Oireachtas Joint and Select Committees

Thursday, 30 June 2016

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach

Estimates for Public Services 2016
Vote 1 - President's Establishment (Revised)
Vote 2 - Department of the Taoiseach (Revised)
Vote 3 - Office of the Attorney General (Revised)
Vote 5 - Office of the Director of Public Prosecutions (Revised)
Vote 6 - Office of the Chief State Solicitor (Revised)

9:00 am

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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We will resume. I welcome the Taoiseach and his officials. We have his opening statement but, in the interests of time and given the fact that he will have to leave at 12 noon, perhaps he will outline the main points so that members will have time to ask questions.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I am glad to be here for the committee to consider the 2016 Estimates for Votes 1 to 6, excluding Vote 4, covering the Central Statistics Office, which has already been approved by the Dáil. I was not able to provide members with an advance copy of the briefing material but I know they are anxious for material on the UK referendum so I have circulated that. The Estimates are for the President's Establishment, the Department of the Taoiseach, the Office of the Attorney General, the Office of the Director of Public Prosecutions and the Office of the Chief State Solicitor. I am joined by staff from the Department, namely, Mr. Martin Fraser, Secretary General; Mr. John Shaw, assistant secretary; Ms Mary Keenan, head of corporate affairs; and Ms Geraldine Butler, finance officer.

The Revised Estimate for 2016 in respect of the President's Establishment is €3.811 million. This includes €2.6 million for pay and administration, with the balance for the centenarians' bounty. It is estimated that 420 centenarians will receive the bounty in 2016. Increased funding was provided to cover the cost of the President's 1916 centenary event in Áras an Uachtaráin.

The figure for the Department of the Taoiseach is €29.35 million, which includes €16.68 million for pay and administration. The core role of the Department is to support the executive functions of the Taoiseach and the Government and to oversee the implementation of the programme for partnership Government. There are four Ministers of State: a Chief Whip; a Minister of State for European affairs, data protection and the EU digital single market; a Minister for diaspora affairs; and a Minister of State with responsibility for defence. An important part of this Department's work is providing the secretariat for meetings of the Government and Cabinet committees. I established a number of Cabinet sub-committees, from housing to arts, Irish and the Gaeltacht, which I chair myself. It has recently been difficult to get fixed times for meetings but we will work out a convenient time for members to attend. The Department deals with all the items listed on page 7, such as Cabinet meetings, Government meetings, press events, freedom of information requests and so on.

The 2016 centenary commemorations were an important part of the work of the Department of the Taoiseach. The Secretary General chaired the steering group and that led to a cross-departmental effort in which everybody played their part. I am very proud of the efforts people made, the time they gave to it and the comprehensive, sensitive and inclusive manner in which it was carried out. Planning for the anniversary of the 1916 Easter Rising started in late 2014 and involved a collaboration across a range of Departments. At the heart of the process was a need to stimulate debate and the wealth of books, material, pamphlets and information that has now come to light about 1916 and the families and people of the time has been a revelation for most people. People now look at our flag differently and have a much deeper understanding of the movement from 1916 through to independence. The highlights included a wet day on 1 January in Dublin Castle when the flag was raised; the Easter Sunday wreath-laying ceremony in Kilmainham; the Easter Sunday ceremony in the GPO and the parade; the Easter Sunday State reception at Dublin Castle; and the inter-faith ceremony at the Glasnevin cemetery remembrance wall. All were seminal moments and they were conducted in an exemplary way.

The Department is also co-ordinating the ceremony at the Irish National War Memorial Gardens at Islandbridge to commemorate the 100th anniversary of the battle of the Somme. The Minister for Arts, Heritage and the Gaeltacht is in France today and the President will be there tomorrow. President Hollande will be here towards the end of the month as part of the Somme commemorative events and an additional €433,000 has been allocated for a commemoration programme. I commend the staff of the Department, who gave many long hours over and above the call of duty to make this a real success, and I was really proud of them.

The committee discussed the results of the UK referendum with the Minister for Finance earlier and I will also take any questions members may have. We published a national risk assessment on this in 2014 and in March 2015 we set up a dedicated unit in the Department of the Taoiseach to look at contingencies in the event that the British electorate decided to vote to leave. The European Council met on Tuesday and Wednesday and I will talk to members about that if they wish. On Tuesday, the Prime Minister, David Cameron, gave a presentation on the background to the result and on Wednesday morning, with the British Prime Minister absent, there was a full-scale discussion for a number of hours about the situation and how the resulting issues should be addressed. Our interests are in the extent of trade across the Irish Sea, the common travel area, the peace process, an open border and maintaining our links with Northern Ireland, the UK and the European Union.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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If the Taoiseach wants to elaborate on any of those matters now, he can. We have time.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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The meeting took place on Tuesday in Brussels. There was the normal meeting first when they went through the issues of migration and NATO - co-operation between the European Union and NATO with clarity for any country with a policy on neutrality such as ours - and a number of others. In the evening the discussion was about the Brexit referendum. I think the Prime Minister, Mr. Cameron, was disappointed with the result. I saw some of the headlines, that he had made a real case that the issue of migration had to be dealt with. He said he was disappointed that the number was 180,000 instead of the 80,000 he had thought it might be, which might be relevant. The referendum was held and the "Leave" side won. There were a number of comments from leaders around the table. On the Wednesday morning, there was a far deeper discussion. The basics are that the nomination and appointment of a new British Prime Minister will be completed by 9 September, forward from the original date he had mentioned. The second point is that there will be no negotiations between the United Kingdom and the European Union until such time as the Commission is informed by Britain of its intention to withdraw from the Union. The clock will start to tick from that moment. The discussions and negotiations will take place within a two-year period, but there may be a short extension. If they are not concluded within that time, we will automatically move to the World Trade Organisation conditions that apply to trade and so on.

It is important to note that there are three institutions in the European Union, as the Chairman is well aware - the European Commission, the European Parliament and the European Council. Traditionally the European Commission has had expertise and experience of dealing with applicant countries to join the European Union. It has made the case that that experience should continue to be used and it will, but I want to make it clear that there will be political oversight of the process by the European Council, that is, the elected leaders of the different countries. Therefore, all three institutions will be involved in one way or another. There were quite a number of views expressed about this, but, in the absence of being informed formally by Britain, negotiations cannot and will not commence.

I have to say the leaders were very clear at the European Council that there were lessons to be learned and that the challenge for the European Union was to demonstrate a human interest in the peoples of the different countries, to show an understanding of the challenges and difficulties and the hardship many people experienced, but the agenda for the European Commission is one of simplification, the abolition of red tape, investment to increase growth and competitiveness, and dealing with migration and security matters. The European Council decided that there would be a meeting in Bratislava in September. I made the point that it was very important for the citizens of the European Union to actually be able to understand the progress the Commission was making on that agenda. It is important to be able to point to the issues that have been simplified, the red tape that has been eliminated and the programme of investment to ensure growth and job creation and increase competitiveness. One of the issues, if one likes, is that the Juncker programme is a major infrastructural programme, but the funds have not been drawn down to the extent that was thought, but there are other issues that need to be addressed also because within the same element one has EUROSTAT which is independent in its workings. It has been inconsistent and unpredictable in its assessment of the financial investment opportunities. That issue needs to be addressed, not just in the case of Ireland but in the case of others also. Some work is ongoing in that regard.

