Dáil Éireann - Volume 625 - 17 October, 2006

Leaders’ Questions.

  Mr. Kenny:We are always happy to welcome our Scottish colleagues to Ireland.

I wish to ask the Taoiseach a number of questions on the ESB regulatory pricing regime. The Taoiseach will be aware that on 1 October, the price of gas increased by 34% and approximately a 20% increase has been granted to the ESB. It is an increase of 19.4% for residential electricity, 19.6% for small enterprises and 21% for large industrial units. These increases come at a time when the price of oil globally is falling. When the increases were granted, oil was $65 per barrel, $5 higher than it is today.

These increases mean that a number of categories of people are severely affected. Irish families will have noticed the dramatic increase in gas and ESB bills in the past 12 months. The ESB was granted a 25% increase last year. The gas increase will result in an increase of about €25 per household bill each month. That means families, faced with rising mortgage interest rates, are now faced with rising energy rates which will affect them very severely. Questions will have to be asked about whether radiators are kept on during the day or at night, for example. Hundreds of thousands of elderly people, many of them living alone and who need heat, will have to decide whether to heat or eat in some cases — it will be that serious.

Energy costs are crippling for businesses. I advise the Taoiseach that this is a very serious matter. I wish to bring to the Taoiseach’s attention a letter I received from an employer of 1,000 people. The point was made that the pricing model for electricity is out of kilter with reality and that since 2001, the energy regulator has granted cumulative price increases of 100% in electricity and 170% in gas. The question is asked how the electricity pricing regime can be correct when the company in question has signed a 12-month oil contract at 22% below the price of oil six weeks ago.

The global price of oil is dropping, and in this country ESB and gas charges are rising through the roof. The point is made by this employer that the only way of dealing with this is to move out of the country. That is a very serious matter. What will the Taoiseach and his Government, who set policy in this area, do about it?

  The Taoiseach:The prices that came into force on 1 October this year, including the 33.8% increase, will be fixed for one year until 30 September 2007. The Commission for Energy Regulation will review prices again during the summer of next year for the gas year starting on [1162] 1 October 2007. Under the Gas (Interim) (Regulations) Act 2002 responsibility for the regulation of tariffs is delegated to the CER, which has responsibility for ensuring market stability, encouraging new market entrants and ensuring tariffs are cost-effective and do not discriminate unfairly between licensed operators in the State sector, such as ESB or Bord Gáis, and those in the private sector. There is no need to rehearse all the issues dealt with in its decision.

Following a long price freeze from the mid-1980s onwards Bord Gáis has been able to sustain relatively low prices, in part due to favourable long-term hedging contracts, resulting in a very low average cost of gas relative to the price. The effect of the proposed increases of 33.8% on the CPI figures is 0.164%. I do not think increases in gas prices of that order will drive anyone out of the country.

The proposed increases in gas tariffs and electricity prices are practically the same. Some of the largest suppliers in the UK have also faced significant price increases. Npower has experienced rises of 30.8%, Scottish Power has averaged 34.6%, as our friends in the Gallery will know, and Powergen has experienced an increase of 24.4%. The CER has published its draft decision on the average price increase of 19.7% for ESB customers, to come into effect on 1 January 2007, one of the contributors to which is the cost of gas. While the price fluctuates the regulator takes the price over the full period and not just a few weeks.

  Mr. Kenny:That does not deal with this situation. Gas was available free of charge in the UK two weeks ago but industrial electricity costs in this country are 30% higher than in Great Britain. Industry, as the Taoiseach knows, is not included in the CPI figures. He said the price rises were unlikely to drive anybody out of the country. The company of which I speak will suffer an increase in electricity costs for next year of €800,000. I have evidence from a food processing firm in Cork whose gas bill has doubled from €3.4 million to a staggering €6.8 million per annum in the past four years. We are pricing ourselves out of the competitive market.

I have been informed by the company in question, as has the Minister, that for companies trading internationally these increases cannot be passed on and will ultimately be addressed by moving operations out of Ireland unless the situation is resolved effectively. That is a clear warning to the Taoiseach as head of Government.

Will the Taoiseach send a direction to the regulator to defer these price increases until such time as a full-scale assessment of the pricing regime is carried out? While the Taoiseach cannot direct the CER it should take cognisance of what the Taoiseach says.

