Vol. 1080 No. 4
162. Deputy Cian O'Callaghan asked the Tánaiste and Minister for Finance if he will ensure the Ireland Strategic Investment Fund, ISIF, is fully divested from all companies, directly and indirectly, involved in illegally occupied Palestinian territories; and if he will make a statement on the matter. [10053/26]
The Ireland Strategic Investment Fund, ISIF, still has investments in companies operating in the illegally occupied Palestinian territories. Over €6 million of our money remained invested in six companies identified on the UN database at the end of 2024. This is an arm of our State actively profiting from companies working on illegally occupied land. Will the Tánaiste ensure that the ISIF fully divests from companies operating in illegally occupied Palestinian territories?
I thank Deputy O'Callaghan for the question. In replying I want to restate the Government's clear opposition, which is also the clear opposition of this House, to illegal Israeli settlements, which are contrary to international law and damaging to the pursuit of peace in the Middle East. Ireland has not been found wanting in its support of the Palestinian people and has taken practical steps at national, EU and international levels. We have been a clear and leading voice on this. Ireland’s financial support to the people in Palestine since January 2023 will amount to €144 million by the end of this year, following a recent announcement of additional funding made by the Minister for foreign affairs, Deputy McEntee.
The Deputy refers to the ISIF and to the UN Human Rights Council database, which identifies businesses involved in specific activities in the occupied Palestinian territories. This UN database was first issued in 2020, updated in June 2023 and most recently updated in September 2025.
It is important to say from the outset that ISIF has complete independence in implementing its investment strategy under the law of the land, namely, the National Treasury Management Agency Acts, through an investment committee that reports to the NTMA's board. However, in 2024 ISIF took an investment decision to divest from six companies, all of which remain on the updated UN database, with a total value at the time of the divestment decision of approximately €2.95 million. The six companies are known and I am happy to provide them to the Deputy but in the interests of time, I will not name them now. The NTMA also divested from directly held sovereign bond holdings within the global portfolio across Egypt, Israel, and Jordan in July 2025. It is important to state the companies in question operate all over the world and ISIF's investment in them represents a very small proportion of its overall investments. This is, truthfully, some of the challenge. These are companies that are global and that operate right throughout the world. Unfortunately it is also true to say that divestment from these companies does not mean that they would stop maintaining their presence in the occupied Palestinian territories.
As I have outlined already, ISIF has, to date, completed several divestment programmes and has also excluded investments from the fund. Exclusion is used on a limited basis, reflecting exclusions mandated by legislation including the Fossil Fuel Divestment Act 2018 and the Cluster Munitions and Anti-Personnel Mines Act 2008, among others.
The issue here is that there should not be a single cent of Irish public money invested in companies operating illegally in the occupied territories of Palestine. I do not believe there is any public support for our money being used in that way. What is clearly needed is an absolutely full divestment by the ISIF - which invests public money - from companies operating in the occupied territories. I am calling for full divestment. Will the Tánaiste also call for that? Will he call for a full divestment by the ISIF from any companies operating illegally in the occupied territories in breach of international law? Will he join me in calling for that?
I have a specific legal role and responsibility. The NTMA, and the ISIF in particular, has complete independence in implementing its investment strategy under the NTMA Act and I am respectful of that. However, I did recently meet with officials from the NTMA and I was assured that ISIF will continue to monitor its holdings. It does not comment on individual investments but I have outlined the views that I know are shared in this House.
I will make two points to the Deputy on this. The first is that it is my understanding that ISIF exposure to companies involved in specified activities in the occupied Palestinian territories, as listed on the UN database, account for about 0.16% of its global portfolio. The fund has taken a number of decisions already to divest. The second point, and this is just a statement of the obvious, is that we are operating in a world where these are such large, global companies that have vast presences across the world. They may have a very small presence in a territory that we believe is absolutely illegally occupied but they are massive, global companies and that is a complicating factor.
The independence of the NTMA and the ISIF has to be respected. I met with them recently and conveyed my views in relation to this. It represents only 0.16% of its global portfolio.
I am not clear whether the Tánaiste is actually justifying the current situation. Is he justifying it or making excuses for it?
Not a single cent of our money should be invested in companies operating in illegally occupied territories in Palestine. The Tánaiste knows this and I know this. The public do not want their money invested there. I am making an easy ask to the Tánaiste. I am not asking him to direct the strategic investment fund. I understand that, because of its independence, he cannot do so. However, he can publicly give his view and call on it to divest fully. There is nothing in law to stop him doing that. The Tánaiste is able to give his opinion on that and call for it. I ask him to make a stand now and call on the fund to divest in full from any companies in breach of international law in the Palestinian territories. Will the Tánaiste join me in making that call?
