Ciarán Cannon (Progressive Democrats)
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I move amendment No. 1:

In page 4, between lines 11 and 12, to insert the following:

"(5B) Failure to comply with subsection (5A) is an offence and a company shall be liable to a fine not exceeding €10,000.".

As I pointed out the last time I had an opportunity to make a contribution on this Bill, Fine Gael welcomes the legislation and supports it in principle, but we feel a number of amendments are necessary, of which this is one. Section 194 of the Companies Act 1963 requires that directors disclose to their boards any conflicts of interest in respect of contracts or proposed contracts and that a book of these declarations be kept by the company. The Bill proposes to amend the 1963 Act by providing that the Office of the Director of Corporate Enforcement should have the power to ask for this book and by making it an offence not to present the book when asked for. The penalty in the 1963 Act for refusing to present the book is £100, which we suggest is far too small and does not act as a deterrent. We suggest this be increased to €10,000.

Mary Coughlan (Donegal South West, Fianna Fail)
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What the Senators are proposing is an addition to the proposed subsection (5A) of section 194 of the Companies Act 1963. The amendment creates an offence the fine for which is €10,000. I appreciate where they are coming from and their enthusiasm for sending a message. However, as it stands the fine is €1,900. It used to be £100, but that was a long time ago. It has been increased accordingly. There will be reforms in the consolidation Bill, major legislation that is coming in, although Senator O'Toole will go through me for a shortcut when I say that.

Joe O'Toole (Independent)
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Absolutely, I do not want to hear about what is coming next year.

Mary Coughlan (Donegal South West, Fianna Fail)
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It will be a major Bill and applying a fine at that level now would have an enormous effect on the consolidation legislation. I appreciate the desire for a clear signal but the ODCE can go to court so it would be overdoing it to increase the fine to €10,000 at this time. Having said that, we are giving the ODCE access to the books for the first time. I appreciate the Senator's aims but it is not appropriate to have a €10,000 fine at present.

Liam Twomey (Fine Gael)
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The Minister says she has a problem with fines up to €10,000 if the Office of the Director of Corporate Enforcement deems an offence serious enough but we fine fishermen far in excess of that for landing a few small fish.

Joe O'Toole (Independent)
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I am disappointed. The Government wonders why it gets bad publicity but this is a classic example. This simple amendment shows authority and commitment. When people criticise the Government for not putting laws in place, this is what they mean. The Minister said she intends to deal with this issue in the consolidation Bill next year and no one disagrees with that. The Minister has not told us, however, the problem with putting this arrangement in place now. The Director of Corporate Enforcement is investigating issues full time, waiting six months to put a system in place does not help.

Where is the problem with putting this in place now? Every attempt should be made to support the work of the Office of the Director of Corporate Enforcement. I cannot understand how the Government gets itself into these binds or why it does not recognise that Fine Gael has put forward a good idea that will show people what we are about and that we will not stand for any delay to the work of the ODCE.

The first thing that happens when a request comes from the Office of the Director of Corporate Enforcement to a company is that a phone call is made to the company's lawyers. The company's lawyers will be of the view that it should give nothing away until absolutely necessary. They will then slow down the process. I spoke to someone who told me about six different communications with the legal team of an institution over a simple list of decisions taken. Lawyers probably made at least €10,000 while the official body established by the Minister could not get the information. This happens all the time. It is a smaller version of what the developers are talking about with NAMA - they will take it to court.

We are behind the eight ball every time. It would cost the Department nothing to put this in place and it would at least allow the Minister to say that while the legislation will be consolidated, she put in place a positive idea from the Opposition. How can that hurt? Surely that must be positive and is the sort of thing we should be doing. When the Taoiseach, the Minister for Finance and the Minister get together to look at these things, surely this is what is wanted.

Fine Gael is not trying to score political points here, it is a sensible approach to legislation that will reflect discussion in this and the other House and in the newspapers about how we do our business. I appeal to the Minister to accept this amendment in the spirit it is offered to let ordinary people see we are thinking of them.

Ciarán Cannon (Progressive Democrats)
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I am concerned that every amendment proposed by us and Senator O'Toole will be fobbed off with the suggestion that it will be covered when the consolidation legislation is introduced. This is an opportunity to send out a strong signal. It gives discretion to a court to apply a fine of up to €10,000, it need not be the entire €10,000. The Minister should take this on board and send out the right signal. There are constant calls for co-operation from the Opposition. This is such an occasion and the Minister should reciprocate.

Mary Coughlan (Donegal South West, Fianna Fail)
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The court can compel. If I was to accept the amendment, this section would contain provision for a fine of up to €10,000 while the next would allow for a fine of €1,900. We would have different amounts in different parts of the Companies Act. We would end up picking and choosing which fine would be €1,900 and which would be €10,000. On that basis I would prefer to wait for the consolidation legislation.

I am not here to take away from the strong message that is coming from this House and the Dáil that the legislation should be so robust that the Director of Corporate Enforcement will have the legislative power to deal with the issues that exist. That is what we want. We want to send a clear signal that if people do not co-operate with the director, the full rigours of the law will be used.

That must be balanced with the argument that we have so many good companies here because it is easy to set up, we support companies quickly and we do not have the same bureaucracy as other European companies. My Portuguese counterpart indicated that it is possible to set up a company there and be at work within 24 hours but that is too quick. When the Director of Corporate Enforcement insists he should have access, it should be given. The legislative measures are such that he can revert to the courts if needs be. In the new legislation, I would prefer not to have subsections coming in willy-nilly that do not give an overarching view of where we want our company law to be.

I am not nit-picking or saying I am not prepared to listen to what the Opposition has to say. Anyone who knows me knows I accept different perspectives. On this occasion, I feel that if €10,000 is predetermined in this section, I would have to reconsider all of the other fines in the companies legislation, which is what I will do in the consolidation Bill, which is why I prefer to wait.

Joe O'Toole (Independent)
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I understand that but I sat in this seat in 1990 when the original legislation was passed. We had many discussions on this issue and on the importance of having a consolidated Bill. Then we went away for the summer holidays with our buckets and spades and suddenly the beef industry fell apart. The then Government needed to act urgently to deal with that and both Houses reconvened to pass one or two parts of that legislation - I cannot recall which it was but the Minister's adviser will be able to tell her. I can quote the Minister chapter and verse on when we have enacted parts of legislation on a number of occasions.

The answer to the Minister's first point is that we want a clear message to be given. I advise her that I am not a member of the Opposition, I am one of the Independent Members. I am as likely to vote for the Government, as Fine Gael will know, on any issue as it arises. I consider the issues and deal with them as I find them.

This provision does not amount to additional regulation. It is a red herring to suggest it does and I would like the Minister to acknowledge that point. The regulation is in place. This provision simply deals with the level of fine for not complying with the regulation. That is all we are talking about in this instance.

In terms of the difficulty of having one figure for one and no figure for another, we will do a deal with the Minister, if she accepts this amendment, all the others can be introduced on Report Stage. It is very simple, we can introduce them all next week. There is no difficulty about doing that. That is the way we should approach this issue at this stage. There is no doubt we can deal with issues on Report Stage.

The Minister will not have heard what I said here this morning or yesterday morning. All of us as public representatives should be dealing with these types of issues, whether they relate to the National Asset Management Agency, the Director of Corporate Enforcement or directors' compliance statements, in a co-ordinated and co-operative manner to move matters forward. I want us to examine each such issue and consider how we can strengthen the legislation underpinning it. The Minister will get no marks for citing St. Augustine's line in response, namely, that a proposal might be a good idea but it will not be acted on yet, it will be done next year when all the other matters are being dealt with. I guarantee that we will not have the consolidated Bill before next summer. It is too big to be ready by then, although I agree with the Minister it is needed. I will cite a minor example that illustrates the need for it.

When I checked which director is referred to in the section, whether it was the Director of Corporate Enforcement, the Director of Public Prosecutions or both of them, I could not find the definition in the 2003 Act, to which the section refers, or in the 1990 Act. I know the definition is included in the legislation and I am not suggesting it is not. I accept the need for a consolidated Bill and I accept the need for this Bill. There is a $64 question in this respect. This legislation is being introduced now because the Minister thought it was important. There is nothing in it that could not be deferred until the introduction of a consolidated Bill, except the Minister prioritised this Bill, rightly, but it is all part of what will have to be dealt with again in the new Bill next year. This will have to be encompassed into the new companies legislation. In this legislation the Minister is changing the 1990 Act, the 2003 Act and the various other Acts. This will have to be done again next spring. If that is the case, what is the difficulty about accepting the amendment proposed by Senator Cannon? That is the reality. The Minister's arguments do not hold water. I promise her I am saying this for her own good.

Mary Coughlan (Donegal South West, Fianna Fail)
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Are you?

Joe O'Toole (Independent)
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There are Brownie points to be won by the Minister in doing this. She is getting enough hassle knocking on doors around the country. She should put something on the credit side, namely, that we will not stand for nonsense. If I was arguing against the Minister on a doorstep and there was a proposal before her to deal with bankers and other people who will not supply information by imposing a €10,000 fine on them, and if she started to explain that the Government will do that next year, I would say to her, let us do this, this is a good decision and it should be implemented now. It is one decision and then this would be done.

Liam Twomey (Fine Gael)
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Some of the Minister's comments reinforce the need for this measure. She said it is easy to set up a company in Ireland. That is beneficial for people who are engaged in business. The majority of the companies that have been set up operate legitimately and simply want to get on with doing their work within the business community. However, where there are a few rogue companies, it is important provision is made for putting in place fines to address the nature of the offence. The Minister should take on board this amendment.

I was not joking when I made an earlier comment about fishing. If a fisherman catches a few extra fish or some species that is over the quota, he or she could easily be fined up to €10,000. The Minister is well aware that the Government passed legislation to imprison fishermen for such an offence, yet she is making an excuse to allow rogue companies not to be fined on the basis that she will do something about it next year. That is ridiculous.

Mary Coughlan (Donegal South West, Fianna Fail)
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I heard Senator O'Toole talk about getting his buckets and spades, but if I recall correctly he got off of a very nice boat on the Shannon and no buckets and spades were needed there.

Joe O'Toole (Independent)
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I did not have it at the time so I was stuck with the buckets and spades.

Mary Coughlan (Donegal South West, Fianna Fail)
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Account needs to be taken of the all-encompassing legislation in this respect. Section 194 of the principal Act provides that it is the duty of a director to disclose his interests in contracts made by the company. If I was to accept this amendment, we would have subsections (5A) and (5B). This provides that if a company fails to comply with a subsection, the company and every officer of the company who is in default shall be guilty of an offence and liable to a fine not exceeding €1,904.61, and if any inspection of production required thereunder is refused, the court may, by order, compel an immediate inspection or production. To that would be added the proposed subsection (5B), which provides that "Failure to comply with subsection (5A) is an offence and a company shall be liable to a fine not exceeding €10,000." The next section, section 6, provides that any director who fails to comply with this section shall be guilty of an offence and liable to a fine not exceeding €1,904.61. This would mean that failure by a company to comply would carry a fine of €1,900, failure to comply with the same provision would carry a fine of €10,000 and failure to comply with it again would carry a fine of €1,900. It is the same offence, but acceptance of this amendment would mean it would carry two fines, one of €1,900 and one of €10,000. If I was to accept the amendment, I would be talking against myself on two occasions, as it were. Two fines would apply for the same crime. It is on that basis this amendment proposed by Fine Gael cannot be accepted. In this legislation the principal Act is being amended by inserting the subsection as set out in the section. Fine Gael is seeking an amendment of the section that provides for the amendment of the principal Act, which provides for a fine of €1,900 for one part of the provision, in terms of proposing a fine of €10,000 for the same part of the provision. On that basis, I am not in a position to accept the amendment.

Liam Twomey (Fine Gael)
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I am confused. The Minister has given two fines for the same crime.

Mary Coughlan (Donegal South West, Fianna Fail)
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Yes. The Companies Act is in place. This section amends section 194 of the principal Act by inserting a new subsection after subsection (5), namely subsection (5A), which is set out in the section. It provides that "A company shall, if required by the Director, produce to the Director for inspection the book kept by it in accordance with subsection (5)(a) [which refers to the principal Act] and shall give the Director such facilities for inspecting and taking copies of the contents of the book as the Director may require."

The Deputy's amendment would involve a further amendment of that section of the principal Act, creating a further subsection. If one reads the entire section, it provides that any director who fails to comply with the section shall be guilty of an offence liable to a fine not exceeding €1,904. Taking account of the principal Act, if I was to accept what the Fine Gael amendment proposes, we would have two fines for the same crime. That is the issue. We are amending the principal Act, which refers specifically to a fine of €1,900. The problem is the Deputy would need the book I have to check through all this legislation.

Liam Twomey (Fine Gael)
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I am trying to work out whether we have two fines for the same crime or two different crimes.

Mary Coughlan (Donegal South West, Fianna Fail)
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Two fines for the same crime.

Joe O'Toole (Independent)
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The point at issue is clear. We should be increasing the fines in regard to these issues. If this is not the correct way to do it, we should be doing it the right way.

We listened to the contributions on Second Stage. Senator Callely spoke about various problems with laws and asked if this legislation could provide for this, that or the other. I will call for a vote on every section. I want Members on the Government side to walk through the lobbies in respect of the sections of this Bill so that the next time I have to listen to them give out about the non-compliance of bankers and company directors, I will be able to say they had an opportunity to do something about that. When other legislation was debated in this House, we were too soft on these issues. It will not make a great deal of difference to the Tánaiste, but for those of us who are working on making this have more impact and to give a message to people, this is important. The Tánaiste has made up her mind.

Mary Coughlan (Donegal South West, Fianna Fail)
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It is inappropriate to say I or any Member of this House does not want to give a clear message. I want to do it as much as the Members here. That is why I introduced this legislation. We will have the "blacks" with everything written down and I am prepared to accept exactly what everybody is saying. I can give an undertaking to the House that we need to examine the fines and ensure the penalty reflects the crime, which Senator Twomey talked about. It is my intention to increase fines. My preferred option is to do it within the new, consolidated legislation. It might take away from the fact that the legislation coming very quickly is very complex and difficult. I appreciate what Fine Gael Members are trying to say, that we want to give a very clear, strong signal. I am prepared to give that strong signal.

Ciarán Cannon (Progressive Democrats)
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But not now.

Mary Coughlan (Donegal South West, Fianna Fail)
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It cannot be done now. I could not accept the amendment as it is written because from a parliamentary drafting perspective it would be contradictory to what we are trying to do. I undertake to increase fines in the context of the new legislation.

Ciarán Cannon (Progressive Democrats)
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By her own admission the Tánaiste is highlighting the urgency of this legislation. It is urgent because it serves to give the Director of Corporate Enforcement the powers he needs to police rogue directors and to engender real confidence in the public that we are tackling this issue head on. Is there any mechanism whereby within this legislation we can uniformly apply that new fine across all sections for ease of application and, as Senators O'Toole and Twomey said, to send out a strong, clear and unequivocal signal to the public that we are taking this issue seriously? This is urgent legislation. If it were not, we would not be here but would wait for it to come in a year's time. The urgency attaching to this legislation requires that the penalties it provides for are appropriate and serve as a sufficient deterrent to stamp out the kind of activity we have seen in recent years.

Mary Coughlan (Donegal South West, Fianna Fail)
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Four hundred sections of company law have offences attached to them, so we would have to go through 400 sections of Companies Acts to do this. I do not have the wherewithal to go through 400 sections of legislation. It would delay my taking this legislation any further, which none of the Senators wants to happen. I will undertake to increase the fines. We will have a further discussion on Report Stage but I am not in a position to accept the proposal now.

David Norris (Independent)
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I apologise to the Minister for this small intervention but I was at the Oireachtas Joint Committee on Foreign Affairs and heard the vote. In regard to the section and the vote we just had, will the Minister outline why, for example, none of the principals in the present rather awkward financial situation has been addressed under the existing legislation dealing with reckless trading? I would have thought it perfectly obvious that directors of companies would be addressed. I have been a director of several companies.

The country is going down the Swanee but, as far as I can see, nobody has been prosecuted for reckless trading. Surely the Government should make some statement as to why, when the welfare of the country is being prejudiced, none of the principals involved has been approached over the question of reckless trading. I would have thought it would have been an obvious thing to do.

Mary Coughlan (Donegal South West, Fianna Fail)
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The section relates to the role of company directors. Reckless trading has its own parameters and determinations. As I indicated, the reason I have introduced this legislation is to supplement some of the existing legislative powers of the Office of the Director of Corporate Enforcement. I asked the Director of Corporate Enforcement whether the legislation was robust enough and he said it was and that there was more than adequate provision. However, on the basis of his current experience, his view was that additional legislative measures needed to be introduced.

As the Senator knows, reckless trading has its own configurations. I do not want to damage, in any way, ongoing investigative work which has not been brought to completion, nor, I am sure, does anybody in this House. No one in either House wants to say anything that would disadvantage or take from the independent work being carried out by the Director of Corporate Enforcement.

