Micheál Martin (Cork South Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

The Tánaiste knows, and we all know, that the Rehab organisation has been asked by the Committee of Public Accounts to appear before it and has been before the committee to answer important questions relating to salaries, pensions and a range of other issues pertaining to the organisation. For good reason we all agree that this is in the public interest, just as it is for other organisations in the charitable area which have significant and substantial service contracts with the State. The figure in question is approximately €80 million worth of funding from the taxpayer to Rehab. It is clearly in the public interest that those who are asked to go before the Committee of Public Accounts should do so. However, there has been an unacceptable degree of prevarication and delay by the Rehab organisation in its dealings with the Committee of Public Accounts. In particular, people were surprised and rather taken aback by the refusal of a former chief executive officer, Frank Flannery, to appear before the committee.

He was a strategic adviser to the Taoiseach and his right-hand man on many fronts. He knows the importance of the Oireachtas and of committees like the Committee of Public Accounts. However, he has not gone forward to answer questions that remain unanswered. What was really unacceptable was that on the very day the Committee of Public Accounts was meeting Rehab, Mr. Flannery was in Leinster House on other business, metaphorically giving the two fingers to the Committee of Public Accounts which I believe to be unacceptable.

Does the Tánaiste agree that is unacceptable?

According to reports in The Irish Times, Rehab was paying its directors specifically to lobby Fine Gael and Labour Party Ministers. It is reported that Mr. Flannery was also paid to do so. Does the Tánaiste accept the principle that it is wholly wrong for charitable organisations, which have such substantial service contracts with the State, to pay their directors to lobby Ministers and arrange meetings with officials in Departments? Does he agree that is fundamentally an unethical principle to adopt?

The Minister for the Environment, Community and Local Government, Deputy Hogan, appointed Mr. Flannery as chairman of the Forum on Philanthropy. That organisation has been lobbying, for example, for changes to tax rules on residency governing tax exiles. Does the Tánaiste consider it appropriate that Mr. Flannery should continue in that position while still refusing to go before the Committee of Public Accounts, a cherished institution of the Oireachtas?

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

I was asked that question here on Thursday last when I stated clearly that I believe Mr. Flannery should attend before the Committee of Public Accounts. I have seen the letter the clerk to the committee wrote to the chief executive of the Rehab group. The letter was issued yesterday and names a number of people, including Mr. Flannery, whom the committee wishes to interview. I believe that all those whom the committee wishes to interview should appear before it.

Lobbying is part of our democratic system and people have a right to lobby. However, we need to have transparency around lobbying. The Government has been preparing legislation to provide for a regime whereby there will be a register of lobbyists. Under the proposed legislation, professional lobbyists engaged in formal lobbying will be required to register. There will also be a requirement to record the lobbying that takes place. In other words, the public will know who is lobbying whom and for what. That legislation is at an advanced stage of preparation.

The general scheme of the Bill was submitted for pre-legislative scrutiny by the Committee on Finance, Public Expenditure and Reform, and its report has now been received. The drafting of the Bill is proceeding and the Minister for Public Expenditure and Reform, Deputy Howlin, plans to present the Bill to the Houses of the Oireachtas early in the second quarter of this year. When that Bill is enacted we will have a register of lobbyists and a transparent lobbying regime.

As regards Mr. Flannery's position as chairman of the Forum on Philanthropy, it is my understanding that he is stepping down from that position.

Michael Healy-Rae (Kerry South, Independent)
Link to this: Individually | In context | Oireachtas source

That is news.

Micheál Martin (Cork South Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

I thank the Tánaiste for his view that Mr. Flannery should go before the Committee of Public Accounts. I agree with him on that. I am somewhat curious that he did not respond to my question concerning the appropriateness or correctness of charitable organisations, Rehab in particular, that provide services for people with intellectual and physical disabilities, and which have large service contracts with the State for the provision of such services, paying their directors to organise meetings with Ministers and Government officials on behalf of such organisations. It is wrong. They should not be paying their directors money and no one should do so in that situation. We are not talking about private companies or anybody else. We are talking about people who have daily meetings with the State about the services they provide.

It is extraordinary that someone with the unrivalled access to power that Mr. Flannery had - and probably still has - should be paid. It has not been denied and there has been no clarification or rebuttal of that report in The Irish Times. The Minister for Education and Skills, Deputy Quinn, said he would regularly be met on the Tuesday mornings of Cabinet meetings.