I do not in any way doubt the Deputy's bona fides and I fully respect his sincerity. I do not believe that I can go further than I have. I have made it clear that the ISIF has already taken a number of decisions to divest from companies and directly from sovereign bond holdings. It continues to monitor this. The fund's level of exposure in this area is 0.16% and has been declining. The fund continues to keep this under review. I want to see a situation where we do not have occupied Palestinian territories but where we have a two-state solution. That is the position of the Irish Government.
163. Deputy Malcolm Byrne asked the Tánaiste and Minister for Finance for an update on the programme for Government commitment to consider tax measures to encourage gym membership. [9526/26]
Given the rate of osteoporosis in Ireland and the problem with regard to fragility fractures, I would be grateful for an update on the commitments in the programme for Government to consider tax measures to encourage gym membership to allow for strength and resistance training.
I thank Deputy Byrne for raising this issue. I acknowledge that it is not the first time he has raised it with me, despite my short time in this current role. I acknowledge the presence of this issue in the programme for Government. This question provides me with an opportunity to outline the significant investment that the Government has made in this area. The Government has now invested well over €1 billion in sports infrastructure and development in Ireland since 2018. It is worth putting that figure on the record. The return on that investment in community participation, inclusion, integration, and physical and mental well-being is enormous and it is probably not even possible to fully quantify all of those benefits. The allocation for the sports programme in the budget of 2026 is over €290 million, meaning an increase of just under €60 million, or 26%. This clearly exceeds the national sports policy commitment to double Government funding in sport by 2027 compared to 2018 levels. Our sincerity, bona fides and credibility in terms of investment in sport and physical and mental exercise and well-being are there for all to see. The programme for Government says that we will consider measures in conjunction with my Department to encourage gym membership and active participation in sport and exercise.
The tax code already provides for a number of fitness-based measures, including the cycle to work scheme and the accelerated capital allowance scheme for child care facilities, but also for fitness centres, which encourages employers to develop fitness centres on site for their employees. Furthermore, the private gym sector already receives tax-based public support through the reduced rate of 9% VAT on its membership fees. It is estimated that this reduced rate saves private gym operators and gym members around €32 million per year. An exemption from income tax and corporation tax also applies for the income of certain bodies established for the purposes of the promotion of athletic or amateur games or sports where it can be shown to the satisfaction of Revenue that such income is applied solely for these for these purposes. Any income received and availing of the relief by the sports body must be used for the purpose of promoting the game or the sport. The Finance Act 2024 provided new measures in relation to sports bodies and their donors in terms of being able to elect for tax relief.
Officials in my Department considered potential tax measures to support gym membership as part of the annual tax strategy group process last year in chapter 10 of the paper, "Income Tax: Tax Strategy Group - 25/01", which is available on the Department's website. This will be kept under review in the context of future budgets.
I acknowledge and am very enthusiastic about the enormous investment that we have made in sport, but this is really about measures to increase strength, resistance training and flexibility. We know that about 250,000 people have osteoporosis in Ireland - approximately 20% of women and 6.2% of men aged over 50. Annually, we see in the order of 32,000 fragility fractures, basically because of lack of strength. The estimated cost of that to our health service is €464 million annually, not to mention the pain to the individuals concerned. Given our ageing population and the challenges here, this could rise to a €1 billion within the next decade.
We need to have sufficient resistance and strength training among all of our population. There is a very clear commitment in the programme for Government to develop that. We need to look at examples in other countries like Canada and Singapore that have done this. We need to be able to build up that strength and resistance training because in the long term it is a saving on our health budget.
I instinctively agree. I do not mean to be pedantic but the programme for Government says we will consider measures. I take very seriously the programme for Government and we should continue to consider these measures as well. We had it looked at last year in the tax strategy group paper, which is published. The paper said it was not possible to estimate the exact cost of an income tax relief. It said that, conservatively, the measure would have an additional Exchequer cost of the order of €65 million, or if applied to all sports club memberships, about €147 million. There were some concerns about the dead weight in tax, which is there for all to read. I will not waste the time of the House with it now. However, we will keep this under review, and I take the Deputy's point about osteoporosis and the specific health benefits of resistance training.
We have some income tax supports already. I have outlined the VAT and benefit-in-kind measures. There are also a number of other tax and direct expenditure measures. To make long story short, though, I will give consideration to this when the tax strategy papers are compiled again this year. I am happy to engage with the Deputy in advance of the next budget.
I thank the Tánaiste and I look forward to engaging further on it. I know he is serious about this. However, I always wonder when "dead weight" is mentioned by the dead hand of the Department of Finance.
That hurt.
