Dáil debates

Tuesday, 24 October 2017

4:55 pm

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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11. To ask the Minister for Finance the work that the Revenue Commissioners are undertaking in preparation for Brexit; the arrangements being considered for the Border area in view of the likelihood of the UK leaving the customs union; and if he will make a statement on the matter. [44695/17]

Photo of James BrowneJames Browne (Wexford, Fianna Fail)
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15. To ask the Minister for Finance the steps he has taken to date and plans to take in preparation for post Brexit customs checks at ports here specifically Rosslare Europort; and if he will make a statement on the matter. [44711/17]

Photo of David CullinaneDavid Cullinane (Waterford, Sinn Fein)
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40. To ask the Minister for Finance the reason his predecessor refused to publish the report prepared for him by the Revenue Commissioners on the impact of Brexit on customs. [44712/17]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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73. To ask the Minister for Finance the steps the Revenue Commissioners have taken to identify possible customs posts on the border; the locations that have been examined for these posts; and if he will make a statement on the matter. [44757/17]

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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I wish it to be absolutely clear that the Fianna Fáil position on a hard border is that we do not support it. Our objective, which we share with Government, is that there should be no hard border on the island of Ireland. However, I want to ask the Minister about the work of Revenue, whose representatives were before the finance committee in May. At the committee, they gave extensive evidence on the advance or preparatory work being done. I seek an update on that in light of recent political developments.

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 11, 15, 40 and 73 together.

Like all Government agencies, Revenue is actively engaged in examining a range of scenarios in order to support Ireland's objectives. This work is being undertaken within a whole-of-Government framework led by the Department of Foreign Affairs and Trade. While the precise customs arrangements that will apply after Brexit will depend on the outcome of negotiations between the EU and UK, it is clear that political solutions must be found before technical resolutions can be applied. I am informed by the Revenue Commissioners that it is not possible, at this juncture, to assess what specific arrangements would be required if the UK left the customs union or what post-Brexit checks would be carried out. The Chairman of the Revenue Commissioners has previously confirmed that Revenue is not looking for sites for customs posts.

In respect of the Revenue report referred to, I am advised that this was a draft working document that was subsequently published on Revenue's website on 11 October 2017. The paper was a preliminary analysis compiled internally by Revenue in September 2016 to support its scenario examination and deliberative process following the UK vote in June 2016 to exit the EU. However, it is important to note that matters have moved on significantly since then and, in particular, since Article 50 was triggered. As such, this document remains in draft form and was not finalised as it was overtaken by consequent major developments and policy statements and does not reflect Revenue's current view on Brexit. Their current view was set out clearly in the chairman’s opening statement to the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach on 25 May 2017.

The Government's priorities in respect of the unique concerns that arise for Ireland are very clear - to maintain the common travel area and to protect the gains of the peace process and the Good Friday Agreement in all its parts, including avoiding a hard border. The Government welcomes that these priorities have been reflected in the EU's negotiating position and further welcomes and supports the task force's paper, Guiding Principles on the Dialogue for Ireland/Northern Ireland, which was published on 7 September. The paper builds on the European Council guidelines and reflects the priority Irish issues identified by the Government, including that, in view of the unique circumstances on the island of Ireland, flexible and imaginative solutions will be required to avoid a hard border, including any physical border infrastructure. This must be achieved in a way which ensures that Ireland's place within the Internal Market and customs union is unaffected. The paper also makes it clear that it is the UK's responsibility to propose workable solutions in this regard. It is the Government's view that the UK staying in the customs union and Single Market, or as close as possible to that, would be the best solution.

However, it is important that internal analysis continues in the meantime. Several helpful reports and working papers have been published by the ESRI, InterTradeIreland and business representative bodies. Most recently, my Department and Revenue co-sponsored an ESRI study, working paper 573 on Ireland's international trade and transport connections, which was published on Thursday, 12 October 2017.

5:05 pm

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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I would be glad to have confirmation of Fianna Fáil's position.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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It has never been in doubt.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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I was listening to BBC radio on the way to Dublin earlier and I heard one of the party's representatives arguing for the hardest of borders. The Deputy might want to send her the memo but, hopefully, she is on her own on that issue.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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She is.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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We are discussing the Revenue's report. The Minister mentioned that a great deal of other internal work is being done by ESRI, InterTradeIreland, and business organisations. Are we to believe that the Revenue Commissioners have stopped all contingency scoping exercises relating to different potential Brexit scenarios? Is it the case that Revenue has not undertaken any scoping measures since the draft report, which is quite old? Did the Minister's predecessor or his Department intervene with the Revenue to leave the report as is because at the time it was leaked, we had the commissioners before the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach, as well as the former Minister for Finance who denied any knowledge of this type of scoping activity? Were instructions given to the Revenue Commissioners? Is the Minister telling us that no scoping exercise is being done to address different Brexit scenarios from a Revenue and a customs point of view?

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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The Minister said the onus is on the UK side to come up with workable solutions but the problem is they will not nor do they want to because the UK is happy to leave the border open. The issue is on the EU side because if the UK leaves the customs union, which looks increasingly certain, there will be an obligation on the EU to protect the integrity of that union and the Revenue will be the national agent of the European Commission. It is a European Commission competence. The Minister needs to answer the question. If the UK leaves the customs union, which looks increasingly certain, what are we looking at in respect of Border arrangements? There has been some change in the Revenue position regarding preparatory work. The Minister needs to clarify whether the Revenue Commissioners are continuing to conduct analysis and contingency work, to examine options, to scale up IT infrastructure and so on because those were the types of issues they put on the record at the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach in May but there seems to have been a change.

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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We are involved in a negotiation at the moment on an issue that will have a profound effect on our island. With regard to the Deputy's statement about the British Government's view of a customs unions, it is crucial that we gain clarity regarding what its customs policy will be. The Government's view is clear. A customs policy that is as close to the current arrangements as is feasible will provide the best framework whereby we do not return to a hard border. This is a key strategic priority of the Government in managing this issue. The Chairman of the Revenue Commissioners has stated that they are not involved in any work that will prejudge the outcome of these negotiations because they are political and they are ongoing.

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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Is there no contingency planning going on within the Revenue? I travelled here from Donegal earlier and I passed through Clady Bridge. I do not want to see customs posts. We have made it clear and the House has spoken regarding special status for the North, something the Government has not put on the table. I find it difficult to think that an agency that may be responsible for ensuring the collection of customs duties is not doing any scoping whatsoever. It baffles me, not that it should provide a solution to the British Government but it should inform our negotiators as to the different scenarios that may be on the table in the negotiations. I asked two questions. Will the Minister confirm the Revenue is not engaged in contingency planning in respect of the application of customs duties at the Border? Was there an intervention, direct or otherwise, by the Minister, the Department or Government in respect of the Revenue ceasing the type of work it was doing on the draft report or any other work it intended to do?

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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Of course, the Revenue Commissioners are inputting into and sharing information with our negotiating team regarding the different outcomes that could emerge from the negotiations that are under way relating to Article 50 but political agreement must first be achieved. We are clear that a customs policy that is as close as possible to the current customs unions will minimise any of the difficulties our island will then need to face. The Revenue Commissioners are aware of the negotiations that are under way, they are inputting into our team as the negotiations continue and we will be prepared for the outcomes that emerge from the British decision to leave the EU. First and foremost, however, we need to reach political agreement on what will be the customs policy between Britain and the EU and the impact of that on the island. Neither my Department nor I influenced the Revenue Commissioners in any way in respect of their work and I am not aware of such influence having been exerted on them.