How a food crisis led to Delhi’s foul smog

If there was a gold medal for bad air, Delhi would be hard to beat.

Yet, despite high levels of air pollution, more than 30,000 people, many wearing masks, took part in the capital’s half marathon on Sunday. Organisers said they used devices on the route to transmit radio frequency waves to clear the air, but scientists were sceptical of these claims.

Delhi’s marathon, ironically, marked the beginning of the city’s smog season. But it has been creeping up on the capital for a few weeks now.

A fortnight ago, Nagendar Sharma was returning to Delhi from the hill station city of Shimla when he spotted smoke rising from the farms alongside the highway.

It looked like someone had picked up a box of matches and set the earth on fire. Lack of winds meant that the acrid smoke hung in the air.

Mr Sharma, the Delhi-based media adviser to the capital’s chief minister, was driving through Haryana, barely 70km (43 miles) from the capital.

When he stopped his vehicle to investigate he found that the farmers had begun to burn the stubble left over from harvesting rice. They said they had to remove the residue in three weeks to prepare the farms to sow wheat. They were burning the crop stubble as they could not afford the expensive machines that would remove them.

“It’s the same old story. Every year,” Mr Sharma said.

Every year, around this time, residents of Delhi wake up to a blanket of thick, grey smog. Pollution levels reach several times the World Health Organisation’s recommended limit. Last year, doctors declared a state of “medical emergency”; and hospitals were clogged with wheezing men, women and children.

Levels of tiny particulate matter (known as PM 2.5) that enter deep into the lungs reached as high as 700 micrograms per cubic metre in some areas. The WHO recommends that the PM2.5 levels should not be more than 25 micrograms per cubic metre on average in 24 hours.

Last winter Air Quality Index (AQI) recordings consistently hit the maximum of 999 – exposure to such toxic air is akin to smoking more than two packs of cigarettes a day. The city becomes what many call a “gas chamber”.

“This marks the beginning of the Great Smog that goes on to last for about three months, even though the crop residue burning lasts a few weeks. It is during this period that air quality indices hit their maximum possible limits, when visibility drops drastically, when regions even far away – such as Delhi – smell of burning gas,” says Siddharth Singh, energy expert and author of a book soon to be published, The Great Smog of India.

And although there are other reasons – construction dust, factory and vehicular emissions – it’s mainly crop residue that has emerged as one of the main triggers for the smog.

More than two million farmers burn 23 million tonnes of crop residue on some 80,000 sq km of farmland in northern India every winter.

The stubble smoke is a lethal cocktail of particulate matter, carbon dioxide, nitrogen dioxide and sulphur dioxide. Using satellite data, Harvard University researchers estimated that nearly half of Delhi’s air pollution between 2012 and 2016 was due to stubble burning. Another study attributed more than 40,000 premature deaths in 2011 to air pollution arising from crop residue burning alone.

But it wasn’t always like this.

In Mr Singh’s telling, the deadly pea-souper is result of the “evolution of the farming operations, government policy and changing labour markets” sparked by the “green revolution” in India in the late 1960s and 1970s.

The “green revolution” allowed a country wracked by famines, hobbled by un-irrigated farms and dependency on food aid to produce enough grain to feed its people. The northern states of Punjab and Haryana turned into breadbaskets, producing enough rice and wheat for the country. Wheat is sown and harvested during winters, and rice to coincide with the monsoon season in July and August.

Price support for crops, high-yielding seeds, expanded irrigation, official farming timetables and the introduction of combine harvesters – which combined the jobs of cutting and threshing the crop in order to produce processed grain in a matter of seconds – were the catalysts of this modern farming revolution.

The “green revolution” was an unqualified success in giving India much-needed food security. It led to vast increases in wheat and rice production, but also ended up polluting air and depleting groundwater.

“That a revolution in agriculture was necessary is by itself not up for debate. What the revolution and the subsequent policies did, however, was contribute to the creation and timing of the air pollution crisis and also to the rapidly depleting groundwater levels; this has been termed as an ‘agro-ecological’ crisis,” says Mr Singh.

