Thomas Byrne (Meath East, Fianna Fail)
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Go raibh maith agat. Tá mé buíoch don Cheann Comhairle gur roghnaigh sé an t-ábhar seo. Late last year a number of payments to substitute teachers were stopped by the Department of Education and Skills's payroll section and that resulted in them being overtaxed on recent payments. It seems the Department of Education and Skills failed to register substitute teachers and some special needs assistants for a new PAYE system, meaning that they were treated as new employees and have had emergency tax deducted from their fortnightly payslip. The issue affects a number of teachers and has had a significant effect on their take-home pay. Some teachers have been taxed more than €500 for eight days work. Some substitute teachers who were not paid before Christmas for one week between 17 December and 21 December were not paid until last week. Many received no warning that they would be missing a whole week's pay prior to Christmas and that was deeply distressing for them.

When my office contacted the Department of Education and Skills about the issue before Christmas, we were assured that it would be addressed directly after Christmas and we were told that the fault lay not with the Department or the Revenue but with boards of management. One suggested option was to advise teachers to simply go to the board of management and to ask for a sub, as one would call it, on their wages.

This week, some teachers have been faced with a major tax bill and some got a double whammy. I was informed that the schools were at fault but it seems clear now that the Department is responsible, which was denied prior to Christmas. Could the Minister confirm that the cause of this issue has been identified? I accept that PAYE modernisation is complicated and the Department of Education and Skills is not the only organisation experiencing these issues. On the whole, however, people have not been affected by it and the question that arises is why this cohort is being so badly impacted. The teachers being impacted by the failures are some of the most vulnerable and they cannot afford to take the hit. The issue requires absolute priority.

The Minister addressed the issue of substitute teachers last weekend but I am not sure what he or the Department has done about it. There are too many vacancies and too much demand for substitute teachers in the system. We cannot get substitute teachers and that is a bigger problem.

The individual problems for these teachers are absolutely devastating. Many of them are substitute teachers because for some bizarre reason they cannot get permanent jobs at second level. At primary level we do not have enough teachers to fill the gaps and substitute teachers are brought in. For all the substitute teachers that have been devastated by this, there are many more gaps where positions have not been filled either permanently or by substitutes. One constituent of mine has been out of her primary teacher job because she is very seriously ill. She is going back before she is better because she feels so bad. A special needs teacher was taken out of special needs education within the school to cover her class. There is a huge feeling of guilt among teachers because this is necessitated by somebody's serious illness. Can the Minister outline exactly how the tax and pay situation came about for these substitute teachers? When can the teachers expect a repayment of the emergency tax that was taken from their pay last week? Is the Minister confident that these issues, which have plagued the system, have been resolved? If not, can he provide details of any further issues identified so that teachers will not be left in the lurch and will know what is happening? This has now happened in the Minister's Department. Similar issues with changes in IT and new systems happened in the Department of Employment Affairs and Social Protection. A cohort of people out there are badly affected. Some feel this is a small cohort of people and it does not really matter. It matters a lot to them. It adds to the perception that teachers are not valued by the system. They are not valued by the bureaucracy which funds the education system. It is deeply damaging to teaching morale when teachers see these stories in the paper. Moreover, it is deeply damaging to the prospects of recruiting more teachers. Every time I get the opportunity I appeal to people to consider teaching as a profession, notwithstanding all these difficulties.

Joe McHugh (Donegal, Fine Gael)
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Ba mhaith liom mo bhuíochas a ghabháil leis an Teachta fá choinne an t-ábhar seo a ardú. Tá mé ag obair ar an ábhar seo agus tchím na deacrachtaí agus tá mo chomhghleacaithe ag obair le chéile fá choinne réiteach a fháil. Ar dtús, labhróidh mé faoi chúlra an ábhair seo.

I am taking this issue very seriously. I am very glad the Deputy raised it. A large cohort of people has been affected. I would like to give some background, as the Deputy asked for, and then I will outline to the House what we are doing to rectify this situation.

The Revenue Commissioners introduced pay as you earn, PAYE, modernisation systems from 1 January 2019. PAYE modernisation involves the most significant reform of the PAYE system since its introduction in 1960. From 1 January 2019 employers are required to report their employees’ pay and statutory deductions to Revenue for each payroll issue. The new real-time reporting regime is operational for all employee payments made from 1 January 2019. Employers, agents and payroll providers have to have new business processes and practices in place to meet the new requirements. This involved major changes to most payroll systems in the country. The aims of PAYE modernisation are to improve the streamlining of business processes and to reduce the administrative burden previously experienced by employers in meeting their PAYE reporting obligations.

My Department issues 120,000 payments per fortnight to teachers, non-teaching staff, retired staff and casual and non-casual substitute staff. The serving staff are employed by the managerial authorities of schools and their salaries are paid by my Department on behalf of the managerial authorities. The salary issue that has arisen and has been referred to relates to the taxation of the substitute staff. It is confined to substitute staff who were paid in the first payroll of 2019 and in the case of post-primary substitute teachers in the second payroll also. The first payrolls of 2019 were on 3 January 2019 for post-primary teachers and on 10 January for primary teachers, non-teaching staff and retirees. The second payroll for post-primary staff was on 17 January.