If I have a fragility fracture, I can get a tax relief on my healthcare expenses, I can get tax relief on my nursing home expenses, and I can get tax relief if I go to a physiotherapist, an osteopath or a chiropractor, but if I decide to join to join the gym in order to be able to build my resistance, I will not get tax relief. There is a long-term financial saving on the health side.
I have made this case often before. We need to think about the Department of Health not as a Department of sickness and illness. We have to look at ways of ensuring that as we live longer - one of the big successes of this country is the fact that we are now living to an average age of 83 - we can ensure that we live healthily in old age. Part of that is through strength and resistance training, which gym membership offers.
Just to follow on from that question about tax measures to encourage gym membership, I ask that when the review is being done at the end of the year, tax measures for families be looked at. We see young families stuck on their phones. I have two teenagers and a young adult and this year we have got a family gym membership. It is great to be able to go to the gym together. In fairness, our local gym is a testament to the money that was invested in our local sports club, in that it has allowed that facility to be there. Perhaps for parents with very young children, that tax incentive could be given for gyms. It could also be given to leisure centres so that our young children could start learning how to swim, which is a vital life skill. I ask for a tax incentive to be there for families in that regard to set in train that really good habit from a very young age and to keep families being active together and away from their phones.
I had to be very disciplined in this role in relation to tax and tax commitments in the advance of the last budget and in advance of the next budget, given that it is the month of February. We will consider all of these matters and the compelling cases that are made. The tax strategy group paper is worth reading in relation to this. After reading and considering it, I wonder whether there could be a further tweaking, development or evolution of the policy points that Deputy Byrne is trying to advance.
Regarding Deputy Callaghan's point, we have to get young people off their phones, off social media and back out exercising, socialising, engaging and making eye contact with one another again. I hope that the House can unite around measures to get people off their phones and back moving again.
I take that point about the extra cost faced by families. I would point out as regards gym membership that we already have the reduced VAT rate of 9%, which is worth around €32 million per annum, be that to the gym operators or being passed on in membership fees. Of course, how we support families with the costs of trying to live healthily is the point that is uniting both Deputies and certainly something that we will keep under review.
164. Deputy Eoin Hayes asked the Tánaiste and Minister for Finance if he has reconsidered flood insurance-reinsurance models in light of recent flooding events across the country and if he will make a statement on the matter [10059/26]
In June of last year, I asked the Taoiseach for a Government policy on a flood reinsurance scheme. He said that insurance companies have to do more. The Minister of State, Deputy Troy, corresponded with me on the issue. I thank him very much for that. Essentially, he said a State-backed scheme was impossible in a market like Ireland. Imagine my surprise to read his announcement for businesses and not residential properties last week in the Business Post saying: "It's fair to say that it will require State backing". Will the Minister of State establish the Department's position on flood reinsurance schemes?
I thank the Deputy for raising this matter again. I acknowledge that he has engaged with me on this on a number of occasions. I reiterate my earlier acknowledgement regarding the serious damage caused by the recent flood events and the impact they have had on families, communities and businesses across Ireland. As previously stated, insurance reform, including increasing the affordability and accessibility of insurance, including for flood insurance, remains a key priority for the Government. Building on the work carried out by the Central Bank, the Action Plan for Insurance Reform 2025-2029 includes four specific actions on flood and climate protection. With respect to action 17 of the action plan, the Department of Finance is currently engaging with multiple stakeholders on the development of a long-term strategic approach to the provision of flood insurance to consider potential solutions specific to Ireland to increase the availability and affordability of flood insurance. An update on this work will be provided at the next Cabinet subgroup on insurance reform.
This work builds on the extensive research undertaken by the Central Bank of Ireland into the nature and scale of the flood protection gap in Ireland, which I mentioned earlier identified a flood insurance protection gap of approximately 5% of buildings in Ireland that have limited access to flood insurance. Flood insurance alone cannot address the totality of the flood protection gap and current Government policy remains focused on the development of a sustainable, planned and risk-based approach to managing flooding. As such, the Government remains committed to protecting Ireland's present and future generations by investing in climate adaption measures to manage the impacts of extreme weather. Accordingly, €1.3 billion has been committed to the delivery of flood relief schemes over the lifetime of the national development plan to 2030. This will protect approximately 23,000 properties across various communities from river and coastal flood risk. My officials will continue to monitor developments at EU and international level and assess flood insurance matters, including through participation in the OPW and Insurance Ireland working group. These matters remain a priority for this Government and efforts continue to be made to encourage a responsive approach from the insurance industry.
Gabhaim buíochas leis an Aire Stáit. With respect, I am not asking about flood defences. I am asking about the reinsurance scheme and a State-backed reinsurance scheme. The article I referenced stated: "Businesses and homeowners within certain pockets of Dublin, such as along the River Dodder, where several flood defence schemes have been developed in recent years, remain unable to obtain insurance." This is a real issue.