Both meetings were very measured and calm. There was no sense of hysteria or hysterics about what might or might not happen. The economics and the markets will obviously adjust and affect all countries, but the politics in the European Council overseeing the negotiations that will inevitably take place will have to bear in mind that, at the end of the day, this is all about citizens in the different countries. Britain will continue as a full member until it actually leaves the European Union. The British will continue to pay their charges and abide by all of the rules of the European Union. They will continue to keep their ships in the Mediterranean and play their full part.

The question can be asked of what is best for Ireland's interests. It is that the United Kingdom still have access to the Single Market, but it was made perfectly clear by the European Council that access to the Single Market carried with it a responsibility to accept in full the four principles of the European Union, one of which is freedom of movement. Obviously, those who supported the "Leave" campaign put forward the proposition that the issue of migration should be considered and the numbers reduced. It has been made perfectly clear by the Council that, in the event of access to the Single Market being available, it will carry with it that requirement and it will not be changed.

I see some headlines on the Scottish position. A number of weeks ago I attended a meeting of the British-Irish Council in Glasgow when, obviously, we discussed some of these issues. First Minister Sturgeon made it perfectly clear that, if the outcome of the referendum was to leave, Scotland would very much be of a mind to discuss with the European Commission the opportunities that might present to allow it to remain a member of the European Union. I was asked to convey that message, which I did. I know that First Minister Sturgeon met the President of the European Parliament, Mr. Shulz, and the President of the European Commission, Mr. Juncker. She did not meet the President of the European Council, Mr. Tusk.

Before I went to Brussels, I spoke to the First Minister, Ms Foster, and the Deputy First Minister, Mr. McGuinness. I am glad to see that, while they represent different parties and elements of the referendum campaign, they have issued a joint statement on behalf of the citizens of Northern Ireland, which we support fully. The Minister for Foreign Affairs and Trade, Deputy Charles Flanagan, was there on Wednesday and we will have a North-South ministerial meeting on Monday. I have already asked officials at a high level to identify the priority issues of real importance to Northern Ireland. We will discuss them at the meeting on Monday and issue a statement on them.

For our part, I assure the committee that the European Council is very much aware of the common travel area with Britain since 1922. It is very much aware of the impact of the peace process. It is very much aware of the open border we have with Northern Ireland. It is very much aware that our particular interests are the common travel area, the peace process in Northern Ireland, our trade links with Britain and our pivotal position between the United Kingdom and the European Union. As there will be no discussions until such time as the European Commission is informed by Britain of its decision to leave, the negotiations on these issue cannot take place.

I want to deal with the matter of how long the process should take. As announced, there will be a new Prime Minister by 9 September. The feeling was that he or she should have a short time within which to assess his or her strategy and what it was Britain actually wanted. That is going to be a matter for some consideration because there are different models, be it the Norwegian model, the Canadian model, the Singapore model, or the Swiss model of connections. It may well be that Britain might decide to look for a different variation of any or all of those models. At least 60 countries have achieved independence from the United Kingdom which had a global empire. Obviously, when one looks at the numbers travelling to England from former colonies as diverse as Afghanistan or countries in Africa, one can understand this has been an issue for 250 years.

The discussion yesterday was very calm, rational and considered and members will reflect on it for the future. We will continue to develop and expand the unit across all Departments. I have asked every Minister and Secretary General to make an analysis of how they see Brexit impacting on their Departments in so far as their responsibilities are concerned in order that we will have as full a picture as possible.

I called in the leaders of all the Opposition parties last week for as full a briefing as I could give them based on the information we had available. We will update Members on a regular basis. This is an issue that requires us to work together in the interests of the country, the people and the economy and at the same time to understand we have important connections with Britain and Northern Ireland and the European Union. I have asked every Minister to liaise with his or her opposite number in the Opposition. The EPP had a Brexit reflection group at European Parliament level. The ambassador spoke to all of the Irish MEPs from different parties and we will keep them regularly informed. Parties in the Oireachtas that support our continuing links being strengthened agreed to discuss with their group leader at European level the fact that Ireland was the country that could be most affected by Brexit adversely.

We want to make Northern Ireland a priority and it will be, particularly in the context of the common travel area. The structures under the Good Friday Agreement will continue. We are co-guarantor of the Agreement with the British Government. The North-South Ministerial Council is best used to ensuring we work together to safeguard the peace process and maintain strong relations on these islands. While quite a number of the newer eastern European leaders might not be well acquainted with the details, they are very much aware of the peace process in Northern Ireland which has been continued for almost 20 years following the Good Friday Agreement.

There is a lot of ongoing work between Secretaries General and Permanent Secretaries at official level. Shortly after I became Taoiseach, we signed a memorandum of understanding with Britain which we have followed through each year with regular meetings at official level. These meetings and updates are helpful to Ministers as they go about their work on behalf of the Government.

I set up a small office within my Department to monitor implementation of the programme for Government which contains over 600 commitments.

The Deputy will understand the reforms taking place with the assistance of the Ceann Comhairle and the Business Committee, as well as the new ways of doing business in the Dáil, including reform of the budgetary process and the development of a broader consensus. I am very happy to support this process. The reforms have implications for all Ministers and Departments. The Chief Whip's office will work closely with a new parliamentary liaison unit and the programme for Government office to make progress on policy and legislative commitments.

We recognise that economic and social progress go hand in hand. I like to think that following the discussions on the formation of a Government we have tried to reflect the need to invest in people and facilities to deal with the many challenges we face. The economy grew strongly last year and the level of unemployment has fallen to 7.8%, but we still face challenges. The Action Plan for Jobs 2016 includes 304 specific actions. I will bring the relevant agencies and Ministers together at the appropriate Cabinet sub-committees.

Housing provision is major priority for the Government. There is a Minister with specific responsibility for housijng and I hope the draft action plan will be available in the next two to three weeks. We will deal with the issue today at the Cabinet sub-committee on housing.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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I might bring in members of the committee at this stage. I do not want to cut the Taoiseach short, but I am conscious of the time.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Our deadline is noon.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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Members can take ten minutes each.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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I welcome the Taoiseach and his officials.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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The Deputy can take less time, if he wants.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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We will go with the figure of ten minutes, if that is okay.

On Brexit, the Taoiseach is fresh from his return from the European Council. I will start with how the process will be managed on the Irish side. The Government published a contingency framework, work on which will be co-ordinated by the Department of the Taoiseach. Will the Taoiseach tell us about the team involved? Has he put together or is he putting together a team, including people with a legal or financial background or diplomatic experience? How many will be involved and what will the process involve? Will the Taoiseach send a team to Brussels or Downing Street? What are his plans in this regard?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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The framework document involves the tracking of a number of policy issues and developing negotiating positions. It is important when the new British Prime Minister is elected that he or she set out what he or she wants to do and the intentions of the British strategy. There is speculation about what it might entail. I need to take our unit which was located in the Department of the Taoiseach and make it interdepartmental. That means we have to be able to call on Ministers when needed to reflect on the monitoring of progress by the unit in the Taoiseach's Department. I do not want to have a very large number of people who will have to meet regularly. It might be more important to have issues addressed as they develop. We will also have to have more people in Brussels where we have a very good section. When the process starts, we will need to be right on top of it because our interests are critical. We will strengthen the existing facilities, including the Cabinet sub-committee on European Union affairs, the joint UK Permanent Secretaries-Ireland Secretaries General group, the North-South Ministerial Council, the British-Irish Council, the European Union senior officials group and the interdepartmental group. Business, trade and commerce links are very important.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Will the unit in the Taoiseach's Department be focused on managing the implications of Brexit for Ireland?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Yes.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Will the Taoiseach indicate how many people will be dedicated to that work and who will be in charge?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I cannot give a precise number, but we will see to it that whatever staff are required will be able to do this work. As Taoiseach, I will have to oversee it.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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How many are in the unit currently?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Eight.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Eight people in the Department of the Taoiseach.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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It is one of the smallest Departments.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Does the Taoiseach plan to strengthen and beef up the unit? The number strikes me as being very small, given the significance of what we are dealing with.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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We made several announcements on it being set up at the very beginning in March 2014. It was set up in May of that year and we could not determine what the outcome would be. There are 24 people in the European division. It is one of the smallest Departments.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Yes.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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We need to expand it. The areas I have mentioned-----