Apart altogether from the Bill to establish a register of lobbyists, it should be clearly stated that organisations like that, which deal with the Government regularly - be they the Brothers of Charity, Enable Ireland or Rehab - should not be paying people to meet Government Ministers.

Our system is accessible and I am not casting aspersions on Ministers about meeting Rehab or organisations like that. The State pays out €80 million for the services provided by Rehab, so the meetings are quite regular in terms of those service contracts. Does the Tánaiste accept there is no basis, foundation or rationale for any organisation to pay large fees to its own directors with a view to organising meetings with Ministers or officials?

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

I do not know what arrangements were made for payment between Rehab and Mr. Flannery, other than the reports I have read in newspapers, which Deputy Martin has also seen. It would seem to me that the appropriate place for that issue to be pursued is at the Committee of Public Accounts. I encourage Mr. Flannery to attend that committee.

The issue of lobbying is not a new phenomenon and is not a new problem.

Michael Conaghan (Dublin South Central, Labour)
Link to this: Individually | In context | Oireachtas source

Not for Fianna Fáil.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

Over the years, we have seen many issues arising from lobbying and the questions of who is paid and who has access, and so on.

Finian McGrath (Dublin North Central, Independent)
Link to this: Individually | In context | Oireachtas source

The Tánaiste should answer the question.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

There is nothing wrong with lobbying per se. People lobby all the time.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

Please allow the Tánaiste to answer.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

First, we need to have absolute transparency about, and a record of, what is happening in the area of lobbying. The forthcoming legislation will provide that when somebody walks in the door to see a Minister or a departmental official, there will be a record of what was asked for, who asked for it and on whose behalf.

Second, where people are lobbying on a professional basis, whether paid or remunerated in some way, there will be a register of those lobbyists which will identify who the lobbyists are, on whose behalf they are acting, how much they are getting paid, who they are lobbying, what they are asking for and who stands to benefit from it. That is the transparency we need to have around lobbying.

Micheál Martin (Cork South Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

There is a principle involved.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

We are over time.

Michael Healy-Rae (Kerry South, Independent)
Link to this: Individually | In context | Oireachtas source

Answer the question.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

Deputy Martin had a long time to reflect on this. It was a period when we had tribunal after tribunal examining lobbying issues where senior figures in Fianna Fáil were involved. As far as this Government is concerned, legislation is being prepared to provide for absolute transparency in the area of lobbying.

Finian McGrath (Dublin North Central, Independent)
Link to this: Individually | In context | Oireachtas source

The Tánaiste avoided the question.

Michael Healy-Rae (Kerry South, Independent)
Link to this: Individually | In context | Oireachtas source

A good job. Well done.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

The Deputies should settle down.

Gerry Adams (Louth, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

The Taoiseach is meeting the British Prime Minister today and I understand they will discuss trade, energy supplies and the North. In the wake of remarks last week by the British Secretary of State for Northern Ireland, Theresa Villiers, I hope the Taoiseach will remind the British Prime Minister of the London Government's outstanding obligations to the peace process. Among other issues, the British Government has failed to implement key parts of the Good Friday Agreement, including Acht na Gaeilge, the civic forum, the bill of rights, and other equality and human rights issues. The British Government has also refused to establish an inquiry into the murder of the human rights lawyer, Pat Finucane, the Ballymurphy massacre, or to hand over files concerning the Dublin-Monaghan bombings, despite a call by the Oireachtas to do so.

More significantly, we are now entering the third month since Dr. Richard Haass and Professor Meghan O'Sullivan presented proposals which followed lengthy discussions with political parties and others. The Tánaiste knows that the UUP has rejected these proposals, while the DUP has yet to support them. The proposals are largely supported by Sinn Féin, the SDLP and the Alliance Party.

Recent history teaches us that the Unionist parties will move positively and address issues only if encouraged by both Governments to do so. Running away from the Richard Haass proposals will not achieve anything but instead will encourage those who are against progress. Will the Taoiseach make it clear to the British Prime Minister that negative engagement by London and rowing back on commitments by it is deeply unhelpful?