In the letter the Minister of State sent to me last year, he said:
In terms of the provision of flood insurance, please be aware that this is a commercial matter for insurance companies based on an assessment of the risks they are willing to accept. Government cannot interfere with the provision or pricing of insurance or direct as to what cover is provided is reinforced by the EU framework for insurance solvency II directive.
Apparently, the State can after all get involved in reinsurance schemes. From the outset, I had issues with the Government's position because the solvency II directive allows for general price controls. Many other countries have done it. Consorcio de Compensación de Seguros in Spain, Caisse Centrale de Réassurance, CCR, state insurance providers in France and even VHI here in Ireland are exempt from the directive. Is it Government evasion and a lack of ambition at play here and not regulatory constraints?
With due respect, flood defence measures are an important part-----
They are not working in my constituency.
-----of providing protection for households and businesses. Speaking to any of the unfortunate householder or businesses in areas where the schemes have been held up for a myriad of reasons over the past number of years, they eagerly await the roll-out of the flood defence mechanisms. It is fair to say that in many constituencies, such as in Athlone in my own constituency, where permanent flood defence measures have been introduced, they have brought a real sense of confidence and reassurance to people who have previously been affected by flooding.
It is unfortunate that heretofore the insurance companies have not recognised in a meaningful way State investment in permanent flood defence mechanisms. That is why I met with my colleague, Minister of State, Deputy Moran and I am due to meet with my colleague, Minister of State, Deputy Cummins, next week in relation to outstanding issues with a service level agreement to ensure insurance companies step up to the plate in relation to areas where flood defences have been erected. I will come back in the next reply regarding areas where there are no flood prevention mechanisms in place.
The residents of Sandymount, Ringsend, Merrion and coastal communities across Dublin cannot afford another disaster and delayed action from the Government. A Financial Times article from last year and University of Galway's studies have noted that Ireland's coastal cities face huge risks during future storms. Sandymount would have been submerged in approximately 5 m in Storm Éowyn if a high tide occurred at the time. It is time for reinsurance models that include not just businesses but also people's homes to protect people's lives as well as their livelihoods. It is time the Government stopped using the excuses of EU regulation or the insurance companies not doing enough or flood defences having to take care of the risk and get on with the responsibility of protection for the coastal communities that need it in terms of reinsurance schemes. People know what climate change means. It was mostly riverside communities affected in recent weeks, but coastal communities know that they will face some of the most extreme challenges in the future. Will the Minister of State illuminate whether his comments to the Business Post were accurate, whether the Government is considering a State-backed scheme and whether that is something that it will be delivering over the coming weeks and months?
In terms of the reinsurance schemes, it is important when we are considering about flood insurance that we also consider thatch insurance. I have a constituent in Carlow who was flooded but does not have insurance for flooding. As he lives in a thatched house, he also does not have insurance for fire. I ask that when we are considering reinsurance that we might consider that too.
To reinforce what Deputy Hayes said, we have had this issue in Clontarf. The River Wad flooded in 2023. The city council got on with a scheme - the protection of the Wad phase 2 funded by the OPW. Work is more and less complete. It successively went into operation just before Storm Chandra, but there is a big question mark as to whether the insurers will come to the table and start insuring those areas again with the works done. I endorse what Deputy Hayes said. I encourage the Minister of State to proceed with this.
The Minister of State is entirely correct in that the best insurance is where we have the necessary flood protection and indeed coastal protection schemes. In some of the communities near where I live, such as Arklow, Aughrim and Enniscorthy, recently we have witnessed the dramatic impacts of floods. I wish to focus on Bunclody where they had floods for the first time in 60 years where people did have insurance, particularly along Ryland Road, on some of the properties. Now those businesses and homes do not expect to be able to get it into the future. I am certainly open in terms of the suggestion that has been made to exploring until we can guarantee that those flood protection schemes are put in place that we can guarantee those homeowners and business owners some degree of security until the necessary protections are in place.
I thank the Deputies for raising their points.
I do not know whether Deputy Byrne was present earlier when I mentioned that the Cabinet committee on climate action, environment and energy is meeting tomorrow to examine what immediate measures can be taken to protect areas where there is a longer lead-in for permanent flood defence measures to be introduced.
In relation to Deputy Callaghan's points on the thatched issue, that is something I am acutely aware of. It is a very niche part of the market. I have been in London meeting insurance companies to explore the possibility of seeing what level of appetite they might have in this regard. I have also met the representative body in relation to the thatched industry. I am happy to engage with the Deputy further in that regard.
In relation to the main question, there is an acknowledgement that an intervention is needed. That is why it is one of the priority actions in the action plan for insurance reform. There are ten priority actions. This is one of the priority actions to develop a long-term strategic approach for the provision of flood insurance. That will require working with the Central Bank, insurance industry, Department of Finance and OPW. Today, I met with a representative of the insurance industry who sits on its flooding task force.