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Let me move on because time is tight. What scope does the Taoiseach see for bilateral engagement with the United Kingdom? On the broader issues that fall under the heading of EU competence, the negotiations will take place at EU level between the remaining 27 member states and the United Kingdom. What scope is there for Ireland and the United Kingdom to engage in bilateral negotiations? Are there issues on which the Taoiseach believes we can reach agreement with the United Kingdom on a bilateral basis?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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The first is the common travel area. The process worked well when the two countries were outside the European Union and it has worked well with both inside. It has not been tested with one outside and one inside.

I spoke to the Prime Minister, Mr. Cameron, about this on Tuesday. Obviously, he has been well aware of it for a long time. He wants us to do everything possible to maintain the common travel area. In respect of the peace process, we want to maintain the open Border with Northern Ireland if that is possible. The Deputy is aware that trade is a European issue. Ireland is a European country, but we do not want a hard border from Dundalk to Donegal as a European land frontier here in our own country. There is of course scope for bilateral talks on those issues.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Okay. When will those talks start?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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These issues have been mentioned at the highest level over the last couple of years in Downing Street and elsewhere. The need to retain the common travel area, the peace process and the open Border with Northern Ireland has been raised with the Prime Minister and senior officials.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Sure.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I would say we have mentioned this on each occasion over the last few years.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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Will meaningful talks begin in September when the new Prime Minister comes into office?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Yes.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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The common travel area is one thing, but the right of Irish people to take up employment in the UK is clearly another thing. That is not a question of the common travel area; it is a question of the right to travel. We need to protect the rights of Irish people who are currently working in the UK and the ability of people who are currently in Ireland to go to the UK to take up work. Does the Taoiseach see that as an issue on which we can reach bilateral agreement, or does he see it as an EU competence?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I see it as something that evolves all the time. I was talking this morning to representatives of a firm that intends to purchase a firm in England. I see that as something practical and realistic. I think this will continue. A difficulty was raised about the question of in-work benefits in the context of our traditional links with Britain and the unique relationship we have with that country. The British Government has been acutely aware that where this applies at lower-paid levels, everything will be done to ensure it continues as it is and there will no discrimination of any type against Irish workers going over there to work. Talks are ongoing at official level in London and Belfast as we speak. There will be a North-South ministerial meeting here in Dublin on Monday.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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The Taoiseach was quoted as saying at the European Council meeting that, given the way Scotland voted last week, it should not be dragged out of the EU against its will. Does he feel the same about the Six Counties? The people of Northern Ireland also voted to remain within the EU.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I was reflecting what the First Minister of Scotland had said. Her view and that of the Scottish Parliament is that Scotland should not be dragged out of the EU against its wishes. That is why she wanted to go to Brussels: to talk to the President of the Commission and the President of the Parliament. I cannot interfere in the negotiation process in the case of a state like that. I cannot speculate on what the outcome might eventually be.

Obviously, we want to continue to develop our links with Northern Ireland. We want to maintain an open Border if that is possible. I do not accept the proposition that there should be a Border poll in this regard. It is important for us to make it a real priority to maintain the peace process. Regardless of the outcome of the negotiations, there is a €3 billion fund on the table from the EU between now and 2020. We want to see that money spent in those communities, which are still fragile as we emerge from a turbulent time.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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The Taoiseach said that if agreement is not reached at the end of the two-year period, or following an extension beyond that period, the UK will exit the EU and the default position will be the WTO trading terms, which involve trade barriers and so forth. What would be the implications of that for Ireland? It is likely that the UK position will be that it wants to negotiate open-market, free-trade access to the Single Market. If that is the UK position, does the Taoiseach believe it will be possible to separate access to the Single Market from the free movement of people, labour and capital?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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To be honest, I hope that regardless of when the negotiations start, they can be concluded within the period referred to by the Deputy. In light of the decision of the British people, it is in our interest for Britain to have access to the Single Market. It is perfectly clear that if such access is to be given, the four fundamental freedoms will have to be accepted. One of those freedoms is the free movement of people.

I cannot say what the outcome of the British Prime Ministerial election will be. It is a matter for the Conservative Party to decide whether to elect a person who supported the "Leave" campaign or a person who supported the "Remain" campaign. That person will have a short period of time in which to make his or her mind up and announce what his or her strategy is for Britain. We cannot have negotiations until we have a sense of what Britain wants and what structure it is looking for. I have mentioned some of the possibilities already.

I hope we do not reach a point at which the WTO circumstances apply here. That would obviously create difficulties for us. The best thing for Ireland is for the UK to have access to the Single Market in a way that allows us to continue to trade as we are trading. At the same time, the UK must accept that the principles of the EU have to be applied.

I will conclude on this point. Europe is an evolving peace process. Central to our thinking here is not only the links in terms of the common travel area, but also Northern Ireland issues such as the maintenance of a free and open Border and the development of a prosperous, peaceful and outgoing Northern Ireland.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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I welcome the Taoiseach. I would like to raise the issue of principal dwelling homes. According to the briefing document we have received, some 8% of principal dwellings are in arrears. The actual figure is approximately 85,000 homes. I would mention as evidence of the sustainability of that figure that it is almost twice what it would be in a normally functioning housing market. I would like to get the Taoiseach's opinion on how financial institutions are interacting with their clients. I am using the phrase "financial institutions" rather than the word "banks," because many of these institutions are not banks; they are financial companies that do not provide banking services.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Will the Deputy repeat his question?