Farmers burn crop residue because the stubble left behind after the combine harvesters have done their job is sharper and taller than it otherwise would be, potentially injurious to farmers and not good fodder for animals. If they do not remove the stubble, straw gets stuck in the machines that plant the rice crop.

So they simply set fire to the farmland to get the soil ready quickly for the next crop, as Mr Sharma saw on the highway to Delhi.

According to Siddharth Singh, there are some 26,000 combine harvesters in use in India, most of them in northern India. They are responsible for a practice that is now a major contributor to air pollution.

The government has tried to solve this with “happy seeders”, which are attachments mounted on tractors that help plant wheat seeds without getting jammed by rice straw stubble from the previous crop. But they are expensive – upwards of 130,000 rupees (£1,363; $1,769) and diesel-guzzlers – and remain out of reach for most farmers, who own small plots of land.

During the smog season last year, according to Mr Singh, there were about 2,150 of these machines in Punjab and Haryana as against an estimated requirement of more than 21,000. Another machine called the “super straw management system” which chops and spreads the stubble evenly is also effective but expensive for the majority of farmers.

Mr Singh reckons if crop stubble burning is to be stopped fully within five years, 12,000 “happy seeders” will need to be purchased every year. India, he believes, needs a second “green revolution which would be a technological one – one that adequately deals with agricultural shock to air quality”. Until that happens, Delhi’s foul air will continue to poison its 18 million people.

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California vote opens the door for British Columbia to stop changing clocks for Daylight Saving Time

Time could be ticking on a long-time tradition in British Columbia. Premier John Horgan says that if California goes ahead with sticking on permanent daylight saving time, B.C. could very well follow suit.

On Tuesday, a majority of California voters, nearly 60 per cent, voted in favour to leave the state in daylight saving time all year round.

“There is a long way to go still but I can’t imagine British Columbia can’t go down that route if California chooses to,” said Horgan on Wednesday to Global News.

In order for the clocks to be fixed all year round two-thirds of the members of the California state legislature would have to vote in favour of the change. There would then have to be the support of a majority of the national congress to change the federal law.

WATCH HERE: A week after saying it wasn’t on the radar, the B.C. government says it may be time to consider abandoning Daylight Saving Time

“A two-thirds vote isn’t easy to do, particularly in the United States, and then they would need approval of Congress,” Horgan said.

“It certainly speaks to how much people care about this issue. I have received tens of thousands of emails from British Columbians who want to stay on Daylight Saving time. I said last week that as long as our neighbours, trading partners are changing their clocks, we should too,” said Horgan.

Horgan seemingly put the time change issue to bed last week when he told reporters the challenge with stopping the practice of changing the clocks was working with other jurisdictions along the west coast. Oregon and Washington had previously indicated a lack of interest in making a change.

Democratic Rep. Kansen Chu of San Jose said last month that he sponsored the California resolution after his dentist called him to complain about springing forward when clocks are moved up an hour every March. That switch takes away an hour’s sleep in the middle of the night as it shifts an hour of sunlight from the morning to the evening.

Chu said he investigated the issue further and learned the original reason for implementing Daylight Saving Time — to save energy during the First World War — no longer seemed relevant.

Chu said he also came across studies showing an increased risk of car accidents and heart attacks following the spring change when people lose an hour of sleep.

“It’s a public safety measure,” Chu said. “And I don’t know anybody who really enjoys doing this adjustment of their schedule twice a year.”

–With files from the Associated Press

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The EU's tariff threats against Asia's autocrats risk backfiring

NEW YORK (BLOOMBERG) – The European Union is threatening to slap tariffs on Asian leaders who abuse their power, a move that risks upending several key garment-producing nations in the region.

Last month, the EU told Cambodia it would start the process of withdrawing tariff-free access for most goods under the “Everything But Arms” initiative, saying its July election was “marked by harassment and intimidation”.

The bloc is threatening to do the same for Myanmar due to genocide allegations, and a Reuters report said Sri Lanka may be next on the list.