I expect a proposal to come from the task force within a number of weeks. It might be in a month or so. The Government will explore that proposal and look at what support we can put in place to ensure flood insurance is something people can expect in the not too distant future. To clarify my remarks in the Business Post, such support will not be exclusively for businesses. Any scheme we look to introduce would be inclusive in supporting both residents and businesses.
165. Deputy Cormac Devlin asked the Tánaiste and Minister for Finance for an update on the action plan on insurance reform; and the progress made under the priority actions contained within the plan. [9531/26]
I seek an update on the Government's action plan on insurance reform. This issue continues to be raised with many of us by households, community groups and business still facing very high premiums and, in some cases, finding it difficult to get cover at all. I would like to know where the action plan currently stands, what progress has been made to date and, in particular, whether the priority actions identified within the plan are being implemented.
I thank the Deputy for raising this matter. The Government is progressing the commitments in the programme for Government to further reform the insurance sector in Ireland and ensure transparency, affordability and availability of insurance for all consumers. Significant progress was achieved through the 2020 action plan for insurance reform. Key measures delivered included the introduction of the personal injuries guidelines, legal reforms to rebalance the duty of care and the establishment of the office to promote competition in the insurance market. Those actions helped to create a more competitive market and have supported new entrants into the Irish insurance sector.
The Action Plan for Insurance Reform 2025-2029, published in July 2025, is comprised of 26 actions being led across a number of Departments, ten of which are priority actions. Of those priority actions, transparency in the insurance sector is a key priority, with a transparency code for the insurance industry well advanced and to be published in the coming weeks. The code will require insurers to provide simple, understandable explanations of how premiums are formed, what mitigating actions may be available to customers and what broader factors influence pricing. It will also ensure consumers can directly receive additional information, upon request, to better understand the factors impacting their premium.
Work is ongoing in the office to promote competition in the insurance market to enhance competition. Meetings have taken place with insurers to address capacity issues. The office has established a speciality forum to explore the speciality insurance sector and examine how Ireland can be effectively positioned and promoted as a leading jurisdiction for speciality insurance business.
My Department is also working closely with the Office of Parliamentary Counsel to the Government to progress the right-to-be-forgotten legislation to ensure fair access for cancer survivors to financial services, specifically mortgage protection insurance, and to allow the Bill to progress in the coming weeks.
The Government is firmly committed to addressing the cost and availability of insurance through implementing the reforms set out in the programme for Government and the Action Plan for Insurance Reform 2025-2029.
The action plan was pledged as the answer to years of rising premiums and uncertainty for households and businesses. However, as I am sure he acknowledges, my colleagues and I continue to hear from people who have not yet seen any meaningful reduction in their insurance costs despite the reforms that have been announced. Will he set out how the Department is tracking the implementation of the reforms and measuring the impact they are having in practice on insurance customers?
We have seen an increase in car insurance in the past 12 months but that came on the back of reductions over the previous number of years. The previous action plan delivered savings in the motor insurance industry in particular. I acknowledge that some of those gains have started to be eroded. That is why there was a need to introduce a further action plan to continue to build on the progress of its predecessor.
The Central Bank collates insurance data on an annual basis, which it makes available. That is how we can track what progress is being made in terms of how insurance premiums were decreasing for a number of years but, sadly, have increased in the past 12 to 18 months. Were it not for some of the actions introduced by the previous action plan, we would have seen significant increases in recent years as a result of market conditions.
While not directly included in the action plan, I have a question about the Central Bank (Amendment) Bill 2025, particularly the right-to-be-forgotten provision for cancer survivors seeking mortgage protection insurance, as alluded to by the Minister of State. Will he confirm that mortgage providers will embrace that provision? Has there been any dialogue, input or feedback from them in this regard?
To be fair to the insurance industry, and we quite frequently stand to criticise it, providers introduced a voluntary code of practice in this area back in December 2023. It was on the back of that voluntary code that we were able to see the difference the right to be forgotten makes to cancer survivors. We have brought forward provisions in the Central Bank (Amendment) Bill 2025 to put that voluntary code on a statutory basis. It is my intention to bring the Bill to Committee Stage within the next couple of months at the very outside. It will make a very real and meaningful difference to people who have survived cancer diagnoses and come out the other side by ensuring they are able to get on with their life and avail of a mortgage. I do not have the figures to hand but in the 12- to 18-month period after the introduction of the voluntary code, something in the region of 1,200 people benefited. It is a really significant improvement and I hope to be in a position to bring the Bill to Committee Stage within the next two months.
