Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

I thank the Minister of State, Deputy O'Donnell, for taking this question on behalf of the Government. We had a useful debate on the future of healthcare yesterday. He will be aware of that. The Minister, Deputy Carroll MacNeill, spoke about the success in Ireland where we now have a life expectancy of 82.6 years. As she rightly pointed out, our aim is not just to live longer but also to live healthier lives. The Minister used Government statistics to point out that over the next 20 years, the numbers aged 65 to 84 in this country will grow by 65% and those aged over 85 will more than double. That is a remarkable success in terms of life expectancy. One of the challenges for many people as they grow older is that they are not necessarily as healthy as they could or should be.

We know, for instance, that a teenager today has a one in five chance of living to the age of 100. A baby born today has a one in three chance of living to the age of 100. We need to start to think in the long term about how we can ensure that people lead healthy lives throughout the many decades they are going to live. One of the problems is that because of physical activity, it leads to a greater demand on our health service. The World Health Organization last year measured Ireland's physical activity and estimated that the cost of physical activity in Ireland was of the order of €1.5 billion per year.

With that in mind, and as we are trying to encourage healthier lives, physical and mental well-being, a number of us have for quite a while been advocating the concept of gym membership to encourage people to get involved in gym and other physical activities as a way not necessarily to build big muscles, although that should not be discouraged, but to encourage flexibility and the maintenance of muscle and balance. My colleagues Deputy Dolan and the Minister of State, Deputy Christopher O'Sullivan, have been strong on these issues. In the budget last October, the then Minister for Finance, Deputy Chambers, indicated that his Department would review and examine the possibilities of how such a tax relief measure would operate. It was, as the Minister of State will be aware, also contained in the programme for Government. There has been an active campaign by the Irish Physical Activity Alliance, led by Darina Dunne, to ensure that gyms would be responsive if the Government were to initiate this campaign.

There are quite a number of examples around the world where other governments have adopted this approach, particularly in a number of the provinces in Canada. I will give just one example. Newfoundland and Labrador has a physical activity tax credit. In that case, every family can apply for up to 2,000 CAD of a tax credit but there is a requirement in terms of their gym or activity membership: "It must involve significant physical activity that improves cardiorespiratory endurance, as well as muscular strength, flexibility or balance."

There are similar schemes operating across a number of the other Canadian provinces, including Prince Edward Island, Saskatchewan, Nova Scotia, Manitoba and Yukon. In Singapore, retirees receive free gym membership as part of the Age Well SG programme. The impact of that is seen in the fact the number of older Singaporeans who require hospital or nursing home care has been reduced significantly.

This is a health promotion measure and as the Minister of State who has responsibility for older people at the Department of Health, I hope the Minister of State supports this in addition to indicating on behalf of the Department of Finance what research has been done.

Kieran O'Donnell (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I thank the Deputy for raising this matter. I am taking it on behalf of the Minister for Finance. As Deputy Byrne will be aware, the programme for Government, Securing Ireland's Future, includes a commitment to "Consider measures, in conjunction with the Department of Finance, to encourage gym membership and active participation in sport and exercise". The programme for Government also acknowledges that "sport holds a special place in Irish life and society ... promoting health and well-being, encouraging community participation and instilling a sense of pride in our people". It also commits to supporting our sporting ecosystem so more people can participate, reap the benefits of sport and fulfil their potential from grassroots right up to high-performance level. This can be achieved through a variety of means including increased participation, education, increased funding, supporting high performance and governance.

On the commitment to consider measures to encourage gym membership and active participation in sport and exercise, officials in the Department of Finance will consider the matter over the coming months with the expectation that an update of the examination will be provided as part of the annual tax strategy group process during the summer. That normally comes out around July. In line with best practice and as with all proposals for the introduction of new tax measures or the amendment of existing tax reliefs, the proposal to encourage gym membership and active participation in sport and exercise through the tax system must be assessed in accordance with the Department of Finance’s tax expenditure guidelines. These make clear the importance that any policy proposal that involves tax expenditures should only occur in limited circumstances where there are demonstrable market failures and where a tax-based incentive is more efficient than a direct expenditure intervention. Any decisions regarding taxation measures are made in the context of the annual budget and Finance Bill processes at the appropriate time and having regard to available resources and the sound management of the public finances.

