asked the Minister for Finance if he is aware that the receiver of the McCartin Group in County Leitrim said that departmental approval was obtained for the receiver's fees and expenses which were over £600,000 in respect of the receivership; if he will confirm that he received full details of this receivership account; how the sum of approximately £600,000 is broken down vis-à-vis fees and expenses; if he will give details of these accounts; if he is satisfied with the total fees and expenses charged; and if he considers that they were reasonable and in order.
Ceisteanna—Questions. Oral Answers. - McCartin Group Receivership.
3.
The Exchequer funded the receivership of the McCartin group for the period 19 March 1980 to 3 February 1981 and detailed accounts covering the expenditure involved were supplied to my Department prior to the payment being made.
The total in fees and expenses paid to the receiver which relate to this period was £381,000 and this was met by the Exchequer. No funds were provided by the Exchequer in respect of the balance of the cost of the receiver's fees. The receivership fees met by the Exchequer were £316,500 made up of £275,500 for the management of the receivership and £40,000 for a special report commissioned by the Government on the viability of the group. The total number of hours worked by the receiver and his staff in respect of the £316,500 was 14,200 and the average rate per hour was £22.30. A further £64,500 was provided in respect of travel and accommodation for the receiver and his staff.
The amounts involved are substantial but they cover an 11 month period and they are in line with charges for this kind of work.
On a point of order, can the Chair tell the House why the name of the McCartin Group was mentioned in the question? This is a departure from normal practice.
That is the name of the firm.
It is not normal practice to include the name. We can look at the Order Paper but we will not find any names of outside bodies.
First, it is a matter for the Deputy to put down the question. Second, it has been the practice to try to preserve the anonymity of the people about whom queries are made, but it appears that this firm has been before the public for some years and the item being queried was published on the papers some time before the question was put down.
Why is not the receiver's name given? We can look at the Order Paper and see in Question No. 5 "a person (details supplied)", and this has been normal practice in this House.
The receiver's name was not mentioned in the question as furnished and it would be improper for the office to include his name, which most people know.
In view of the very serious public concern expressed arising out of the fees charged in this case, does the Minister agree that they were exorbitant? If so, has he any plans in hand to ensure that such exorbitant fees are not charged on all receiverships and liquidations? In view of the fact that most people believe those fees were exorbitant, does he not agree that this is bringing the whole system into disrepute? It must be realised that while these fees were charged other items were left outstanding such as tax, sizeable sums due to the ACC and so on. Would the Minister comment on those questions?
As I said in my reply, the amount paid in this case by the Exchequer in receivership fees amounted to £275,500 for the management of the receivership and the balance of the total was made up of various expenses and the cost of the special report commissioned by the Government. I also pointed out in my reply that the total number of manhours spent on that portion of the receivership financed by the Exchequer was 14,200 and the average rate per hour was £22.30, a level of fee which is in line with that normally paid for this kind of work.
I accept that fully but——
A question please, Deputy.
A fee of £22.30 per hour for the principal of a firm is justified, but 14,200 hours were worked by that firm. Does the Minister consider that every person in that firm was entitled to £22.30 per hour for services rendered? In his capacity as Minister for Finance, would he have this matter seriously looked at by an independent body to decide if those fees were exorbitant, and if they are, to have the receiver make a sizeable return to the Exchequer?
I am prepared to accept that there may be a case for asking if the scale of fees applicable in a case like this should not be examined again with the profession in question, although as far as I am aware the levels of fees laid down are common in that profession. For some of the period 17 staff from the firm in question were engaged full-time on various aspects of the receivership and for much of the period during which the Exchequer financed the receivership there were seven full-time staff on the firm's premises, including high level management staff. As to the question of fees, there may be grounds for taking up with the profession in question the level of fees charged for this kind of work.
Have the travelling hours to and from the firm been included in the hours charged for management time? Would the Minister accept that a considerable amount of the exorbitant expenditure involved here was caused by the promoters of this firm because the receiver was unable to gain access to the premises? We have all read the number of times the receiver went down there and the kind of action that was taken to prevent access——
That is a different question.
(Interruptions.)
Everything is relevant.
The figures I have given include an amount for expenses in addition to the fees incurred by the receiver. As to the factors that led to the receiver having to spend the amount of time he did on the job, that is separate from the question which deals with the amount paid. A full account of the expenditure involved was supplied to the Department of Finance before payment was made and it was found to be justified.
Deputy MacSharry.
I think the Chair is trying to move away from the substance of the question I asked.
Deputy Reynolds will withdraw that allegation.
What am I to withdraw?
That the Chair is some way moving away. I am calling Deputy MacSharry.
What allegation did I make?
The allegation was that the Chair in some way is moving away from a point you raised.
I asked a supplementary question and I did not get an answer. With all due respect, I am entitled to a reply.
I am asking Deputy Reynolds to withdraw any allegation he made against the Chair.
I did not make any allegation against the Chair.
The Chair holds that you did.
I did not. Name the allegation and I will withdraw it.
The Deputy alleged that the Chair was deliberately moving away from the question.
I did not use that expression.
Moving away from the substance.
When to be fair the Chair was calling Deputy MacSharry because he represents the constituency in which this concern was based——
I represent many people who were hurt by this collapse, as the Chair is well aware.
I am asking Deputy Reynolds to please withdraw his allegation against the Chair.
If you name it I will withdraw it.
I have named it.
I did not make that allegation.
If Deputy Reynolds states that he did not say what the Chair understood him to say and that, if he did, he will withdraw it——
I did not say what the Chair understood me to say. Everybody else heard what I said as well as the Chair.
There should not be arguments with the Chair. When the Chair called Deputy MacSharry twice Deputy Reynolds said: "You seem to be moving away from the question"——
From the substance of the question.
——thereby implying that the Chair was not being fair. I appeal to Deputy Reynolds to withdraw the allegation.
If the Chair is so sensitive, I will withdraw it.
The Minister has accepted that the fees for the time served were normal for the profession. Would he care to comment on the reason for the receivership being involved for such a length of time? Could he give the total cost to the Exchequer, including loss of revenue to the Revenue Commissioners, the ACC and generally to the Exchequer?
I have already pointed out the total amount of time involved. The Exchequer funded the receivership from 19 March 1980 to 3 February 1981. The receivership in question was particularly difficult for a number of different reasons. The figure I have given covers the total cost of the receiver's fees funded by the Exchequer. As I said, the total was £381,000.
I heard that twice. I asked another question. I asked the total cost to the Exchequer of this whole receivership.
In terms of the revenue foregone, I have not got a figure for that. It would be impossible to estimate what the revenue would have been had the business continued in operation without a receiver.
Surely the figures of money due to the Revenue in terms of PAYE and other sums due are available to the Minister.
I think you will agree that is a separate question.
It is not. The Minister said he could not give an estimate but, there are known figures which he must have of amounts due to the Revenue.
Clearly that is a separate question. The question deals with receivership only. I am calling Ceist 4.
The Minister did not give the reason for the length of the receivership.