David Norris (Independent)
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I thank the Minister for her response because I somewhat jumped the situation. I will have to go back to the Oireachtas Joint Committee on Foreign Affairs but I would like to signal to the Government that many people would be concerned. I was director, chairman and chief executive of two small companies and I was very conscious that if one behaved in a certain way, one would be in danger of prosecution for reckless trading, although not in any sinister way. I signal to the Government that people are watching to see if directors can get away without being prosecuted for reckless trading. This is fairly clear and I do not think it requires very long drawn out investigation to do people for reckless trading as that kind of thing becomes clear fairly quickly. I thank the Minister for her answer and I will read the record of the House carefully to see if anything further emerges. I indicated I would be speaking at the Joint Committee on Foreign Affairs and I ask to be excused.

Pat Moylan (Fianna Fail)
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Amendments Nos. 2 to 9, inclusive, are cognate and may be discussed together by agreement.

Ciarán Cannon (Progressive Democrats)
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I move amendment No. 2:

In page 4, lines 20 and 21, to delete "books or documents" and substitute "classes of documents".

As the Cathaoirleach has pointed out, all these amendments seek to achieve the same outcome, that being to formalise and to clarify an existing power available to the director by providing that the director shall specify the books or documents to be produced where and when. The precise reference to books or documents as opposed to classes of documents - as suggested by Fine Gael - may hinder the director in that the person to whom a direction is made may require the director to identify a particular book or document as distinct from just identifying a class or a type of document. Leaving the director open to such a challenge carries some risk in our view and most certainly lessens his powers of seizure.

Mary Coughlan (Donegal South West, Fianna Fail)
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I am very interested in the explanation because I was trying to understand where the Senator was coming from. Under the companies legislation as it stands, the definitions and their interpretations compose quite a suite. The definition states, "Books and documents and books or documents include accounts, deeds, writings and records made in any other manner". It is covered within the definitions and that is the interpretation of the definition. I wonder why the Senator is of the view that we need to introduce classes of documents because the interpretation of a class would actually be a subsection so therefore it is encompassed within the existing interpretation and the definition. The view would be that it would not in any way hinder the capacity of the director.

Joe O'Toole (Independent)
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The Minister is absolutely correct in the point she makes about the broadness of the interpretation. I have been on the receiving end of this issue where lawyers just read exactly what the Minister has read out and which is certainly broad enough. However, there is a suggestion there that the director has to know what he is looking for, if the Minister understands me. The reference to classes of document means any document which relates to rather than having to ask for a particular one. This is the intention of this amendment. I agree with the Minister's interpretation or explanation of the term "books and documents" in the legislation as it stands and that it is perfectly broad enough and I recall that being broadened out.

I will give the Minister an example. The lawyers will just look at it and say, "What book has he asked for?", or "How did he describe the book?" or "Can you describe the book?", "Is it a particular book or is it any book?". If he fails to describe it in a way that can clearly identify it then one could argue it does not have to be presented. I think it allows the director to do his job more effectively. I agree with the Minister's view that it is not about broadening it but rather what it is called.

What does the director write to the company? What does he put in the body of the letter? This is the significant issue. I may not have convinced the Minister the last time but every letter like this is perused, examined and dealt with by the lawyers. This is not a letter to the directors who deal with it and reply to it; that is not what happens. It goes straight to the lawyers so the director is actually talking to Arthur Cox or McCann FitzGerald or Matheson Ormsby Prentice and that is where it is dealt with and their view will be only to give what one must give which does not meet the spirit of the legislation. In that sense this is a helpful amendment.

Mary Coughlan (Donegal South West, Fianna Fail)
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All the amendments and the entire Bill have been proofed by the Director of Corporate Enforcement and he has indicated to me that the phrase, "books or documents" is more than adequate to deal with his needs. Section 19(1) of the Companies Act 1990 states:

The Minister may, subject to subsection (2), give directions to any body requiring the body, ... at such time and place as may be specified in the directions, to produce such books or documents as may be so specified...

This means the director can and may - not shall - make direction to any body as to what he wants to access. By saying it is just books or documents and given the interpretation in place and given the powers he has under section 19, his view is that he has more than adequate recourse within the law to get anything that is necessary and that "classes of books and documents" are a subsection of "books and documents". I would be assured on the basis of what the director has said to me and to the officials, that he has adequate recourse to get whatever is needed and he can make direction as well under section 19 and this will be augmented by this amending Bill. I hope this will reassure the House that in the view of the director he is not curtailed in any way in gaining access to the information.

Ciarán Cannon (Progressive Democrats)
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If the Minister is content the definition of "books and documents" does not in any way impede or hinder the director in carrying out his work and if the director and his office have looked at this legislation and he shares that opinion then we are content to withdraw those amendments.

Joe O'Toole (Independent)
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On a point of clarification, these additional powers which the Minister has given to the Director of Corporate Enforcement, are general powers and not just to do with loans. Do I take it they just extend his powers for any of his work?

Mary Coughlan (Donegal South West, Fianna Fail)
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Yes.

Joe O'Toole (Independent)
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I thank the Minister.

Ciarán Cannon (Progressive Democrats)
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I move amendment No. 10:

In page 5, to delete lines 19 to 38.

The Minister accused me of being somewhat exuberant earlier in my pursuit of-----

Mary Coughlan (Donegal South West, Fianna Fail)
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Is it my turn now?

Ciarán Cannon (Progressive Democrats)
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-----wayward company directors. We are trying to strike a balance here between giving the director the powers he requires to do his job properly and ensuring we do not unnecessarily obstruct the entrepreneurial effort of thousands of Irish business people and that is exactly how the second part of that balance is being struck with this amendment.

The proposed extended power of seizure at section 2(a) affords the director or his staff a very broad power to seize documents. The suggested power would allow an officer to form a view that a filing cabinet, for example, might contain material covered by the warrant and he would be empowered by this legislation to take that whole filing cabinet away to his office and to read every single item in it at his leisure and come to a decision at some point as to whether the material was incriminating in any way.

Apart entirely from the acceptability of seizing such uncertain documents, it seems the object of this subsection is to facilitate a fairly leisurely review. Any execution of a warrant should be resourced, comprehensive and exact. The officer should be able to come to a view on the spot, even if the execution of the warrant takes some days, but the notion of the director or his or her staff "taking homework home with them" is suggestive of procrastination and even idleness. The only limitation on the power conferred under section 2A obliges the officer to carry out the determination or separation of documents as soon as is reasonably practicable. Given what we know to be the extremely sluggish approach of law enforcement or regulatory authorities in Ireland and the amount of documentation that might lawfully be seized under this extended power of seizure, the effect of this section would be possibly to paralyse completely the company in respect of which the material was seized.

The Director of Corporate Enforcement and his or her staff, I argue, have little or no experience of running a company or business. Every company in this particularly difficult environment needs to have the flexibility to adapt its market forces and be able to move very quickly. To have a considerable proportion of a company's documentation taken away on the pretence that perhaps one or two pages might be incriminating we believe to be somewhat too punitive. We ask that this whole section be re-examined for the Bill to be more efficient, while allowing that the director needs adequate powers of seizure. However, it needs to be less cumbersome, with fewer opportunities for the long deliberations that are commonplace in these types of investigations. I look forward to the Minister's response.

Joe O'Toole (Independent)
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I prefer Fine Gael when it is in a more exuberant mood.

I do not see myself as a Member of the Opposition, but take each issue as I find it. In this case I find myself very firmly on the side of the Government. Whereas I take the point Senator Cannon made as regards the importance of them, I certainly do not want people prohibited from diligently doing their work. Nonetheless, the words "reasonably practicable" are there, as are the courts, and nothing here prevents a person having access to them while the Director of Corporate Enforcement is dealing with them.

More often than not, as Senator Norris has pointed out, the Director of Corporate Enforcement suffers from allegations about not moving in at all, not having sufficient powers or failing to move matters onwards. I believe this is reasonable and reflects what people want. However, if it turned out that in its application, some type of obstacle or block was to appear as regards companies continuing to trade or advance their business, that would be a serious issue. Certainly, a point has been raised in that regard and perhaps there might be some method for reviewing that. My view is that the present Director of Corporate Enforcement is absolutely diligent about his responsibilities and would share a very strong concern as regards the importance of companies being able to continue trading and do their business. There is no question or doubt in my mind whatever about that. I have full confidence in him, but I agree with Senator Cannon to the effect that this cannot be dealt with on the basis of the current director's modus operandi and one does not know how any future director might do his or her business. The additional power being given to the director is important and I support that section as it stands. However, I should like to be reassured that the issues raised by Senator Cannon would not arise.

Feargal Quinn (Independent)
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I have listened very carefully to Senators Cannon and O'Toole. It seems that Senator Cannon has a point: if the Director of Corporate Enforcement is seeking a particular document, which is in a filing cabinet, it would appear on the basis of this that he or she has the right take away the whole filing cabinet. I know there are protections in place and I am not sure what the answer is, but it appears to place restraints on a company's ability to continue trading on that basis. I take the point that both Senators have made, that we are not talking about the present director. We are putting in place legislation that I hope will last and which is for the protection of the clients of the particular company. I want to hear from the Tánaiste as regards this, because I should like my mind to be put at rest as I am concerned over it.

Mary Coughlan (Donegal South West, Fianna Fail)
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Perhaps it might be helpful to explain the entire purpose of the proposed subsection 2A. The Director of Corporate Enforcement or an officer authorised by him or her may, when conducting a search under a warrant, find something which he or she believes contains material information. However, it may prove impractical to form a decision on the spot as to whether it can be seized under the warrant. Therefore, the Bill allows him or her to take control of that material and remove it to another place where he or she will make a determination about its relevance to the matters being investigated.

This type of situation would typically arise where the volume of the material on a premises is enormous. Likewise, vast amounts of information may be stored on a computer and an examination of this, to determine its relevance, could necessarily take some time. This might be best undertaken away from the premises of the company under investigation. I am satisfied this provision is an important element of the strengthening of the ODCE's power of search and seizure. I consider it to be a reasonable and proportionate provision. I am aware that fears have been expressed that the extended powers could, in extreme cases, impair the operation of a company whose premises are being searched, for example, where key information is seized by the ODCE. However, I point out that the powers being given to the ODCE are not unfettered. There are appropriate balancing provisions and protections for parties whose records are seized, both in the Bill and within the existing legislation, for example, section 20 as amended and sections 21 and 23, as amended. The ODCE must make provision to allow reasonable access - I believe that is the issue Senator Cannon has raised - by a company to its records during that period of examination. Privileged material is also protected, and where confidential information is seized, the ODCE must maintain that confidentiality.

I am satisfied that every effort is being made to ensure the provision will not threaten the ability of a company to operate, and on that basis, I should like to assure the House that the concerns, although doubtless real, should not be such as to lead Members to believe the powers of the ODCE are unfettered. We have safeguards in place to ensure a company, during an investigation, may continue to trade and have access to relevant information.

Ciarán Cannon (Progressive Democrats)
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I thank the Minister for her response. The amendment we are tabling places an onus on the Director of Corporate Enforcement and his or her staff to be exact and definite in establishing what types of documents they need to remove from a company's premises. They have powers of separation under which they may enter a premises and deem which documents are pertinent to the case they are making. I cannot understand why that separation mechanism may not occur on the premises and why documents need to be taken away.

Could the Minister confirm whether, when such documents are removed, there is any finite time limit imposed on the director within which to return them to the owner, thus allowing a company, perhaps, to restart trading? Matters are overweighted in favour of the director rather than those thousands of companies which operate every day on a legitimate basis.

Mary Coughlan (Donegal South West, Fianna Fail)
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The director will be able to make a determination in normal circumstances.

Ciarán Cannon (Progressive Democrats)
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On the premises.

Mary Coughlan (Donegal South West, Fianna Fail)
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That is correct. Naturally, where there are enormous amounts of information, it might be considered best to take the information away. If a person is in a trading situation the last thing he or she wants to see on the premises is the staff of the ODCE for three or four months, when it might, in fact, be best to have that information off site. In normal circumstances the director will make his or her determination. In a situation, however, where vast amounts of material need to be reviewed, then information would be taken off site, but only in those circumstances. I have been around a long time and I know that one person's determination of what "as soon as practicable" means will vary from another. One person will see it as being instant and someone else will take it to mean somewhat longer. I appreciate the Cathaoirleach has a further amendment to deal with, on time limits, but it should be emphasised we do not want to tie someone's hands to the extent he or she has to access the courts, which could mean, in effect, going back through the entire process and stalling an investigation. At the same time, one does not want to see people stopped from trading normally.

It is important to achieve balance. This is as balanced as can be, given that the section deals with situations in which one does not know what one might meet. An examination could be very short with a prompt determination. On the other hand, there could be a huge investigation. We want to ensure that any investigation that takes place is right and for everyone's benefit. It must protect the reputation of the Director of Corporate Enforcement and for the benefit of a person being investigated there must be fair procedures.

On that basis, I am convinced the legislation to amend section 20 of the 1990 Act is more than adequate.

Joe O'Toole (Independent)
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In an attempt to be helpful to Senator Cannon, I ask the Minister to clarify the following point. If a company felt it was being unfairly dealt with and that what was happening was not practicable, what recourse would be available to it? It is my understanding that the company could seek a mandamus injunction requiring the Director of Corporate Enforcement to return the documentation. In that case, the director would have to show cause that he was acting in a reasonable and practicable manner. If a company was unhappy, it could seek a mandamus injunction in the courts. The director would then be required to show he was acting reasonably and practicably. Would a company have that recourse, in the extreme?

Mary Coughlan (Donegal South West, Fianna Fail)
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That is correct. In an extreme case the matter would be referred back to the courts.

Ciarán Cannon (Progressive Democrats)
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I move amendment No. 11:

In page 6, after line 47, to insert the following:

"(vii) the constitutional rights of the company or the holder of the information,

and

(viii) the rights of any person, who is the subject of the information, under the Data Protection Acts 1988 to 2003.".

This amendment attempts to award some protection to company directors, to the entity that is the company itself and to any person whose personal information might be contained in company records. It seeks to protect the rights of a company or a holder of information so that these rights are not abused during the document seizure process. Subparagraph (viii) seeks to protect the rights of any person who is the subject of the information being seized.

Is there sufficient protection in the Bill for the company and for people whose data may be stored within company records?

Mary Coughlan (Donegal South West, Fianna Fail)
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I am glad to hear Senator Cannon explain the reasoning behind this amendment. Subsection (vii) of the amendment relates to constitutional rights. The director is obliged at all times to operate within constitutional norms. Proceedings permitted by Acts of the Oireachtas are to be conducted within the principles of constitutional justice and any departure from these principles would be restrained and corrected by the courts.

The constitutional rights of a person who is the subject of the relevant information are safeguarded, as always. On that basis, it would not be appropriate to make specific provision for constitutional rights in this case. Anyone who is given powers such as those granted by this legislation must operate within constitutional norms.

Joe O'Toole (Independent)
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I would like to hear the basis of Senator Cannon's amendment. I am always reluctant to make references to the Constitution in legislation. All legislation must be constitutional. Was a particular issue in this regard brought to Senator Cannon's notice? I have spoken on this issue several times in the House. If one makes reference to constitutional rights in legislation one must do so in all legislation. It is assumed the law of the land must be constitutional. The constitutionality of legislation can be tested in the Supreme Court.

Does Senator Cannon know of some side issue relating to constitutionality? If there is a worry in this regard the Bill should be tested and tried. Is there a question of constitutionality in an earlier part of section 5? If so, we should hear about it. I have reservations about making reference to constitutional rights without setting the reference in a broader context.

Ciarán Cannon (Progressive Democrats)
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Subparagraph (viii) of the amendment holds more importance for me. In the event that personal data are stored within company records, the Data Protection Acts should take precedence over this legislation. That is the most important provision of the amendment. I would like clarification on that.

Mary Coughlan (Donegal South West, Fianna Fail)
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Senator Cannon is concerned about the possibility of inadvertent conflict between this legislation and the Data Protection Acts. I believe data protection legislation should not prevent access to information that is expressly provided for within the Companies Acts.

I will have this matter examined and I will bring it back on Report Stage.

Ciarán Cannon (Progressive Democrats)
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I thank the Minister.

Mary Coughlan (Donegal South West, Fianna Fail)
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That is me being nice. I told the Senator I could be.

Ciarán Cannon (Progressive Democrats)
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I never said the Minister was not nice.

Pat Moylan (Fianna Fail)
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That is what we like to see in this House.

Pat Moylan (Fianna Fail)
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Amendments Nos. 12 and 13 are related and may be discussed together, with the agreement of the House. Is that agreed? Agreed.