Will the Taoiseach review the electricity pricing model, which will seriously affect thousands of jobs in this country? This is a very serious [1163] issue. Will he agree to do so on the basis that these increases are savage? At a time when world oil prices are falling they are going through the roof in this country. He is now warned, in advance, of what he needs to do. Will he defer the price increases and carry out a real assessment of the electricity pricing regime so as to allow some comfort to businesses, families and the elderly?

  The Taoiseach:The system in this country allows for increases once a year, as agreed in legislation passed by this House. The position is examined over a year and the regulator makes a decision that applies from operable dates. This provides consistency of policy for industry and is designed as a model that gives certainty. We have experienced one increase but in the UK this year there have been 13 increases.

  Mr. Connaughton:There have been five.

  The Taoiseach:Throughout Europe and internationally prices are going up dramatically. We, like most countries, import most of our gas from the one location in Russia. We do not have a North Sea gas resource to protect us from price rises. The same applies to industry in every country. We cannot have a regulator who keeps the situation neutral when times are good and ask him or her to stand down an increase when there is a difficulty and a real price increase. Under the legislation the responsibilities of the CER include market stability, encouraging new market entrants, ensuring tariffs are cost-effective, guarding against discrimination and exercising its functions in a way that protects the interests of the final customers of gas and electricity. A large part of the increase in electricity is because of the gas price. Gas and oil are internationally traded commodities and every business understands that.

  Mr. Durkan:They are coming down internationally.

  Mr. Bruton:Our prices are 50% more expensive than the UK.

  The Taoiseach:We have no control over them because they are internationally traded and our model is set in legislation. We have kept prices down for years, during which there has been no increase whatever. The regulator has made its judgment and recently provided figures based on its calculations over the year.

Deputy Kenny asked what we proposed to do. We took immediate action. Some 70% of generation costs are outside domestic control and the Government and the regulator will work with industry to reduce the remaining 30% of costs and improve efficiency and competition in the sector. Several weeks ago we announced a substantial increase from 1,800 to 2,400 free units for old people which, based on the calculation of the [1164] regulator, will fully protect the hundreds of thousands of people in the State who would otherwise have difficulties. It will give certainty to individuals that they can continue to be protected from the increases.

  Mr. Rabbitte:I do not know whether this is a normal parliamentary exchange with our colleagues from Scotland or whether they want to examine our proposed electronic voting system.

  Mr. J. O’Keeffe:Stay away from it.

  Mr. Rabbitte:This system cost us €52 million. We could not use it because it was not reliable and it costs us almost €1 million a year to store it in various centres around the country. I will ask the Taoiseach about remarks made at the weekend by the Minister for the Environment, Heritage and Local Government, Deputy Roche, reported in a newspaper as follows: “Roche plans to press ahead with e-voting despite security flaws.” The Minister also told TV3:

They will be used in the election and referenda after 2007. I am not going to scrap them. We have actually paid good Irish taxpayers’ money for them.

The last part of that is true — we certainly paid good Irish taxpayers’ money for them. The Minister’s remarks followed the report by the Commission on Electronic Voting to the effect that they were not of sufficient quality to enable their use to be confidently recommended and that functional testing revealed programming errors. The Taoiseach then told me that a Cabinet sub-committee was examining the issue, which reminds me of the remark of the Minister for Justice, Equality and Law Reform, on the protocol to the Maastricht treaty, to the effect that the unfortunate and much-maligned Fianna Fáil backbenchers reminded him of chimpanzees with a screwdriver behind a television set. After the Cabinet sub-committee was set up the Swedish group of computer enthusiasts said the hardware was not secure and explained why in their report. Do the remarks of the Minister for the Environment, Heritage and Local Government, Deputy Roche, come in the wake of the Cabinet sub-committee’s report? Has the Cabinet sub-committee reported or is the Minister misleading us? Does the Government intend that these machines will be used, but like St. Augustine’s plea, “not yet”, not in the general election 2007 or whenever, but after that? Is that the recommendation of the Cabinet sub-committee?

The Minister says it will not continue to cost €800,000 to store the machines because he will store most of them at some central location guarded by the Army. I would not have thought there was any difficulty in guarding them because they are useless but that seems to be the use the Minister has in mind for the Army. Will the [1165] Taoiseach tell the House the Government’s position?