If the EU follows through, the moves risk hurting garment sectors that employ nearly two million labourers, most of whom are women. In all three countries, the initiative has made the EU as one of their biggest export markets for garments, generating billions of dollars in revenues annually.

Human rights activists have applauded the EU, which is increasingly taking a leadership role on humanitarian issues from a more inward-looking US under President Donald Trump.

At the same time, some in the business community see the moves as counterproductive, and analysts doubt they will lead to major changes.

EU MARGINALISED

China, in particular, could step in to offset any export losses from nations hit with new EU tariffs, according to Mr Murray Hiebert, a senior associate of the South-east Asia Programme at the Centre for Strategic and International Studies in Washington.

“Putting pressure on governments to respect human rights is very important, but to use sanctions as one size fits all will risk marginalising the EU in giant swaths of Asia,” Mr Hiebert said.

“The best the EU can hope for is that it will feel better about punishing gross violations of human rights.”

Sri Lanka has also suddenly come under scrutiny after the President abruptly fired the prime minister, triggering a political crisis that has yet to be resolved. The country’s garment sector employs some 600,000 people and accounts for about a third of manufacturing employment.

Mr Tung-Lai Margue, the EU ambassador to Sri Lanka, told Reuters last week the bloc would consider withdrawing duty-free tariff benefits if the government wasn’t meeting its commitments. The embassy declined to comment when contacted.

AFRICAN ALTERNATIVE

The situation is more worrying for Cambodia and Myanmar.

In Myanmar in particular, the news is a setback for many foreign companies that moved in after the country transitioned to democracy from military rule over the past decade. EuroCham Myanmar said the move may put as many as 450,000 of the country’s garment workers out of a job within four years.

Some European companies have indicated they would move their operations to Africa or other nations if the EU puts tariffs on Myanmar goods, according to Mr Filip Lauwerysen, the executive director at Eurocham Myanmar and Secretary-General of the European Business Organisations Network.

The bloc has “completely lost any sense on how to address these issues”, Mr Lauwerysen said. “Myanmar is heavily backed by China and Russia and there is not much we in Europe can do with our current status in the global landscape of things.”

Preferential exports to the EU from Myanmar have more than doubled in recent years to US$1.48 billion (S$2.03 billion) in 2017, according to EU data.

Mr Aung Ko Ko, an independent economist who also sits on the ruling NLD party’s economic committee, said that Myanmar had not done anything wrong and was confident the EU wouldn’t stop preferential treatment.

“Myanmar isn’t doing any harmful actions to EU members,” he said, noting the government has invited European officials to see the “true story”.

‘STIFF COMPETITION’

In Cambodia, the garment sector is by far its biggest export, a US$5 billion industry that employs about 750,000 Cambodians.

Prime Minister Hun Sen, whose party won every seat in a July election boycotted by the main opposition party, has struck a defiant tone toward the EU and failed to win a reprieve from the bloc in talks last month.

In an Oct 20 letter to the trade commissioner of the European Commission, the Garment Manufacturers Association in Cambodia said a suspension of duty-free access or unilateral sanctions would hurt garment workers and their families.

“All the progress that Cambodia has achieved over the past two decades through the efforts of all stakeholders, including development partners like the EU, could be destroyed very quickly,” it said.

Mr Eric Tavernier, the chief executive officer of textile firm We Group Ltd. which has a factory that employs about 700 workers in the Cambodian coastal town of Sihanoukville, said the subsequent EU tax burden would likely mean the end of his business there.

“Cambodia is going to face some stiff competition from elsewhere now that they are no longer the cheapest option,” he said.

Still, he understands why they acted.

“Why should we keep helping countries if they don’t follow basic democratic rules?”

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Ikea rules out new Irish stores as digital grows

Ikea has no plans to open further stores in Ireland, despite strong growth in sales.

Sales in Ireland grew 7.4pc in the company’s last financial year to €181.5m.

Ireland market manager Claudia Marshall said it is focused on investing in its so-called multi-channel approach – ie online sales as well as physical store sales.