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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I am suggesting that approximately 12% of principal dwelling homes are in arrears, and that this figure is approximately twice what it would be in a functioning market. Some 85,000 people live in these homes. I would like to hear the Taoiseach's view on how financial institutions are interacting with their clients who are in arrears. I have evidence that they are interacting very badly - worse than heretofore - principally because the asset has increased in value, which means that the institution can get its money back if it repossesses the house. Can we get the Taoiseach's view on the interaction between the financial institutions and their clients who are in arrears?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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As the Deputy can see, the number of borrowers in arrears continued to fall throughout 2015. In the fourth quarter of last year, after ten consecutive quarters of decline, 88% of accounts in principal dwelling homes were not in arrears. The number of accounts in arrears has continued to fall in 2016. Many of those who are in serious arrears have never made any engagement at all with the lending institutions. That is something that needs to be addressed. People who are in trouble have a genuine fear and a deep anxiety about answering the letters they are sent. I do not have information on the number of cases of voluntary surrender of houses, as opposed to the number of repossessions ordered by the courts. Under the code of conduct for lending institutions, they are supposed to treat their clients with courtesy. It takes two to come to a solution. There is a solution in all these cases. The number of cases has decreased from over 100,000 to the current number and is continuing to decrease. Although progress is being made, many people still have a real difficulty in this regard. One would like to think that the institutions will comply with the code of conduct by treating their customers in a fair, proper and courteous manner. Some people have failed to demonstrate the courage or the capacity to engage with the lending institutions, even though structures have been provided to help them through the personal insolvency practitioners or MABS. The failure of people to engage will not bring their problems to a conclusion. We are trying to help them.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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When MABS tries to help, it is ignored in many cases by financial institutions that are intent on one action. I am seeing a lot of evidence that these institutions, rather than leaving those who are only partially paying their mortgages in their homes, are choosing to repossess properties now that the increase in asset values means they will get all their money back. There is a great deal of evidence of this throughout the country. I would contend that it is a pretty consistent approach.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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When a repossession is ordered, it is practically the end of the line. The majority of houses that have been repossessed have been handed over voluntarily. I hear comments and stories about how some houses have been repossessed following court orders. Further work needs to be done in terms of proper, fair and courteous treatment of clients by lending institutions. There is a solution to all of this. It is not in anyone's interest that engagement would not take place. I understand that people feel fear and loathing when required to answer letters from their lending institutions but the position will only become worse if they do not deal with the issue.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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The allocation for commissions of investigation has increased substantially from €2 million in 2015 to €3.4 million in 2016. Some members of the committee were involved in the banking inquiry which sat for almost two years. Does the allocation for commissions of investigation represent value for money? A figure is not provided for the cost of the Fennelly commission, while the figure provided for the Guerin report is €157,000. In light of the report by Mr. Justice O'Higgins, which contradicted the Guerin report, was the €157,000 cost of the Guerin report money well spent?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Commissions of investigation are set up by the Dáil. A process is in place for charging their costs and my Department pays out what it is requested to pay at the determination of the judge in question.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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What I am saying is that the O'Higgins report was produced after €157,000 had been spent on the Guerin report and resulted in the Dáil record having to be amended. Was the cost of the report by Mr. Seán Guerin SC money well spent?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Mr. Guerin was appointed by the Government in February 2014 to conduct an independent, non-statutory inquiry into certain allegations that had been made and he did that. The underspend under the relevant subhead in 2015 was due to some aspects of the Fennelly commission's operating costs being somewhat lower than anticipated. Subsequent to the Guerin report, we had the O'Higgins report which made very clear findings.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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Does the Taoiseach believe the €157,000 spent on the Guerin report was value for money given that its findings were contradicted by the O'Higgins report?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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There have been some court cases about this matter and obviously I cannot comment on that aspect of the report. There are legal issues arising that do not allow for detailed discussion of that aspect of it. When this issue was raised with great vehemence in the Dáil, it became clear that a scoping exercise needed to be undertaken. Mr. Guerin's exercise was then followed by a full-scale analysis by Mr. Justice O'Higgins.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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The Taoiseach's opinion on the €157,000 cost of the Guerin report would not be a legal issue.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I do not have a function in determining what are the charges as there is a process laid down and the Department of the Taoiseach merely pays out the costs. It should be noted, however, that my Department has assumed responsibility for a number of commissions of investigation because other Departments were being investigated and it became necessary for another Department to monitor and oversee the process. In these cases, my Department assumed that role.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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Should an office be established for carrying out inquiries and replace the ad hocapproach under which the Fennelly, IBRC and Guerin inquiries came under the Department of the Taoiseach? Some Members spent nearly two years working on the banking inquiry. Would it not be preferable to have a specific body with responsibilities for inquiries? Of the €3.5 million allocated to commissions of inquiry this year, €157,000 was spent on the Guerin report which was essentially contradicted by the O'Higgins report.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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The Social Democrats expressed the view that a permanent entity with legal expertise and so on should be established. There is something in that proposal, as opposed to having issues constantly raised in the Dáil and becoming matters of public concern, out of which demands are made for commissions of investigations. For example, a demand has been made for a commission of investigation into the National Asset Management Agency, on which the Comptroller and Auditor General is doing an analysis.

There is merit in the suggestion that a body of experience would be available to the Oireachtas because when Deputies raise issues which become matters of public concern we need to have a method of addressing them. The only method available at present is to have either a full-scale tribunal or a commission of investigation. As the Deputy is aware, these things cost money. The inquiry into matters related to IBRC is a good example. This matter was raised on a number of occasions as being in the public interest and the Government responded to claims in the Dáil that a commission of investigation was required by agreeing to establish a commission, with the necessary legislation set to be published this week. The point is that all Members and representatives of the different parties have been informed of the challenges that arise in this regard. The commission of inquiry will cost at least €10 million and the judge in charge of it has pointed out the scale and timeframe involved in dealing with the matter. I cannot predict the outcome of that.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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Is the Taoiseach open to the possibility of establishing an office of inquiry?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I am.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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How many meetings of the Economic Management Council were held in 2015?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Last year, we held 15 meetings of the EMC which, as the Deputy will be aware, no longer operates. To be clear on this issue, when Mr. Eamon Gilmore was Tánaiste, it was important, given the perilous state of the economy at the time, to have regular and constant engagement between senior Departments. This required regular meetings to be held and it was important that both parties in a government that was dealing with highly sensitive issues were able to engage regularly as issues or crises of one sort or another arose. It is not necessary to have an Economic Management Council now and I did not re-establish it as a sub-committee on this occasion. The EMC did not act as a Government because it had to bring any recommendations or proposals it made to Cabinet for endorsement.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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As an Irishman who holds the position of Taoiseach, how could the Taoiseach travel to Europe and represent the view expressed by people in Scotland that they do not want to be dragged out of the European Union and fail, in the same breath or sentence, to represent the views of people on this island who expressed the same wishes and desires through the ballot box in the same referendum?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I did not see any press at the meeting I was at. Reports are one thing but I was very clear that my first interest is Ireland's interests, namely, the protection of the common travel area, the peace process, the open Border we have with Northern Ireland and the future of Northern Ireland citizens. I stated earlier that when I attended the British-Irish Council in Glasgow, the First Minister of Scotland, Ms Nicola Sturgeon, made clear that if the vote was to leave, she would like that mentioned. I am not representing Scotland and I do not want to interfere in any of the processes. However, in the sense of meeting leaders of assemblies or governments, it is important that we talk about these things. I reject completely that it is not our first interest and priority to state at every meeting, as I do constantly, that Ireland's interests are the common travel area, our trade links with the United Kingdom, the peace process, the open Border with Northern Ireland and our continued and developing interest in the interests of Northern Ireland and its people.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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The Taoiseach rejected a question I did not ask. I asked him a specific question. Does he dispute that at the meeting on Tuesday evening, with Prime Minister David Cameron in the room, he referred to the issue raised with him by the First Minister of Scotland, Ms Nicola Sturgeon, before the referendum result was announced that Scotland would not want to be dragged out of the European Union, but failed to mention that the same views were expressed in the ballot box by hundreds of thousands of people in the North of Ireland?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I reject that completely.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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In that case, I presume he did express that view.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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My first interest, which I have stated publicly and privately on every occasion, is Ireland's interests. I said that before I went to Brussels and in Brussels and I will continue to repeat it. Why would I not do so?