166. Deputy Catherine Callaghan asked the Tánaiste and Minister for Finance if he will amend inheritance tax thresholds for individuals who have no children of their own and would like to leave an inheritance to a niece or nephew; and if he will make a statement on the matter. [9956/26]
Will the Tánaiste consider amending the inheritance tax thresholds for individuals who have no children and would like to leave an inheritance to a niece or nephew?
I am aware of the group that is doing very good advocacy work on this issue. I look forward to meeting and engaging with it shortly.
Capital acquisitions tax, CAT, applies to both gifts and inheritances and is charged at a rate of 33%. For CAT purposes, the relationship between the person giving a gift or inheritance and the person who receives it determines the maximum amount, known as the group threshold, below which CAT does not arise. The group thresholds were most recently increased in budget 2025. The group A threshold, which in general applies where the beneficiary is a child of the disponer, increased to €400,000 from €335,000. The group B threshold increased to €40,000 from €32,500. This threshold applies where the beneficiary is a brother, sister, niece, nephew or lineal ancestor or lineal descendant of the disponer. The group C threshold increased to €20,000 from €16,250, with this threshold applying in all other cases. These increases amounted to an increase of 19.4% for group A, while the groups B and C thresholds increased by 23%.
My officials examined CAT as part of last year's annual tax strategy group exercise. The resultant papers outlined the tax policy considerations for the Government and the options available to it in forming last year's budget. Published in advance of the budget, they are the best means of considering issues such as inheritance tax in an analytical and transparent way. The tax strategy group is not a decision-making body - that is a matter for the Government and this House - and the papers produced by my Department are simply a list of options and issues to be considered in the budgetary process. What the group did very well was examine a number of cost modelling exercises, including proposals to amend the group B threshold parameters, as the Deputy and many others have raised in the House. There is a significant cost associated with further changes to the group thresholds. That is not necessarily a reason to make or not make them but it is something we must factor into our considerations. I recognise the burden of capital taxation and will continue to review these matters alongside my officials. We will consider any further changes in the context of the next budget.
I thank the Tánaiste for his answer.
We know - and the Tánaiste knows better than anyone - that over the last number of years Fine Gael has been at the forefront of a changing Ireland where alternative family structures are welcomed and where people do not feel the pressure to confirm to what was once the traditional idea of a family. Fine Gael values personal liberty and it is clearly reflected in the broad liberalisation of Irish attitudes. However, while societal attitudes can naturally evolve over time, laws do not evolve of their own accord. They need political will to bring them up to date. I believe the current inheritance tax is reflective of a different Ireland from the Ireland we live in today. The most recent census data show there are almost 400,000 families without children in Ireland. Therefore, if an individual wishes to leave an inheritance to someone outside their immediate family, as has been mentioned, they are only tax exempt to the first €40,000 of that inheritance while couples in group A benefit from an exemption of ten times that much. With that in mind, how does the Tánaiste intend to work towards bringing our tax system in line with social attitudes and support new family structures by increasing the inheritance tax thresholds for childless individuals?
I am, as Deputy Callaghan will know, very aware of the burden that capital taxation places on people, and it is our party's position as well. Whether it is families or farmers, the burden of capital taxation is real. That is why in budget 2025 we as a Government took a decision to increase the thresholds. We increased threshold A, B and C. I certainly do not rule out over the lifetime of this Government further moves in this area. In fact, I commit to keeping these issues under review. That is the first point I would make. Second, I take the Deputy's point very much about the changing face of Ireland, diversity and composition of families. That is all absolutely true. I will be truthful that any significant changes in what we call threshold B does come at a significant cost. It is again not a reason why we do or do not do these things; it is just something we all need to consider in the context of the budget. Third, we should continue to look at what other countries are doing in this area and international comparisons because I am sure other countries are grappling with this issue. Finally, I take the point that there can sometimes be relatives who also have a caring role, perhaps a nephew or a niece who has been caring. That is something I hear a lot. I do not mean that they are just a nephew or a niece because that is a very important familial relationship but in addition to that they may have been in a long-term caring role too. There are a number of issues to unpack here. That is why I want to meet the advocacy groups and ask the tax strategy group to continue to consider all of these issues in advance of the budget.
I thank the Tánaiste. I like that response and that well-thought-out way of looking at it from the carer's point of view. I am heartened to hear that tax measures as a whole will be reviewed in the course of this Government. I point out, perhaps again, that for many people across Ireland, factors other than choice determine whether or not they have children. If these people own properties and should they wish to pass them on to their close relatives, the low exemption thresholds mean they will be burdening those relatives with large tax bills. Oftentimes, what happens then, as we all know, a family home that people would like to keep in the family needs to be sold. That is against the wishes of the person who has left it and those of the person who is inheriting it. Furthermore, as the Tánaiste is aware, these thresholds last throughout a person's lifetime. This means that if an uncle gives a gift of over €3,000 to their niece or nephew during their lifetime, it is deducted once again from the recipient's inheritance tax threshold at the end of life. With this in mind, would it be possible to amend the rules so that there is a greater exemption for gifts that are given during a person's life?