“We have no plans to open additional stores in Ireland at present,” she said.

Ikea has recently introduced online shopping here and said that helped to boost Irish revenues.

Ms Marshall said the move to online “has been a great success and has performed strongly in its first 10 months in operation, giving customers all over Ireland the opportunity to shop with Ikea whenever and wherever they want”.

The sales figure covers the year to the end of August last.

The company also said it had been boosted by investment in its two outlets here – the full-sized store in Ballymun and its order and collection point in Carrickmines, South Dublin.

It said price reductions and the hot summer had also helped.

“Ikea’s seasonal sales saw a bumper boost and, as a result, outdoor furniture was the biggest area of growth in Ikea Ireland this year, with a total sales increase of 29pc,” the company said.

The Swedish chain has enjoyed decades of rapid growth as shoppers flocked to its out-of-town warehouses to pick up cheap furniture to assemble at home.

But with the rise of online rivals such as Amazon, alongside signs of waning consumer enthusiasm for DIY home improvements, Ikea is now investing in ecommerce, city-centre showrooms and more home delivery and assembly services.

Barbara Martin Coppola, chief digital officer at Ikea Group, the owner of most Ikea stores, said tests underway ranged from connecting staff with customers via video to artificial intelligence tools to help people furnish their homes.

“It’s fantastic to see human interaction through technology when the consumer might need help or advice on where to place furniture,” she told Reuters last month in an interview at a new Ikea city-centre store in Madrid dedicated to living room furniture.

Ikea, whose stores are owned by 11 different franchisees, opened 19 new outlets last year, taking the total to 422 in more than 50 markets.

The largest franchisee is Ikea Group, with 367 stores.

The brand, which does most of its sales in Europe, opened its first store in India this year and announced plans to enter Latin America, starting with Chile in 2020 followed by Colombia and Peru.

It said last month that it was also looking at entering Mexico, Estonia, Ukraine, Puerto Rico, Oman, Luxembourg, Macau and the Philippines over the coming years.

Additional reporting Reuters

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B.C. social worker accused of stealing from kids in Ministry care

A civil lawsuit that has been filed in Kelowna claims a social worker stole money from teens in the care of the Ministry of Children and Family Development.

The court papers claim that in early 2016, Robert Riley Saunders had a First Nations youth placed in an independent living arrangement under Ministry care.

The teen was then eligible for financial benefits from the Ministry.

The documents allege Saunders opened a joint bank account with the youth and took some of the money for his own purposes.

The financial institution where Saunders did his banking is also being named a defendant in the case for failing to recognize Saunders’ banking irregularities.

The teen eventually found himself in a transient and sometimes homeless living situation.

The Ministry of Children and Family Development and the Director of Child Welfare were also named as defendants in the case for not adequately overseeing Saunders’ actions, and is facing some serious questions.

“My response is there’s a publication ban on this case. I’ve been advised that I can’t speak to it, which, I’m sure, is as frustrating for me as it is for you,” Katrine Conroy, Minister of Children and Family Development said outside of the B.C. legislature on Wednesday. “As soon as it is lifted, and our lawyers are working on that, I will be able to share as much information as I can.”

The notice of claim also alleges Saunders engaged in the same and similar activities in respect of dozens of other minors in his care, most of whom are Aboriginal children.

A proposed class action lawsuit has also been launched in Vancouver court.

Attempts by Global News to contact Robert Riley Saunders were unsuccessful. His profiles have been removed from social media sites.

Saunders has three weeks to respond to the notice of civil claim.

None of the accusations made against Robert Riley Saunders have been proven in court.

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YMCA sounding alarm on rising homelessness rates in Moncton

With the number of homeless people on the rise in Greater Moncton, the YMCA is sounding the alarm with the colder months right around the corner.

“We’re trying to come up with new initiatives to make sure that these individuals don’t get harmed during the winter months, they don’t experience things like frostbite or even death,”says Lisa Ryan, director of Outreach & Employment Services.