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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Did the Taoiseach express the view that Scotland should not be withdrawn from the European Union without its consent?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I have seen the reports on that. What I said was that the First Minister of Scotland, Ms Sturgeon, had made clear that Scotland would not like to be dragged out of the European Union. That is not my view but the view of the First Minister.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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The question I originally put to the Taoiseach is why he did not, in the same breath, say that the people of the North of Ireland have spoken and expressed the view that they also do not want to be dragged out of the European Union.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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It is because I said it in a different forum - at the same forum - before I went to Brussels and long before I went to Brussels for this particular meeting. My interests are Ireland's interests and my interests are Northern Ireland's interests. I repeat that I will articulate and strongly defend them on every occasion.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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What is the plan B if Britain does not get access to the Single Market because it would not sign up to the four freedoms? What is the plan B in terms of a hard Border of some sort being imposed? Has the Irish Government a plan B in that regard?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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As I stated, we set up a section in my Department to look at the contingencies that might arise depending on the outcome of the vote. Deputy Pearse Doherty is speculating on the outcome of the negotiations. For our part, we want to maintain our common travel area, as does the current British Government, and to maintain our free and open Border. We do not want a hard Border, with customs, checkpoints and all the rest of it. I made this point during the run-in to that referendum. When I went to Manchester, Liverpool and Glasgow, I made the point that these things are not fully within our control. I also made the point that, in matters of trade, we are speaking from the perspective of being a member state of the European Union if it is the situation that Britain does not have access to the Single Market. As I pointed out to Deputy Pearse Doherty, acceptance to and entry into the Single Market on a continued basis for Britain requires that it accepts the four freedoms of the Union, one of which is the free movement of people.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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That will be decided between Britain and the European Commission in the negotiations over the next two years and we will try to influence the process as much as possible in the interests of people, North and South. However, my question concerns what happens if that is not successful. Others, including Cabinet Ministers, have already suggested that, as a result of the way the vote was cast, Britain may not sign up to the four freedoms. This could have a serious impact on the island of Ireland in terms of there being a hard Border. I want to be reassured by the Taoiseach that a contingency plan has been or is being developed in the event that Britain does not get access to the Single Market and we do not have a common travel area. I want to be reassured that there is some type of plan B or contingency process which has been or is being worked on and which can be deployed. Otherwise, there will be major disruption both North and South, particularly for people living in the Border region.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Yes, there would be. However, the Deputy is asking me to accept a speculative theory that Britain will not have access to the Single Market and that it will not accept the fundamental freedoms, one of which is the free movement of people. The Deputy is asking me to determine what the future Prime Minister of Britain will say or what will be his or her view. We will have to wait until 9 September when that person is elected to see what is his or her view and whether he or she supported the "Remain" campaign or the "Leave" campaign.

For our part, we will examine all the options. I do not want to see a hard Border between the Republic of Ireland and Northern Ireland. I do not think anyone else does either. If it becomes an issue, we will deal with it. I cannot give the Deputy an answer on the outcome without knowing Britain's intent, its strategy, where it wants to be or what it wants to do. Obviously, it has to determine those matters. It will not be dealt with by the European Commission alone. It will be overseen by the European Council. All three institutions will be involved, namely, the European Commission, the European Parliament and the European Council.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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I will move on from the question, but I am not asking the Taoiseach to accept all the things he has just outlined. I do not know if the question is being lost in translation as it crosses the room but what I am asking the Taoiseach to do is reassure me and the people of Donegal, the north west and the Border region that, in the context of these negotiations, if access to the Single Market and freedom of travel is not secured at the end of the process, the Irish Government has a contingency plan on which it is working. I am not asking the Taoiseach to outline the plan because that would undermine the principal objectives of the Government. However, will the Taoiseach please reassure us that the Government has been, or is about to start, working on a contingency plan.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I hope this does not get lost in translation but I assure the Deputy that my plan and intent is to maintain the common travel area and not to have a hard Border between the Republic of Ireland and Northern Ireland. While that is my intent and my plan, I do not have full say over all of that. I do not know what the extent of the negotiations will be because I need to know in advance of any negotiations what will be the strategy of the new British Prime Minister. I do not have any function in the election of that Prime Minister, who will be appointed on 9 September.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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Obviously, the Department supports the role of the Chief Whip and we heard her recent comments, which were that if the EU pursued Ireland in respect of its corporation tax rate, we would not, to use her words, be seen for dust. In case that is lost in translation, it means we would withdraw from the EU. These same comments were echoed by the Taoiseach's former junior Minister for Finance, Mr. Brian Hayes. Does the Taoiseach share those views and think that Ireland would withdraw from the EU if there was an attempt to take taxation sovereignty from the State.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Certainly not.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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I am glad-----

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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First, corporate tax and taxation generally are matters of national competence protected by the European Union treaties. We will not be leaving the European Union.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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The Taoiseach may want to have a word with his Chief Whip after this meeting. She said it on Vincent Browne's programme, which is available on playback.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Vincent is still at it, is he?

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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The Taoiseach might go out to him some night. He will show the Taoiseach the clip.

On the Taoiseach's recent correspondence with the EU President, Mr. Juncker, on flexibility in the fiscal rules - rules that the Taoiseach helped negotiate and sold to the Irish people and on which we had a referendum - will he furnish to the committee a copy of the letter to Mr. Juncker and any response received from him on the flexibility the Taoiseach has been seeking? I put it to the Taoiseach that, while we have always disagreed about the fiscal rules, we pointed out from the start that this is the type of implication that would arise, which is that money that is available to us could not be spent on capital investment because of the fiscal rules.

There is a debate on Brexit and one of the arguments is that national governments blame Europe for all the bad things and take all the credit for the good things. Is this not such an example? If the Taoiseach did not make a choice, for example, to cut USC in next year's budget, the Government could spend approximately €1.3 billion in capital investment, yet he sends letters to Mr. Juncker saying we have a historically low level of capital investment and need flexibility in the fiscal rules. I support that, but the reality is that, even within the flexibility available at this point in time, the Taoiseach is taking decisions to cut taxes instead of investing in capital. The Taoiseach is giving the impression to people, particularly those who are homeless or on housing waiting lists, that it is Europe that is preventing us from building houses instead of the ideological position of his Government, which is to cut USC, not put money into housing and so on.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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That is nonsense. We want to give working families a break. We have made it perfectly clear that in the forthcoming situation it will be a 2-1 split in terms of spending and tax. We want to give those with incomes of €70,000 or less a break on the USC over the next number of years and we will do that. I am glad Deputy Pearse Doherty supports changes in the fiscal rules-----

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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I am glad the Taoiseach supported our position in respect of them.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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On Irish Water, the European Investment Bank put up money for it and the EUROSTAT agency, which is independent, stated that if we ticked certain boxes it would be allowed off balance sheet. Obviously, to comply we had to tick those boxes, but the rules then changed. That is only one instance. The European Investment Bank stated that it would not provide any more money if that is going to be the way. There is a need for predictability and consistency from EUROSTAT. I have raised the issue with the European President, Mr. Juncker, directly. This issue is not just confined to Ireland. Many other countries have the same problem and work is ongoing in respect of it.

If the leaders of the European Council state that we have to listen to people, invest in facilities and address citizens' human concerns, issues and anxieties, we need to do it in a clear way so that when we go on a pathway for investment it actually stands up and not have the goalposts changed on a monthly basis. I spoke to one of the directors of EUROSTAT on Tuesday about the issue and work is ongoing on it not just between Ireland and EUROSTAT but between other countries and EUROSTAT as well.

On housing, we have changed the structure here and given the housing Minister the specific responsibility of dealing with it as the most urgent priority of the Government. The construction sector is thriving in every area except housing.

We hope to continue that development in the afternoon at the housing sub-committee.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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To clarify the question, will the Taoiseach make the correspondence with President Juncker and the response available to the committee?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Yes. I will get it to each member.

