Dáil debates

Thursday, 7 February 2013

Topical Issue Debate

Fuel Rebate Scheme

4:55 pm

Photo of Timmy DooleyTimmy Dooley (Clare, Fianna Fail)
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I welcome the Minister of State, Deputy Brian Hayes. He has a keen interest in this area and will be aware that as a result of the Budget Statement, the Government decided to extend a fuel rebate system to the haulage sector. I was grateful for this decision, having lobbied hard and having worked with the hauliers on it. They brought forward some concrete proposals demonstrating that were a rebate scheme to be put in place in line with other jurisdictions, there were significant revenues to be generated by the State. The approach they took was that many hauliers who travel internationally would buy fuel at home in the event of such a rebate scheme being in place. The Road Haulage Association thought that many of its members were engaged in what might be referred to as fuel tourism, whereby they purchased fuel outside this jurisdiction because it was cheaper elsewhere, with the State losing the entire duty as a result of their decision. The hauliers came forward with a comprehensive and detailed analysis carried out by Deloitte and I was very pleased the Government accepted the position in this regard.

Following on from that decision, there has been an approach from the Coach Tourism and Transport Council of Ireland which, as the Minister of State is aware, represents bus and coach operators. The council does not make the same argument in respect of fuel tourism but nevertheless has a strong argument. These operators believe that were the scheme to be extended to include them, the cost would be a relatively small amount out of the €70 million that has been set aside in this year's budget. I believe its estimate is somewhere between €2.02 million and €3.79 million per year. This proposal should be considered in the context of the services these operators provide to the tourism sector. The Minister of State is aware of the existence of coach tour business in a wide variety of markets. Initially it was geared to the North American market but in more recent years has expanded into the European and other markets. This is an effort to assist the coach tour business in difficult economic circumstances, much of which are based on the current recessionary environment, in maintaining a quality fleet of vehicles that is appropriate to the kind of service that must be provided to the discerning tourist.

They have expressed concern to me and others that if the operators of the coaches are not in a position to have quality fleets, the image of the product we offer will disintegrate. These businesses pay VAT on various services and fuel, and they are a significant generator of revenue for the State.

I support these transport businesses as they have a legitimate case, which should be recognised by the Department and acted upon based on the costing available. I am sure these people have contacted the Department and I appeal to the Minister of State to reflect on the issue. Perhaps in the presentation and publication of the finance Bill, there will be consideration of these coach tour operators.

5:05 pm

Photo of Brian HayesBrian Hayes (Dublin South West, Fine Gael)
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I thank Deputy Dooley for raising this important matter. I will not read out a script but I will instead cut straight to the point. We are considering this issue very closely. The Deputy makes a very solid point, particularly about the age of the fleet. Having recently met some coach tour operators, I know the age of the fleet has been increasing because of the cost of fuel in recent years. As the Deputy rightly indicates, hauliers can make a case because of fuel tourism, and fuel can be bought outside the country to make a saving. This is not usually the case with tour operators, although some are involved in activities outside the country. I fully appreciate it is a key export.

Representatives of these hauliers made a point in a submission which I relayed to the Minister for Finance that there are solid economic arguments in extending the relief to this industry as we have with hauliers. We are considering the question and the decision will be for the Minister for Finance. In other parliamentary replies and in my meetings with the groups two weeks ago, it has been indicated that we are considering this issue in the context of the finance Bill, although that is without giving a firm commitment one way or the other. We accept many of the arguments made and the Minister will come to a full decision when he publishes the finance Bill.

Photo of Timmy DooleyTimmy Dooley (Clare, Fianna Fail)
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I thank the Minister for an open and frank response, which I had expected and which is helpful. A detailed analysis should be done, and when the Department and the Revenue Commissioners examine the issue, they will look at it in the broadest extent. I am sure some of the numbers may appear astronomical when one takes into account the entire fleet of commercial vehicles in the State. Nevertheless, there are ways of achieving the objective, and if necessary there should be consultation with the coach tour operators, including the Coach Tourism and Transport Council of Ireland. Its members are a solid bunch of people who have worked in a very difficult environment, and they understand the Minister's position. I hope a system can be put in place that could meet their needs to the greatest extent possible.

I ask the Minister of State to enter into a dialogue with the group, although I am grateful he has met them already. There was a dialogue with the Irish Road Haulage Association, with toing and froing over a period of 12 months, and now a principle has been established, it should be possible for all sides to formulate a workable solution that does not break the bank. We have got rid of one bank today and we certainly do not want to break another. We can help these people, who are such an integral part of our tourism offering. There is no point in laying a greater layer of fat on what we have done but it is the year of The Gathering, and this would be a helpful measure for all concerned.

Photo of Brian HayesBrian Hayes (Dublin South West, Fine Gael)
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The Government is very mindful of the Deputy's comments and the arguments he has made so cogently. There is still time and the rebate for haulage will not come about until July this year, when the finance Bill is enacted. Without giving a commitment in the issue, the Minister is looking at this very seriously to see if something can be done. There is very little money around and rebates and breaks of any description have a cost, and we must be able to offset that cost with additional economic activity that may come through the sale of additional better equipped and more modern fleets.

I was struck by the argument made that if people are coming to the country for coach tours, we need high specification vehicles in which to bring them around in preference to coaches that are seven, eight or nine years old. The Government understands that and wants to help. We will have to wait and see if we can do this with the finance Bill. The Minister for Finance is mindful of the arguments.