I absolutely concur with everything Deputy Callaghan has said. She rightly mentioned that families come in many shapes and forms and different sizes. I am very conscious that we link everything to our blood relatives. The time has come that when we are reviewing all the categories we have to consider those members of our families - because essentially, they can be very much considered as family - and perhaps consider a nominated heir rather than a straightforward A, B, C category and trying to slot them into a particular blood tie or familial relationship. While we are considering those, we consider those who care for us, family friends or whoever it is, and allow the person who has worked so hard to accumulate their house and assets during their lifetime to decide who should be the correct person to inherit those assets and properties.
I have pressed the Tánaiste on this before, as I have done his predecessor. I reiterate the fact that asset values are rising and have been steadily rising over many years. This applies particularly to the family home. At the same time, families are smaller and, as my colleagues are saying, it is not always a direct inheritance from a parent to child. Sometimes, it goes elsewhere in the family or even outside the family. In light of the fact that prices and incomes are rising, I stress that there is absolutely no inflationary-based response in the thresholds. I seek the Tánaiste's commitment that he will address this and look to reform the inheritance tax categories in budget 2027.
Gabhaim buíochas le Deputies Butterly, Brennan and Callaghan. It is really good that we tease through and discuss this issue. We have various views on this and different parties have different commitments in their manifestos in relation to this. We have a programme for Government now. We need to work our way through all of this. I have to be honest with the House. Every year over the next four budgets there will be a pot and resource, subject to the economy continuing to be run well, that will be available for tax decisions, and there will be competing demands and views as to what best to do. There is personal income tax, capital tax and a whole variety of different issues. We will tease our way through that. However, over the course of those four budgets, we can achieve quite a lot together too. That is why I am committing to keeping capital taxation and the burden of capital taxation under review. To help the conversation perhaps, I will put some figures on the record. If we were to increase, for example, the group A thresholds to €500,000 from the existing €400,000, the cost of that is €86.6 million. If we were to bring everyone on threshold B into threshold A, in other words, up to €400,000, the cost of that is around €305 million. These are all budget ready reckoners as opposed to my views. Of course, there are costs associated with all of these but I take that point about families changing, care changing and the empowerment of individuals, and I will give further consideration to this in the time ahead.
167. Deputy Cathal Crowe asked the Tánaiste and Minister for Finance whether any engagement has occurred with the insurance sector following recent severe weather events, including Storm Bram and Storm Chandra; and if he will make a statement on the matter. [9545/26]
Has any engagement by the Department occurred with the insurance sector following recent severe weather events, including both Storm Bram and Storm Chandra? These storms have caused real damage and anxiety for many households that are now trying to cope with the aftermath. Could the Minister of State outline what specific engagement has taken place to date and how the insurance sector is responding to these interactions?
First, I would like to acknowledge the serious damage caused by recent storm events, and the impact they have had on families, communities and businesses. In the aftermath of Storm Bram and Storm Chandra, I engaged with Insurance Ireland, the representative body for the Irish insurance industry, regarding the insurance sector’s response to claims and reiterated the Government’s expectations that insurance companies should treat policyholders fairly and expediently in the context of claims relating to Storm Bram. Insurance companies actively track storm events to ensure adequate readiness and resource allocation. For both storm events, Insurance Ireland advised that in advance of each storm, the insurance companies took preparatory measures such as informing the public on their websites and social media platforms and activating surge plans in anticipation of the increased call volumes. The insurance companies were well prepared and were actively assisting their policyholders. For the most recent storm, Storm Chandra, Insurance Ireland has advised my officials that it is too early to quantify the overall cost of damage arising from the storm. Clean-up and assessment work is ongoing, and a clearer picture will emerge over the coming weeks. Insurers have resources in place and are on hand to support any homeowners or business owners who have unfortunately experienced flood or storm-related damage. Claims teams and emergency assistance services are fully operational and insurers are actively monitoring claims as they come in. Insurance Ireland’s insurance information service has also been available to assist members of the public who may need additional support or help navigating the claims process. My Department will continue to engage with Insurance Ireland concerning the recent storms to ensure insurers remain focused on processing claims fairly and efficiently and on working closely with service providers to expedite assessments and repairs. These matters remain a priority for this Government and efforts continue to be made to progress a responsive approach from the insurance industry.
I thank the Minister of State. As more claims are processed, households now fear that making a valid flood claim could lead to exclusion from further insurance cover or sharp premium hikes, which compound their vulnerability to future weather events.