Ciarán Cannon (Progressive Democrats)
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I move amendment No. 12:

In page 8, to delete lines 3 to 20 and substitute the following:

"(2F) Where an extended power of seizure is exercised, it shall be the duty of the officer—

(a) to carry out the determination or separation concerned as soon as practicable after its exercise, and in any event, within 3 months or such further period as is permitted by the Court, and

(b) as respect anything seized in exercise of the power found not to be material information or, as the case may be, anything separated from another thing in exercise of the power that is not material information, to return, as soon as practicable after that finding or separation, and in any event, within 7 days after the finding or separation, or such further period as is permitted by the Court, the thing to its owner or the person appearing to the officer to be lawfully entitled to the custody or possession of it.

(2G) Where an extended power of seizure is exercised and pending the determination or separation referred to in subsection (2F), the Court may give such directions concerning that which has been seized as the Court considers appropriate including, without prejudice to the generality of the foregoing, directions as to—

(a) the determination or separation, prior to the 3 month period referred to at subsection (2F), of all or part of that which has been seized,

(b) the return, prior to determination or separation, of all or part of that which has been seized, upon such terms as seem appropriate to the Court.".

The phrase "as far as is reasonably practicable" is dotted throughout legislation. There are as many interpretations of it as there are instances of it. I have serious concerns that the power granted in section 5 is weighted too much in favour of the Director of Corporate Enforcement. Most regulatory and law enforcement authorities have taken an extremely sluggish approach. The Minister said a company could be shut down for months on end if a significant amount of information needed to be seized. The effect of the foregoing sections would be to paralyse a company from which material was seized.

In most instances it should be possible for an officer to carry out an inspection and separation on a company's premises. The purpose of this amendment is to protect the legitimate rights of a company. There should be a requirement that the determination or separation referred to in subsection (2F) of the 1990 Act be carried out on the spot or, if that is not possible, within a fixed period. I suggest two to three months.

In most instances, that would be more than enough time to carry out the separation of documents and to return those documents not pertinent to the investigation. Once the separation of documents has been carried out one can begin indepth examination of the pertinent documents.

In addition to these requirements, there ought to be power to apply to the High Court for the immediate return of documentation in appropriate circumstances. Senator O'Toole mentioned earlier that this is already possible. Can the Minister confirm that this is the case and that application to the High Court would not be an onerous procedure for company directors?

The Minister spoke of the need to strike a balance. In this instance, the balance is weighted too much in favour of the Director of Corporate Enforcement. A period "as far as reasonably practicable" could stretch for months if not years. Allowing the director power to, effectively, shut down a company places too onerous a burden on company directors who, in the main, act in very good faith at all times.

Larry Butler (Fianna Fail)
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Could the Minister place a timeframe on this provision? Senator Cannon's approach is reasonable. This provision could cause great difficulties for companies. A timeframe would help.

Feargal Quinn (Independent)
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As I remarked on Second Stage, the concern of everyone is to ensure and enable business to operate and I realise the Tánaiste's heart is behind that concern. I cannot improve on the words of Senator Cannon. There is great doubt about the phrase "as soon as practicable" and it seems rather vague. I realise it is dotted throughout legislation but it is essential we have some control on a future director. The present situation is not in question but we wish to ensure Ireland is an attractive place to open, encourage and operate business. There is a danger if we put in place constraints which at some point in future could stifle the ability of a given company to operate. This may occur for very valid reasons but also perhaps for reasons not so valid and on that basis there should be some time constraint. The time constraints included in Senator Cannon's amendment are worthy of consideration.

Joe O'Toole (Independent)
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It is worth teasing out the matter. I refer to the recent Northern Bank money laundering case. It took a team of 26 gardaí several months to examine one series of documents on computer and on file. They had to go through every document and that was outlined in the court.

One side of the argument is related to the length of time it takes to go through computerised information because one must check what is on the hard disk and so forth. On the other hand, if someone needed to search a drawer in a filing cabinet and the Office of the Director of Corporate Enforcement was examining the matter one week, one month or one year later then one would recognise that such a situation is hardly practicable. The legislation must cover such extreme instances. The only way to do this is a form of words which requires judgment and the only judgment that covers the two areas is the phrase "reasonably practicable". In my time here I have been unable to come up with any other phrase.

Let us consider the upside and down side. The down side is that one person's "reasonably practicable" is another's utter dismay. Therefore, one must find someone to mediate and to make a call on it. Unless the Minister establishes some in between, mediation, arbitration or determination process, the normal way of dealing with an interpretation of the law is to go to the courts. That would take the form of either a judicial review or mandamus injunction to establish if one is being reasonably practicable. The arguments put by Senators Cannon, Butler and others are spot on and no one could argue with them. However, one must cover both ends of the spectrum.

Let us remember the scene outside the bank on St. Stephen's Green two months ago. The Garda carted out truckloads of material. I do not know how long would be considered reasonably practicable to deal with all that documentation and associated material on computers. However, let us park that for one moment. Let us suppose there is a court case in which the whole world is watching to see what we are doing about the people who wrecked the country and so on - we know the speeches. How would Joe Duffy deal with the matter on "Liveline" if it turned out we passed legislation which required the Director of Corporate Enforcement to fill up the trucks again and cart everything back to St. Stephen's Green two weeks later, despite the fact he did not trawl through all the material? We would all appear pretty stupid. These are the two extremes and there is no answer to the matter because the arguments put by my colleagues are absolutely clear and true. This is an old story and if people do not work within the spirit of the act then one must go to court. That applies either to the person who owns documents or the person who seizes documents, namely, the Director of Corporate Enforcement. There is no other way to deal with this unless one creates something such as a Labour Court style body for high finance.

Mary Coughlan (Donegal South West, Fianna Fail)
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We will have none of them.

Joe O'Toole (Independent)
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From experience, I do not believe that would quicken matters in any way. I would be very open to a change if change were necessary to get the right balance. However, to get the right balance one must go to the middle and the only middle ground I can see is the phrase "reasonably practicable". If there is another form of words which could deal with both ends of the argument we should examine it. I seek the right balance and I fully agree with the arguments made by my colleagues. If someone is playing the old soldier and using the legislation to block people from doing their daily work then that is not what we have in mind. It is not the intention of the legislation and should not be allowed. On the other hand if people try to hide material because of the legislation and because they know there is a time limit before which they could be checked then it does not meet our cause either. The only way is for people to act reasonably in the spirit of the law and the only way to judge that, generally speaking, is in the courts. There are other ways but lawyers would never allow us to do so.

Mary Coughlan (Donegal South West, Fianna Fail)
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I thanks the Senators for their contributions. The amendments I propose in the legislation would allow for the imposition of any necessary timeline restrictions through regulating making powers being presented to the Minister. That is contained in section 5(2G). The overall thrust and the content of section 20 of the Companies Acts 1990 through to section 5 of this Bill also contains measures to allow for the involvement of the court. Therefore, I cannot accept the amendment as I wish to continue to have access to the court as part of the legislation. That being said there has been a reasonable thrust to the entire discussion to the effect that "practicable" is something that could be finite or otherwise. On that basis I call for consideration to be given for me to reflect on this and I will revert on Report Stage on the basis of the timeframe.

Ciarán Cannon (Progressive Democrats)
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I thank the Minister for her offer of reflection and we look forward to the result of her deliberations.

Mary Coughlan (Donegal South West, Fianna Fail)
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This proposed amendment seeks to avoid unnecessary duplication that could be caused by two applications being made to the court arising out of the same circumstances. As currently worded, the Bill provided that the ODCE, Office of the Director of Corporate Enforcement, or court appointed investigator must apply to court for a determination on whether material seized was professionally privileged. The company under investigation or a person from whom books and documents have been taken may, if they wish, apply. The amendment to the Bill provides that where the ODCE or court appointed investigator is aware that the company or person has already made a relevant application to court there is no need to file a separate application.

Joe O'Toole (Independent)
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This is very sensible and we should support it. This is an example of where the pendulum shifts to require the Director of Corporate Enforcement to go to court. This balance is present in the Bill, which I am sure he finds something of a pain at times. However, we have inserted this protection and it is quite correct to do so.

Ciarán Cannon (Progressive Democrats)
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We are about trying to strike a balance. We oppose the section and believe it would act as a major disincentive for people to get involved in entrepreneurial effort and a major disincentive for people to become directors of companies. The section, which amends section 40 of the Companies Act 1990, would appear to provide for directors to be held or deemed to have committed criminal offences regardless of whether they knew or had the belief that unauthorised transactions were being entered into. We have serious reservations about whether it is possible to impose guilt by association. Is that fair or rational? My wife and I are co-directors of a small company in Galway and I hope that neither my wife nor I would carry out any actions that would bring the company into disrepute.

Mary Coughlan (Donegal South West, Fianna Fail)
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I would expect not.

Ciarán Cannon (Progressive Democrats)
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However, if I were a director of a company with some 20 or 30 other co-directors, to hold me personally responsible for every action of every other director would place an unnecessary, unfair and unjust burden on me as a director. If that provision was in place and this section of the legislation was enacted, I would seriously question whether anybody would take the risk of being guilty by association. The Minister has been co-operative and helpful and has agreed to re-examine certain sections of the legislation. I hope she takes the same approach in this case and comes up with a form of words that will allay our concerns on this matter.

Feargal Quinn (Independent)
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I understand the reason for this being included in the Bill and the reason the legislation attempts to cover the matter, because any director on a board who does not bother reading the papers, does not accept responsibility nor bother attending to his or her duty should be found guilty. On the other hand, many companies are not simple companies. I recall my experience as chairman of An Post, which had 15 board members and which received vast amounts of information. I wonder should any of the 15 board members who missed out on something that was incorrect or wrong be held guilty of a criminal offence. Of course they should have examined every document and covered everything, but it would be far too onerous to infer a criminal offence for every one of those directors. I am not sure what the solution is, because we do not want to relieve directors of having that responsibility.

Senator Cannon has put it correctly. There is an onus on us to ensure Ireland is an attractive place to do business and that it attracts entrepreneurs. We recognise the need for people with ability to join boards and accept responsibility as directors, but that should not be such an onus that it places a threat over them if they make even one slip-up by not covering something. I remember similar legislation to this previously and have thought about the situation in my former company of which I was director for many years. If something went wrong, were all my other colleagues held responsible? If I was the chief executive, I was certainly responsible, because an executive director must accept responsibility. However, that is not necessarily true for non-executive directors, although they have a responsibility to check everything that takes place.

I believe large numbers of people would refuse to take on the responsibility of being directors or to be part of an operation if they felt they would be found guilty of a criminal offence in the case of failing in their responsibility. I understand the need for the legislation in the case of executive directors, but it is too onerous to make it a criminal offence for every director.

Joe O'Toole (Independent)
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These issues change with the public mood. The provenance of this legislation is simple. As Tánaiste and Minister for Enterprise, Trade and Employment, the Minister's predecessor would deal with this issue very quickly. When she was in front of the Committee of Public Accounts in 2002 discussing the issue of offshore accounts, she said we would never again have to listen to the argument that people did not know about something. This was reiterated throughout her speech and that was the reason the 2003 Bill was published, namely to deal with the "We didn't know" issue.

We do not want people to be thrown into jail for something of which they are not guilty or something about which they could have no knowledge. We must be reasonable and decide whether they should or could have known about it. We could not possibly find somebody guilty of something they could not have known about. When the 2003 legislation was passing through the House, a colleague who was in the House then but who is not here any more - a director of Independent News and Media - asked how he as a director could be held responsible for something that went on in the back offices of the South African part of the company. That is not what is implied here, but all these things tie in together.

When we come to the amendment I have proposed, I will remind the Minister about what she said about the Director of Corporate Enforcement. I will also remind her it is about materiality. Did people have the structures in place to ensure compliance? Perhaps the Minister will tell us about the contravention of section 31 in her response and how it might arise. Perhaps she will tell us the kind of decisions that would need to be taken before we get into it.

My colleagues keep talking about this being a country where we must make it easier to do business. I support that idea. I have spent months in Government Buildings over the years negotiating national agreements to ensure this. It is, for example, about finding balance between the Virgin Islands and France. It is trying to find the in-between position where people act reasonably and responsibly and within the law. I do not want to overstate the situation, but over the weekend I listened to discussion about Burma and how it deals with people who cannot meet their liabilities or who act in contravention of financial regulation etc. They are dealt with quite summarily.

I do not want to go into a history lesson, but it is important to recognise how we got to this position. All these things operate on the basis of trust and confidence. Before we had companies' legislation, people shook hands on their agreements. Documents were not signed in the stock market until recent decades, because the day one defaulted was the day one went out of business and nobody would deal with one anymore. From where did this practice come? It came from the middle ages and the question of how to deal with finance, beginning in places like Genoa and Barcelona where trading between nations began. The people in these areas often relied on the Jewish community with regard to how business was conducted, because the Jewish community was allowed to deal with money when Christians were not. Under the Christian code of conduct at the time usury was not allowed. However, I assure Members that Christians found ways around that.

The issue then was that if people could not meet their liabilities, it was a capital offence and they were hanged outside the door of their business. That kind of uncivilised behaviour is not acceptable at any level now, but it is important to remember that was how they dealt with the issue. How do we deal with it? We dealt with it by saying that people must be able to do business. They must be able to take reasonable risks in trade and to operate in an unencumbered way. Therefore, we introduced the concept of limited liability. I asked the Minister about this on Second Stage. Limited liability is a gift the Minister hands out to entrepreneurs, business people and others. It is a gift, a privilege and a function of democracy. It is something we give out and value and must be acted upon in a responsible way.

What we need to do with this legislation is find balance. How does somebody come to contravene section 31? Is it reasonable to say the structure should be in place so an officer of a company would have to know about something? That is the question. If an officer of the company could set up a structure in such a way that he or she was not required to be told, informed, made aware of or sign off on something, but then could claim two months later that he or she did not know about it, we are making fools of ourselves. This is what we must examine in order to move things forward. It has all to do with the structures, compliance, being reasonable and acting within the spirit of the legislation.

We must bear in mind at all times what Senators Quinn and Cannon have said about not burdening people unnecessarily. In doing that, we also want to ensure they have put in place the structures within their companies that will ensure nobody loses out. I do not want to mention particular issues, but that is what happened recently. I thought I would never hear it again, but we heard it last month. Here in the House people were asking if other directors knew about loans. People were saying: "Your man was chief executive and a director and then became chairman, so he had to know". We were back wondering who knew and how they knew. We all know they should have known. Therefore, the structures should be in place to ensure that if somebody breaches section 31, he or she can only do that by breaching the controls within the company. If somebody does that, it is fraud. That is a different issue altogether and somebody else cannot be held responsible for it. This issue goes to the core of what we are talking about.

Mary Coughlan (Donegal South West, Fianna Fail)
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I was wondering which horse the Senator was on as he was finishing.

Joe O'Toole (Independent)
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I was waiting for someone to give me an answer on section 31.

Mary Coughlan (Donegal South West, Fianna Fail)
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The purpose of the-----

Joe O'Toole (Independent)
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I am a complex person.

Mary Coughlan (Donegal South West, Fianna Fail)
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I gathered that. They think women are complex, but men are worse. Perhaps Independent Senators are the worst of all.

Paddy Burke (Fine Gael)
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Agreed.

Mary Coughlan (Donegal South West, Fianna Fail)
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The purpose of section 7 of this Bill is to replace section 40 of the Companies Act 1990, which sets out the penalty for breaching the statutory prohibition on the making of loans by companies to the directors. To prove that an offence has been committed under the existing section 40, it is currently necessary to prove beyond reasonable doubt that the accused knew, or had a reasonable ground for believing, that the company was in breach of the requirements of section 31 of the 1990 Act. In effect, it is necessary to prove there was a wilful default. In other words, ignorance of the law can be used as a defence. The existing requirement on the prosecution to affirmatively prove the accused's knowledge of the law is unduly onerous, particularly when compared to many other offence provisions found elsewhere in the Companies Acts.

The proposed new provision will provide that if a company enters into a transaction or arrangement that contravenes section 31 of the 1990 Act, every officer of the company who is "in default" will be guilty of an offence. Section 383 of the Companies Act 1963 sets out the meaning of an "officer who is in default". It provides that an officer is "in default" if he or she authorises a default mentioned in the provision in question or, in breach of his or her duty as an officer, permits such a default to occur. Section 383 of the 1963 Act further provides that an officer is presumed to have permitted a default by his or company unless he or she can establish that he or she took all reasonable steps to prevent the occurrence of the event in question or, by reason of circumstances beyond his or her control, was unable to do so. In essence, the amended version of the 1990 Act will bring this offence into line with numerous similar offences in the Companies Acts. It will also set out a mechanism whereby an accused officer can defend his or her actions in appropriate circumstances. I am satisfied the approach being proposed is appropriate. Accordingly, I do not feel I can accept the deletion of this section.

Joe O'Toole (Independent)
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I accept what the Tánaiste has said. It matches my understanding of the position. It might help Senator Cannon if a comma were included after the word "company" in the proposed new section 40 of the 1990 Act. Although the word "who" cannot refer to a company, the manner in which the proposed section is worded almost suggests the company is being referred to. The Tánaiste has made it clear the reference is to any officer who is clearly in default. There will be a quite high burden of proof on the prosecution to prove that is the case. I am comfortable with what is being proposed. Somebody might rely on an old interpretation of the word "who" to claim it refers to the company, and therefore every officer of the company. It is a small point. The Tánaiste has clarified the matter on the record of the House.

