Dáil debates

Thursday, 21 April 2005

3:00 pm

Joe Sherlock (Cork East, Labour)
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Question 2: To ask the Minister for Defence the annual cost to his Department of providing military escorts for cash in transit transfers; the total amount of the cost, in cash and percentage terms contributed by banks for these military escorts; if he has asked banks (details supplied) to contribute more money to his Department for the military escorts given to security firms; if he has received any response from the banks to this request; and if he will make a statement on the matter. [12524/05]

Photo of Willie O'DeaWillie O'Dea (Limerick East, Fianna Fail)
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To aid the civil power, meaning in practice to assist, when requested, the Garda Síochána which has the primary responsibility for law and order, including the protection of the internal security of the State, is among the roles assigned to the Defence Forces. In this regard, the Defence Forces assist the Garda as required in duties which include escorting cash deliveries to banks, post offices and other institutions.

An annual contribution of €2.86 million is paid by the banks in respect of Army escorts. This figure was set by the Department of Finance in the 1995 budget and has not been altered since. The contribution from the banks was designed to part-cover the total costs to the State of providing cash escorts. At that time, the contribution covered approximately 72% of the total cost arising to the Defence Forces, which includes pay and allowances. Based on annual costings by my Department, the relative level of the contribution has fallen in real terms over the years to the situation where it now only covers 43% of total costs.

Since taking over as Minister for Defence, I have had a number of discussions with the Irish Bankers Federation on this matter, with a view to increasing the level of contribution by the banks in respect of the costs incurred by my Department in the provision of cash escorts. While the ongoing discussions are difficult and the banks put their position robustly, the banks and the IBF have been positive and constructive in their dealings with me and I welcome this.

My most recent meeting with them was on Wednesday last, 13 April, and we continue to make progress. The Irish Bankers Federation will shortly revert to my Department following further discussions with its members. It is my hope that my officials and officials of the IBF will then be in a position to complete a draft memorandum of understanding between the Department of Defence and the IBF in regard to the financial aspects of the Defence Forces' involvement in cash escorts.

The total cost in respect of the provision by the Defence Forces of assistance to the Garda Síochána in protecting movements of cash in 2003, the latest year for which figures have been finalised, was in excess of €6.6 million, including pay, allowances, transport and aerial surveillance. This related to 2,335 escorts, approximately 80% of which covered deliveries to banks.

For the first nine months of 2004, approximately 1,825 escorts took place. In any given month, approximately 1,592 Army man-days are expended on these escorts.

Joe Sherlock (Cork East, Labour)
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The Minister has answered the last part of my question which related to the number of troops involved on an annual basis in escorting cash consignments. Does he consider it acceptable that financial institutions which make annual profits of billions of euro each year — last year AIB made profits of €1.4 billion — should effectively ask taxpayers to subsidise the provision of escorts for them? Does the Minister believe that the financial institutions should pay for the escorts?

Photo of Willie O'DeaWillie O'Dea (Limerick East, Fianna Fail)
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Deputy Sherlock always asks his questions plainly and I will try to answer as plainly as I can. I do not consider it acceptable. If I thought it were acceptable I would not be negotiating for an increase. I would not have called in the institutions and said that I want an increased contribution from them.

The initiative whereby the Garda Síochána, subsequently with back-up from the Army, began to escort these cash transit operations commenced in 1978 as a result of a spectacular robbery in my adjoining constituency in west Limerick, at Barna Gap where a large amount of cash was seized. There was paramilitary involvement in that robbery and it was considered at the time that the State had an interest in not letting large consignments of cash fall into the hands of paramilitaries or other criminal elements. Obviously the paramilitary threat has receded somewhat but there is ample evidence that the people involved in cash transit robberies at present are highly organised criminal gangs who are looking for money to invest, largely in the drug trade.

I do not think it is acceptable that only 43% of our costs are being covered. I want that increased and I have engaged in extensive negotiations that are nearing completion.

Joe Sherlock (Cork East, Labour)
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Is it not the case that there has never been a successful robbery of a cash consignment under Army escort? Given that, is it not reasonable that financial institutions would pay the full price for the provision of such escorts? When does the Minister hope his talks with the financial institutions will conclude and what prospects does he have for a successful conclusion for the State?

Photo of Willie O'DeaWillie O'Dea (Limerick East, Fianna Fail)
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I agree it is not acceptable that only 43% of the costs of security escorts are being met at present. That is why I have been endeavouring to increase the contribution. I am not asking the banks for the full cost of the cash escorts because all the activity does not relate to banks. Some 20% covers post offices and a small amount relates to other financial institutions such as the Central Bank and so on. In effect, I am asking the banks to pay for what they are getting.

They have made various points to me such as that they are contributing a great deal in taxes to the Revenue. They also make the point that there is an extra cost entailed when the Army is involved in cash escorts, such as subsistence allowances, security duty allowances, the cost of transport etc. They further stated that even today the amount they are paying covers that extra cost and that we would be meeting the basic wages anyway. That is the substance of their argument. I have put counter arguments but I am sure the House is not interested in the detailed negotiations.

To answer the latter part of the Deputy's question, I have told the banks that I want this matter finalised and concluded within the next fortnight.