Dara Calleary (Mayo, Fianna Fail)

): The recommendation was tabled as a Committee Stage amendment in the Dáil by Deputy Bruton and was the subject of a significant amount of discussion at the time. The Minister, Deputy Lenihan, listened carefully to the arguments put forward at the time and subsequently in committee. The recommendation seeks the introduction of a new tax relief for retraining which would work on the basis of a refund of tax previously paid by the individual concerned in the previous six years, as Senator Twomey outlined. As outlined by the Minister on Committee Stage, there are already significant supports within the tax system for tuition fees and retraining expenses. These include tax relief for tuition fees in respect of third level courses and for certain training courses on information technology and foreign languages. It should be noted that the tax relief under these schemes is available to the individual who pays the associated fees, which does not have to be the student undertaking the study or retraining. In addition, a benefit-in-kind tax exemption is available for the retaining of employees in the event of redundancy.

The tax reliefs I have mentioned are all available in addition to considerable support measures provided by the Government through expenditure programmes operated by the Department of Social Protection, the Department of Education and Skills and FÁS. These support measures include the back to education allowance which allows individuals in receipt of social welfare payments for a specific period of time to attend full-time second and third level courses and to continue to receive the equivalent of their social welfare payments. Immediate access to this scheme is provided for persons made redundant as long as they were entitled to statutory redundancy and qualified for social welfare payment.

For training allowances that do not qualify under the back to education allowance, such as ECDL courses, there is also the scheme for education, training and development courses. This scheme allows individuals to continue to receive their social welfare payments while they attend such courses. A broad range of courses are approved from personal development or basic education to general training or acquiring job skills. All these supports are provided and many of the courses run by the Department of Education and Skills or its agencies are generally available free of charge and grants for maintenance, subject to means test, are also available.

While the Minister did not accept the amendment during the debate on Committee Stage, he undertook to examine the proposal further. An initial examination of the issues involved in the introduction of the new incentive along the lines proposed by Senator Twomey has raised further questions that need to be considered on a cross-departmental basis. These include how a tax refund scheme would fit in with the existing expenditure schemes and educational policy, how much such an incentive would cost, who the target beneficiaries would be, for example, those made redundant or those in receipt of jobseeker's benefit or allowance, what the likely take-up would be, what the capacity of individuals to obtain benefit under the scheme would be depending on tax paid in previous years, whether such a scheme should focus on areas where there is a skills deficit or whether it should be more broadly based, how qualifying schemes would be certified and by whom, what the effect of a new incentive would be, if any, in terms of increasing places if places are limited, whether such incentives for retraining schemes would be better provided through the public expenditure system, and whether there are other more effective incentives that could be considered.

As announced in the Minister's Second Stage contribution, he will ask each of the colleagues in Government to assess the effectiveness of tax expenditures as they relate to their specific responsibility. This will also be the case where new tax expenditures are proposed. Given that there are already significant State supports to help the unemployed retrain, we are reluctant to accept an additional tax incentive in this area without proper and careful examination of the issues involved such as I have outlined. For that reason I cannot accept Senator Twomey's recommendation.