Ciarán Cannon (Progressive Democrats)
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That is exactly the point. I ask the Tánaiste to assure the House that there is no possibility, under this legislation, of a director of a company who has no knowledge of the carrying out of an illegal act being implicated in the commission of that act. That is the issue. As far as I am concerned, the current wording of this provision - "if a company enters into a transaction or arrangement that contravenes section 31, every officer of the company who is in default shall be guilty of an offence" - reads as if one is trying to remove a tumour with a machete rather than with a scalpel and some surgical skill. It seems to be far too much of a burden. Can the Tánaiste give me some reassurance in this regard? I tabled an amendment to try to protect executive and non-executive directors of a company. The Bill does not even draw a distinction between the two categories. If people are not involved in any way in the commission of an illegal offence, it should not be implied or assumed they are guilty. If the Tánaiste can assure the House this section of the Bill does not provide for such an implication or assumption, I will be quite happy to support it.

Mary Coughlan (Donegal South West, Fianna Fail)
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I appreciate these issues are complex and complicated. I do not want to create a set of circumstances in which nobody wants to be a director of a company. We do not want that either. If a person is a director or an officer of a company, it is important he or she should be aware of the law as it stands. I hope we will be able to offer some further guidance when the consolidation Bill in this area is introduced.

Joe O'Toole (Independent)
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Is there a date for that Bill?

Mary Coughlan (Donegal South West, Fianna Fail)
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When it has been completed, I will give the Senator the first copy of it.

Joe O'Toole (Independent)
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Will I have retired at that stage?

Mary Coughlan (Donegal South West, Fianna Fail)
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The Senator is waiting with bated breath for the Bill. We are removing the criminal penalty aspect of section 31 of the 1990 Act, which prohibits the making of loans to directors and connected persons. We are trying to strike a balance with the issue of personal concern that was expressed by the Senator on the basis of his experience. It will be a matter for the director to make a determination. The court will make the final decision. Of course it will be open to each person to prove that he or she was not involved in something untoward in any way. I have tried to assure Members that a balance is being struck. We will not punish people who are not guilty or associated with wrong-doing. We are trying to do two things. We are trying to ensure people cannot use the excuse that they did not know - that they were ignorant of the law. At the same time, we are trying to-----

Ciarán Cannon (Progressive Democrats)
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I agree with what the Tánaiste has said about ignorance of the law, but ignorance of the facts surrounding a criminal act is a much different proposition.

Mary Coughlan (Donegal South West, Fianna Fail)
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We need to go back to section 383 of the Companies Act 1963, which sets out the meaning of an "officer who is in default". If Joe Soap were to read this section of the Bill, he might think it covers everybody. The most important part of it is the term "who is in default".

Ciarán Cannon (Progressive Democrats)
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It is the company that is in default.

Mary Coughlan (Donegal South West, Fianna Fail)
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The meaning of the term "in default" in this section is set out in section 383 of the 1963 Act, which states:

For the purpose of any provision in this Act which provides that an officer of a company who is in default shall be liable to a fine or penalty, "officer who is in default" means any officer of the company who knowingly and wilfully authorises or permits the default, refusal or contravention mentioned in the provision.

Under that Act, an officer who is in default shall be liable to a fine or penalty. There is a clear determination. For the purposes of the section before the House, an officer shall be presumed to have permitted a default by the company unless he or she can establish that he or she took all reasonable steps to prevent it, or that it took place by reason of circumstances beyond his or her control. When we introduce the consolidation Bill, we will make sure all references are to "he or she". It is the duty of each director and the secretary of the company to ensure the requirements of the Companies Acts are complied with by the company. I assure the House that section 383 of the 1963 Act allows an officer to claim that a default took place by reason of circumstances beyond his or her control. That assurance can be given to an officer of a company. One has to get the balance right. One cannot allow lack of knowledge to be cited, mar dhea, as a reason. At the same time, one must bear in mind that those involved in smaller companies, such as family companies, do not necessarily deal with these matters on a day-to-day basis. I reiterate that people involved in companies should familiarise themselves with the law, even if they are not working within an individual company on a day-to-day basis. We need to emphasise to people that they should be aware of their responsibilities.

Joe O'Toole (Independent)
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That does not always happen, unfortunately.

Mary Coughlan (Donegal South West, Fianna Fail)
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I know, but it is something we should consider.

Joe O'Toole (Independent)
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Three cases of this nature were reported in one of yesterday's newspapers. In one case, four different family members were included in an action. When I read about the case, I wondered whether each of the four people in question knew what they were getting themselves into. That is part of the problem in many cases. The points made by the Tánaiste seem reasonable. I do not think she will be able to make the same argument in response to the next amendment proposed by Fine Gael, which is amendment No. 16. I think a stronger case will be made on that amendment.

Ciarán Cannon (Progressive Democrats)
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On the basis of the Tánaiste's assurance that nobody can be found guilty by association or implication, I will agree to this section.

Mary Coughlan (Donegal South West, Fianna Fail)
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Section 8(1)(b) of this Bill, which proposes the insertion of a new section 41(10) into the Companies Act 1990, acknowledges the existing legal powers of the Financial Regulator to make appropriate changes to its rules and other instruments in order to ensure the effective regulation of licensed banks. I understand the regulator is proposing to amend the conditions it attaches to its banking licence to require increased disclosure in the annual accounts of banks of the giving of loans to directors and other connected people. The amendment that I propose in the Bill as initiated clarified that any company law disclosure requirement imposed on companies that are licensed banks did not override the independent rule-making powers of the Financial Regulator. The verb I used in the Bill referred to rules etc. that are made under the Central Bank Acts. The proposed new wording widens this to cover all rules etc. made, issued, granted or otherwise created. My intention in this proposed amendment to the Bill is to widen the provision so that there is no doubt that it includes all relevant actions that the regulator can avail of under its own legislative powers.

Ciarán Cannon (Progressive Democrats)
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I move amendment No. 16:

In page 11, to delete lines 3 to 6.

This leads us back up the same path. I do not know what our discussion over the past 15 or 20 minutes has achieved. It is there in black and white: "Where a company makes default in complying with this section, the company and every person who at the time of that default is a director of the company shall be guilty of an offence." I would add that this applies to someone who may or may not have known about the default. Where is the protection afforded to a director who has no knowledge whatsoever of a criminal act taking place and is suddenly made guilty of a criminal offence? That is a more worrying development than the one we have just discussed. It is a major disincentive for people to become company directors. There is no way out for any director. The Bill does not qualify the statement that "every person who at the time of that default is a director of the company shall be guilty of an offence". I look forward to hearing the Minister's response to this amendment.

Joe O'Toole (Independent)
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Senator Cannon has a very strong point on this issue. Maybe there is something in the Bill that we do not understand. It seems, however, that what Senator Cannon feared in respect of the earlier amendment could happen under this provision, that a company could be in default and a director who acted honourably and correctly but was kept in the dark would be guilty of an offence. There seems to be a lack of equity in that, unless some previous Act that we do not understand covers it.

I can see a situation arising in which a company is in default, not because the director failed in his or her duty but because of decisions taken at a remove from the director and the first the director knows about it is that he or she has broken the law. Unless there is some context for this that we do not understand I would be very worried because it is a disincentive to a company director.

Jim Walsh (Fianna Fail)
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We need to take a coherent approach to imposing regulations on directors. I fully support every measure that improves corporate governance but we should stand back from anything that makes people disinclined to get involved, or is a disincentive to becoming involved. People should be made accountable for gross negligence or wilful default. These are public service measures being imposed on the private sector but there are examples of serious negligence, for example in the Hepatitis C case, for which public servants were not held accountable. We cannot have one approach or ethos for the public service and an entirely different approach for the private sector.

We have moved in recent years to facilitate people in small companies by removing some of the bureaucracy and costs. Small companies should be the engine of our enterprise and job creation. They now have reasonably significant thresholds before being required to submit audited accounts. While that is a good move it means that people do not have access to the professional advice of auditors which they might have in a full audit. I am concerned that if we heap more obligations on companies we will create a situation in which people may unwittingly be in default. I do not know how the Minister can deal with that but it needs to be examined.

I am in favour of keeping the Bill as simple as possible but with impositions for serious negligence or wilful default. People must have the scope to run and operate their companies efficiently and effectively and there is an increasing trend for small family companies to engage outside, independent, non-executive directors. That is a good measure which helps companies because the directors might be people with expertise that the owners or proprietors do not have. We need to make sure that non-executive directors cannot be unjustly held to account for issues of which they were totally unaware. There have been some high profile cases of that happening recently in the banks.

I agree with the thrust of what the Minister is doing but this is a complex area and we need to consider how to do it without affecting the overall objective of increasing the number of private companies and the interest from, and participation of, executive and non-executive directors in a progressive way.

Feargal Quinn (Independent)
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The Minister explained very well why she is not accepting amendment No. 7 but the paragraph this amendment seeks to delete is very blunt: "Where a company makes default in complying with this section, the company and every person who at the time of that default is a director of the company shall be guilty of an offence." I do not know whether the explanation the Minister gave in respect of amendment No. 7 will apply to this amendment but Senator Walsh has touched on the important point that we need to encourage non-executive directors into family businesses. I know of one successful family business that wanted to bring in a non-executive director. The man was ready to join until he read through the requirements, before this Bill was introduced, and decided that because he had a family to look after he could not take a chance that he might be found guilty if the company was in default. To the best of my knowledge that company still comprises only family members.

Part of what we are attempting to do here is to encourage governance from outside the family in family businesses. I imagine that the Minister will say that exactly the same points apply in this case as applied in respect of amendment No. 7, but this is so blunt I would find it difficult to defend it.

Mary Coughlan (Donegal South West, Fianna Fail)
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On the overall issue raised by Senator Walsh, we are striving to reduce the regulatory burden and have set down a 25% reduction in the regulatory burden on businesses. I want to achieve this and will make some further pronouncements on it fairly soon. We all would like to see simplification in life. That work will continue on the Consolidation Bill because entrepreneurs are unusual people who have great ideas but whose idea of compliance might be that they pay their taxes and that is the limit to it. Businesses are frustrated and feel that these matters are an annoyance but it is important that we continue to invest in educating people. The Director of Corporate Enforcement holds seminars and the Company Registration Office does this kind of work. We as politicians need to reiterate this when it comes to the question of compliance. We are striving towards consolidation and simplification, and reducing the burden on small family businesses because they are the bread and butter of much of our society, particularly in rural areas, but we do not want to deter people from continuing in business and using their acumen. By necessity, even constitutional rights remain within the framework of all the legislation.

Kieran Phelan (Fianna Fail)
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As it is 5 p.m.-----

Mary Coughlan (Donegal South West, Fianna Fail)
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Am I going to turn into a pumpkin or something?

Kieran Phelan (Fianna Fail)
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-----I ask the Senators to report progress.

Mary Coughlan (Donegal South West, Fianna Fail)
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Is it possible for me to have 30 seconds in which to conclude?

Kieran Phelan (Fianna Fail)
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Is that agreed? Agreed.

Mary Coughlan (Donegal South West, Fianna Fail)
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The purpose of my amendment is to insert a specific offence for the failure to comply with any of the requirements of section 41 of the 1990 Act, which is the requirement that companies disclose in their accounts the existence of loans or substantial contracts etc., with directors and others. There is no offence.

Joe O'Toole (Independent)
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What about a loan made to director A that is hidden from directors B and C?

Mary Coughlan (Donegal South West, Fianna Fail)
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There is no offence. The Senator should allow me to make my next point.

There is a separate existing requirement obliging companies to prepare annual accounts, namely, section 148 of the Companies Act 1963. By extension, the failure to comply with the requirements of section 41 of the Companies Act 1990 would amount to a breach of section 148. It could prove problematic to prosecute a company for failing to disclose such loans in accounts on that basis. The insertion of the new subsection (11) will remove this doubt. It should be noted that the Bill provides in subsection (12) that it shall be a defence in the proceedings for a defendant to show he or she took all reasonable steps to secure compliance by the company with the requirements of the new subsection (11). On that basis, I am satisfied my proposed amendment should be made.

Joe O'Toole (Independent)
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There is an inherent contradiction regarding the stipulations on guilt.

Progress reported; Committee to sit again.

Mark Daly (Fianna Fail)
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I move:

That Seanad Éireann acknowledges and welcomes international endorsement of the Government's overseas aid programme.

Much of the debate on the overseas aid budget is concentrated on the commitment to reach the target of 0.7% of gross national product by 2012. Sweden, when it experienced economic difficulty in 1992 and had to consider restructuring its banking system after its failure, decreased its overseas aid budget to less than what it had aspired to. However, it increased its contribution in subsequent years and it is now regarded as an example to other countries.

Our historic link with overseas aid is related to our experience with famine. One of the most telling comments during the Famine of the 1840s was that of Lord Trevelyan, the Under-Secretary to the Treasury in charge of famine relief. In 1849, after he had closed down the soup kitchens, relief works and all forms of aid to those left destitute by the Famine, he wrote a letter to a colleague stating Ireland should be left to "the operation of natural causes". This was basically a death sentence for the entire Irish population and an admission that those who would live would live and that those who could not survive would be left to their own devices and would perish. They perished in their millions; figures vary depending on which book one reads. Cecil Woodham-Smith's book, The Great Hunger: Ireland: 1845-1849, a very authoritative account of the famine published in the 1960s, states that 1 million to 1.5 million people perished and that 1 million to 1.5 million emigrated. It depends on the figures, but when one is talking in millions one does not focus on the personal circumstances of the individuals concerned.

The emigration that followed the Famine continued for generations until a decade or so ago. Ireland is unique in that for every two people born in this country, one has emigrated. Consequently, there is a diaspora of 40 million people of Irish descent in the United States, and there are more in Argentina, New Zealand and Australia.

It is because of the Famine that the Irish, be it through the Government or their own generosity, insist on helping those most in need. This is why we target our aid at our most destitute partner countries. Zambia, which I visited recently, is an example. Some of our learned friends in the Opposition have said we should legislate to ensure the Government will spend 0.7% of gross national product on overseas development aid. I pointed out what Sweden did during its economic crisis. However, I am open to other ideas and if the Opposition would like to propose that a voluntary levy be introduced whose proceeds the Government could put towards the overseas aid budget, it is not beyond the bounds of possibility.

Maurice Cummins (Fine Gael)
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Is Fianna Fáil looking for another levy?

Jerry Buttimer (Fine Gael)
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It is Government policy now, is it?

Mark Daly (Fianna Fail)
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We are taking our cue from Sweden and other countries. While we would demand more for less, we have no doubt that a cut in budget has an effect on other people. We do not want to be the Lord Trevelyans of this time. However, what is more pressing than overseas aid budgets, as our learned friends in the NGOs are aware, is our trade policies with developing countries. These have a more detrimental effect that anything else on their survival and development. The EU's trade agreements with African and Caribbean countries and others in the Third World are preventing their development more than anything else. For every €1 billion we give them we take away €3 billion because of our trade policies. Thus, we are stifling their growth and preventing them from working their way out of poverty.

Recently, there was an interesting presentation to the Joint Committee on Foreign Affairs about Mozambique, where the production and processing of the coconut crop has a major impact on the surrounding areas. This is how countries get out of poverty. Giving people hand-outs is not good enough. This is also true in terms of employment, as we in this country know. People have to be trained and given skills and then they must work their way out of poverty. It is the only way forward. We must reform our trade arrangements, not only in Ireland but also by using our influence within the EU to persuade it to improve its trade policies. We are imposing detrimental trade policies on these countries, which is hard to believe. We are giving these countries a pittance in overseas aid relative to the amount our trade policies are costing them. This is the area on which we must focus when there is less money available for overseas aid.

I commend the Minister of State and the Minister for Foreign Affairs on their work with our partner countries. We have rightly focused on a small number of countries, unlike countries such as Switzerland which, at one stage, was dealing with 50 different countries, but has since followed the Irish model and narrowed down the number of countries somewhat to 24. The money must be targeted as much as possible on AIDS and education, which is a key factor. In Zambia, which I mention again because I was there, Ireland plays a role, with the Dutch, in developing an educational curriculum. Instead of sending out one teacher we send out somebody to train other teachers, eventually producing 6,000 teachers who will educate the next generation.

There is no silver bullet for solving the problems with overseas aid. It is not a question of demanding more money or fewer cuts, it is about being more intelligent in our approach and using the fact that trade is the means for these countries to lift themselves out of poverty. It is not just a question of giving money but of targeting money and helping with governance. While some would say governments are corrupt in Third World countries or indeed throughout the world, we must help good governments because ultimately somebody must run the departments of education and health. If we do not promote good governance and monitor donations properly to make sure they are not squandered and do not go astray, these countries will be perpetually in need of our assistance and will never be able to run themselves.