Photo of Seán SherlockSeán Sherlock (Cork East, Labour)
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I welcome the Taoiseach to the committee. I will start with the Vote. I acknowledge the role of everybody involved in the 1916 commemorations. I know this was a cross-party initiative led by the Taoiseach's Department. We must acknowledge the inclusivity of the programmes and the fact that the occasion was participated in by communities right across the country. It is a programme of which everybody can be very proud. When will the citizens' assembly be established? There is provision for it in the Estimate, but will it still meet the October timeline?

The Cabinet committee on rural and regional affairs deals with rural development, broadband and flooding. I know it has a particular eye on the catchment flood risk assessment and management programme, CFRAM. I hope to get a signal from the Taoiseach that this is not just a talking shop and that the Cabinet committee has a budget line with real actions around it. Will the Taoiseach provide an insight on that?

Will I start with that opening gambit and come back with a few more?

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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If the Deputy so wishes, he may do so. He has ten minutes.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I thank the Deputy for the comment on the 1916 commemorations. The citizens' assembly will consist of 100 people, with no politicians present, and an appropriate chairperson. It will, in the first instance, consider the question of the eighth amendment. We had Government approval a couple of weeks back to implement this commitment in the programme for Government. At this week's meeting on Tuesday, we had approval for use of the electoral register. The next stage is to appoint, under proper conditions, a polling company that will objectively choose people based on gender, age and location to make up the 100 people on the assembly. The original intention was the assembly would be set up and running by November, but I expect to be able to bring that forward by a month. We have to go through a clear and objective process, as was applied before the Constitutional Convention. Authorisation was given by the Government on Tuesday for use of the electoral register to choose those people, and the process is now under way. We expect to have it up and running a month earlier than was originally intended.

With regard to the Department dealing with arts, heritage, regional, rural and Gaeltacht development, the allocation of tendering for broadband, for example, would be handled by the Department of Communications, Energy and Natural Resources. It is a requirement that there be a county task force in each case to roll out the consequence of the allocation of the tender. In other words, this concerns what will happen in Laois, Clare, Donegal or any county. It concerns the process by which the provision of broadband capacity can be rolled out, for example. There is a need for task forces in every county to do that. There has been good development of what could be a template in County Cavan, and we are still looking at how to spread that across the country. The same applies in other areas, and one can draw from different Departments for budgets to fulfil the Department's remit.

Photo of Seán SherlockSeán Sherlock (Cork East, Labour)
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I will make a political point about the citizens' assembly. We are in a citizens' assembly. Notwithstanding the Government's decision, we have received a mandate from the people regarding governance and decisions, so we are well equipped by virtue of that mandate - and its diversity - to deal with the issue.

I am worried about the number of Irish personnel serving in EU and international institutions. I know there is a specific job to be done and the Department is working on that. When the United Kingdom exits the European Union, the number of staff with English as a first language will decrease significantly, so there is scope for Irish people to take up the slack. I hope we will be strategic in that respect.

Are all the case files in the Chief State Solicitor's Office being managed and is it being done in a timely fashion? Is there much of a backlog in the office and are enough resources being allocated there?

I am very conscious of the time but I will speak about Brexit. I do not know why Mr. Tusk refused to meet the Scottish First Minister. I recognise some concerns were raised by the Spanish Prime Minister, who is a member of the European People's Party, of which the Taoiseach's party is also a member. There may have been some issues relating to how Scotland is not recognised as a state but rather as a region. One can consider the political issue of Brexit and that Northern Ireland voted overwhelmingly to stay within the European Union, as did Scotland. The question did not arise for Ireland. The Secretary of State for Northern Ireland is an avowed Brexiteer and the First Minister of Northern Ireland has a very explicit position on the UK's membership of the European Union. That presents a serious challenge for us, particularly in ensuring there is a negotiated position that does not leave us weakened economically as a result of the decision by the United Kingdom to leave the European Union. I wish the Taoiseach well in the coming months with the economic diplomacy that will have to be gone through, as well as the political diplomacy. Anglo-Irish relations have never been as good as they are now, arguably, and I would like to get a sense from the Taoiseach now or in future as to how we will address the political conundrum of ensuring that once there is a new British Prime Minister we can up the ante in that diplomatic onslaught. At this stage I acknowledge the role of our ambassador in the United Kingdom, Mr. Dan Mulhall, as well as the role of the consulate in Edinburgh in ensuring we did everything we could to encourage Irish people in the United Kingdom to vote on the referendum. In future there should be a mechanism to ensure the terms of trade are enhanced and we do not become disadvantaged due to the potential of the United Kingdom to lower its corporation tax and VAT rates, for example, making us even less competitive for inward investment. It is a political point but I want to put it on record.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Ambassador Dan Mulhall does a good job, no more than all of our ambassadors. We have the British-Irish Association, the British-Irish Council and engagements between Secretaries General and Permanent Secretaries. There is now constant interaction between Ministers of our Government and their counterparts in Britain. We must first let the Conservative Party decide whom it wants to elect. Let us see who that person is. The new British Prime Minister will then make a statement of intent in how he or she sees the lie of the land ahead.

I cannot speak to that, but it is in our interests to keep up a very high level of engagement with counterparts. There has been speculation about everything from an election taking place in Britain, the possibility of reruns of referenda and so on. That is entirely a matter for the British, but I take the Deputy's point.

IDA Ireland would say that the investment pipeline will continue to be very strong. I heard the chief executive comment recently that the back end of this year will be particularly strong. The Minister for Jobs, Enterprise and Innovation has been involved with Enterprise Ireland in terms of companies that are exporting. We have looked at a number of options that may be available to help people. The markets will fluctuate and settle down eventually, but we are concerned about the scale of exports of some of our companies and the competitiveness issues that could arise in that regard. For now, however, we are keeping a very close eye on that. I assure Deputy Sherlock, and the committee, that we will keep up a very high level of engagement. Obviously, we will engage immediately with the person who is elected Prime Minister.

I take the Deputy's point about the Secretary of State for Northern Ireland and the First Minister, but I was glad to see the First Minister and the Deputy First Minister issue a very clear statement about their intent for the Assembly and the Executive in terms of trade, the economy, people and relationships with us here. Obviously, we will keep up that engagement at a very high level also.

In respect of the Chief State Solicitor's office, it had 246 staff in 2015. It received a delegated sanction to fill vacancies below principal officer level without needing sanction from the Department of Public Expenditure and Reform. Appointments at principal officer level and above will require sanction from that Department. The staffing level of the office at the end of 2015 was 121 professional staff, 25 technical staff, 84 clerical staff and so on. I will come back to the Deputy on the question he asked about the caseload and the backlog.

Photo of Seán SherlockSeán Sherlock (Cork East, Labour)
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If I could get a note on that, I would be happy.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I will do that for the Deputy.

Photo of Seán SherlockSeán Sherlock (Cork East, Labour)
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I thank the Taoiseach.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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In respect of the citizens' assembly, I take the Deputy's point that this is a citizens' assembly but this is an issue that has divided Irish society for over 30 years. The first issue they will examine is the eighth amendment in terms of its completeness. It is important to have a national conversation among citizens, and that is one way of doing it. It will come back to the legislators, believe me. The assembly will have access to the expertise it needs including medical, legal, constitutional and so on and from the Oireachtas committee will come recommendations to the Dáil. If that is the case, people will eventually be asked to vote on those, and they will vote according to their conscience.

