Dáil debates

Wednesday, 24 September 2008

3:00 pm

Photo of Michael CreedMichael Creed (Cork North West, Fine Gael)
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Question 117: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the progress there has been in reducing business regulation and red tape by 25% in all Departments, in view of her Department's co-ordinating role; if she is satisfied with the progress to date in reducing business regulation, as highlighted in the first report of the high level group on business regulation; and if she will make a statement on the matter. [30988/08]

Photo of Simon CoveneySimon Coveney (Cork South Central, Fine Gael)
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Question 133: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the reduction in the administrative cost of regulation since her Department adopted its 25% target; and if she will make a statement on the matter. [30985/08]

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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Question 135: To ask the Tánaiste and Minister for Enterprise, Trade and Employment her plans to implement the recommendations of the high level group on business regulation, received by her on 6 August 2008, regarding a reduction in the burden of red tape on business; and if she will make a statement on the matter. [30906/08]

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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Question 197: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the amount the administrative cost of regulation has been reduced since her Department adopted its target of 25%; and if she will make a statement on the matter. [31357/08]

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I call on the Tánaiste, or rather an tAire Stáit. It is a formidable ministerial team.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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It is value for money.

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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It takes five of them to mark us.

Photo of Jimmy DevinsJimmy Devins (Sligo-North Leitrim, Fianna Fail)
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It is not just quantity, it is quality as well.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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The cutbacks start here.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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I propose to take Questions Nos. 117, 133, 135 and 197 together.

Photo of Jimmy DevinsJimmy Devins (Sligo-North Leitrim, Fianna Fail)
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That will keep the Deputies on their toes.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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We could do with a 50% cut right away.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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That is efficiency.

The report of the high level group has identified more than €20 million in cost savings to business as a result of simplified administrative procedures of Government. The Government's commitment is to reduce the administrative burden on Irish business by 25% by 2012 and this demanding target is a key priority. The task of the high level group is to identify areas in which legislation has imposed an administrative burden, or red tape, on business and to recommend ways to reduce that burden without undermining the policy objectives behind the regulation. The work of the group is focused on concrete measures in specific policy areas, including taxation, statistics, environment, health and safety, employment and company law. The first report of the group sets out a number of instances in which procedures have been simplified, making it easier for business to deal with Government; for example, electronic filing of annual returns to the Companies Registration Office, on-line access to tax clearance certificates for Government contracts, increased exemption thresholds for VAT registration, and higher thresholds exempting small businesses from having to conduct statutory audits. In addition, further changes to reduce the burden on business are expected with regard to procedures for waste collection permits, road haulage permits and employment permits.

The work of the high level group is estimated to have saved Irish business €20 million in administrative costs this year through reductions in paperwork, revision of the rules for small businesses and provision for better use of on-line services. The rolling programme of work set out by the group must continue to be ambitious and I look forward to its continued work on the concrete suggestions put forward by the business sector. If the work of the group is to produce optimal benefits, businesses, especially small business, must continue to come forward with practical proposals for areas in which they feel the burden is greatest. Small businesses in particular have a lot to gain from participating in this process and making known areas in which they feel over-burdened by red tape. I encourage the business representatives on the high level group to continue to inform its work.

In addition to the work of the high level group, my Department has put in place a process across all Departments that will measure the administrative cost of red tape on business arising from domestic legislation. As in all other countries that have done this, it will take about a year and a half to complete the measurement process. In line with the recommendation of the Business Regulation Forum, we are adopting a prioritised approach. Initially, all Departments are required to list the information obligations which their regulations impose on business. Based on that listing, Departments will assess, in consultation with business, the most burdensome requirements and will measure their actual cost to business. At that point, the most appropriate approach to achieving the Government target of reducing by 25% the administrative burden of domestic regulation on business by 2012 will be determined. With regard to future regulations, the Government has agreed that all Departments should measure the administrative costs of regulations on business and specifically examine the impact on small businesses.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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I am happy that we now have a target of 25% in reducing the administrative cost of regulation. This target does not have to be met until, I assume, the end of 2012. Does the Minister of State not think there is a good case for having an interim target? The Minister could report back early next year and tell us how far we have come in achieving the 25% reduction. In this way we will not have to wait until 2012 for the Government to tell us it has not succeeded.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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A review.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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Perhaps an annual review would be appropriate.