“We’re worried that this could be the first winter that we could see some of those things increase.”

Ryan says they’re aware of approximately 120 people who are homeless, using their services, which include visiting tents in the area. She says there’s still the “hidden homeless,” referring to those who are couch surfing or using shelters. She says they were working with roughly half that number last year.

“I think all of the organizations that are on the ground that see this rise in numbers of individuals who are experiencing states of homelessness are very concerned.”

Lisa Ryan of the YMCA says they’re aware of roughly 120 people who are currently homeless in Greater Moncton

Lack of affordable housing is one of her concerns, in part due to rooming homes shutting down in recent years.

“(It’s) very difficult to house people, which keeps them in shelters longer, and the longer somebody’s taking up a bed in a shelter, the longer somebody else has to wait,” says Ryan. “That’s kind of what we’re seeing. That’s what’s alarming to us.”

Cal Maskery, who is executive director and founder of the Moncton shelter Harvest House Atlantic, says they’ve been over capacity during the warmer summer months, with as many as 57 visitors using the shelter designed for 32.

It’s a viscous cycle when some people can’t rent their own place due to mental health and addictions concerns. Ryan says they hope to offer more services in the form of supportive housing programs, including assisting someone trying to rent following those concerns.

Ronald Straight says he was living on his own until injury about six weeks ago forced him to leave work and turn to the shelter.

“(There are) a lot of obstacles for a lot of people,” he says. “People are on social services and on very, very limited income. Again, it’s just a blessing to have a place like this for people to come to.”

Maskery says they saw the need for more affordable housing, and they hope to double their ”step-up housing” rooms to 72 over the next two or three years. The rooms are made for someone starting a job or education, who can prove themselves to be “stable,” to 72 over the next two or three years.

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Jury picked for ‘El Chapo’ Guzman trial

Jurors have been selected in the trial of notorious Mexican drug lord Joaquin “El Chapo” Guzman.

Seven women and five men will decide if Guzman is guilty of 11 charges related to trafficking, money laundering and firearms.

All 12 will remain anonymous under tight security terms and be escorted to and from court by US Marshals.

If convicted, the leader of the infamous Sinaloa Cartel could face life in prison.

Guzman – whose nickname “El Chapo” roughly means “Shorty” in English – twice escaped prisons in Mexico before he was extradited to the US in January 2017.

His trial in a federal court in Brooklyn will begin on 13 November and could last up to four months.

US prosecutors say the Sinaloa cartel under Guzman’s tenure shipped vast amounts of heroin, methamphetamines, cocaine and marijuana into the US.

Guzman’s lawyers have reportedly hinted they plan to argue he had a smaller role in the cartel than is believed.

Of the jurors, at least three are immigrants and three speak Spanish fluently. Several have relatives who work as prison guards or in law enforcement.

While nearly all said they had heard of Guzman before being called for jury duty, they said they would be impartial in the trial.

Prosecutors said the stringent security conditions were necessary to protect jurors. They said Guzman has a history of intimidating or ordering the murders of potential witnesses, a claim his defence denies.

Several potential jurors were excused after expressing fear about participating.

One woman reportedly wept after learning she was picked, and said she was fearful of the attention she would get if she was found out to be on the panel. She remains a part of the jury.

However, others were excused for more particular reasons.

One man, who was born in Medellín in Colombia, was not chosen after admitting he was a “bit of a fan” of Guzman’s, and had tried to get his autograph.

Another said his job as a Michael Jackson impersonator made him too well-known to serve, while a third man was reportedly recused after saying he had heard of Guzman thanks to a bagel named after the criminal at a deli near his home – a fact which, if made public, could lead to the man’s identification.

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Dangerous doctors being hired by HSE, judge warns

People with “little knowledge of the basics of medicine” are being allowed to work in hospitals here due to “defective” recruitment in the HSE, a leading judge warned.

High Court President Mr Justice Peter Kelly warned starkly of the “obvious danger to patients” as doctors lacking basic skills are being employed.

The judge will now contact Health Minister Simon Harris and the head of the HSE over the alarming concerns about recruitment of medical staff.

