Written Answers – Department of Finance: Budget Measures (18 Feb 2014)
Séamus Healy (Tipperary South, Independent)
205. To ask the Minister for Finance if he will reverse the budget 2014 measure regarding health insurance due to the fact that as a result health insurance premiums have been increased excessively; and if he will make a statement on the matter. [8154/14]
Michael Noonan (Minister, Department of Finance; Limerick City, Fine Gael)
In the first instance, decisions taken to increase the cost of health insurance premiums are made by health insurance providers and are beyond my control. However, it is the case that in Budget 2014 tax relief for medical insurance premiums was restricted to the first €1,000 per adult and the first €500 per child insured. Any portion of premium paid in excess of these ceilings no longer qualifies for tax relief.
The cost of Income Tax relief in respect of medical insurance has increased significantly in recent years, estimated at €404 million in 2011, €448 million in 2012 and €500 million in 2013. Despite the increasing cost of the relief, the number of individuals insured has reduced over the same period, while at the same time the level of medical cover has decreased on some policies. Against this background the increase in costs is unsustainable. If the relief were to remain unchanged and the trend was to continue, the cost would increase to approximately €1 billion by 2020.
Prior to this reform the State was effectively paying 20% of the cost of all private medical insurance premiums via the system of income tax relief. In effect this means that those taxpayers who could never afford private health insurance, or who have had to give up their policies due to personal circumstances, are providing financial support via the tax system to those individuals who can afford such insurance.
Although it is true that the restriction of the tax relief may have in some cases, led to a net increase in medical insurance premiums payable by individuals, it should be noted that many would only be affected marginally, depending on the cost of the policies that individuals choose to purchase.
The measure to restrict tax relief in respect of medical insurance premiums was approved by the Dáil via Financial Resolution on Budget night and confirmed by the Oireachtas via the enactment of Section 8 of Finance (No. 2) Act 2013, which was signed into law by the President on 18 December 2013. I have no plans to review the restriction in the short term.
In light of Irish Water stating yesterday that they will not have charges identified until after the elections despite the Taoiseach stating to the contrary during Leaders Questions on 04 February http://wp.me/p1Uvd5-wN , Deputy Healy again asked the Taoseach this morning:
Deputy Healy asks the Taoiseach the following questions with regard to the introduction of the water charges:
“Where water is not fit for purpose, such as in the case of the 18,000 families subject to boil water notices like residences in my constituency served by the Burncourt regional water supply scheme, will families be charged for water?”
“Where hard water is supplied and is corroding electric kettles, shower heads, washing machines and dishwashers, as is the case across the northern part of Clonmel, will the families be charged for water?”
“A huge number of premises will not be metered before the introduction of the charges. How will the bills for these families be calculated?”
“What will be the free water allowance? Will larger households get a larger free allowance of water?”
“Where individuals have special needs for extra drinking water, will the extra amount be free?”
“Will individuals with medical conditions requiring frequent use of toilet facilities, for example those suffering from incontinence, prostate problems or Crohn’s disease, be provided with extra free water for sanitation?”
In addition Deputy Healy asked the Taoiseach if he had misled the Dáil last week, reminding the Taoiseach of his reply which is on the Dáil record, or had Irish Water mislead the Dáil Environment Committee yesterday.
Link to this mornings show:
Seamus Healy TD on Morning Ireland re Water Charges
Courtesy of Morning Ireland:
How long before consumers know how much they will pay in water charges?
Seamus Healy, Independent TD for South Tipperary, discusses claims by Taoiseach Enda Kenny that water charges will be revealed before the local and European elections.
The link above is for the whole programme, the relevant piece starts at 27 minutes 45 seconds, or, click the option on the right which reads:
“How long before consumers know how much they will pay in water charges?”
This will bring you directly to the relevant podcast.
Workers & Unemployed Action 