I remind Senators that 160 years ago, during the height of the Famine, the British would have said that the Irish could never run their own country as they did not have the education and were not fit to do it. In that case, it took generations. It is a generational problem, but we must take that approach and try to improve education and trade links over time. Education is the key. To quote Thomas Jefferson, "If a nation expects to be ignorant and free ... it expects what never was and never will be." I refer not just to freedom from foreign occupation but freedom from hunger and want and for people to choose their own future. Education is the key to that, which is why Irish Aid is much involved in education.

The most stifling problem in all of Africa is that of AIDS. With regard to Zambia, one thinks that if we educate people about AIDS it will reduce the prevalence of this disease. However, one must consider the prevalence even within the health system. A total of 38% of doctors and nurses in Zambia are HIV positive through their own behaviour, although they know how it is contracted and spread. They know the consequences because they deal with them every day, yet they engage in risky behaviour and contract the disease. One must wonder how many generations it will take for the tide to turn and people in Africa to take responsibility for their own actions. I have tried to explain to people at home the problem of HIV and AIDS in Zambia with regard to the culture and customs that exist. Changing that culture would be the equivalent of persuading people in Ireland they could no longer go to the pub but must drink at home. I do not think that will ever happen in Ireland, so it will take generations to achieve the equivalent in Zambia. It is a question of teaching people how AIDS is spread and how to prevent it.

The issue of human rights in Gaza was discussed today at the Joint Committee on Foreign Affairs. This is also connected to our aid budget, and Ireland has taken a lead role in supporting John Ging, a great Irishman who is working with the UN in Gaza and whom I have had the pleasure of meeting. He is the epitome of grace under fire. We saw him on our television screens during the recent invasion of Gaza by the Israeli Defence Forces. Although the truth is often lost in the midst of war, John Ging is a great example of a man who is able to state his case simply. Ireland's support for the UN in Gaza is important. Europe's preferential trade agreement with the Israelis, of which, as clearly stated under Article 2, respect for human rights is an essential element, is still in place despite the glaring examples of human rights abuses during the recent invasion. This was recently the subject of a resolution of both the Joint Committee on Foreign Affairs and the Joint Committee on European Affairs. I ask the Minister to take this up in his reply and to consider this issue.

In summary, helping other countries is not all about money, it is about trade as much as anything else. If we are to lift countries in the Third World out of poverty we must be fair with them in terms of trade and help them by targeting our aid towards education. By targeting education we can turn things around so that these countries can help themselves. If we continue to give them money without giving them the means and education to provide for themselves, nothing will have changed in 100 or 200 years' time. I commend the motion to the House.

Ann Ormonde (Fianna Fail)
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I welcome the Minister to the House once again and second the motion. I acknowledge the international endorsement of the Government's overseas aid programme. I was delighted to attend the launch of the Development Assistance Committee's review of Ireland's overseas aid. The DAC carries out reviews of the programmes every four to five years. It acknowledged Ireland's contribution and that it is increasing its aid to the least developed countries. There are many positives highlighted that show the value of our programmes for families across the globe, especially in the African countries we have partnered. Irish Aid programmes are highly regarded and it is vital we continue to build on them despite our current economic challenges.

Recent reductions in the programme are regrettable. Once the global recovery begins and there is an improvement in Ireland, we should review our commitment as a priority. It was disappointing we had to reduce it this year but our heart is in the right place. The Taoiseach and his predecessor have taken a personal interest in the programme and are determined that Ireland will reach its international commitments at the earliest possible date.

Ireland is a generous donor, ranking sixth out of the 22 DAC members in terms of percentage of gross national income, GNI, and ranked 17th in terms of its volume of overseas development aid. The Government is committed to meeting its target of 0.7% of GNI by 2012. It has adopted a phased approach and plans to meet the interim target of 0.6% in 2010. It is a challenge to reach these targets and to ensure our money is being used in the best possible way.

The concentration of our efforts in the poorest African countries is a strength of the programme. Of our bilateral aid, 80% is targeted to sub-Saharan Africa where communities face some of the most difficult challenges on the planet. The challenge for us now is to ensure our programmes remain effective and have a positive impact.

A number of important measures have been undertaken to ensure we are effective. Last September the Taoiseach and the United Nations Secretary General launched the hunger task force, a world first. It is a blueprint not just for Ireland but for the globe. The establishment of a stability fund for post-crisis situations and the rapid response initiative ensure Ireland is well positioned to respond quickly to disasters as they occur. I welcome the placing of essential supplies in hubs in Italy and Ghana in particular, allowing for rapid distribution.

Ireland's commitment to fair trade has caught the imagination of communities throughout the country that have worked to have themselves declared fair trade villages, towns and cities. While the Irish Aid volunteer centre on O'Connell Street is an invaluable service to those who want to make their own contribution to aid efforts, I encourage teachers to bring their students to the centre to learn more about their programmes. There are also opportunities for work experience programmes.

There is much for us to be proud of in our record in overseas aid but we must remain open to suggestions as to how we can improve our effectiveness. The recent review welcomed our commitment to aid but raised questions about our ability to analyse the results of our efforts and their effectiveness to let us see how we can communicate the most effective programmes to the world. There is a gap at that level which I spotted while visiting Malawi. While our aid has been reduced, it is not about money but about how we implement programmes and how effective they are. There is waste and because we must tighten our belts, we should analyse the impact of the programmes to ensure those who need them will not be deprived.

There must be an interdepartmental approach. There are issues surrounding education, HIV-AIDS, agriculture, trade and the environment. These areas must be looked at and we must have political backing. While Irish Aid has moved to Limerick, there must be no change in policy, with an interdepartmental approach so no Department can say it is not going down that road.

David Norris (Independent)
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The road to Limerick?

Ann Ormonde (Fianna Fail)
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There should be a more coherent approach to the implementation of these programmes. The Minister of State must ensure we do not deprive the most needy. We must call in our partners overseas, such as our embassies, to see where we can cut back without scaling back on the programmes.

The review is excellent. It recognises our work and I look forward to seeing how the programmes work, even with the decrease in funding this year.

Maurice Cummins (Fine Gael)
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I move amendment No. 1:

To delete all words after "Seanad Éireann" and substitute the following:

"notes that then Taoiseach Bertie Ahern, TD at the Millennium Summit of the United Nations committed Ireland to reach the UN target of 0.7% of Gross National Product devoted to overseas development aid by 2007, but did not fulfil that promise;

notes that then Taoiseach Bertie Ahern, TD again committed Ireland to reach the UN target, this time by 2012, at a UN summit of world leaders in 2005;

notes that the White Paper on Irish Aid, describing the impact of Irish aid, stated that 'With Ireland's support, Tanzania has made major strides towards universal primary education. Net primary school enrolment rates have increased dramatically from 50% in the late 1990s to around 95% in 2005' and that 'With Ireland's support, a new welfare system has been put in place in Ethiopia which keeps hunger at bay for six million of the poorest people in that country each year';

notes the fiscal collapse experienced in Ireland in 2008 and 2009 and the resulting cuts in State expenditure imposed in 2008 and 2009;

notes that as Ireland's Overseas Development Aid budget is calculated as a percentage of Gross National Product, its cost to the taxpayer was already reducing substantially as Ireland's GNP reduced during the economic downturn being experienced;

regrets that Ireland's Overseas Development Aid budget was disproportionately targeted for cuts that reduced the incomes of Irish aid agencies by between 20 and 25%, far in excess of other aspects of the Irish State expenditure;

expresses alarm that Ireland's biggest development agency, Concern, has had to lay off 19 staff and pull out of three countries, while Goal has had to lay off 9 staff and to pull its team out of the Democratic Republic of Congo as well as reducing by 70% all water and sanitation, health and nutrition programmes in Niger, all due to cuts in Ireland's overseas aid budget;

reminds the Government in the words of then Taoiseach Bertie Ahern, TD in the foreword of the White Paper on Irish Aid that 'Every day Ireland's official aid programme, Irish Aid, saves lives';

reminds the Government that its own White Paper on Irish Aid stated that 'The level of need in these countries is not comparable to anything in Ireland';

expresses extreme concern that the cuts imposed will cost lives of those reliant on Irish development aid;

urges the Government to re-state its commitment to reach the 0.7% of GNP devoted to overseas development aid by 2012;

endorses the call from the Organisation for Economic Co-operation and Development that the government 'refrain from further budgetary action that would undermine this commitment'; and

calls on the Government to begin reversing the cuts in the overseas aid budget in the 2010 budget."

I look at the self-congratulatory Fianna Fáil motion and am reminded that self-praise is no praise, but I suppose Fianna Fáil will take any praise it can get at the moment. The motion acknowledges and welcomes international endorsement of the Government's overseas aid programme. Ireland's overseas aid programme has been praised in the OECD report but, as usual, the Government is being economical with the truth. The aid programme the OECD praised has been savaged by the Government in the past year. The report also calls on the Government not to cut the budget for Irish Aid any further.

Of course the motion does not mention that. We could look in vain through statements issued by the Government on the OECD report to find any mention of that call. It is as if the Government only wants to highlight those sections of the report that praise Irish Aid without mentioning those negative sections that criticise the Government.

I will remind the House what the OECD said about the Government cutbacks to the overseas development aid budget. It urged the Government to refrain from further budgetary action that would undermine its commitment to achieving 0.7% of gross national product, GNP, devoted to Irish development aid by 2012. The OECD is also critical of the decision to move Irish Aid to Limerick, saying that it has resulted in a loss of knowledge and experience as key staff are unable to make the move and have therefore left the section entirely.

It is in many ways the very staff the Government's policies are driving out of Irish Aid, through the decentralisation of Irish Aid's headquarters, who are the unsung heroes of the report, about which we are speaking, but thanks to the Government, Irish Aid is losing them.

Our charities and non-governmental organisations are crucial to the success of Irish Aid. Those charities and NGOs are being devastated by the cuts in the Irish Aid budget which the Government has imposed. That is the reason Fine Gael has introduced a comprehensive amendment to the motion before the House. We acknowledge fully the economic and fiscal crisis facing the country. We in Fine Gael are aware that the decline in our gross national product means that the amount of money going to Irish Aid would automatically reduce as a result.

What concerns us greatly is the scale of the cuts imposed on Irish Aid. They are far more severe than those imposed elsewhere in Government expenditure. Our amendment reveals that Concern has had to lay off 19 staff and pull out of three countries, while GOAL had to lay off nine staff and pull its team out of the Democratic Republic of the Congo as well as reducing by 70% all water and sanitation health and nutrition programmes in Niger, all due to the cuts in Irish overseas aid. Those Government cuts have made the problems they face much worse than they are. The cuts in Irish Aid are disproportionate and will hit the poorest, the most marginalised and the most in need of help.

We have not seen the end of the cuts. Notwithstanding the appeals of the OECD, I understand from various Irish charities that they are being warned privately to expect a further €100 million in cuts in Irish Aid in the next budget. I will be explicit. These cuts will cost lives. There are people alive today who will be dead by the end of the year directly because of the cuts the Government is imposing on Irish Aid.

Fine Gael believes that in facing up to the economic and fiscal crisis we should have a principle, some words to the effect that cutbacks should not cost lives. That should be our motto. That is the reason we opposed the abandonment of the vaccine for cervical cancer. That is the reason we have taken a stance on other issues and the reason we are critical of the Government's cutbacks on Irish Aid. We believe that the disproportionate cutbacks on Irish Aid will cause deaths that could have been preventable. That is the reason the Fine Gael amendment before the House criticises the disproportionate nature of the cutbacks. That is the reason we endorse the call by the OECD that the Government refrain from further budgetary action that would undermine the commitment to reach the target of 0.7% of GNP by 2012. That is the reason we in our amendment call on the Government to begin reversing the cuts in the overseas aid budget. We are not calling for their full and instant reversal but further steep cuts should not be applied to Irish Aid. Stating that may not win us votes and some may criticise us, but it is a stance based on principles and fundamental beliefs.

When the White Paper on Irish Aid was published, the then Taoiseach, Deputy Bertie Ahern, said bluntly: "Every day Ireland's official aid programme, Irish Aid, saves lives." We agree with that statement, but unfortunately life or death did not feature on the balance sheet when the Government was planning to slash the Irish Aid budget.

Because we believe the scale of the Irish Aid cutbacks were wrong, that they cost lives and that politics should be based on principles and not just expediency, we are taking a stand with our amendment. The Government's motion is a whitewash, one which simply highlights the positive while hiding the obvious criticisms that should be made.

The House must tell the truth on this issue. Ireland can be proud of its aid programme. It has been targeted for disproportionate cuts. The Government should, as urged by the OECD, stop any further cuts in Irish Aid and should begin the process of reversing the cuts in Irish Aid. I commend the Fine Gael amendment to the House.

Jerry Buttimer (Fine Gael)
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I second the amendment. I welcome the Minister of State to the House. To the surprise, perhaps, of Senator Daly, I want to acknowledge the significant investment up to this point by the Government in overseas aid. It is regrettable we have had a reversal of such investment and that overseas aid has become the Cinderella of the Department of Finance and of the Irish finances. Those of us who advocate social justice and the distribution of wealth equitably need to consider the developing world. Whatever model or methodology we want to follow on how better to develop the world, resources are required and support for the people must be given by those of us in the western world who can afford to contribute. Senator Daly can wax lyrical and cite quotations from different people but the reality is that people in the poorest regions of the world will be affected by our decisions. Whatever principles guide us politically, humanitarian and otherwise, we must always do what is best for all people and all citizens of the world. I passionately believe that. We on this side of the House will advocate and support the creation of efficiencies in how we spend our money in the context of getting value for money and how best to maximise the resources we have at our disposal.

I want to give immense praise to the Irish aid agencies, the missionaries and the NGOs who have worked throughout the world helping people in developing countries, many of whom are friends of mine. I regret never doing that work but I hope before my time is finished in this life that I will go out to the missions and do some work because our citizens who have gone abroad to do this work have made a significant contribution. On this day when the report of the Commission to Inquire into Child Abuse and suffering has been published and other issues will arise regarding the church, it is important that we pay tribute to the many church people who have worked throughout the world as well as the many lay volunteers and the State agencies.

Senator Daly spoke about what Sweden did in this area, but what is his response to the following quotation: "Poverty destroys human potential, increases vulnerability and limits opportunity"? That is a quote from the Taoiseach, Deputy Brian Cowen. The direct cut in aid about which we speak will have consequences. We are talking about 70 cent for every €100 spent. Senator Daly is correct. There is no silver bullet.

Mark Daly (Fianna Fail)
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Jerry-----

Paddy Burke (Fine Gael)
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Allow Senator Buttimer to continue without interruption.

Mark Daly (Fianna Fail)
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Jerry-----

Jerry Buttimer (Fine Gael)
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I know the truth hurts.

Mark Daly (Fianna Fail)
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The Senator is referring to me.

Paddy Burke (Fine Gael)
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Allow Senator Buttimer to continue without interruption.

Jerry Buttimer (Fine Gael)
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I am responding to Senator Daly's contribution. We are having a debate and if the Senator cannot-----

Paddy Burke (Fine Gael)
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Senator Daly should refer to the Member by the term Senator.

Mark Daly (Fianna Fail)
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Senator Buttimer mentioned my reference to Sweden but he did not say what I said it did when it cut back on its aid budget in 1992.

Paddy Burke (Fine Gael)
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I ask Senator Daly to allow Senator Buttimer to continue without interruption.

Jerry Buttimer (Fine Gael)
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I realise Senator Daly is embarrassed by his own Government. I appreciate that.

Mark Daly (Fianna Fail)
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The Senator should stick to the facts.

Paddy Burke (Fine Gael)
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Senator Daly, please.

Mark Daly (Fianna Fail)
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The facts are that Sweden cut back------

Jerry Buttimer (Fine Gael)
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The facts are-----

Paddy Burke (Fine Gael)
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I ask Senator Daly to have respect for the Chair. He should address a Member by the term Senator.

Jerry Buttimer (Fine Gael)
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I am not being political in my contribution but the reality is-----

David Norris (Independent)
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May I suggest that the phrase, "Put a cork in it", would be appropriate?

Paddy Burke (Fine Gael)
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Senator Buttimer, without interruption.

Jerry Buttimer (Fine Gael)
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The reality is that as a consequence of what the Government has done, programmes on HIV, famine relief, education and gender equality will be adversely affected.

I agree with Senator Daly that we should create good governance and put in place new practices where people can be empowered and learn, but monitoring programmes and empowerment education require financial resources. We heard reference today to the Famine. There is no comparison. Our people had access to education and we were empowered as a nation. If we have beliefs, these cuts will have an impact, as Senator Cummins rightly said, on irrigation projects, food prices and trade, about which Senator Daly spoke in his contribution. The prevention programmes for a multiplicity of diseases will also have an impact.