  The Taoiseach:The second report of the Commission on Electronic Voting was one of the most comprehensive official reports ever produced on the matter. The overall conclusion of the report was that the system chosen for our country can potentially enhance and deliver real efficiency in the administration of elections.

  Mr. Howlin:“Potentially” we could land on Mars.

  The Taoiseach:The commission concluded that it could recommend the voting and counting equipment for use in elections, subject to further work that it recommended and it set out the nature of that work. Deputy Rabbitte correctly said that we established a Cabinet sub-committee, chaired by the Minister for the Environment, Heritage and Local Government, to consider the reports in detail and to report to the Government on the full implications of the commission’s report, consider the composition of a peer review group drawn from international electoral reform bodies and the IT industry to supervise any software redesign work, to report to the Government on confidence-building measures and identify any other improvements that might be built in to the system.

  Mr. Rabbitte:What about the report from Sweden?

  Mr. J. O’Keeffe:Yes look at what happened in Sweden and Holland.

  The Taoiseach:In response to Deputies Rabbitte and Jim O’Keeffe, in Holland the anti-electronic campaign group, of which Deputy Rabbitte used not be a part——

  Mr. Connaughton:It did not work.

  The Taoiseach:Our Scottish friends would find it amusing to know Deputy Rabbitte was totally in favour of electronic voting until the results of the last election.

  Mr. Cullen:The Deputy is in the Dark Ages.

  Mr. Durkan:They would not find the cost amusing.

  Mr. J. O’Keeffe:Nothing works under this Government.

  The Taoiseach:The anti-electronic voting campaign group in the Netherlands physically hacked into a machine to demonstrate security flaws. If one hacked into a ballot box one could do that too. It is important to note that the Commission on Electronic Voting made recommendations on how the physical and electronic security of the [1166] system could be improved. I understand the Dutch Government has stated publicly that the revelations had no implications for the forthcoming elections. I note from media reports, which I received this morning, this is the view of the Dutch national media too.

The commission also concluded that the main hardware components of the system, including the voting machine, are of good quality and design and are robust against failure and well suited to their purpose.

  Mr. Howlin:Why do we not use them if they are so wonderful?

  The Taoiseach:The commission offered an overall validation of the investment in the machines——

  Mr. Connaughton:Are they waterproof?

  The Taoiseach:——and the associated hardware and the most negative conclusion in the report related to the management of the software which it could not recommend. It recommended what should be done to correct this and that is precisely what the committee is endeavouring to do.

  Mr. Rabbitte:If the machines are as good as the Taoiseach says, why are we not using them in the election? Is that not the net point? What is the point in telling us that the software does not work?

  Mr. Cullen:The Deputy was not listening.

  Mr. Rabbitte:It is like saying the chassis of a car is in perfect condition but the engine does not work.

  Mr. Cullen:That sounds like a Labour car.

  Mr. Rabbitte:I had forgotten the former Minister for the Environment, Heritage and Local Government, Deputy Cullen. Let us hear what he said.

  Mr. Cullen:Deputy Rabbitte needs to look at his own chassis.

  Mr. Rabbitte:This is a direct quote from Deputy Cullen: “The system Ireland has used successively and will use next year is the most secure electronic system that exists in the world”.

  Mr. Allen:At great expense.

  Mr. Rabbitte:Deputy Cullen continued “At all stages all aspects of electronic voting have been tested and re-tested by independent——

  Mr. Cullen:No matter what system Deputy Rabbitte uses it will not help him.

[1167]   Mr. Rabbitte:——experts. My Department has engaged six independent consultancies [I believe that bit as well] to verify electronic voting. Labour has engaged two branch secretaries.”

  Mr. Stagg:We were right and the Minister was wrong.

  Mr. Cullen:Fair play to the Dutch who at least showed Dutch courage.

  Mr. Rabbitte:That is what the Minister said. The point was that the truth of the report commissioned from two branch secretaries by the Labour Party has been borne out in all respects. Although this Minister was warned by among others, independent experts outside the House, he, like his predecessor, the Minister for Communications, Marine and Natural Resources, Deputy Noel Dempsey, insisted on ploughing ahead.

  Mr. N. Dempsey:With the support of the House.

