Róisín Shortall (Dublin North West, Labour)

I move amendment No. 3:

In page 6, between lines 19 and 20, to insert the following:

"3.—The Minister shall as soon as may be after the passing of this Act prepare and lay before both Houses of the Oireachtas a report on the potential yield of each of the following revenue raising measures:

(a) requiring insurance companies to compensate the Minister for illness or disability payments where they have admitted liability and where the value of social welfare entitlements are deducted from the gross claim settlement;

(b) changing Charge PRSI on rental income on PRSI classes A, B, C, D, E, H & S;

(c) applying PRSI to capital gains on PRSI classes A, B, C, D, E, H & S;

(d) applying PRSI to share based remuneration and share options on PRSI classes A, B, C, D, E, H & S;

(e) withholding payment of Mortgage Interest Supplement until proof is provided that a bank has declined a payment-free period, an interest-free period, a partial write-off, an extension of the term, or any other reduction in the cost of the mortgage to the mortgage-holder and use the saving to improve the means-test for Mortgage Interest Supplement and modernise the rules including the deletion of the "30 hour rule".".

The purpose of this amendment is to propose a number of revenue-raising measures. As I said on Committee Stage, I thought the Minister would be able to identify some of these areas in which savings can be made. At a time when there are such pressures on the social welfare budget, and certain people are calling for cuts to be made in pensions and other social welfare payments, it is important for the Minister to seriously consider alternative ways of raising revenue in his Department.

In this amendment, I suggest five areas in which revenue can be raised. Three of the proposals relate to types of income on which PRSI could be applied. Certain categories of people do not currently pay PRSI on rental income. Similarly, certain classes of people should be liable to pay PRSI on capital gains, share-based remuneration and share options. I do not know why the Minister is not taking such an approach. There is a need, on equity grounds, to extend the types of income on which PRSI is levied. There is no reason it should be levied on earned income but not on income from capital, rent or shares. There is very little consistency in the application of PRSI. On Committee Stage, the Minister agreed by and large with what I am suggesting. I thought the Minister, having considered the matter further, would have tabled an amendment of his own on Report Stage, but unfortunately he has not done that.

This proposal also relates to the compensation paid to those who receive illness or disability payments after an accident. Due to the way the social welfare system operates, this is a subsidy to the insurance companies. It does not make any sense whatsoever. There should be an arrangement whereby payments made to the person who is covered under the insurance scheme can be recouped. The insurance company should foot the bill in that regard.

The final area where I see potential for revenue raising is the mortgage interest supplement. This scheme is operating in a way that provides a subsidy to the banks. The supplement is the first port of call for people finding it difficult to repay mortgages. The banks should make the first concession or take the first step to assist someone who is in difficulty with mortgage repayments. We know of many cases of irresponsible lending by financial institutions where people were overstretched and sometimes encouraged by their lending institution to overstate their incomes. The first port of call should be the lending institutions. They should be required to facilitate customers in rescheduling mortgages, taking breaks from mortgage repayments and negotiating new agreements. That should happen first, before mortgage interest supplement kicks in. Otherwise, if the supplement is paid without the banks playing any part in the resolution of a problem, the scheme simply amounts to the State, yet again, subsidising the banks.

These are five reasonable proposals. The Minister often asks us to come forward with proposals for revenue raising. These are five areas where he could raise revenue within his Department. I ask him to accept the amendment.

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