Photo of Paul MurphyPaul Murphy (Dublin South West, Anti-Austerity Alliance)
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I will pick up on that point. It seems that €200,000 is being allocated for this year, which is described as a kind of set-up cost for the citizens' assembly, and the running costs only kick in from 2017. If it is established in October, how will that be funded? In terms of the timing of this, the Chief Whip - on the same television programme - referred to the fact that there would likely be a referendum to repeal the eighth amendment in the early part of next year. Is that a timetable the Taoiseach believes is realistic in terms of the report of the citizens' assembly, the Dáil and then a referendum on the eighth amendment possibly early next year?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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The €200,000 is three months' money out of the Department's existing resources. That would be the equivalent of €800,000 for the full year. The citizens' assembly would be due to deal with its work in, say, 12 months but it will deal with matters other than the eighth amendment. The first issue it will examine is the eighth amendment.

Photo of Paul MurphyPaul Murphy (Dublin South West, Anti-Austerity Alliance)
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Would it report then, and then we could have a possible referendum or-----

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Yes. It will report then on the eighth amendment. The report can be dealt with initially followed by the setting up of the Oireachtas committee and obtaining access to expertise in the various sectors. It can then get on with making its recommendations to the Oireachtas for decision by the legislators. If I get it set up and running by October, which is a month earlier than was envisaged, that would mean that it can start its work and reflection on the eighth amendment. When that element of its work is finished, it can report that to the Oireachtas and proceed ahead either with other issues it wishes to examine or ones that it might want to determine itself that it should examine. Either way, it is envisaged that the citizens' assembly would complete its programme of work inside 12 months.

Photo of Paul MurphyPaul Murphy (Dublin South West, Anti-Austerity Alliance)
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Is it likely or possible that a referendum on the eighth amendment could be held early next year?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Depending on whether the citizens' assembly makes recommendations or proposals, they would come to the Oireachtas committee which would reflect on those and engage with that level of expertise. It would then have to make a decision as to what it wants to do arising from that body of work. Does it want to make propositions for a referendum? Does it want to make recommendations for a change to the eighth amendment? Does it want to make a series of proposals for the Oireachtas to consider? I cannot answer that question for the Deputy because I do not want to predetermine what the Oireachtas committee might do.

Photo of Paul MurphyPaul Murphy (Dublin South West, Anti-Austerity Alliance)
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With regard to the European Union, I believe the Brexit vote is an opportunity for discussion across Europe about the kind of Europe we want. An aspect of that is the question of trade relations between the European Union and other states and the kind of trade relations that exist. There is a lot of controversy around the Transatlantic Trade and Investment Partnership, TTIP, deal between the EU and the US, in particular because it contains a provision for an investor-state dispute settlement mechanism, ISDS, which are effectively private courts where corporations can sue states if they interfere with their right to profit. There is already an agreement, the Comprehensive Economic and Trade Agreement, CETA, between the EU and Canada which contains an ISDS. My understanding is that the Commission is seeking two things: first, to have it provisionally applied soon, possibly at the next European Council meeting, before any vote of any member state parliament; and, second, according to reports, to have it redefined as an EU-only trade agreement rather than a mixed agreement, which, therefore, would avoid the need for votes in member state parliaments, including the Dáil. Do the Taoiseach and the Government have a position on that? Will he vote against the provisional application of CETA at the European Council when it comes up, possibly next month? In particular, does the Taoiseach consider that the provisional application of CETA without a vote in the Dáil is potentially repugnant to the Constitution because it is an international agreement that could impose a charge onto the State by virtue of ISDS?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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The TTIP arrangement was approved at the G8 summit in Fermanagh at the start of 2013. The European approval had been given and the American side agreed to start the process. To be honest with Deputy Paul Murphy, I do not think this will be finished this year.

Photo of Paul MurphyPaul Murphy (Dublin South West, Anti-Austerity Alliance)
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CETA is what I am interested in. Forget about TTIP. I am interested in the agreement with Canada. The agreement is effectively done, but the Commission wants to apply it without a vote of the member state parliaments.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I believe the Parliament here should have a say on that, and I will see that it will do so. It is important that the views expressed by the elected Members of the Houses would be clearly heard.

Photo of Paul MurphyPaul Murphy (Dublin South West, Anti-Austerity Alliance)
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That is what Deputy Richard Bruton said in his previous capacity as Minister for Jobs, Enterprise and Innovation.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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I do not know whether that matter will come before the European Council. I have not seen the agenda. The next meeting will be held in Bratislava but I believe that will deal with the agenda for the Commission for the period ahead and reflect on the changes that will have been made either before the British Prime Minister is elected or any developments that have taken place in between.

Photo of Paul MurphyPaul Murphy (Dublin South West, Anti-Austerity Alliance)
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I ask the Taoiseach to keep a very close eye on that. If it comes up for a vote, and there are reports that it is for provisional application, I ask that he would vote against it, hopefully with other member states. If the agreement is applied, the ISDS would apply for a three-year period, even if the Dáil was to vote against it subsequently. That is politically wrong, but I also believe that it could potentially be in contravention of the Constitution.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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If that is an issue that has to be decided and if it is repugnant to the Constitution, then we will have to seek legal advice from the Attorney General. I accept that that kind of advice would be important in the decision the Government would have to take.

Photo of Paul MurphyPaul Murphy (Dublin South West, Anti-Austerity Alliance)
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If I may ask a brief question on the fiscal rules, I appreciate the Taoiseach sending the letter to President Juncker. Reports relating to the context of the letter indicate that he is seeking more transparency and consistency in terms of the off-balance sheet position as opposed to the change in the rules. Does the Taoiseach not agree that the rules themselves are a significant problem? Is the fact that we have money on-balance sheet, for example, the Ireland Strategic Investment Fund, which we cannot use to invest in building homes to resolve our housing crisis because of these rules not a fundamental problem?

Is that not a contradiction in the programme for Government in which there is a huge commitment to abide by all the EU fiscal rules but at the same time there is a commitment to build homes and to resolve the crisis? Do the rules not need to be changed?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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There are a number of countries that have problems now. Some of them would make the case that if they are prepared to make fundamental structural changes to the way their economies are run, they should be shown greater flexibility. This is a matter that will be discussed in due course by the European Council. In respect of my own letter to Jean-Claude Juncker, this is an issue that affects quite a number of countries. I am not asking for a change in respect of the independence of the EUROSTAT agency but I am asking for predictability and consistency in the way that applications are actually treated.

People in Ireland find it very difficult to understand in that there is such an availability of finance internationally and that when one needs finance, one should be able to get it under consistent and clear rules in order to provide houses for people. As housing is a priority for Government, is there a way of using this facility in the people's interests? If the goalposts have been changed, or change on an irregular basis, there needs to be predictability and consistency about that. Along with other countries, we will try to work on that so that the independence of the agency can be changed but people can plan ahead, knowing that there is that consistency about it.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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Has the Taoiseach some time to take some questions from me?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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Sure.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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I will not delay the Taoiseach. In terms of Brexit and bolstering the number of officials in Brussels during this time of critical discussions and plans being made, is it not an issue for those who are permanently in Brussels on the official side - this is no reflection on them - that they have almost turned native? What is required there is a particular defence of the citizens of the different states within the European Union. It has become very focused on institutions rather than on solutions for the individual citizen we represent. That is where the disconnect started. Therefore, our officials and our politicians and Ministers who go there, should do as the Taoiseach described this morning, in terms of the leaders' meeting, that is, make sure that it is all about the citizen and the people we represent.