  Mr. Rabbitte:The current Minister, Deputy Roche, completes the line-up of The Three Stooges. Has this Cabinet sub-committee reported? If not why is Deputy Roche speaking on television and issuing press releases to the effect it has been decided to use this system but not in the general election? Is the implication that it is alright to use it in the European election but not in a general election? The Taoiseach says the report of the commission was comprehensive. It certainly was. It was a comprehensive indictment of the system’s reliability and confidentiality to be used in these circumstances after spending €52 million of taxpayers’ money on it.

Finally, one of the commission’s most alarming findings was that a testing of the count software found that where two or more candidates were tied and one had to be eliminated the software eliminated the wrong candidate. The Taoiseach tells us it is alright to use that system in the European and local elections. If the Cabinet sub-committee has not reported when will it do so and what is the Government position and policy on the waste of €52 million of taxpayers’ money? The former Minister, Deputy Cullen, is still in office, Deputy Noel Dempsey is struggling with ESB price rises and Deputy Roche is preparing to join them.

  An Ceann Comhairle:Deputy Rabbitte should give way to the Taoiseach. He cannot have the seven minutes to himself.

  Mr. N. Dempsey:Deputy Rabbitte is still in Opposition and will stay there. The Labour Party supported the system.

  Mr. Rabbitte:I supported a system that would work.

[1168]   Mr. Stagg:That was then this is now.

  The Taoiseach:I will not take seven minutes to reply. The commission concluded that the main hardware components in the system, including the voting machines are good quality in design, robust against failure and well-suited to their purpose. That was the view of the commission on the expenditure. It was quite satisfied that the hardware that cost the money can work and operate effectively.

They are not in use because of the democratic system whereby the voting system for people to exercise their franchise needs agreement. Members of the Opposition were happy with that and then changed their minds.

  Mr. Allen:No. That is not true.

  Mr. J. O’Keeffe:We will accept a working system.

  The Taoiseach:Some €500,000 has been spent on the election management software. The commission gave its views on how we could improve that. That is what the committee is doing.

Our Dutch colleagues and others have studied this position. An editorial in a Dutch newspaper this morning stated: “A return to the system of paper and red pencil sounds romantic, but it is only a spurious solution, since fraud is possible in any system.”

  Mr. Howlin:It is all double Dutch.

  Mr. Allen:We still use it.

  Mr. J. O’Keeffe:That’s right, we still use it.

  The Taoiseach:As Deputy Rabbitte knows, thousands of votes in our elections that are not stamped take away the democratic franchise of the electorate, which proves that our silly old system is outdated.

  Mr. J. O’Keeffe:The Taoiseach wants us to use an even sillier one.

  The Taoiseach:We have to correct the software, which will cost €500,000 and try to move forward. Otherwise, this country will move into the 21st century being a laughing stock with our stupid old pencils.

  Mr. Allen:The silly old Minister is the problem now.

  Caoimhghín Ó Caoláin:Appropriately in the presence of our Scottish visitors, will the Taoiseach join with me in recording a welcome for the progress made during the talks at St. Andrews in which I was a participant as a member of the Sinn Féin delegation? Does the Taoiseach agree there was a clear sense of willingness on the part of all parties to assist in mov[1169] ing the situation forward at the St. Andrews talks? Does he agree this momentum must be maintained?

What is the Taoiseach’s response to the postponement by the DUP of today’s scheduled talks between it and Sinn Féin? I understand that the engagement still had not taken place when we commenced Leaders’ Questions. Does the Taoiseach concur that the agreement between the two Governments and any ongoing discussions must affirm the Good Friday Agreement and work towards its full implementation? Does he agree that the process is not about finding a way around, undermining or superseding the Good Friday Agreement?

Does the Taoiseach agree that the next assembly elections should take place at the end of the current term, namely that envisaged from the last assembly elections rather than a new set of elections occurring as mooted by some opinion? Is he also of the view that the St. Andrews document in no way supersedes or overrides the essential essence of the Good Friday Agreement as endorsed by the electorate North and South? Does he agree a referendum on the agreement at St. Andrews is not required in this State? Will the Taoiseach join with me in urging everyone of all opinion and none throughout Ireland to take the time to read the document presented by the two Governments to the final plenary session on Friday? People must inform themselves properly and reflect and engage in every positive way imaginable in order that the momentum towards the full implementation of the Good Friday Agreement can be maintained.

