Thomas Byrne (Meath East, Fianna Fail)
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368. To ask the Minister for Public Expenditure and Reform if his Department has undertaken an analysis of whether it would be more efficient in terms of reducing uncertainty and transaction costs on employers to implement the increase in the national training levy proposed as part of the employer contribution mechanism in one budget rather than sequenced over several budgets as proposed. [27200/17]

Thomas Byrne (Meath East, Fianna Fail)
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369. To ask the Minister for Public Expenditure and Reform his views on whether or not it would be possible to vary the rate employers pay on the national training levy to the proposed employer contribution mechanism according to the assumed benefit they derive from higher education training or alternatively to varying contributions by sector whereby employers in more high skilled sectors pay a higher contribution. [27201/17]

Thomas Byrne (Meath East, Fianna Fail)
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370. To ask the Minister for Public Expenditure and Reform if the limits imposed by the expenditure rule on spending the surplus of the national training fund are due to the legislative provisions which established the fund as a hypothecated revenue rather than as general revenue and as such could be altered by amending the National Training Fund Act 2000 to disestablish the fund as a hypothecated revenue and re-establish it as general revenue. [27203/17]

Thomas Byrne (Meath East, Fianna Fail)
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374. To ask the Minister for Public Expenditure and Reform if his Department has sought approval from EUROSTA on whether it would be permissible under the fiscal rules to use the surplus from the national training fund levy for capital expenditure. [27324/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 368 to 370, inclusive, and 374 together.

As the Deputy will be aware, I announced at Budget time last October my intention, together with the Minister for Education and Skills, to carry out a consultation process on the design and operation of an Exchequer-Employment mechanism to help fund higher and further education and training into the future and to drive continued reform. The consultation process specifically aimed to:

- Fully explore with employers the balance between impacts(on competitiveness and productivity), benefits(of skilled human capital) and costsof a proposed investment mechanism;

- Contribute to the development of an equitable and sustainable long term funding model for HE and FET;

- Strengthen outcomes for the HE and FET system of benefit to employer and the wider economy;

- Convey a clear signal domestically and internationally of the value Ireland places on the education and training of our human capital in an ever more competitive and risk heavy environment; and

- Demonstrate collective leadership where Government and Employers can consult on a high level national priority and together drive enhanced outcomes in return for additional investment.

There was considerable engagement (28 submissions) with the public consultation, which was subsequently followed by an open forum event with stakeholders on May 31st hosted by the Minister for Education and Skills and I. The purpose of the forum was firstly to better understand are the proceeds from the National Training Fund (NTF) currently being put to the best use and secondly, if there was an increase in the NTF levy how should this be configured in order to meet the needs of employers and the wider economy. Both Departments are now actively considering all of the issues raised as part of the consultation process including the specific issues referred to in the Deputy's questions, for example, the sequencing of the proposed increase in the NTF and the scope and case for establishing differential rates for the NTF levy. Following this consideration, the Minister for Education and Skills and I will bring a Memorandum to Government on the outcome of the consultation process and the proposed next steps.

With respect to the use of the surplus in the NTF; as set out in the consultation document this is constrained due to the EU fiscal rules. In the absence of an increased rate of contribution, additional expenditure cannot be sourced from the NTF without a corresponding reduction in Exchequer expenditure in other areas. The rules are designed to ensure that increases in public expenditure are sustainably financed and reduce the risk that additional expenditure is funded on the basis of cyclical or windfall revenues. The fiscal rules are applicable to all government finances therefore to disestablish the fund and re-establish the proceeds as general government revenue, as the Deputy suggested, would not alter its treatment.

As set out in the legislation the intent is for the proceeds of the NTF to be used to give skills to, or raise skills amongst those in, or seeking, employment. Given how the surplus safeguarded the FET sector during the downturn, the implications and knock-on effects of using the fund for any other purpose, including capital expenditure, require careful consideration. Regarding capital expenditure more generally, the Deputy will be aware that the capital plan is currently being reviewed by my Department in order to take stock of our national infrastructure priorities now and in the future and to allocate further resources so that they best meet our social and economic needs.