I would like to refer to the other part of the Government bicycle, the Green Party. At a meeting of the Oireachtas Joint Committee on Foreign Affairs when the Green Party was in opposition, Deputy Cuffe derided the cuts. What did the Green Party Members say today about the cuts in our overseas aid? What do they say about the U-turn and backtracking on the commitment given by the former Taoiseach and by the Green Party when it entered Government? We made a commitment to provide 0.7% of GNP to overseas aid and it looks like that figure will never be met, which is regrettable. As Senator Cummins said, it will have an impact on the aid agencies. People can legitimately argue that aid agencies have become dependent on Government money. That is a different argument and I accept that we need to have a debate on that. However, the overseas aid budget has been hit four times in four budgets. I met a missionary priest who was home on holidays and he made a very telling comment to me when he said this Government is hitting the vulnerable in Ireland, and the world through its cuts in overseas aid. I would like to hear the Minister's remarks on that.

We are in a time of economic recession and overall budgets must be examined. However, we made a commitment to the United Nations, which we will not fulfil. If one takes the amendment put down by Senators Mullen, Quinn, Norris and Bacik, we must refrain from further budgetary action that will undermine our commitment. If we do not, we are sending the wrong message and imposing cuts that, as Senator Cummins said, will impact on people's lives and the quality of their lives. All of us in this House are open to the developing world and want to produce results that will see Ireland's standing in the world enhanced by our support. This motion is timely regardless of the economic climate because we need a debate on how best we can support our aid programme and how best we can see Ireland and the people of the world benefiting from our financial contributions.

Does the Minister think the move to Limerick is beneficial? He will say it is from a political point of view because it is in his constituency.

Peter Power (Limerick East, Fianna Fail)
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It is beneficial from every point of view.

David Norris (Independent)
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Come on, the Minister is losing credibility.

Jerry Buttimer (Fine Gael)
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How does the Minister square the comments made-----

Peter Power (Limerick East, Fianna Fail)
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The OECD did not criticise the decentralisation programme.

Jerry Buttimer (Fine Gael)
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I know it did not. I did not say the OECD criticised it, but I ask how the Minister sees the drain on personnel having an impact. The OECD report said we need to be an advocate for trade, agriculture, development, getting private sector initiatives going and gender equality across the world - Senator Daly alluded to this. We will not meet our aid target, however one looks at it. What are we saying about that? The OECD has been critical on aspects of the Government's policy. It queried whether the relocation would lead to a loss of expertise and "institutional memory". That is there in black and white. I look forward to the rest of the debate. In seconding the motion, it is regrettable we have a cut and that aid is becoming the Cinderella of finances. Despite Senator Daly's comments-----

Mark Daly (Fianna Fail)
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Is George Lee against the move to Limerick?

Jerry Buttimer (Fine Gael)
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Senator Daly is embarrassed and I do not blame him. If I were in his position I, too, would be embarrassed.

Mark Daly (Fianna Fail)
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If the Fine Gael candidate is against the move to Limerick we would like to hear about it. As election agent, what is his position on the move to Limerick?

Jerry Buttimer (Fine Gael)
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I fully support and second the Fine Gael amendment to the Government motion and I hope the Members of the House will support it.

Peter Power (Limerick East, Fianna Fail)
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I am delighted to join the Senators in the House this evening to discuss the motion and I welcome the opportunity to focus on Ireland's aid programme, especially on its international reputation, but most important on its impact on the lives of the poorest people in the world. Although the motion is framed in positive terms it gives rise to the possibility of a wider discussion. I welcome the points the Senators have raised to date and will raise as the debate progresses. It gives us an opportunity to discuss some of the wider and more challenging issues facing us.

Self praise is no praise, and that is why we welcome praise that comes from impartial international third parties with no vested interests. Notwithstanding the challenges we face, the recently published OECD report makes it clear that Ireland's aid programme is among the best in the world.

David Norris (Independent)
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In 2008.

Peter Power (Limerick East, Fianna Fail)
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It is important, therefore, to have this debate in the context of the highly positive standing which our aid programme currently enjoys and of which every Irish citizen can be justly proud. I returned last night from the six-monthly meeting of the EU Development Council in Brussels, where the main subject of discussion was the effect of the global economic crisis on the countries of the developing world. The debate among Ministers from the 27 member states threw into sharp focus the complex series of challenges and tensions which must be addressed now if we in the developed world are to sustain the momentum in our work for international development.

We are committed, through the millennium development goals, to halving the levels of world poverty and hunger by 2015. Important progress has been made since 2000. However, we face a global economic crisis, which originated in the financial markets of the developed world but which is being experienced with increasing severity across the developing world. The advances achieved in Africa and elsewhere are under threat. At the same time, we have set ourselves ambitious targets - more ambitious than other countries - which are expressed in terms of the proportion of GNP devoted to overseas development assistance. Therefore, overall aid volumes are set to decrease just as they are needed most. Although percentages rise, aid volumes may well drop. This is a paradox which we must confront.

It was clear to me from my discussions over recent days with EU colleagues that aid budgets everywhere are under serious pressure as Governments move to underpin the economies and the public finances on which they are based. We in Ireland are facing these challenges perhaps more openly and more directly than other countries and therefore the debate on the subject has been particularly intense here. I strongly welcome this debate. It is essential that the Irish people and their democratic representatives consider openly and with a sense of realism the vital issues at stake.

In Europe, Africa, the US and across the world governments are addressing urgently and directly the need to make aid more effective to ensure every euro and dollar counted as ODA has the maximum effect in saving lives and creating the conditions for future growth. Ireland has a major role to play in this effort. This was recognised very clearly in the important international report published this month by the development assistance committee of the OECD following its peer review of the Government's aid programme.

Peer reviews conducted by the development assistance committee of the OECD are the most important independent assessment any donor country undergoes. They are the key international benchmark of the quality and effectiveness of the overseas development programmes of member states. The review involves rigorous research and analysis of Irish aid policies and programmes over the past five years and an intensive series of meetings with Government and non-governmental organisations in Ireland, together with a visit to our programme country, Uganda.

In short, and without in any way minimising the scale of the challenges we face at home and abroad, the people can be very proud of the report's enormously positive conclusions. By any measure, the report is a strong vindication of the policies we have pursued, notwithstanding the comments made by Senators Cummins and Buttimer.

It addresses openly the issue of aid targets and calls clearly on the Government to continue to work towards meeting our stated goal of spending 0.7% of GNP in 2012, three years before the overall EU target date. I can confirm to the House that we are continuing to work towards our target even though clearly it will be more difficult to achieve in current circumstances.

The OECD also states that "Irish Aid is a strong, cutting edge development programme", that "Ireland is a champion in making aid more effective" and that "poverty reduction is the overarching goal of Irish Aid and its programme is well concentrated on a limited number of very poor African countries".

It praises Ireland for working in a genuine partnership with the developing countries and it focuses on and calls on us to work with other donors to share the lessons of our successes in making our aid so effective where it counts - among the poorest communities in the poorest countries in Africa.

Naturally, I welcome this strong international endorsement of the approach we have taken in our policies and actions towards the developing world. We welcome the recognition that our development assistance policies are an integral part of our foreign policy and we welcome the advice that we increase our work in communicating development results to the public in order to maintain support for overseas development.

This is crucial. The people have always been generous donors in a private capacity and they have, I believe, strongly supported the huge expansion of the Government's aid programme over the past ten years. A visit to the very successful Africa Day in Limerick last Sunday or in Dublin next Sunday would confirm the enthusiasm and support of thousands of Irish people for the work of development.

However, I accept that we and the NGOs and missionaries with whom we work in partnership need to redouble our efforts, not just to achieve clear results from our funding for aid, but to demonstrate that Irish taxpayers' generosity and money are saving countless lives each year. We want to maximise the contribution people make through their own donations and through their taxes to fighting global poverty and hunger.

The OECD review was finalised just as the Government faced a series of very difficult decisions across all Departments. I repeat to the House that I, like many Senators, very much regret the need to reduce the budget for 2009. However, I emphasise that decision was taken by the Government with the sole intention of stabilising our public finances and establishing a platform from which Ireland can return to economic growth.

We learned the lessons of failing to establish the basis for sustainable growth in the 1980s. We learned what happens when one avoids difficult decisions. I believe firmly that our overseas aid programme cannot grow to the ambitious levels to which we aspire without a strong and vibrant Irish economy.

We owe it to the people and to the people and governments of the developing world to ensure our development assistance programme is sustainable. We practice sustainable development in Africa and we need to do so at home. We need to show it is based on the reality of a sound national economy. It would be in nobody's interests to focus solely on GNP percentage targets if that GNP is in steep decline and we were to face the prospect of borrowing internationally to fund assistance to the poorest countries. That is simply unsustainable. This is a clear, if somewhat uncomfortable, reality to face. Those who sometimes make pejorative commentary must also face that reality and in doing so, they must accept the Government bona fides in this regard.

Despite the difficulties, however, it is right we recognise that with a budget of just under €700 million for this year, Ireland remains the fifth most generous aid donor in the EU and the sixth most generous in the world in per capita terms. I hope people commenting on this area respect that. Even in enormously challenging times that represents a very solid achievement.

As the OECD states, our spending on development remains at historically high levels and is among the most effective in the world. It expanded almost five fold over the ten years to 2008. We should also note that it grew at a disproportionately faster rate than our national economy. The Government allocated €4 billion in overseas aid over the past six years alone.

Our programme will be reduced this year but we will work with our partners to ensure it is even more effective. I assure Senators that I will lead a relentless focus on efficiency and effectiveness of our programme in all of its formats and delivery mechanisms.

Ireland's official development assistance and the individual contributions of the people are saving lives every day. The Government has given a clear commitment, which I repeat, that we will resume the expansion of the aid programme as soon as economic conditions permit and we have re-established a pattern of sustainable economic growth.

I recognise the strength of the views being expressed in the House on the subject of the aid programme and I accept the passion with which these views are often expressed. We are talking about saving the lives of the poorest and weakest people. This is a subject on which I, too, am passionate but I do not believe it serves the interests of anyone if we fail to recognise the scale of the contribution Ireland continues to make. The scale of the challenge is such that we need to avoid any temptation to indulge in a competitive, negative or acrimonious political debate that can only serve to undermine public opinion at a time when it is needed most.

I welcome views on how we can make our aid more effective in the current climate and actively invite suggestions from Senators. As a contribution to this debate, I would like to highlight in concrete terms how Irish Aid is making a difference in the fight against poverty, as outlined by the OECD. The examples are by no means exhaustive but they serve to illustrate the tangible progress in areas that are critical to the world's poorest and most vulnerable communities. First, Ireland is praised as leading the way in the fight against HIV and AIDS. We have the highest proportionate spend on HIV and AIDS within the European Union. Beyond funding, Ireland is recognised for its innovative partnerships, including with the Clinton Foundation in Mozambique and Lesotho, and for spearheading single national programmes in fighting the epidemic.

Second, Irish Aid is acknowledged for intellectual leadership and achievements in the area of gender equality. Our work in highlighting and seeking to prevent gender-based violence is regularly singled out for mention by our international partners. Third, the OECD emphasises that Irish Aid is notable for its capacity to respond quickly and flexibly to local needs and local priorities in the developing countries with which we work. We could cite many more examples. Our work on hunger in Malawi, on education in Tanzania, to which Senator Daly referred, and on the safety net programme in Ethiopia are all highly regarded internationally.

Fourth, the OECD praises the strategic approach we take to supporting the excellent work of our non-governmental partners. Ireland works more closely in partnership with NGOs than any other OECD member state. We value our partnership with NGOs because it reflects the values of the people and their commitment to making a difference to those less fortunate than ourselves even when we are facing our own economic difficulties and families at home are under pressure.

Our commitment is reflected in our policy dialogue with the NGOs and in our funding. The Government channelled €800 million in development funding through the NGOs over the past five years covering long-term development work and response to emergencies and humanitarian disasters.

I accept the need to reduce our contribution to NGOs by 20% or so will have an effect on their work as will the increased pressure on private funding. However, our funding to the NGO sector will still be higher than for any other member state of the EU or the OECD. It reflects the quality of the work and their ability to work in niche areas. The Government provided about €200 million to aid agencies last year, including very significant funding to Concern, Trócaire and Goal and many others. In 2007, funding for the agencies represented about one quarter of our total development funding, a figure which the OECD describes as "very high". It represents the highest percentage among all OECD member countries. In my discussions with the aid agencies in recent weeks, we agreed on the need to strengthen our partnerships. The funding relationship is crucial and it is inevitably affected by the economic climate, but the challenge now for Government and for non-governmental organisations must be on improving aid effectiveness and ensuring that their approaches remain in line with best international practice. In this regard in my ongoing discussions with other OECD aid donors, we are very cognisant of the need to work more closely together. This will ensure that our combined aid is more effective and gives better value. By working together as countries, we naturally can reduce duplication and plan more effectively. We also reduce the burden on poor countries having to deal separately with so many donors. The result is more lives saved and more effective aid. This important aspect of international aid and development was discussed at our informal session of development Ministers held recently.

There is now an opportunity for our NGO community to look at the possibility of working more closely together, including in joint planning and perhaps joint programming, where they would work in the same country in similar sectors. By pooling funds and their undoubted expertise, it will be possible to do more and be more effective. The possibility of joint appeals could also be explored. This would reduce the cost of necessary fundraising. I know this will represent a challenge to the NGO sector but the opportunity exists to refocus on ensuring that our aid is as effective as we can possibly make it and I look forward to discussing these proposals with the NGO sector over the coming months. I am determined that Irish Aid will lead the way in this respect.

The Government is determined that Ireland will play a strong role in shaping the EU's response and that of the wider international community to the needs of the developing countries as they face the global economic crisis. In Brussels yesterday we discussed how the European Commission can respond more flexibly to the immediate and the long-term effects of the crisis on the most vulnerable countries. We also discussed how the EU and the US can co-operate more effectively and there was strong recognition of the role Ireland is playing in highlighting the need to strengthen the international response to the scandal of global hunger.

In response to the report of the Government's hunger task force, I have made the fight against hunger a cornerstone of the Irish Aid programme. The reality today is that almost 1 billion people are at risk from hunger, one in every seven people on the planet. Their lives are in danger because they do not have enough to eat. We can sometimes lose sight of this critically important fact that it is simply not possible to achieve any of the millennium development goals targets if the people of this world do not have enough food to eat. With the benefit of the hunger task force and with the support we have received throughout the country, from these Houses and from the NGO community, I have been able to raise the hunger issue at the highest level in the international community and to ensure that it receives the priority it deserves at European Union level. I assure Senators that I will continue to do so.

Large sections of the urban poor in developing countries do not have regular access to food and in many cases price reductions in recent months have not reached rural areas. A significant proportion of small-holder farmers, a majority of whom are women, cannot grow enough food to meet their own needs. A key focus of the Irish Aid programme in future will be on support to small-holder and women farmers, the targeting of infant and maternal malnutrition and the improvement of farm productivity and agricultural research. All our programmes delivered through the aid agencies or through the national and bilateral programmes will in future be looked at through the prism of hunger, even the health, education and agricultural and research programmes, to see how they can contribute to the fight against hunger.

It is important that the Irish people know that the Government's aid programme - the people's aid programme - is innovative, accountable and focused on results. The international endorsement from the OECD is welcome. Most important, however, are the recommendations from the OECD on how we can improve our contribution. There can be no question of complacency on our part. I take on board the comments made by Senator Buttimer about the decentralisation to Limerick of Irish Aid. The Senator accepted that the OECD was not critical of the decentralisation process but it observed that it should be monitored to ensure that institutional memory is not lost. The Senator's comments were fair in that respect but not in respect of criticising decentralisation per se, upon which the OECD did not comment. I assure the House and Senator Buttimer that we are putting systems in place, including the recruitment of new development specialists and including collaborating with local educational institutions to ensure that the training and ongoing education of all our staff is at the highest level. This can be discussed at a future time. It is true that Ireland is making a greater contribution per capita than any of the larger EU member states. This fact is sometimes forgotten in this debate, that the Irish Aid contribution is bigger in per capita terms than that of Britain, France, Germany, Spain and Italy, notwithstanding the economic challenges we face. We will now take the recommendations of the OECD peer review, as we did with the last report in 2003, and work to protect and develop the strengths of our programme.

I welcome the strong support across the House for the aid programme. We are managing the programme in difficult times and we are doing so on the basis of our central strategic objective which is to ensure we make decisions which are sustainable for the programme in the long run. Our aid targets are expressed over many long periods of time. They were expressed initially in the year 2000. It is over a period of 12 to 15 years and this sometimes means that we have to make decisions along the course of those long-term targets to ensure that we create the conditions and the platform of concrete rather than sand to ensure that when we reach our aid targets, expressed as a percentage of our gross national product, this will be a real and meaningful contribution in real aid volume terms to those who need it most. To do otherwise would be a real disservice to the people whom we aspire to help. We aim to contribute to the reduction of global poverty and hunger in the poorest countries in the world, with a particular focus on sub-Saharan Africa. It is our firm intention that Irish Aid will continue to develop as a world-class, knowledge-based programme with an unrelenting focus on results, hunger and poverty and on saving and improving the lives and the prospects of the poorest and the most vulnerable people in the world.

