asked the Minister for Finance if he will quote the statutory authority for the payments made to the liquidator in respect of certain repayments made to depositors of the Irish Trust Bank Limited.
Ceisteanna—Questions. Oral Answers. - Irish Trust Bank Limited.
11.
Of the moneys advanced by the Central Bank to the official liquidator of Irish Trust Bank Limited to enable him to make full repayment to depositors, approximately £1.9 million fell to be recouped to the bank from Vote 15, Miscellaneous Expenses. A Supplementary Estimate for this purpose was approved by Dáil Éireann on 13 December 1977. The Estimate was given statutory effect in the Appropriation Act, 1977.
The balance, £996,000, was provided by the Central Bank from its own resources. That amount corresponded approximately to the further distributions expected to be made by the liquidator on the realisation of the assets of Irish Trust Bank Limited. The Central Bank ranks as a creditor in the winding up.
The Central Bank has wide powers under the Central Bank Acts, 1942 and 1971 to supervise the banking system so as to promote the orderly and proper regulation of banking and also to exercise the powers and functions of bankers, in accordance with normal banking practice. There is some uncertainty, however, whether the bank's statutory powers cover the advances made from its own funds in this case and the Government agreed, accordingly, to propose legislation to put the matter beyond doubt. The necessary legislation is currently in preparation.
(Cavan-Monaghan): Would the Minister say whether all the depositors have been paid in full?
Not yet. As I indicated, the liquidator has already paid a certain amount on what was already realised. In anticipation of what else might be realised extra funds were guaranteed through the Central Bank, coming to something of the order of 60 per cent. It has not been possible yet to ascertain the balance.
(Cavan-Monaghan): What has been the cause of the delay?
There has been a delay in trying to ascertain the total amount of the assets and liabilities and the matter is still under active consideration.
(Cavan-Monaghan): As the Government accepted responsibility for any shortfall, would the Minister not think the reasonable thing to do would be to pay all known depositors immediately?
Over and above that, the Government paid through the Central Bank as agency in respect of loans that were ascertained.
Did I understand the Minister to say that the Central Bank had paid money for which there was no statutory authority?
No. I said there was some doubt whether the bank's statutory authority covered the advance made from their own funds. The view was that it was covered by existing legislation. In view of that, it was agreed to introduce new legislation to put the matter beyond doubt and that legislation is in course of preparation.
Retrospective legislation?
Is there a possibility that money has been paid for which statutory authority has not issued?
It is a very vague possibility.
It is concrete enough for the Government to introduce legislation to correct it retrospectively.
This matter was discussed when a Supplementary Estimate for that purpose was approved by the Dáil in December 1977, and this question was dealt with then.
I am dealing with it today. All I want to know is if there is some doubt as to the legality of money paid out.
No. I am advised it does not pose any legal issue.
Why is it considered necessary to introduce new legislation?
There are two functions in legislation. The most important function is to ensure that if a situation of this sort were to arise again there would be clear statutory provision to enable us to act immediately.
The Minister has already acted.
We acted in accordance with the authority of the Central Bank.
Question No. 12 is to be taken for written reply.