Mary Harney (Dublin Mid West, Progressive Democrats)

To deal with the last issue first, I share the Deputy's view that it is high and out of sync with other countries. However, it is entirely a matter for the independent financial regulator and neither the Government, the Minister for Finance nor I have a role with regard to the reserve requirements set by the regulator in Ireland.

With regard to new EU directives, I hope there can be consistency throughout the European Union on this matter. A company incorporated in another jurisdiction doing business in Ireland would only have to meet the reserve requirement suggested by the Deputy if it were incorporated in the UK.

Tax relief has not been withdrawn from anybody. We all have 20% taken away at source and this has not been interfered with. Last week's announcement was that additional benefits will be given to everybody over the age of 50. This will be a benefit of €200 for those aged between 50 and 59, €500 for those aged between 60 and 69, €950 for those aged between 70 and 79 and €1,175 for those aged 80 and over. This will be deducted from the premiums at source.

It is true the Supreme Court found we must have community rating within a plan. However, the market is segmenting to such an extent that thousands of plans will exist. A company with a young workforce will get a particular plan while another company with a workforce of an entirely different age profile will have a different plan. Within each plan everybody will pay the same. We know many companies introduced plans covering maternity benefits, sports injuries, joining a gym and teeth whitening, but not hip replacements or cataracts. Within a plan everybody pays the same but an older person will not take out a plan offering maternity benefits and a younger person will not take out a plan providing for cataract removal.

The Minister has no function in approving price increases. This was changed a number of years ago. I believe in a highly competitive market and for the first time it will be competitive to attract older people. The introduction of lifetime community rating will encourage younger people to take out insurance.

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