  The Taoiseach:This matter will be further debated in the House tomorrow. I thank our Scottish colleagues for the facilities they made available to us and particularly thank the Scottish First Minister, Mr. Jack McConnell, for his courtesy and the time he afforded us on our arrival on Wednesday last.

We had a successful meeting with the Northern Ireland parties and appreciate the valuable contributions that were made. A timetable is in place for the restoration of the institutions. We have ensured the deadline of 24 November remains real. The engagement was difficult and for a long time it seemed we would not get an outcome. However, we produced a document and it is hoped that, after studying it, all parties will come to agreement.

While there are many elements to the document, the essential ones involve commitments by the DUP to power sharing and by Sinn Féin to accept and support policing. Sinn Féin’s position on policing will be decided through its own structures in the weeks ahead.

All parties left St. Andrews in a positive frame of mind. They were asked to say whether they would agree the package by 10 November, following consultation with their members. If agreed, the nomination of the First Minister and [1170] Deputy First Minister on 24 November would be on course. Dr. Paisley told us the DUP will say “yes” to this. While the First Minister and Deputy First Minister will not actually take up office on that date, symbolically it will be a landmark moment.

In advance of this, the parties will begin meeting at leadership level to discuss the programme for government. That issue was to be dealt with today. I do not believe we should get too excited about developments on this issue. Annex A of the St. Andrews document dealt with the issue that emerged today. Annex A states under amendments to the pledge of office:

The pledge of office would require that Ministers would participate fully in the Executive and NSMC/BIC, and would observe the joint nature of the office of First Minister and Deputy First Minister. Before the Government legislates on the pledge of office it will consider the outcome of further preparation for government committee discussions on policing and the rule of law.

It is clear that the issue that created some difficulties today was dealt with by the two Governments and was to be dealt with in the preparation for government committee discussions.

The fundamental principles of the Good Friday Agreement are consent for constitutional change, commitment to exclusively peaceful and democratic means, stable inclusive partnership government, respect for equality and human rights and a balanced institutional accommodation of the key relationships within Northern Ireland, between North and South and between these islands. These remain unchanged. The St. Andrews proposals, which arise from the review of the Good Friday Agreement, if accepted by the parties, will ensure they are fully reflected and implemented as intended by the Agreement for the first time since the suspension of power sharing four years ago.

The Good Friday Agreement was never intended to be static. It provided for a review of its operation by the Governments and parties four years after it came into operation. The review began in 2004 but given the events of December 2004, it could not be brought to a conclusion. We hope these proposals will now help to bring the process forward. I hope with the issues that created some difficulties today, and other issues, that people will look at the annex and agree them, as the Governments said they should, in the preparation for government committee.

  Caoimhghín Ó Caoláin:In the wake of the St. Andrews meetings, will the Government revive the Taoiseach’s proposal for limited representation for Northern MPs in a committee of the whole Dáil? Will the Government outline what further proposed peace dividend will come forward with a particular focus on the Border Coun[1171] ties and the Six Counties? Will it outline the infrastructural developments and other co-operative initiatives on a North-South basis that it will co-host and co-fund to give real substance to the all-Ireland dimension of the Agreement?

Will the Offences Against the State Acts be revisited in line with the Agreement’s commitment to set aside all anti-human rights legislation? Will the Taoiseach enhance the role of the Human Rights Commission in the Twenty-six Counties so that the equality and human rights agenda can be advanced on an all-Ireland basis, given the deficits that apply to the two respective bodies North and South?

  The Taoiseach:In response to my earlier letters to party leaders and based on the 2001 all-party committee report, there seems to be a basis to allow representation for Northern MPs in some form. It must be done with co-operation of Members but, for my part, I will bring it forward. We have already engaged with the British Government at ministerial and official levels regarding the peace dividend. There is a large agenda of items on the North-South Ministerial Council covering health, education, science and food. The human rights legislation is in place and we have set up the associated structures. We will continue to work on those in co-operation with the authorities in the North. The answer to the Deputy’s questions, therefore, is “Yes”. The Government, as we outlined last week and in all previous discussions, is prepared to move these matters forward as fully as we possibly can.