Dáil debates

Thursday, 6 May 2010

Other Questions

School Utility Services

4:00 pm

Photo of Catherine ByrneCatherine Byrne (Dublin South Central, Fine Gael)
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Question 7: To ask the Tánaiste and Minister for Education and Skills the action she has taken to address the fact that schools are now treated as businesses for the purpose of paying for gas; if her attention has been drawn to the fact that the pricing structure is unfair for schools with limited funds; and if she will make a statement on the matter. [18216/10]

Photo of Seán HaugheySeán Haughey (Dublin North Central, Fianna Fail)
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Schools, like all other users, are required to pay for a range of utilities such as electricity, water and telecoms, and gas is but one of these. It is important the pricing structures for any of the utilities as they apply to schools should be determined on a transparent and fair basis.

Responsibility for the regulation of the natural gas market is a matter for the Commission for Energy Regulation, which is an independent statutory body. My Department's understanding is that under the regulated tariff structure for Bord Gáis Energy, the level of each customer's consumption of gas determines which sector they are in with regard to tariffs. This applies regardless of whether the consuming premises is a home, school, shop or industrial premises. It is therefore not true to say that schools are regarded as businesses for the purpose of paying for gas. Since categorisation is based on consumption levels and not governed by the type of business or activity concerned it may be the case that individual schools are on a tariff that also applies to industrial or commercial customers with the same level of usage.

It is also important that schools look closely at their level of gas consumption as a means of lowering their costs. In 2009, in order to improve energy efficiency in existing schools, my Department introduced a new €20 million scheme to improve roof and cavity wall insulation levels in school buildings across the country. The devolved energy efficiency scheme, which was implemented with the help of Sustainable Energy Ireland, allowed schools to apply for funding on a once-off basis to upgrade the fabric insulation in attics and the external cavity walls of their buildings.

My Department has also organised discussions with school management representatives recently with a view to a more collaborative approach to the procurement of goods and services within the school and VEC sectors. This meeting included representatives from the National Procurement Service who explained the potential for the unit to help schools achieve savings. It is intended that the initial focus will be on the procurement of energy supplies.

The capitation grant is the main funding mechanism for schools to enable them meet their day to day running costs including for utilities. The Deputy will be aware that notwithstanding the difficult economic climate the renewed programme for Government has made specific provision for the maintenance of school capitation levels at current rates.

Photo of Brian HayesBrian Hayes (Dublin South West, Fine Gael)
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We all accept that money is tight and it is a very difficult time for the country and schools. They must make do with the money given to them by the Department of Education and Skills. A typical school with gas as its main source of energy may spend approximately €10,000 per year and of that half goes towards site charges, VAT and other charges over which the school has no control. It is a business tariff because once the school goes over a certain volume of gas usage, it is automatically on the business tariff.

I have spoken with representatives of schools up and down the country who have asked the Department of Education and Skills to come to some arrangement with the regulator and the Minister of State's colleague, the Minister for Communications, Energy and Natural Resources, to bring about a deal for schools. They are in a unique position; a school might not be open for 100 days a year but it will be charged by the gas companies nonetheless. A fairer deal should be negotiable for schools that would cut down on gas bills and allow them to use their money in other ways.

Photo of Seán HaugheySeán Haughey (Dublin North Central, Fianna Fail)
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The Deputy appreciates that these are matters for the Commission for Energy Regulation.

Photo of Brian HayesBrian Hayes (Dublin South West, Fine Gael)
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Who will speak up for the schools?

Photo of Seán HaugheySeán Haughey (Dublin North Central, Fianna Fail)
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I reiterate that the tariffs are based on consumption.

Photo of Brian HayesBrian Hayes (Dublin South West, Fine Gael)
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I know that.

Photo of Seán HaugheySeán Haughey (Dublin North Central, Fianna Fail)
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The Department has gone to the energy regulator to raise these issues and it will continue to pursue them with the regulator. We are introducing a number of initiatives to reduce the level of gas consumption in schools and keep costs down in general.

Photo of Ruairi QuinnRuairi Quinn (Dublin South East, Labour)
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I ask the Minister of State and the Minister to confirm that yesterday, the Tánaiste and Minister for Education and Skills told us the HEA and a group of colleges within the authority had come together to negotiate with an energy supplier, of gas in this case. Will the Minister of State offer an opinion? If schools under a particular patronage were to join together, for example, the 92% of the 3,000 or so schools, and collectively approach and negotiate a deal with a gas supplier, would this not be something the likes of which the Tánaiste lauded yesterday morning in committee room 3?

Photo of Seán HaugheySeán Haughey (Dublin North Central, Fianna Fail)
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The Department, the Tánaiste, who is sitting beside me, and I would be in agreement with the thrust of the Deputy's points. We are trying to encourage a more collaborative approach to the procurement of goods and services within the school and VEC sectors. The Department would encourage schools to come together in terms of procurement and the issues raised by the Deputy. We will continue to pursue that.

Photo of Ruairi QuinnRuairi Quinn (Dublin South East, Labour)
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On foot of the Minister of State's response, will he write to all of the primary school patrons and bring their attention to this discussion?

Photo of Seán HaugheySeán Haughey (Dublin North Central, Fianna Fail)
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We will look into it and determine what is the best way to encourage schools to take up this option.

Photo of Brian HayesBrian Hayes (Dublin South West, Fine Gael)
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This matter was first brought to my attention by the Catholic Primary School Management Association, CPSMA, which had the matter brought to its attention by a large number of its schools. I have spoken with some gas companies, which claimed that they have no control over this area because the regulator sets the tariff and pricing structure. This is a matter for the regulator in consultation with the Ministers for Communications, Energy and Natural Resources and Education and Skills.

According to the Minister of State, he met the regulator. When was the meeting? Will there be a follow-up meeting? As Deputy Quinn suggested, can we try to procure gas and other energy sources on the basis of a number of schools joining together? This is the way forward. Otherwise, the waste will continue.

Photo of Seán HaugheySeán Haughey (Dublin North Central, Fianna Fail)
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The meeting occurred during my predecessor's term of office, but I can get the Deputy the date. The regulator is independent and the Department is pursuing these issues with him.

Photo of Ruairi QuinnRuairi Quinn (Dublin South East, Labour)
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He is not unapproachable.

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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We have pursued it with him.

Photo of Seán HaugheySeán Haughey (Dublin North Central, Fianna Fail)
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Yes. We are encouraging the approach raised by the Deputies and we will pursue the matter further.

Photo of Ruairi QuinnRuairi Quinn (Dublin South East, Labour)
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The Minister of State might send correspondence as encouragement.

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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As the Deputy knows, the regulator is familiar with my views in my previous incarnation. I will continue to be as vociferous.

Photo of Ruairi QuinnRuairi Quinn (Dublin South East, Labour)
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We will await the results.

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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I have met a number of Irish companies that are in a position to facilitate this type of procurement policy. It is an appropriate way to proceed.