David Norris (Independent)
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I wish to share time with my colleague, Senator Feargal Quinn.

The Minister of State is a decent man, as I know only too well, but he has a brass neck to come into the House and deliver that drivel. I am glad to say, however, that he looked miserable doing it and he has every right to be so. He mentioned the question of percentages. It is perfectly obvious that since the matter was expressed as a percentage he did not have to cut anything. It could be left alone and we would give the proportion that we could afford, even if it was the widow's mite. We were given promises after promises. The then Taoiseach, Deputy Bertie Ahern, boasted about it at the United Nations and surely the Minister of State should be ashamed of that. He was a very enthusiastic member of the Joint Committee on Foreign Affairs, and so were some of his colleagues, when looking for a separate budget subhead for overseas aid, looking for it to be institutionalised so that it would be crystallised year after year and we would automatically, without any opportunity to change, reach the target. I listened with horror when he was talking about the need for these changes and our duties to the people and this sort of business and rescuing our economy with these piddling cuts in the global context, at the expense of people who are going to die. I never want to hear belly-aching from the Fianna Fáil side of the House about the Irish Famine because we are doing to them what they did to us all those years ago.

Peter Power (Limerick East, Fianna Fail)
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I cannot agree with that.

David Norris (Independent)
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It is absolutely outrageous. The whole thing is a spin. On "Prime Time" on 5 May, in response to a question from Mr. Justin Kilcullen, the Minister of State said we were protecting short-term emergency humanitarian aid because that was where our focus was. We want to save lives, but we are saving lives with our programme in any event. Yet when the researchers contacted the Minister of State's office they were told that the earmarked funding for rapid onset humanitarian emergency programmes, which is exactly what he was talking about, was reduced by 70% from €20 million to €6 million. The office, on being contacted again, responded that what the Minister of State had intended to say was that the reduced amount, in other words the 30% pittance left, would be delivered. That is sheer nonsense.

Now the Minister of State is saying, "although the motion is framed in positive terms". Of course it is as it says nothing, apart from how wonderful we are, but we are not. I do not believe it is right to take historical credit for a situation that has developed over some years, in the present circumstances when we are cutting deeply into this aid. Again, the Minister of State is taking credit for the generosity of the Irish people. The Government is not the Irish people.

Peter Power (Limerick East, Fianna Fail)
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No, I am not. I am complimenting the generosity-----

David Norris (Independent)
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It is on page 4, where he talks about the wonderful generosity of the Irish people. It is not his generosity, I would say. He says he is continuing to work towards the target. He continues to work towards missing it. This is disastrous. He says he accepts that the cuts, which are savage, will have an effect. He does not even have the nerve to acknowledge that it is a negative effect. He talks about going off to huddle with his fellow Ministers in Europe, and we know a number of them are cooking the books, as the Minister of State knows, I am sure, because he is a decent man. They are including things such as debt cancellation as if they were giving money. That is shameful and is something over which I hope the Minister of State, who is a decent man, will raise and rattle their cage in Europe.

Former President Mary Robinson, an old friend of mine and of many people in this House, said that she is concerned because the cuts are proportionately more severe in this than in any other European country. We are told that 25 jobs in this country will be sacrificed from all the aid agencies. Overseas it will be worse. By the end of this year Concern will have cut 500 jobs overseas and its budget is reduced from €26 million to €20 million. Goal will cut nine jobs from its Irish office and its budget is down 29%. Trócaire says it will be forced out of a programme that supported 143,000 in east Africa, who will starve to death. Then there are the children with HIV, where in clinics they are prevented from getting HIV. There is Oxfam, too, and the cholera prevention programme in the Democratic Republic of Congo as well as Amawele in South Africa. We are always boasting about our connections with South Africa and taking credit for the work of people such as Mr. Niall Mellon, yet there is no funding. A number of those projects will close down.

There have been €195 million in cuts, about the cost of a small motorway. The cuts will progress from 0.58% in 2008 to 0.48%. We are going backwards, despite being promised time and again that this would not happen. We are now unlikely to meet the target. Other European countries are shaming us.

Peter Power (Limerick East, Fianna Fail)
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That is not correct. Nobody has gone past us.

David Norris (Independent)
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It is correct. I will dispute that with the Minister of State and we can bandy figures, but these are the cuts. I said the Minister of State had a brass neck, but I do not believe he wrote that stuff. Neither do I believe that he framed the motion. I believe that if he was left on his own he would fight and I hope the strong words he has heard in the Seanad tonight will give him armaments with which to fight, both within Government and with its partners in the European Union, most of which should be thoroughly ashamed.

Feargal Quinn (Independent)
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I have prepared some figures, but since most of them have been read out already or are about to be, I will take the opportunity to place on record a letter that appears today in The Irish Times, which I am not sure the Minister of State will have seen:

Madam,

The present dispute about whether, because of the economic tsunami, Ireland is justified in cutting overseas aid evokes a historic parallel. This is the controversy in Britain, in early 1946, seven months after the end of the war, over whether food should be sent to aid the starving Germans. This was at a time when the average British consumption was about 2,800 calories a day, the equivalent of about 60 per cent of the present Irish figure.

At the time, George Orwell wrote: "If we raise our own rations, we should be doing so while famine descends on Europe. If we do decide to do this, at least let the issues be plainly discussed and let the photographs of starving children be well publicised in the press, so that the people of this country may realise what they are doing."

Happily, the British made the decision to give up some of their food to the Germans. The Irish should take the equivalent decision now.

Yours, etc.,

Professor David Gwynn Morgan,

Law Department,

University College Cork.

I thought when I read those words how succinct, competent and capable they were. It is a reminder to us, as a country, of what we can do. It is estimated that we out overseas aid will slip backwards from an estimated 0.58% to a projected 0.48% this year after the February and April cuts. The World Bank has warned that such recession induced donor fatigue worldwide could result in 90 million more people, mainly in Africa, being forced into poverty. Furthermore, the World Bank reckons that between 200,000 and 400,000 more children will die every year between now and 2015 than would have perished in the absence of a world economic crisis. The Economist summed up the situation when it said, "Progress towards a richer, more equitable world has been set back years."

I mention that because I am not talking about Ireland alone. While I cannot agree with everything Senator Norris has said, I know that the Minister of State's heart is in the right place. I know he wants to do well, as do the Irish people. I am aware of the straitened economic circumstances, but when we look at the figures and how well off we are compared with those who die, are starving and go to bed hungry every night, we realise that we can afford to do more than we are doing. Senator Norris is quite correct when he talks about the percentages. Of course, we do not feed people with percentages. However, when we have the opportunity to do something, as we do now, I urge the Minister of State to use his influence with the Cabinet to ensure that we set out to achieve what we determinedly wish to do. We were determined to do it in the past so let us ensure we do it in the future.

Déirdre de Búrca (Green Party)
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I welcome the Minister of State to the House and thank him for his overview of the current Government position on Ireland's overseas development aid policy. I welcome, too, the opportunity to discuss this issue today because the recent cutbacks in the overseas development aid programme have caused significant concern in many quarters.

We are in a period of financial collapse. The Government will have to consider further very serious budgetary cutbacks. I am somewhat impatient when I hear the parties in opposition condemning every single cutback across the board. It does not matter whether it has to do with the medical area, education, third level fees, transport or local authority budgets. No matter what it is, it is resisted and we are told it is scandalous etc.

David Norris (Independent)
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The Senator cannot say that about the Independents.

Déirdre de Búrca (Green Party)
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I would love to hear where the Opposition believes we will find €16 billion to €20 billion in the coming years. If we do not, we will render ourselves bankrupt and will see the International Monetary Fund making decisions about this country and how it is run. I would prefer that we do it ourselves, which would be much more helpful. That is why the leader of my party suggested the idea of a Government of national unity, because at times such as this when very difficult decisions have to be made, opportunistic opposition by parties of the Opposition is not in any way helpful and does not serve the public interest.

Maurice Cummins (Fine Gael)
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We are discussing Irish overseas aid.

Déirdre de Búrca (Green Party)
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It is important to put that in context. I believe the tone of today's motion is somewhat self-congratulatory. Admittedly, the OECD report vindicates many of the positive aspects about Irish overseas development aid policy to date. That is a good thing but we are in danger of becoming complacent and failing to recognise the serious impact of recent cutbacks on our overseas development aid policy. In 2009, our overseas aid budget will be 0.48% of gross domestic product, GDP, which is a slip from last year when it was 0.58% of GDP. This causes great dismay among those who hoped we would achieve our target of 0.7% by 2012.

The OECD report contains two recommendations which we should take very seriously. The first is that the Government should refrain from further budgetary action to undermine our commitment to reaching our target by 2012. Second, the OECD made a series of recommendations on policy coherence.

Ireland's international reputation is closely bound up with our traditional positions on UN peacekeeping and overseas development aid. Our reputation is well earned. We have done important work. Our development non-governmental organisations and successive Irish Governments are to be highly commended on their contributions. On the back of those activities, we have built an international reputation and have earned international credibility amounting to very important capital. If we undermine this capital it will be our own loss. That reputation and credibility give us an influence internationally and within the European Union. If we were to make further cutbacks what credibility would we have? Could we argue for the retention of current levels of development aid if we are seen to have made cutbacks at the expense of people in the developing world rather than tackling other areas? Cutbacks are necessary but let us make them evenly and across the board.

It is important to look at our vision of Ireland's role within the European Union common foreign and security policy. There are many advantages to being a neutral country with a high international reputation. We want to be seen as champions of development aid and of a more enlightened and progressive policy towards the developing world where we can help to address problems, many of which were created by the developed world in the first place. Overseas aid is partly compensation for past actions. It is also intended to ensure poverty levels in the developing world do not lead to significant problems of migration and even more chronic levels of starvation and death. Climate change is very closely bound up with this issue. To maintain our credibility in this area we must hold the line now and avoid further budgetary cutbacks in this area.

The OECD raised a number of concerns regarding policy coherence. The report acknowledged that Ireland has made progress on policy coherence for development since the last OECD report but a number of concerns were identified. The report said Irish aid lacks the institutional capacity to conduct research and analyse policies for coherence or to trace policy coherence impacts once they have been identified. We must ensure cohesion in the following nexus of policy areas: trade, energy, finance, agriculture, fisheries, security and migration. What we do in one area can undermine another. For example, trading activities can completely undermine our overseas aid and climate change policies.

The report said our political commitment to policy development coherence has not yet translated into an integrated policy framework drawing consensus from the highest levels of Government as well as Parliament. It says there is no system of institutionalised reporting to Parliament on policy coherence development which would facilitate this process and that the relocation of Irish Aid to Limerick poses challenges in maintaining close linkages with other Departments, embassies, NGOs and other organisations based in Dublin. The report also says Ireland could do more in its priority countries, for example, by prioritising aid for trade to complement interventions made through Government and civil society.

I welcome the points made by the Minister of State, Deputy Peter Power, in his presentation. He speaks of greater efficiencies in our development organisations in the coming years. To what extent could institutional structures be put in place to achieve policy coherence as part of that efficiency drive?

Dominic Hannigan (Labour)
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I welcome the Minister of State to the House. The report to which the motion refers endorses the Government's overseas aid development programme. I recognise that Ireland has increased its overseas aid by 90% since 2003. This has helped establish Ireland as a respected world leader in the field of humanitarian aid, poverty reduction, information and education provision and the alleviation of hunger and disease. The report emphasises the quality and commitment of Irish Aid representatives at home and in our donor countries. These individuals, as well as the many NGOs supported by Irish Aid, have done the State a great service and should be proud of their contribution to helping the world's poor and advancing the development agenda.

The report also issues a number of timely warnings in the context of Ireland's success to date. Specifically, the report states that the Government should reaffirm its commitment, entered into by the former Taoiseach, Deputy Bertie Ahern, to give 0.7% of gross national income to overseas aid and development by 2012. Recent Government cuts have thrown this target into serious doubt. The overseas aid budget was cut by €45 million last July, €15 million last October, €95 million in February of this year and €100 million in April. A total of €250 million has been slashed from the budget in the last ten months, representing more than 20% of the total aid budget when Government coffers are reducing by only 8%. Cuts in the overseas aid budget are disproportionate.

I have received considerable correspondence on the impact of these cuts. They will cause cutbacks in donor programmes throughout the world. Concern announced last week that these cuts would lead to a reduction in the number of jobs and in programmes. Yesterday, in The Irish Times Fintan O'Toole highlighted the impact of some of these cuts. A programme in Afghanistan which provides education to 25,000 women is being drastically cut. It is not long since women in Afghanistan could not access education. This cut will not make things better for them. Members of the House were touched by the poverty depicted in the Oscar winning film, "Slumdog Millionaire". A nutrition programme for 35,000 children in the slums of Bangladesh will not no go ahead because of cuts. In Haiti, where terror reigned until recently, a programme to educate 6,000 children is being shut down. When our international reputation needs to be improved, these cutbacks do not help.

Given the self-congratulatory motion tabled by Fianna Fáil Senators, I must assume they have some information we do not have. They seem very confident that the aid budget will not be subject to further cuts. We are already 1.2% off the target of 0.6% for next year. Do Fianna Fáil Senators and the Minister of State accept that further cuts to the aid budget would be immoral, unjustified and grossly detrimental to the operational abilities of Irish Aid.

I do not accept the plea bargain often offered that if recipient countries became more efficient and rooted out corruption they would be able to spend more money. I have seen at first hand how some of our programme countries are tackling corruption. It is present but it is being tackled. A case study in Uganda found that the Irish Aid programme there is strongly aligned with that government's own systems and that 97% of expenditure goes through a financial accounting system while the average in other countries is only 60%. Some 88% of our funds go through country procurement systems, which is very positive. I am grateful to the Irish ambassador to Tanzania, Ms Anne Barrington, who kindly forwarded a book entitled, A Parliament With Teeth, For Tanzania, published by the Africa Research Institute. In the book Mr. John Cheyo, chair of the public accounts committee there, writes that if the Government misuses funding given to Tanzania by other countries, Tanzanian MPs should be answerable to MPs in the donor countries for their performance.

Senator Ormonde, from the other side of the House, and I visited Tanzania last year and met Mr. Cheyo and discussed this point. In the book, Dr. Williebrod Slaa, chair of the local authorities accounts committee stated that any good, accountable government should be ready to open its books whenever and wherever it is asked to do so. Nothing should be private between the Government of Tanzania and donors. It is clear that recipient countries such as Uganda and Tanzania understand the need for accountability and transparency and how important it is to the citizens of our country. From the evidence I have seen it appears real efforts are being made to tackle corruption. Our money is not lining the pockets of some dictator, it is making a real difference to the lives of the poor.

I do not agree that our citizens are weary of giving aid. More information should be communicated in terms of the benefits of such aid but so too should the message that this is not costing us very much in real terms. Peter Singer noted in his recently published book, The Life You Can Save, that in a survey carried out in the United States of America, when people were asked how much they thought the American Government was spending on foreign aid, they replied that it was probably 20% of the overall budget. When asked how much they wished to be spent, they stated the ideal amount was approximately 10%. The reality is that a little less than 1% is spent and there is a huge chasm between what many people believe is spent on aid and how much is spent. I suggest a similar study carried out here would probably produce similar results.

I have no confidence whatsoever that the Government will protect the aid budget from further cuts. This lack of confidence stems, in part, from a comparable state of affairs with Ireland's largely defunct equality and rights infrastructure. There have been international and institutional reports on the matter too and Ireland had been regularly singled out on the European and International stage as an example of a society with a vibrant equality and rights landscape. The development of this infrastructure only began in earnest in the 1990s and it took almost 20 years to grow and develop into a truly dynamic series of groups and organisations that promoted diversity, tolerance and social cohesion. However, it took Fianna Fáil, in conjunction with its partner, the Green Party, just two years to destroy this almost entirely. The Government seems to be pursuing a systematic shutdown of independence and critical voices within the State. This is why I have no confidence in the Government's ability to protect the Irish aid budget. Recent years have proven that Fianna Fáil is a fair weather friend, grand for the good times but nowhere to be seen when the going gets tough.

With that in mind I call on the Government Senators to try to prove me wrong. I genuinely hope that I am proved wrong on this issue. I live in hope but I expect the Minister will tell us that nothing is sacred given the global economic downturn and that everything is on the table. I accept the argument that we have come a long way in the past ten years but we have not reached the end of our journey. The improvements of the past decade are proof that we have reached a point in the road where we can walk shoulder high with other nations and do our bit to help others along the way on a journey to a fairer world.

I wish to continue to be able to say to citizens in such countries and Sweden, Norway, Luxembourg and Denmark that we are matching their efforts to promote equality throughout the world. I wish to give example to citizens in such countries as Portugal, Italy and Greece and to encourage them to increase their aid programmes which currently fall well below the average effort.

