Jan O'Sullivan (Limerick East, Labour)

Obviously the EU has decided to refer Ireland to the European Court of Justice between Committee and Report Stages. It is pertinent to the debate and the Minister should explain the relevance in terms of the timing of the legislation. It was intended that the VHI would have an exemption up to 1 September. The European Commissioner, who happens to be Mr. Charlie McCreevy, has now referred this to the European Court of Justice, having indicated his intention of doing so at an earlier stage.

As the Minister explained to us on Committee Stage, the VHI does not have the capital at the moment to comply with the requirements of the EU, and getting the capital may be dependent on this legislation, although I do not know whether that is true. My understanding is that the VHI is expecting to receive funding on the basis of community rating through this interim mechanism but at the moment it is not in a position to comply with the EU directive until it gets an injection of capital, which, as the Minister explained, could come by way of privatisation or from the Government. The Labour Party is vehemently opposed to the privatisation of the VHI. The Bill now has all these implications, although it did not before, because of the actions of the Commissioner. To be helpful, the Minister needs to make a statement on this matter before we can proceed with the legislation.

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