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

As Deputy Adams said, the Taoiseach is meeting the British Prime Minister today. This is now part of a regular, annual summit meeting between the Taoiseach of this country and the Prime Minister of Britain to discuss issues around our bilateral relationship. The issues of trade, tourism, investment, our bilateral relations and the issue of Northern Ireland will form part of those discussions.

Immediate issues need to be addressed. I am disappointed - as I am sure is Deputy Adams - that there has been insufficient progress in the discussions following the work done by Dr. Haass and Dr. O'Sullivan prior to the new year. I was reasonably satisfied that progress was being made in the discussions among the party leaders in Northern Ireland. That progress has, to some extent, been derailed recently arising from the Downey judgment and the subsequent controversy and fallout. I would hope that following the St. Patrick's Day period it will be possible to get those discussions back on track and to make progress again because the three critical issues which arise in that area include how to deal with the issue of flags and identity, how to deal with the controversy surrounding parading and how to deal with the very controversial area of the past. These are issues that have to be grappled with.

I have discussed these issues on a number of occasions since the new year with the Secretary of State and as recently as yesterday. I plan to meet her again following the St. Patrick's Day events and I hope that it will be possible shortly after the St. Patrick's Day period to have the regular quad meeting which the Secretary of State and I have with the First Minister and the Deputy First Minister. The meeting is overdue. The format of this meeting will be a useful forum in which to try to bring things back on track.

As Deputy Adams said, there are issues about non-implementation. There is unfinished business from the agreements which the Irish Government continues to pursue with the British Government.

Gerry Adams (Louth, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

The Tánaiste will know that the concern is that the Unionist parties, in particular, the Democratic Unionist Party, have put back the issues and the proposals from Dr. Richard Haass and Dr. Megan O'Sullivan until after the local government elections, which means until June, which is the marching season. There needs to be a very particular focus. It is not even that the British Government has been disengaged - I would be the last person to complain about British Government disengagement from Ireland - rather its engagement has been negative instead of being therapeutic or positive. As I have already enunciated and the Tánaiste has acknowledged, it has been in breach of agreements made in international treaties and in other agreements between this Government and the London Government and between people across the island.

The Tánaiste referred to the Downey judgment. The issue of on-the-runs, OTRs, is one of several legacy issues common to all conflict resolution processes. It is not solely an Irish issue because it arises wherever efforts are made to move from conflict into peace. The two Governments agreed in the Weston Park Agreement some long time ago that the issue would be resolved. However, it is a very graphic example of an issue that has not been resolved despite entreaties and representations by Sinn Féin over the years. It still arises and is used to negative effect on the process with a resultant stall. Will the Tánaiste agree that there has to be a very basic principle in peace-keeping that when agreements are made and commitments given, they have to be kept and that this must be a primary ongoing tenacious forensic focus of this Government with its counterparts in London, that they have to keep the agreements they made?

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

I agree that when agreements are made they have to be kept. I also think it is important that the two Governments continue to work hand in hand and jointly with regard to the Northern Ireland peace process. I have a good working relationship with the Secretary of State. We talk regularly in the institutional format that I have described. There is a very good working relationship at official level. I believe it is very important that the two Governments, who are the joint guarantors of the agreements, should work together and I hope this will continue to be the case.

Deputy Adams referred to the issue of the OTRs which has been the subject of public discussion arising from the Downey case. There was an understanding at Weston Park that this would be a follow-on issue from the arrangements made as part of the Good Friday Agreement. To be fair, there was an attempt to legislate for it. The Deputy will be aware of the legislation that former Secretary of State, Peter Hain, brought forward in 2005 to 2006. Agreement was not reached with regard to that legislation, arising from which administrative arrangements were put in place to deal with the issue.

I am encouraged by what the Prime Minister, David Cameron, said when he was questioned about this. He said he does not wish to unpick difficult decisions made by the previous British Government as part of the peace process. It is important that there should be no unpicking of difficult decisions made and arrangements put in place. We need to build and to move on. The issue we need to address, in the post-St. Patrick's Day period, is the continuation of the Haass-O'Sullivan talks. It is not satisfactory to the Irish Government that this is an issue that is parked until after the elections in May because, as Deputy Adams observed, if we do so we will be in the marching season. One of the critical issues which is part of that discussion is how to deal with the contentious issue of parades. There is also the issue of the hurt from the legacy of the past for families and survivors which continues to emerge on a very regular basis and which must be addressed.