The claims for the payment of substitute staff are submitted by the managerial authorities of schools using an automated system referred to as the on-line claim system, OLCS. The records of employment are submitted through the OLCS for casual and non-casual substitute staff. The details of each period of employment transfer to the Department where the appropriate rates of pay are applied, statutory deductions are calculated and the payment issues in the regular payroll run for the sector. The OLCS ensures that service history for casual and non-casual substitute staff is accurately recorded regardless of the number of schools a person may teach in and ensures accurate service history and accurate incremental progression.

In the first payrolls of the new year, in which the new system was applied for the first time, the payroll files that transferred to Revenue inadvertently included an end date for casual and non-casual substitute staff which informed Revenue that these staff would not be paid under this employer number in the future. This notification immediately caused Revenue to reduce the tax credits and cut-off points to zero for this cohort of staff. This meant that when they were next paid there were no tax credits available to be applied to the salary if they were paid on our payrolls in the next payroll issue. When Revenue is notified by an employer that an employment has ceased, the credits at that employment are available for reallocation to an existing employment or to a new employment. This has affected the substitute staff paid in the payrolls I mentioned, a group which represents 8% of payees on the payrolls. This has meant that substitute staff who were paid on the payrolls of 3 January, 10 January and 17 January and who have continued to be employed since are being taxed at a very high rate. Substitutes employed or paid after these dates for the first time in the 2019 tax year are not be affected by the issue.

The payroll software has been amended to prevent an end date transferring to Revenue for future payments. This means that casual and non-casual substitute staff being paid for the first time in the 2019 tax year since the payroll of the 17 January will not have problems with tax credits. However, this software amendment did not correct the issues that arose for the substitute staff paid in the first payrolls of the year. That is the issue that has been raised tonight. Within my Department the highest priority is being accorded to addressing the problem for the substitute staff affected and to ensuring that the correct tax credits apply and that refunds of tax that have been deducted in error will issue to the people in question.

The introduction of the PAYE modernisation systems by Revenue means the resolution of the issue is not completely within the control of the Department of Education and Skills. It requires collaboration with the Revenue Commissioners to address the issue and reach a technical solution. My Department is actively working with the Revenue Commissioners to bring about a resolution. I have just left a meeting on this very issue and I wish to let Deputy Byrne and the House know that we are using all our efforts and capacity to find a solution for this. A technical solution is needed, but this requires effort at a human level as well. I am conscious that there are teachers out there who have faced deductions and are facing pressure with the everyday realities of living, having expected a certain amount and then not received it. I wish to give an assurance that when this is rectified, the deductions that were made will be reimbursed.

Thomas Byrne (Meath East, Fianna Fail)
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Tá sé seo i bhfad níos measa ná a cheapamar. Tá daoine ag dul gan pá mar tá an iomarca imithe ar cháin, toisc go raibh fadhb ag an Roinn, agus níl aon fhreagra ag an Aire anseo sa Dáil maidir le cathain a gheobhaidh siad an pá sin.

This is far worse than has been reported publicly. This is an absolutely incredibly blunder by the Department. It is not one blunder but at least two. First, information was inadvertently included to the effect that substitute staff, casual and non-casual staff had an end date. Second, a software fix was applied that did not fix the problem. That is two blunders. I will gladly volunteer to go into the Minister's Department and help write the cheques to the teachers affected. That is the only solution to this problem. It is not good enough for the Minister to come into the Dáil and say he is using all his efforts to find a solution. The Minister is the employer: he is required by law to pay the wages of his staff. I strongly suggest that a manual process is applied, with all hands on deck to make sure that the cheques are written. It is simply not good enough to tell teachers to wait for Revenue to refund their tax. They are PAYE staff. They are not responsible for making returns to Revenue. Not once but twice the Minister has admitted on the floor of the Dáil that this is the Department's fault and we still do not have a solution to this problem. The only news the Minister has given me tonight is that he is using all his efforts to find a solution. I suggest the solution is to write cheques from the Department and then sort it out between the Department and Revenue separately.

That is the only way this will be solved. These teachers are extremely vulnerable. They are utterly dependent on their wages for what is in many cases casual work and this would not be accepted by the Government from a private employer. There must be a total change of approach and money due to these teachers should be paid.

Joe McHugh (Donegal, Fine Gael)
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We must be clear about what is happening here. This is a collaborative approach between Revenue and my Department. The employers of these teachers are the respective boards of management but I have a responsibility as Minister to ensure that we find a solution. The solution will be found, and speed is of the utmost importance. I am conscious that the next round of payment is coming up next week. My assurance to the people who have had wrong amounts deducted from their wages is that the deductions will be paid back to them in full. I have impressed on all my officials, and I have just come from a meeting, the need to ensure we get a solution. I share the Deputy's concern on a number of fronts where people have to pay their day-to-day bills, mortgages or rent. The reality of living costs is foremost in my mind.

I want to be clear that the software used did not take into account substitute teachers. That issue has been rectified but the difficulty is that it has not been rectified for those three payments affecting two cycles for substitute teachers and one cycle for primary substitute teachers. I will ensure that we put all our resources into finding a solution to this issue.

Thomas Byrne (Meath East, Fianna Fail)
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It is not good enough in my opinion.