He made the startling comments in the case of a junior doctor in a maternity unit who was suspended from practising by the High Court.

Other doctors had raised serious concerns, within days of his starting work, that he lacked basic medical competency and was a danger to patients.

Criticism of recruitment in the health service came as the winter trolley crisis kicked in early, with almost 600 patients left languishing yesterday.

A row raged as Taoiseach Leo Varadkar refused to apologise for demanding staff work “full whack” at Christmas.

However, the sharp focus is now also on HSE interview and recruitment procedures, after the case of the junior doctor who was never taught how to examine a pregnant woman.

Mr Justice Kelly concluded the public interest required the doctor, who graduated from medical school in an east European country in 2015, be suspended from practice pending further order.

The judge wondered how the interview panel could have awarded him 55 out of 100 marks for clinical medical and diagnostic skills when his lack of those “was so obvious within days of his coming to work in the hospital”.

He also wondered how the interview panel concluded the doctor was “short on experience” when he had “none at all”.

The suspension order was sought by the Medical Council, and granted by the president of the High Court, to protect the public.

It applies pending a fitness to practise inquiry into complaints by two obstetricians about his methods.

Mr Justice Kelly said it was not an isolated incident and he had encountered other cases where registered medical practitioners “with little knowledge of the basics of medicine” were recruited to work in hospitals here.

He warned that “defective” recruitment and interview procedures have led to employment of persons “wholly unsuitable for appointment and an obvious danger to patients”.

His judgment expressing serious concerns should be sent to the Minister for Health Simon Harris and the acting CEO of the Health Services Executive, he directed.

The judgment noted the doctor never previously worked in any paid capacity in any other hospital anywhere and two consultants said he did not meet the “most basic” standards of competence of doctors practising “at this very junior level”.

Some of his junior colleagues here said they witnessed “wild” clinical assessments by him, made without taking any history or examining a patient.

The application for the order was heard and granted in private last month but yesterday the judge directed his judgment be made public on condition the doctor is not identified.

The doctor had attended an earlier meeting with the Medical Council but did not attend the court hearing or provide sworn evidence.

The judge said while the doctor had described himself as having been a senior house officer in a UK hospital, a letter from the NHS made clear he was merely an observer in a department of medicine and was to have no hands-on contact with patients.

Two consultants here had then raised concerns about his basic competencies, including history-taking, taking blood tests, insertion of IV cannulas, how to prescribe drugs and knowledge of drugs.

The doctor had told the Medical Council he made clear when interviewed here he lacked experience and that it was an observership he held in the UK.

He also said he was nervous and overwhelmed when asked by the consultants here about his medical knowledge.

He added there were “gaps in my training” but he was still studying and going to courses.

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Cocaine and 'party' drug use soaring again as improving economy sends wealth rising

There has been a resurgence in demand for “party” drugs in Ireland as the economy has improved, a new report has warned.

The Cross Border Organised Crime Threat Assessment report for 2018 says cocaine use is nearing its 2007 peak, and crack cocaine and prescription drug abuse will require more focus from gardaí and the PSNI.

The report, which gives an insight into organised criminal activity, says cocaine is second only to cannabis in its attractiveness for gangs.

The drug, which retails at approximately €70 per gram, is in constant demand across a wide variety of areas from urban centres to rural villages, the report notes.

“It is as yet unclear if the consumption of cocaine has returned to its 2007 peak and stabilised, but anecdotal evidence suggests that such a return is likely to occur soon if that has not already happened,” it states.

“In a similar vein, MDMA and related drugs have seen a resurgence in popularity in recent years resulting from the economic recovery.”

Meanwhile, while “still not a drug of national scale,” the report notes crack cocaine will require increasing attention into the future.

It says that “while the more traditional drug importation routes remain in place on both sides of the Border, the advent of the ‘dark net’ as well as the development of numerous, bespoke, psychoactive substances and the abuse of prescription medications” has led to significant diversification in both drug abuse and organised crime groups activity.