I discussed the situation with the Secretary of State as recently as yesterday. The approach of the Irish Government will be to try to get things back on track as quickly as possible after the St. Patrick's Day period.

Joan Collins (Dublin South Central, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

I have a number of issues I would like to raise with the Tánaiste but I will concentrate on media reports last week about returns by Apple Sales International which is the Irish subsidiary of Apple based in Cork. While Apple Sales International is an unlimited company in Ireland and is not obliged to make annual returns to the Companies Office, it is obliged to make returns in Australia. According to those returns, in the years 2004 to 2009, Apple was able to cut its tax bill by referring to an income tax at lower rates. In these years, Apple calculated its tax with reference to the Irish rate of 12.5% corporate profit tax. It should have paid $890 million but instead only paid $36 million to the Irish Exchequer. The sum of €36 million is close to the 2% rate which Apple claimed at the US Senate hearings last year was an arrangement with Ireland. In the accounts for the period from 2004 to 2009, Apple does not claim to be using its stateless tax designation; it claims to have availed of income tax at lower rates. Even a very powerful multinational company such as Apple cannot set up its own tax rates. A number of questions arise from last week's revelation in Australia.

Was Apple able to avail of a rate lower than 12.5% between 2004 and 2009 and, if so, what rate was applied and who decided on this lower rate? We are all very aware that the loophole which allowed not just Apple but a range of large multinationals effectively to avoid tax will close from January next year. My question relates specifically to the returns made by Apple in Australia for the years 2004 to 2009 and its claim that it availed of a lower rate of tax in Ireland, a claim the Government has repeatedly refuted in the past year.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

The issue of effective tax rates has been the subject of a number of public discussions in the past 12 months. It has been acknowledged by the OECD, the European Union and the G20 that international tax planning is an international issue, and the Government is working with these organisations to reach a solution.

The recent coverage of multinational profits by Apple was based on historical accounts from 2004 to 2009 which used a stateless company structure. We addressed the issue of stateless companies in budget 2014 and the Government is fully committed to the OECD base erosion and profit shifting, BEPS, project. The OECD is progressing that project, with the support of the G20, to deal with this international issue. There has been an allegation that Apple had some type of special deal with Ireland. We have consistently rejected that allegation. Indeed, Mr. Tim Cook, CEO of Apple, corrected the record in that regard in May last year when he stated at the All Things Digital D10 conference, "We have no special deal with the Irish Government".

With regard to the allegation that Apple paid only $36 million of tax on profits of $7.11 billion, it is important to clarify that there are two separate scenarios that are often confused in discussions on the effective rate of corporation tax. The first is the global rate of tax that is paid by multinational companies which operate across a number jurisdictions. This is a blended rate which takes into account the amount of tax charged across all countries in which a company trades, not just in Ireland. The extremely low effective rate figures that were recently quoted in Apple's case and attributed to Ireland are based on a flawed premise. They are estimated by dividing the amount of Irish tax paid by a total profit figure that includes substantial profits made by companies that are not tax resident in Ireland. The figures are running together the profits earned by group companies in Ireland and in other jurisdictions and incorrectly suggesting that Irish tax does or should apply to both.

Ireland cannot tax profits that are properly attributable to other jurisdictions. The ability of some multinationals to lower their worldwide rate of tax using international structures reflects the global context in which Ireland and all other countries operate. The best way to address this issue effectively is for countries to work together at international level. The appropriate action is being considered in this regard by the OECD as part of its project on base erosion and profit shifting. Ireland is participating fully in that process.

The second issue is the effective rate of tax applying in individual countries. The domestic rate of tax paid in Ireland is within the control of the Irish tax system, and Ireland is responsible for the amount of Irish corporation tax that is charged here. All companies operating in Ireland, both domestic businesses and multinationals, are chargeable to corporation tax at the 12.5% rate on the profits that are generated from their trading activities here. A higher 25% rate applies in respect of investment, rental and other non-trading profits as well as certain petroleum, mining and land-dealing activities. Chargeable capital gains are taxable at the capital gains tax rate of 33%. Some other countries have a higher headline rate of corporation tax, which is supplemented by a high number of tax reliefs that reduce the overall rate of tax paid. By contrast, the approach in Ireland is transparent. We have a competitive headline rate of corporation tax, which is applied to a broad base.