How will the baseline calculation for the cost of regulation be assessed? What model will be used? Before something can be reduced by 25% there must be a model to work out what 100% is. How will that assessment be made and when?

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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In answer to the first part of the Deputy's question, a reduction of 25% by 2012 is a target, but there is nothing to say we cannot meet the target prior to that date. I have carried out the assessment and the analysis. I have met the business organisations and I understand clearly what they are saying. They have made their submissions and in line with these we will consider a cost-effective way of delivering a smaller burden from Government. For example, let us consider the range of forms that must be filled in for the Central Statistics Office. I have met officials from the Central Statistics Office and have reviewed its forms. I have engaged with the SFA and tried in turn to translate that in a different simplified way to determine whether it would assist business. I have invited and have met the business organisations in recent months to determine if we can identify other areas that will assist. In line with what Deputy Penrose said county enterprise boards are significant players in this matter as they engage with the SME sector. I have used them as an information base to ascertain what is causing the difficulty for small businesses in particular. Legislation is often passed by this House and the one size does not fit all. We need to take an overview of that in light of the tight economic circumstances we are experiencing. We need to try to release the SME sector to do more important business in the real world to create the jobs and profitability they desire.

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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I might have disagreed with the broad thrust of what the Minister of State, Deputy McGuinness, said in his previous statement. However, I am totally ad idem with him on this matter. The Minister of State should slash and burn all the bureaucracy and he will have my full support.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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I am your man.

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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There will be no lawyers left.

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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That is what we want to do — eliminate them from it altogether. In businesses there is the possibility of 100 different forms ranging from seven or eight pages up to 80 pages. The Minister of State is on the right track, and as he has a business acumen and background I expect him to be able to get it right. He recognises that businesses are significant collectors of taxes, including VAT, PAYE etc. Is it not time for entrepreneurs and proprietors of small businesses to get an allowance similar to the PAYE allowance? There needs to be some collection. Some accountants are there specifically to deal with the forms that exist. There are up to 1,000 different legislative provisions that are complex, some of them in the one Act. They impact on health and safety, company registration offices, the CSO etc. Businesses are compelled to reply to these. I have seen it with our own little shop. We are required to comply or they come back again. I often wonder why it collects information. However, that is neither here nor there.

Photo of Billy KelleherBilly Kelleher (Cork North Central, Fianna Fail)
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They are used in answer to parliamentary questions.

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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Would the Minister of State consider introducing a red tape index in each Department and across Departments? This would allow for an instant review every three or four months. Some people believe the red tape simply exists and we cannot think outside the box. It is time to think outside the box of bureaucracy. I attended the Westmeath County Enterprise Board presentation last Friday week. The Minister of State is correct about the importance of county and city enterprise boards. While foreign direct investment and the work of IDA Ireland are very important, it is at a micro level that we will get over the hump. I ask the Minister of State to eliminate as much red tape as possible. He should slash and burn. He will be a hero if he does.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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I do not know about being a hero. However, all great truths begin as blasphemies according to George Bernard Shaw. If the Deputy read my speech he would realise there is not a great difference between any sides in this House — all we want is the best for the country.