I met many of these households and families over the last few days and weeks in Dublin Rathdown, which was particularly hit by the recent Storm Chandra. These families understand the sector's challenges, but they need protection against being priced out or dropped entirely. Will the Minister of State confirm specifically whether his engagement with insurers includes commitments to prevent households from being excluded from future policies due to a single flood claim? Will any measures or guidelines be introduced to safeguard their ongoing insurability?
I thank the Deputy. I will need to ask the insurance industry about that specific question he raised regarding how a previous flood claim may exclude people from future cover. I cannot quantify if that has happened in the past, and, if so, in how many instances. I will undertake to get that information and relay it to the Deputy. It is a problem. We mentioned in previous replies that approximately 5% of buildings are excluded from flood insurance because of previous floods or because they have been identified in a flood risk map as potentially flooding in future. That is why one of the priority actions in the action plan for insurance reform is a commitment to develop a long-term strategic approach to the provision of flood insurance. My Department is working with the OPW, the insurance industry and the Central Bank to bring forward a proposal. I met with a representative of the insurance industry flood task force, and they have given a commitment that they will bring forward a proposal from the insurance industry within the next number of weeks, at which stage we will review it within the Department, working with the Central Bank and the OPW.
I appreciate the Minister of State's and the Department's proactive interaction with the insurance industry. Will he confirm whether his Department's engagements with the insurance industry have included discussions about the role insurers could play in preventing future flooding? In particular, has he explored the possibility of insurance companies contributing in some way to resilience measures such as funding local flood prevention works, supporting community level defences, or even co-operating on schemes that reduce the risks for households and businesses to prevent reoccurrence?
I would love to think that the insurance companies would help with flood prevention mechanisms, but I do not think that is realistic. The challenge and the frustration of Government, and I made this point in reply to a previous question, is that insurance companies have not responded positively where the Government has expended large sums of money installing permanent flood defence mechanisms and where policyholders in those areas are still finding it difficult to obtain insurance. I met the Minister of State, Deputy Moran, on this issue today. I am meeting the Minister of State, Deputy Cummins, on this issue next week to see how we can bring about the relevant changes that are needed to ensure insurance companies come to the table and respect and acknowledge the fact that this State has expended tens of millions of euro putting in permanent flood defence barriers and, at the same time, they are not willing to take on the risk in those areas. That is something we need to look at, but that stakeholder group will be convening next month to explore the proposals from the insurance industry in relation to flood insurance into the future.
168. Deputy Naoise Ó Muirí asked the Tánaiste and Minister for Finance his views on amending the ETF deemed disposal rule to encourage retail investment; and if he will make a statement on the matter. [10082/26]
175. Deputy Joe Neville asked the Tánaiste and Minister for Finance if his Department will reconsider the current 38% exit tax on unrealised gains for ETFs, which is discouraging prudent saving; and if he will make a statement on the matter. [10056/26]
Tá Ceist Uimh. 168 á tógáil le Ceist Uimh. 175. Níl go leor ama againn ach chun an cheist a chur agus an freagra a fháil ón Aire.
I propose to take Questions Nos. 168 and 175 together.
I thank Deputies Ó Muirí and Neville for their questions. The starting point for this conversation has to be that we live in a country where we have a high level of savings on deposits and we need to support people who are seeking greater returns on their hard-earned savings. Work is continuing on the development of a roadmap for the taxation of retail investment. We announced in budget 2026 that this work was under way. I expect to receive proposals shortly and I hope to be in a position then to bring this roadmap to Government. It will set out an approach to simplify and adapt the tax framework to further support retail investment while obtaining the necessary and important anti-avoidance protections in a proportionate manner.
The Government and I are very clear: retail investment needs to be encouraged. It is set out in the programme for Government. It is consistent with our work at an EU level on the savings and investment union, in which I expect us to take a leadership role during our Presidency of the EU Council as well. There is a complexity to all of this in how we tax ETFs, the rate of exit tax and the application of deemed disposal, and we need to work our way through this. An ETF is an investment fund that is traded in a regulated stock exchange. There is no separate taxation regime specifically for ETFs. ETFs, being collective investment funds, generally come within the regimes set out in the Taxes Consolidation Act 1997 for such funds.
I look forward to and want to engage with Deputies Ó Muirí and Neville on this. While it is complex from a taxation point of view, we need to get it right. Detailed consideration will be given to ensure any changes in this area achieve an appropriate balance between supporting retail investment and maintaining appropriate anti-avoidance protections. If we get it right, it can be a democratisation of wealth in many ways, where the squeezed middle can start participating in a savings and investment account structure that gives them a much greater return than what they are saving in a deposit account.