Michael Healy-Rae (Kerry South, Independent)
Link to this: Individually | In context | Oireachtas source

Gobbledegook. Fair dues to whoever wrote that response.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

Will Deputy Healy-Rae stop interrupting other speakers in the middle of Leaders' Questions?

Michael Healy-Rae (Kerry South, Independent)
Link to this: Individually | In context | Oireachtas source

It is the truth.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

I do not care whether or not it is the truth. Deputies are not to interrupt.

Patrick O'Donovan (Limerick, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I would like to hear Deputy Healy-Rae say that to the Kerry Group.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

I have called Deputy Joan Collins. Other Members were given silence when they were speaking; they should afford the same to Deputy Collins.

Joan Collins (Dublin South Central, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

Whoever wrote the Tánaiste's reply seems to have lost the plot halfway through. The fact of the matter is that Apple Sales International's returns in Australia show that it was able to cut its tax bill by availing of lower rates of tax on income, which was a reference to the 12.5% tax on corporate profits in Ireland. Something does not add up here. The Tánaiste cannot on the one hand say there is no such thing as reduced rates and, on the other hand, that there is, in fact, some way in which companies can get around it.

It is quite evident what is happening here - €36 million was paid by Apple to the Irish Exchequer. That money has to have come from somewhere and it did not come from the 12.5% corporation tax. The company is not domiciled in Ireland for tax purposes, so why was that sum paid? The Tánaiste's answer is not good enough and it does not add up. Someone is telling porkies here. The Tánaiste and Apple management should get together and present a proper response to this question.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

Apple management should be brought into the finance committee.

Joan Collins (Dublin South Central, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

Yes, Apple representatives should come before the finance committee.

Patrick O'Donovan (Limerick, Fine Gael)
Link to this: Individually | In context | Oireachtas source

People over there should look to their own tax affairs.

Joan Collins (Dublin South Central, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

A Cheann Comhairle, I have been accused of not having my tax affairs in order.

Patrick O'Donovan (Limerick, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I was referring to the tax affairs of the Technical Group.

Joan Collins (Dublin South Central, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

There is nothing wrong with our tax affairs. I refute that remark and the Deputy should not be able to say it across the floor of the Dáil.

Patrick O'Donovan (Limerick, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Is all the VAT paid?

Finian McGrath (Dublin North Central, Independent)
Link to this: Individually | In context | Oireachtas source

That is an outrageous remark and Deputy O'Donovan should be made to withdraw it.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

I ask Deputy O'Donovan to resume his seat.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

Will Deputy O'Donovan mind his own business and stop causing problems in the Chamber?

Patrick O'Donovan (Limerick, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I am sorry, a Cheann Comhairle.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

There are a lot of pretend comedians in the House today.

Finian McGrath (Dublin North Central, Independent)
Link to this: Individually | In context | Oireachtas source

Will the Ceann Comhairle ask Deputy O'Donovan to withdraw his remark?

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

I ask Deputy McGrath to resume his seat.

Finian McGrath (Dublin North Central, Independent)
Link to this: Individually | In context | Oireachtas source

It is outrageous.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

Deputy McGrath is constantly interrupting. I have dealt with the issue.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context | Oireachtas source

The position on corporation tax is very clear. We have a 12.5% rate of corporation tax. It is statute-based and applies to profits that are earned in Ireland. It is applied consistently. We did have a problem with the issue of the stateless company. The Government recognised that loophole in our tax system and, last October, when we brought in the budget for 2014, we addressed and resolved it by ending the concept of stateless companies.

There is an international issue around corporation tax whereby multinational companies which operate across a number of jurisdictions are able to plan their tax affairs in a way that minimises their tax contribution globally. This is an issue that has to be tackled on an international basis. The OECD, of which we are a member, is working on it by way of the base erosion and profit shifting project it undertook some time ago. Ireland is participating in that project, which has the support of the G20 and the European Union. This is a problem that has to be addressed at an international level. I was at the OECD only a few weeks ago, along with the Taoiseach and other Ministers, where we discussed the progress that is being made on this issue. We want to see this issue addressed at a global level, and the appropriate body through which it can be addressed is the OECD. That organisation is making progress and we are working with it to that end.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

In other words, the Government will continue protecting the multinationals.