Jeffrey Sachs, the well respected campaigner for the developing world, predicts that the end of poverty is within sight if the developed world does its share to allow it take place. We are a small country and we can do our share by giving an example to the rest of the world. This recession will be over one day and when it is I wish to be able to say that I did my share and that my country did its share. I call on the Government Members to do their share to ensure the Government does not let us down on this issue.

Larry Butler (Fianna Fail)
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I wish to share time with Senator Rónán Mullen.

Ireland has a proud record in terms of its overseas development aid. I am also proud of our fine record when it comes to our missionaries, religious orders, nuns and those who have served this country well to deliver services to those less fortunate than ourselves. That must be established here this evening and the message should go out loud and clear.

We are in very difficult times and we are borrowing €20 billion to keep our finances afloat. A percentage of that sum is going overseas, of which I am proud. It is important that we continue to provide aid because the people overseas who depend on our aid deserve our support. It is important that we continue a fair trade situation and Europe could play a greater role in this regard. Our work in the area of fair trade in coffee is an example of how we could make those people more independent. Our approach to farming in the Third World has not been strong enough. We require many more people to go there and show the people living there how to farm effectively and ensure crops grow which are suitable for the environment. This could be easily achieved given the available technology.

We will do our best to achieve the figure of 0.7% of GDP by 2012 and the approach is realistic. As the world economy and our situation improves it will be important to ensure the target is achieved. In the meantime there are certain actions we can take. We must appeal to the professional people in the country who are unemployed at present and who could make a very significant contribution abroad. We must encourage and, if necessary, assist them in whatever way we can whether through voluntary organisations or other means. New thinking is required. If there is a shortfall at one end, the slack should be taken up at the other end. Manpower and woman power is probably a more important contribution than sending money abroad.

The water development schemes and programmes already in place must continue because water is life. If people do not have clean water and a proper infrastructure for the basic necessities, it is impossible for life to continue, as we are all aware.

Rónán Mullen (Independent)
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I welcome the Minister of State to the House. While I have great respect for the Minister of State, the wording of the Government motion is of a political language that brings politics into disrepute. I say that because the motion only tells half the truth about the OECD statement. It does not acknowledge that the Government has been urged to refrain from further budgetary action that would undermine the commitment, which seems mean-spirited and does not fully reflect the situation. We cannot get away from the swingeing cuts that have taken place. It is questionable for the Minister of State to suggest that there is something inappropriate about the fact that we might have to borrow to fund our international aid commitments.

Peter Power (Limerick East, Fianna Fail)
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What about sustainability?

Rónán Mullen (Independent)
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Does that line not betray that we do not really see international overseas aid as a priority? We do not consider looking after those people in the same way as we look after our own, which is not in the best traditions of Ireland, our missionaries and our NGOs. I am none the wiser either about where the proposed cuts will take place. I read a suggestion from the Minister in The Sunday Business Post that emergency and bilateral government to government aid has been protected because it "produces better results". Whatever about emergency aid, it is not the case that bilateral aid produces better results compared with funding at grass roots level and the work done by national and international NGOs. I would like to see a full breakdown of what is being cut, whether, for example, funding for the Clinton Foundation has been cut or funding for the various activities of the UNFPA, some of which may clash with our constitutional values, has been cut.

The question must be asked as to what the Irish public supports. There has always been a sense of envy within Department of Foreign Affairs that its programme, the bilateral programme, has not received the same public recognition as the work of Irish NGOs and missionaries, who together receive only a relatively small percentage of ODA funding. It is Ireland's long and proud tradition of missionary and NGO work that has formed the backbone of public support for overseas development aid. It is because most people in Ireland know someone who went overseas with Concern or know a priest who has worked in Kenya for 30 years, building schools, sinking wells etc. that they are prepared to support overseas development aid. The public does not support bilateral aid in the same way because it is nervous about government to government aid. Therefore, in the real sense the bilateral aid programme piggybacks on the NGO and missionary programmes; the former exists because of public recognition and support for the latter.

I am concerned about the prioritisation that will be made in making the cuts. The bilateral aid programme should suffer the same cuts, if not more, than aid to NGOs and missionary programmes. If the NGOs and missionary programmes cannot be protected from cuts, what public support can there be for the aid programme in general?

I would like to refer to the specific commitments made in response to the hunger task force report last year. That report recommended that Irish Aid work "towards an indicative target of 20% of its overseas development aid to actions to alleviate and eradicate hunger". It also stressed that "regardless of the current international economic climate, without both developed and developing countries acting on their commitments, hunger will not be reduced." The report was adopted in full at the time of its launch. I want to know whether this is still a commitment towards which Irish Aid is working. If it is, has hunger alleviation been spared in the current cuts and, if not, why not?

Just as important is the recommendation by the hunger task force report that serious attention should be given to the importance of small-holder agriculture. Not only does small-holder agriculture resonate strongly among our cultural and historical heritage, it provides a creative and effective response to many of the problems faced by the African people. I will finish with some statistics. Some 80% of Africans live rurally. Some 85% of African land has a medium to high potential for increased productivity and some 80% of Africans live on small-holder farms - probably 500 million people when we count family members. When all this is taken into account, it becomes clear why international studies back the hunger task force report's claim that small-holder agriculture holds the key to African development. I urge the Minister to make that the main priority.

Frances Fitzgerald (Fine Gael)
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I wish to share time with Senator Joe O'Toole.

Pat Moylan (Fianna Fail)
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Is that agreed? Agreed.

Frances Fitzgerald (Fine Gael)
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I welcome this debate. The support of Members for the aid programme has been well articulated, as has their concern about the cutbacks. It is important to put on the record how the crisis is affecting the poorest countries. It is the general view that the cutbacks in which the Government has engaged have been directed at an easy target because there are no votes involved. However, it is clear the people want to see support continue and the Government has their support to continue it.

The aid programme is one of which we should be proud and the work being done was praised in the OECD report. We should consider what the OECD said. It said Ireland was leading the way among EU states in the proportion of overseas aid spent on combating HIV and AIDS, for example. Having carried out an on-the-ground assessment of the Government's work in Uganda, the review team concluded that Ireland was a respected and influential donor with a strong reputation in the field. The report continued in that manner. Therefore, it is important we realise our aid programme is one of which Ireland can be proud.

The danger now is that much of the good work that has been done, the expertise built up and the effectiveness of the programme could be put at risk by the cutbacks. Tom Arnold, the chief executive of Concern, said:

To cut overseas aid on this scale is hugely disproportionate. We realise that the Irish Government finds itself with tough choices to make at home. However, this latest cut means that certain overseas projects - many of which are quite literally a matter of life or death - will be forced to close altogether or scaled down significantly. This will have significant serious humanitarian ramifications in the developing world. This comes at a time when the developed world needs to keep its aid promises to the poorest developing countries.

We know the effect of the financial crisis on people in Ireland. We know there is poverty here and that families are finding it difficult to cope. However, let us put it on the record how the crisis is affecting the poorest countries.

In 2008, the number of people suffering from hunger on a daily basis rose to a staggering 963 million, equivalent to one out of every seven people in the world. According to the World Bank, the combined food and fuel crisis has pushed an additional 130 million to 150 million people below the $1.25 a day poverty line. Thousands more children will die because of the effects of poverty. Therefore, there are serious ramifications to our cutbacks. The range of programmes affected by our cutbacks internationally are huge. They are life and death programmes.

It is right we should acknowledge that the Irish co-operation aid programme has been effective and internationally recognised. However, the Fianna Fáil motion is somewhat bizarre. It calls on us to celebrate this, while at the same time we are cutting back on the overseas programme. Reference was made to international accommodations for Irish overseas aid, but they were paid in advance of the harsh cutbacks. There is no doubt that the cutbacks are harsh and disproportionate. I ask the Minister of State to comment on the disproportionate effect of the cutbacks and the impact they will have. That is the key point.

The Government made a clear commitment to improving maternal health in its 2006 White Paper on Irish Aid. I would like to go into more detail on this if I had the time, because 536,000 women died as a result of complications in pregnancy and childbirth. I urge the Minister of State to maintain the commitment to that issue.

Joe O'Toole (Independent)
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I thank Senator Fitzgerald for sharing her time with me. I welcome the Minister of State, Deputy Peter Power, to the House. I will begin by giving my background in this area. Throughout my adult life I have been involved in the development world and related matters. I established and operated a Central American charity at one stage and have led the development of a significant Third World fund in the INTO, to which every primary teacher contributes every month. I am currently a director of a South African fund for developing education in that area.

I have had face-to-face dealings with the Minister of State and have met him in his capacity as Minister of State with responsibility for overseas aid, and I have always found him to be open, accessible, caring and responsible. I recognise the difficulties facing the Government this year and acknowledge that cuts must be made. I can understand the thinking behind an across the board, slam-dunk 20% off everything as the easy way to make the cuts - any of us might do the same if faced with that choice - but I point out that some areas are more dependent on aid than others. I would, therefore, like the Minister of State to acknowledge that the Fine Gael amendment is very fair and even-handed and I will support it tonight rather than the ones from my own bench. It is fair and it was very gracious of Senator Fitzgerald to acknowledge the OECD issue. I do not think we need to have many differences of opinion here tonight. When we are dealing with this issue, we need to look at the impact of our decisions on people in the Third World. Every citizen of every democracy has to share global responsibility for being prepared to give.

I would like to mention a group that has not yet been referred to in this debate. Christian Aid, with which I have dealings now and again, has taken a heavy hit. It is reeling from the cutbacks. Its budget in seven countries is affected at present. I am sure it has been in contact with the Minister of State, Deputy Peter Power. Its work in the Israeli-occupied Palestinian Territories, Rwanda, Burundi, Sierra Leone, Colombia, Afghanistan and Angola has been affected. I was recently involved in the opening of an exhibition, the aim of which was to draw attention to some of the difficulties that have been experienced in Angola in recent times. Christian Aid is doing superb work in Angola. I am not using this debate to raise the profile of this group, although I am keen to acknowledge its efforts. I could say the same about many other organisations. Would it be possible for the Minister of State to introduce some degree of flexibility to this system? If a particular group has a particular difficulty, can it receive specific assistance? I acknowledge the work of Christian Aid once more.

I understand that my time is almost up. Perhaps I have rambled a little. It is important for us to support organisations that work in different parts of the developing world. We all know people who have given their lives to groups that operate in the parts of the Third World, Africa, the Middle East and Asia. I hold them in the highest regard. I was at one stage very involved in Bhutan, which is an example of a forgotten country with many refugees. I would like the House to acknowledge, as the Minister of State has done, the outstanding work such people are undertaking. Perhaps their endeavours are presenting Ireland around the rest of the world in a light it does not deserve. In that context, I ask the Minister of State to recommend to the Government that it should take on board the Fine Gael proposal to start to reverse these cuts. I will conclude on that note. I thank the Minister of State for coming to the House I would like a longer debate on this issue in the future, during which perhaps we can focus on the impact this work is having on various parts of the world. I reiterate that I intend to support the Fine Gael amendment.

Mark Daly (Fianna Fail)
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I often agree with my learned colleague, Senator O'Toole. As he is also from County Kerry, it is often hard to disagree with him. He cannot be accused of rambling, even if he suggested that he rambled a little in his contribution. I agree that there is some merit in elements of the Fine Gael amendment. I remind those who have called for these cuts to be reversed that we are obviously in difficult times. The Swedish model of overseas development is often held up as an exemplar. When the Swedish economy was in trouble in 1992, the Swedish Government had to take a backward step in its overseas development assistance budget, unfortunately, in order to be able to move forward thereafter. Like Senator O'Toole, I acknowledge the work of Christian Aid, Trócaire, Concern and other groups that are doing substantial work not only in our partner countries but also in other countries throughout the world. I have seen the incredible life-saving work they have done in Gaza, for example. The most disturbing element of these cuts is that if we could give more money, more lives could be saved. That is the stark and shocking reality. It is hard to know where to start and end one's efforts.

Senator Mullen made a critical point about agriculture in the context of the work of the Government's hunger task force. He referred to the lack of productivity of soil in many parts of Africa. He suggested that the agricultural methods used by the people of Africa is contributing to the perpetuation of hunger on that Continent. That, in turn, has a detrimental effect on education etc. and thereby keeps the cycle of poverty going. While money, in itself, is a huge help in crises throughout the world, it is not the only solution. It keeps people alive in places like Congo, Gaza, Vietnam, where Ireland is involved, and Central America. We have to be smarter in these economic times, however. While Senator Buttimer can be adversarial at times, he made some great points this evening. Senator Fitzgerald acknowledged that the OECD has highlighted the things we are doing right. She was gracious enough to quote from the OECD report time and again. One cannot say that we are doing everything right, however. No Government and no person has ever done everything 100% right. We are attempting to do that and we have taken huge steps to that end. We are doing much better, proportionately, than we were ten or 15 years ago. The Irish people are demanding that we do better.

Some of my learned colleagues in the Gallery - I am not allowed to refer to them by name - have said that there are no votes to be gained in local, European or general elections from showing an interest in overseas aid. That does not mean that the Government or the Members of the Oireachtas should not pursue a policy of helping those who do not have an effect on our parliamentary system. The right thing to do is to pursue such a policy. Like the Minister of State and everyone else in this Chamber, I regret any backward step that is taken in respect of overseas aid. When the economy turns around, I believe we will take financial steps to help those in the world's poorest economies in the long run. Ten years ago, we would not have imagined that we would be giving so much money to the poorest people in the world. We would not have envisaged that the OECD would be lauding Ireland for the efforts it has taken to date. It is obvious that backward steps have been taken in recent times. I hope that in ten years' time, Ireland will have surpassed the 0.7% goal. It is a target that is ahead of other EU countries. When we have a similar debate ten years from now, I hope we will be proud of our achievements.

Joe O'Toole (Independent)
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Does the Senator reckon that Fianna Fáil will still be in government?

Mark Daly (Fianna Fail)
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I do not know. I do not have my crystal ball with me tonight.

Maurice Cummins (Fine Gael)
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Will the Senator support the Fine Gael amendment?

Joe O'Toole (Independent)
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Fianna Fáil might be back in government in ten years' time.

Mark Daly (Fianna Fail)
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Of course there will be elections between now and then. I suppose we will have to go for re-election at some stage. I commend the motion to the House.

David Norris (Independent)
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I move amendment No. 2:

To delete all words after "Seanad Éireann" and substitute the following:

"condemns the Government for breaking the commitments clearly and repeatedly given to reach the 0.7% target for development aid."

Joe O'Toole (Independent)
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I second the amendment.

Rónán Mullen (Independent)
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I move amendment No. 3:

To add after "aid programme":

notes that the OECD/DAC also said: 'the challenge for the Government is to reach these targets despite severe economic downturn and increased budgetary pressure'. That DAC also urged the Government 'to refrain from further budgetary action that would undermine this commitment';

notes the recent concession by Minister of State for overseas development, Deputy Peter Power, that decentralisation of Irish Aid from Dublin to Limerick had caused a loss of key personnel;

notes that Ireland has slipped back from progress towards its ODA commitments this year as a result of €195 million in combined cuts in February and April;

notes that despite the Government saying it is committed to meeting the UN target of spending 0.7% of GNI by 2012, it will, in fact, slip backwards from 0.58% in 2008 to a projected 0.48% this year after the February and April cuts;

notes that the serious slippage in ODA/GNI performance projected for 2009 has caused Irish development NGOs, as a sector, to suggest that it is now unlikely that Ireland will meet the Government's own interim target of spending 0.6% of GNI on ODA by 2010;

expresses concern that it sends a strange message for the Government to celebrate its ODA achievements while, at the same time, cutting back on programme areas where we have already made an investment;

regrets that Ireland's overseas development aid budget was disproportionately targeted for cuts, reducing the entire aid budget by 22% in the past ten months;

regrets the lack of transparency in the manner in which these cuts have been implemented;

regrets the statement attributed to the Minister of State, Deputy Peter Power, that he had sought to protect emergency funding and bilateral aid, which 'produces more results', in this year's budget;

reminds the Government that the work of Irish aid agencies and Irish missionaries are the cornerstone of the Irish public's support of the Irish Aid programme;

reminds the Government that the report of its Hunger Task Force in September 2008 noted that 'regardless of the current international economic climate, without both developed and developing countries acting on their commitments, hunger will not be reduced';

reminds the Government of the separate target, set out in the recommendations of the Hunger Task Force, of working 'towards an indicative target of 20% of its ODA to actions to alleviate and eradicate hunger';

urges the Government to publish detailed figures on all disbursements from Irish aid in this fiscal year, and to allow a comparison of these figures with those for the last fiscal year;

urges the Minister to set out how plans to redress the impact of decentralisation of Irish Aid to Limerick;

urges the Government to immediately stop the cuts and build up the programme so that Ireland actually meets its commitments instead of merely talking of them; and

calls on the Government to ensure that the next budget sees us meeting our commitments beyond 2012 and into the future.

Shane Ross (Independent)
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I second the amendment.

Pat Moylan (Fianna Fail)
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When is it proposed to sit again?

Donie Cassidy (Fianna Fail)
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At 10.30 a.m. tomorrow.