund available under the National Prize Bond Scheme. Effective from August 2017, this variable percentage rate is set at 0.50% of the total value of Prize Bonds outstanding. The total value of the Prize Bonds fund at the end of 2017 was €3.17 billion.

  I am also informed by the NTMA that it has no immediate plans to change the variable percentage rate used to calculate the prize fund. However rates are kept under constant review. All changes in rates seek to maintain the balance of remaining competitive, providing good value for the holders of Prize Bonds while also remaining conscious of the cost to the taxpayer.

  Further details on Prize Bonds may be found on the State Savings website www.statesavings.ie.

Tax Code

 161. Deputy Mattie McGrath Information on Mattie McGrath Zoom on Mattie McGrath asked the Minister for Finance Information on Paschal Donohoe Zoom on Paschal Donohoe the number of HAP payments made to section 23 properties in each of the past three years; and if he will make a statement on the matter. [50808/18]

Minister for Finance (Deputy Paschal Donohoe): Information on Paschal Donohoe Zoom on Paschal Donohoe I am advised by Revenue that it can provide details on the numbers of cases that are in receipt of relief under Chapter 11 of Part 10 of the Taxes Consolidation Act 1997, commonly referred to as “Section 23 Reliefs”, and that are also in receipt of Housing Assistance Payments. However, this information is not immediately available from Revenue’s systems and additional analysis is required to compile the data requested by the Deputy.

Revenue advise that they expect to be able to give me the information that the Deputy has asked for very shortly. I will furnish that information to him as soon as is practicable after that.


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