I take this opportunity to note that the tax code already provides for a number of fitness-based measures more generally. For example, the cycle to work scheme provides that bicycles and associated safety equipment provided by employers to employees will be treated as a tax exempt benefit-in-kind, subject to certain conditions being met. One of the benefits envisaged from the scheme was that more people cycling to and from work would improve health and fitness levels. In addition, the accelerated capital allowances scheme for childcare facilities and fitness centres encourages employers to develop on-site childcare facilities and fitness centres for their employees. The scheme provides accelerated allowances for qualifying buildings or structures over a seven-year period and accelerated allowances for related equipment at 100% for a year.

Officials in the Department will consider measures to encourage gym membership and active participation in sport and exercise over the course of the coming months. It is expected an update on this work will be outlined in the annual tax strategy group process during the summer.

As the Minister of State with responsibility for older people, I take the Deputy's point about the benefits. People are living longer and being more active and going to the gym is of benefit to all age groups, including the older cohort.

Malcolm Byrne (Wicklow-Wexford, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

I thank the Minister of State for his response. I welcome that we will see details when the annual tax strategy group process develops over the summer. I ask the Minister of State to input into this process given he has responsibility for older people.

That was a little bit of a standard Department of Finance answer in that the officials are obviously concerned about potential loss of tax income, but this must be seen as a health promotion measure. I cited the World Health Organization figures on the cost not just to the economy but also to the health service as a result of inactivity. If, as expected, nursing home demand in Ireland increases by 123% by 2031 that is going to cost the State over €500 million every year. We are trying to encourage people to live longer, but also to have healthier lives, and gym membership is very much part of that. If we can incentivise or encourage people and even if it is part of the senior citizens’ package – the State has been rightly proud of how we have supported senior citizens over the years – it is something that should be considered. It is obviously not just for those aged 65 or 66 years or older because as we get into our 40s and 50s the challenge is as great.

I ask the Minister of State to take it back to the Department, especially with reference to his brief, to look at the experiences in Canada and Singapore, to consider this as a health promotion measure and to engage with the Irish Physical Activity Alliance and gyms around the country to talk about how this would work. I would love to see the commitment in the programme for Government being met in time for budget 2026.

Kieran O'Donnell (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I thank the Deputy. I have listened to the points he has raised, which are very comprehensive in nature. We all agree on the importance of encouraging greater participation in sport and fitness activities and continuing to support to those already participating in sport across all age groups. This acknowledgement is underpinned through the programme for Government commitment, as the Deputy stated. This includes supporting our sporting ecosystem so more people can participate, reap the benefits of sport and fill their potential from grassroots right up to high-performance level.

There are a range of relevant considerations about the tax relief for gym membership raised by the Deputy that must be taken into account and I will give an overview. These considerations include whether tax relief is the best approach to achieving greater participation in sport and fitness activity. There are individual households that do not have a tax liability for whatever reason, so a tax measure would not be of benefit to them. There is the matter of how one defines what comes within the scope of the measure and how much tax relief for gym membership would cost, which the Deputy has already alluded to. With any budget there is a decision to be made regarding the allocation of tax measures, and cost is a very relevant consideration. There is also consideration of what impact the tax relief would have. The Deputy has outlined some of that. There is the question of whether it would result in increased sport participation, as well as whether it would simply benefit those who are already members of gyms. In other words, we must ask whether it would have an incentive effect. With that said, the Department of Finance will continue to consider the issue with a view to providing an update as part of the annual tax strategy group this summer.