The report was released as the 16th annual cross-border organised crime conference opened yesterday at the Slieve Donard Hotel in Newcastle, Co Down.

The conference brings together representatives from government departments, An Garda, the PSNI, the Criminal Assets Bureau, the National Crime Agency, HM Revenue and Customs and Revenue Commissioners.

Justice Minister Charlie Flanagan, who attended the meeting, said he was committed to ensuring very close North-South co-operation on criminal justice matters.

“I am keenly aware of the threat posed by criminals who seek to exploit the Border,” he said.

Among the issues highlighted in the report is the use of “mules” by criminals to launder money.

This involves a person’s bank account being used to receive monies which have resulted from a criminal act.

The stolen money is then transferred into the “mule” account where it is withdrawn and transferred back to the criminal, with a fee being paid in most cases to the account holder.

The report also warns the “dark web” is likely to see an increase in firearms availability for use by criminals.

The gardaí and PSNI said issues such as human trafficking will remain at the top of their agenda. The report notes “the exploitation of human beings poses significant societal and law enforcement challenges in both jurisdictions”.

This year, Ireland has seen a larger proportion of human trafficking cases, involving trafficking for the purpose of labour exploitation, which is “of concern”, particularly in certain industries, with the fishing industry being especially susceptible.

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Pepper hit with €3.7m bill after tax appeal defeat

Mortgage servicing and lending firm Pepper Ireland paid €3.7m in back tax to the Revenue Commissioners last year after it failed in its efforts to offset €129m in historic losses against future tax liabilities.

It was reported last year that Pepper Ireland, part of the Australian Pepper Group which is owned by private equity giant KKR, had lost a case brought to the Tax Appeals Commission, which resulted in the payout.

The amount of the settlement made with the Revenue Commissioners as a result of losing that case was not revealed at the time.

Pepper bought a mortgage loan book with a face value of €600m from GE Ireland in 2012. The loan book was distressed, and was reportedly sold for about 40pc of its face value.

Pepper subsequently looked to utilise losses in the loan book as a deferred tax asset, which would have enabled it to offset future tax liabilities against those losses.

That could have seen Pepper Ireland having no effective tax liability until such a time as it had used up the €129m deferred tax asset.

The Revenue Commissioners objected to Pepper’s plan in 2014. The finance firm then appealed that decision, with a determination made at the end of 2016.

“I have determined above that the trade that gave rise to the loss is not the same trade as the trade which gave rise to the income against which the Appellant [Pepper] sought to offset the loss and I have determined that loss relief is not available,” said the appeal commissioner.

The latest set of accounts for Pepper Ireland, which have just been filed, show that the firm paid €3.7m last year as a result of an underprovision for corporation tax.

The accounts also show that pre-tax profits at the firm fell by a third last year to €5.6m as revenue from its loan servicing activities declined from €46m to €42m.

Pepper Ireland manages about €16bn of loans for customers including Danske Bank and Bank of Scotland.

“Adjusted for one-off non-recurring items, these are a strong set of financial results at a pre-tax operating profit level and continue to recognise Pepper’s position as one of the most successful servicers in the Irish market,” said Pepper Ireland CEO Cormac Ryan.

The €16.1bn of assets under management at the end of 2017 compared to €17bn at the end of 2016. However, during 2018 the company has secured significant additional servicing mandates, with lenders such as Leeds Building Society.

Last month, Pepper Ireland exited the residential mortgage market in Ireland, having entered the business in 2016.

It sold a €200m portfolio (face value) of mortgages, held by about 900 borrowers, to Finance Ireland, the company founded by Billy Kane, a former CEO of Irish Permanent. Finance Ireland is backed by the State’s Ireland Strategic Investment Fund.

The €200m of residential mortgages that Pepper had at the time the sale was announced last month compared to €113.1m in residential mortgages it had in issue at the end of 2017, and €27.6m at the end of 2016.

In 2017, Pepper also launched mortgage lending activity aimed at commercial properties and professional buy-to-let borrowers. It continues to be involved in that activity.

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