Deputy Varadkar asked about a measurement. While it cannot be answered simply as part of the response to this parliamentary question, a measurement exists and I will make the details known to him. However, if a greater efficiency can be achieved in measuring or identifying the red tape, I would gladly support any measure within the Department to drastically reduce red tape particularly in the SME sector which needs to be released. I am a practising businessman and understand the complications arising from the need for transparency, reporting etc. However, it must be simplified. I encourage the Deputy and small businesses that are interested in the matter to engage with the Department. The Tánaiste and all the Ministers of State in the Department are anxious to achieve what is best to allow business to operate in a simpler way so people can get on with performing on the front line rather than coming back late at night to complete forms. Any suggestions will be gratefully received.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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I appreciate the sincerity of the Minister of State in this matter given his background in business. However, I do not believe he answered either of my questions which I will ask again. Would he agree it would be appropriate to have an interim target of, for example, 10% by the end of next year so we can review the progress he is making on an annual basis rather than waiting until the end of 2012 to see if he has achieved anything? The Minister of State said there is a calculation. I do not believe there is. I would be very interested to find out as soon as he can inform us what the monetary calculated cost of the administrative burden of regulation to business is and the model used to assess that. I doubt that is being done, but if it is I would like to hear the figure or even a ballpark figure.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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A standard cost model exists and there is a model that is also implemented in other countries, for example the Netherlands.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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However, the Government has not used the standard cost model.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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I will make it available to the Deputy so he can fully understand it and will be able to question me on its specifics without any difficulty. I answered his first question. I told him that the target was 25% by 2012 and that my ambition is to reach that target much sooner than 2012 so the Deputy and other Members of the Opposition can measure it as we go along. To reach that target much earlier than the date we specified requires co-operation with the business sector and all agencies and Departments. We are committed to doing it and I will gladly report back to the Deputy in a year, in two years or in six months. I hope to make it better for business. That is my ambition within the Department.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I like quite a lot of the Minister of State's speeches so far — although not all of them. Hopefully we will see some action on them. If he is a man of action can he guarantee that from now on every new Bill we pass in this House will be assessed for the impact it has on businesses? We were promised that before, but it did not happen in the last term. Can the Minister of State say that from today it will happen?

Before the Minister of State's predecessor left he gave a guarantee he would work with the committee to solve the problems of local government regarding business, cost, regulation etc. Does that commitment still stand for the Minister of State and other Ministers to work with the committee to promptly address the problems of business and local government? While I believe the Minister of State does, I want a commitment across the board.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I call an tAire Stáit who, I take it, will speak collectively for the Government.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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I had better not. Anything I say comes with a health warning.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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A Minister speaking is speaking on behalf of the Government at Question Time.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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A regulatory impact assessment is required for new legislation and it needs to continue.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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It is not happening.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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It is happening.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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It did not happen in the last term.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Allow the Minister of State to speak.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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We can double check that and make sure it does happen. Regarding working with the committee, I have already said to the Chairman that not only would I discuss upcoming legislation, particularly the company law reform Bill, but also I am available to the committee to thrash out any other aspect of business that requires discussion with the committee to get the best possible deal for business. I am also available for private briefings with spokespersons from Fine Gael and Labour or anybody else in the House. My interest is ensuring that they do well because the economy will do well if that is the case.

Photo of Arthur MorganArthur Morgan (Louth, Sinn Fein)
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It is unfortunate that the economic downturn had to occur before the Government appreciated the need for this reform. However, we appreciate it and it is better late than never. Would the Minister of State agree that a number of ideas could be implemented fairly quickly, for example by having electronic versions of some of these forms available to businesses instead of hard copies? As he knows it is almost all hard copy at present. As I know some shops and other businesses might prefer hard copies, I am not ruling that out. Would the Minister of State accept there is great potential for merging the format of many of the forms businesses need to complete? Currently they all have different formats and are all over the place and surely could be streamlined.

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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As small businesses need to deal with a number of agencies, CSO, CRO, Revenue, CEB etc., as a long or even medium-term objective, could the Minister of State introduce a standard form that would suit the application to different agencies? Businesses should not be required to fill in the same information on many forms which consumes hours of business time and wastes time. The form should be simplified with four or five pages and not like the form for the carer's allowance. I filled in that form last night for a woman and it had approximately 20 pages, most of which was raiméis and wasteful.

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail)
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The forms for Revenue and company registration are available on-line. I believe the forms about which the Deputy is complaining are those that generally come from the Central Statistics Office, which take some time to complete.

I have met with the Central Statistics Office to see whether those forms can be simplified or if some of Revenue's information could be used in regard to the statistics it is trying to collect. We will work with the Central Statistics Office to try to achieve that objective. That would relieve the burden. It is a question of identifying the problem and working directly with the agency concerned and the business that identified the problem to resolve it. Some of those issues can be resolved. Hopefully, in line with what Revenue collects and what the CSO wants, we can reach a resolution. There will always be a number of different forms because the CSO is collecting different information. Those forms need to be simplified. Sometimes in terms of the EU requirement and our own legislation, it is how the legislation is interpreted in the context of those forms. They can be simplified. They just need to be put in layman's language. We need to understand the requirements of small businesses.