In terms of free movement and our reaction to Brexit, this country relies heavily on the transport of goods across the UK to Europe. We have to make sure that whatever happens, there is not a further difficulty for our exporters in delivering our goods to Europe as they cross through England into France and other parts of the European Union. At one stage, I was a member of the Irish Road Haulage Association. Its concerns and those of independent operators need to be considered and understood at this stage in terms of involving them in whatever approach the Taoiseach will take with the UK authorities and Europe. If the hauliers' activities are affected, it will cause further difficulties for our EU clients and for smaller businesses that are linked to, and rely on, Europe. They must be central to any discussions that the Taoiseach might have.

The Taoiseach mentioned housing in his opening remarks. It crossed my mind that there was a €3 increase in the old age pension in last year's budget but the interesting thing was that most local authorities took more than that €3 back from the pensioners in rent increases. I mention this in the context of housing and the Taoiseach's comments. Many difficulties are being experienced by individuals who are before the courts facing eviction from or repossession of their homes. They find it difficult to represent themselves. I mentioned this to the Minister for Finance, Deputy Noonan, earlier. A call has been made to suspend the activities of the courts while people get to grips with their situations. It is not that they will not deal with their situations. I have heard what is going on. These people find it hard to engage with the system. Their family home is at stake and it is as though the State has abandoned them. They need far greater support than what they are getting at the moment. A suspension of those court cases might be necessary while the Government, through legislation, tilts the balance in favour of the family and the citizen. The banks pay absolutely no heed whatsoever to what is being said in those courts. Requests for original documentation are almost always ignored by the banks. One can see at first hand the plight of those families.

I now turn to the tribunals of inquiry. The Taoiseach has indicated €4.5 million for the Moriarty tribunal. Will the Taoiseach indicate if that figure is for this year's Estimate? What is the total? Are other Departments involved in expenditure relative to that tribunal? Who is assessing the total costs and the likely costs of the third parties?

My final point is on banking and the SMEs, which I made to the Minister, Deputy Noonan, earlier. It is extremely difficult for micro-businesses in this country to get access to finance. I know the statistics present a different story but the reality is extremely difficult for family-owned or individually-owned businesses. They also find that engaging with the banks has, in general, been a very difficult experience.

On a housekeeping note, and seeing as I have mentioned it to every other Minister who has appeared before this committee, there are two sides to the balance sheet. One is this forum where we discuss Estimates - at least that is the impression we give but, in fact, we do not. If there is one area in need of reform, which I believe is absolutely necessary, it is this type of committee setting where we can ask questions but where everything is predetermined. Members cannot talk to the officials. According to the Constitution, the Taoiseach is the person responsible but the process needs to be reformed. We need more time. If this committee gets it right in terms of what is proposed to be spent, there might not be losses at the other end. At the last meeting we had with the Minister for Finance, we discussed the Office of the Comptroller and Auditor General and the Committee of Public Accounts. I firmly believe that until such a time as committees, such the Committee of Public Accounts and this committee, are reformed and given real powers to chase the money or, in our case, look after the money or understand what is being spent, we will continue to see huge losses of taxpayers' money. I appeal to the Taoiseach to look at Standing Order 50 which states that the only role we have is to consider and the only role after that is to send a message to the Dáil that we have considered when, in fact, we have not done so. In the last session, the committee dealt with an Estimate for €379 million in an hour and a half. The same can be said of the other Departments.

In regard to the expenditure for legal services within the State and the different accounts being presented to the sectoral committees, every one of them has legal fees. Is it not time to reform that element of the administration of the State in terms of having one legal department to take control of all the other Departments' legal expenditure? The Taoiseach can revert back to me on some of those questions as I know he is pushed for time.

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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For many years, the Irish representation in Brussels, as the Chairman will know from his own experience, has actually performed exceptionally well. It has been very good at making contacts with the different elements of the institutions, the Commission and so on. The Chairman said that the officials might have appeared to "turn native". It is important to hear that they follow political direction.

Ministers engaging in Brussels in terms of Government policy or philosophy being followed is always driven by what can be done to achieve that. From my experience, the Irish permanent representation there has always been diligent and first class in the way it goes about its business. Often, it is not easy to get political consent around the table afterwards depending how vigorous these issues are pursued. However, it is a rule-based Union and governments sign up to the role. How they are interpreted or how flexibility is shown is always a matter for political discussion afterwards.

The agenda of the Juncker Commission is simplification, abolition of red tape, investment, growth, competitiveness and jobs, security and migration. That issue will be discussed at the Bratislava meeting in September. That is fixed for 16 September but that may change because it is a week after the appointment of a new British Prime Minister. We would, therefore, have an idea of that person's strategy.

I met some of the transport industry representatives last night in Leinster House. They all export machinery to mainland Europe through Britain. A lorry can currently be driven to the Ukraine border just with invoices. If there is a major change, it will mean drivers will require papers entering and exiting Britain. This would mean additional administration and costs and probably delays, as well as impacting on competitiveness. We will address these matters and I take the Chairman's point in this regard. A haulier will be paid a certain amount to bring a load from here to Manchester and will be paid a higher amount to bring one back because the costs are higher on the other side.

It is correct that the €3 a week increase for old age pensioners was part of a package that increased payments to them by €10 a week, but it was never enough.

With regard to housing and mortgages, a range of measures were taken, including the code of conduct, no cold calls from banks, the Money Advice & Budgeting Service, MABS, personal insolvency practitioners, PIPs, and the removal of the veto from banks. At the end of the day, it is difficult to get everyone to engage. If there is no engagement, there will not be a solution, which only causes further stress. The numbers are much reduced and we are trying to do what we can to ensure they continue to decrease.

The €4.5 million allocation to the Moriarty tribunal is for this year and no other Department is involved.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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What is the total for that?

Photo of Enda KennyEnda Kenny (Taoiseach, Department of An Taoiseach; Mayo, Fine Gael)
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To the end of 2015, a total of 58 bills of cost amounting to €13.945 million were settled for a total of €6.667 million. Settlement costs in excess of €20,000 are published by period on the Department's website. The Moriarty tribunal is currently dealing with the remaining applications for third party costs. The Sole Member has indicated that the majority of applications have been considered by him and only a limited number are still being considered. The breakdown of legal fees, administration and third party costs for the tribunal are: legal fees, €35.2 million; administration, €9.5 million; third party costs, €6.667 million; and other legal payments, €2.25 million. That gives a total of €53 million.

I will come back to the Chairman on the facilities for microfinance for small businesses. The Chairman mentioned tendering for legal fees. The Attorney General's office and the Office of the Chief State Solicitor have considered operating a tendering process for the engagement of counsel. The need to have freedom to choose the most appropriate counsel to ensure the best outcome for the State as well as the ability to engage counsel at short notice are major practical obstacles. The offices are concentrated on minimising the fees paid. The methodology used has been discussed with the Department of Public Expenditure and Reform which is satisfied with the approach they use generally.

With regard to Dáil reform, I suggested prior to the formation of the Government that the Ceann Comhairle might chair the reform of Standing Orders. The Chairman has often asked questions in the House to which the Ceann Comhairle replied, "I am only here to implement the Standing Orders. The House can change them if it wants", and he may have a valid point. The business committee is chaired by the Ceann Comhairle. Changes to Standing Orders are a matter that is independent of Government. I will raise the matter with the Ceann Comhairle for his consideration in terms of the way the business is conducted or the outcome of the business. I take the Chairman's point that his only remit is to say that he considered it and from his point of view, as Chairman of this committee, he feels there should be greater opportunity to make recommendations in that consideration. I will raise that with the Ceann Comhairle.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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I thank the Taoiseach and his officials for their attendance. We will notify the Dáil that we have considered these Estimates. Is that agreed? Agreed.