asked the Minister for Finance if he is aware of the statement made by the managing director of Irish Life calling for the privatisation of that firm: if this statement represents Government policy on Irish Life, if not, if it is intended to take action as a result: and if he will make a statement on the matter.
Ceisteanna—Questions. Oral Answers. - Privatisation of Irish Life.
1.
I am aware of statements by the managing director of Irish Life to the effect in general that a re-organisation of the capital structure of the company and a dilution in the Minister's shareholding in that company could be of benefit to the company in facilitating its expansion and development.
The question of privatising Irish Life, however, has not been examined by Government and no decisions have been made on the future of the Minister's shareholding in the company.
Does the reply mean that the Government and the Minister have not yet decided whether Irish Life could or should be privatised? Is the privatisation under consideration by the Minister?
The matter has not been examined by the Government at all and no decisions have been made on the future of the Minister's shareholding.
I am aware of that from the Minister's reply, but the question is whether the Government's policy in regard to privatisation is as it was before the election. They were then against the privatisation of Irish assets.
The Deputy may not widen the scope of the question. The question is a specific one.
The second part of the question asks whether the statement referred to represents Government policy on Irish Life. The Minister seems to infer in his reply that Government policy on privatisation has not yet been decided and is a matter for investigation
The Chair is concerned about the subject matter of the question.
I am anxious to know if the Minister considers it desirable that Irish Life should be privatised. Would he not consider it most important that Irish Life should be retained in public ownership so that investment policy of Irish Life could be controlled by the Government to ensure that investment is in Ireland rather than abroad? Would that not be in accordance with Government policy?
All I can say is that the specific question the Deputy is asking has not yet been considered by the Government. I can say that exploratory discussions about its future have taken place with the company at official level in recent months. No conclusions have been reached and no commitments have been entered into. Given the suggested benefits from a sale of State shares, it is important that the matter be fully explored. The Deputy refers to a statement by the managing director. A number of statements were made and it will be seen that there was no immediate hurry in regard to these questions. Even if any decisions were to be taken, it would be in the longer term.
Does the Minister regard it as in order that the managing director of a State company should be pressing the Government for a particular policy decision when the Government have obviously taken no such policy decision? What is the Minister's view of the action of the managing director of a State company in advocating publicly that the Government should privatise the company?
I assume it is in the interests of the managing director of any company to make statements that he or she may believe to be in the long-term interests of that company. I understand that is the type of statement which was made by the managing director concerned. Everybody will understand that there are a number of legal difficulties involved before any decisions could be made. Exploratory discussions have taken place at middle management level in the Department of Finance and Irish Life and they will continue.
Does the Minister accept that the realisation in whole or in part of the Minister's shareholding in Irish Life could bring in a very substantial sum for the Exchequer, as opposed to the existing return to the Exchequer which on shareholders' funds of about £1.5 billion and an annual income of about £500 million gives a return to the State of only about £0.5 million?
That is the legal basis of the present situation in Irish Life. Those are the legal difficulties to which I referred. These matters will be examined further and in greater detail.
May I ask one other question?
I will not allow a debate on this matter.
Would the Minister not accept that there is a case to be made for the setting up of a feasibility study to examine the manner in which a disposal might take place and the present legal and other constraints on such a disposal, so that an informed decision might then be made by the Government, bearing in mind the realities of the situation rather than any doctrinaire approach?
The Deputy, as a former Minister, will be aware that exploratory discussions took place in December, January and February. These will continue, to do the very things which the Deputy has just outlined.
When does the Minister expect to have the results of the study?
I do not know. I said they will continue.
Arising from the discussions at official level alluded to by the Minister, would he agree that the minimum period for any legislative changes and policy changes would be at least 18 months to two years, in the event of a Government policy decision being taken to permit the placing of shares on the market? Would the Minister agree with that time-scale?
I think the Deputy is right, but I would shorten the time-scale if such a decision were taken to about 12 months.
Would the Minister confirm that no decision on this matter was taken by the previous Government?
All I am saying is that this Government have not yet had the matter examined.
Would the Minister agree that no decision—
The Deputy was a member of the previous Government. He might tell us.
Would the Minister be prepared to confirm from the official information available to him that no policy decision in relation to this matter was taken?
I am not quite sure whether the Government had made a policy decision or not, but in regard to the exploratory talks that are going on, no conclusions had been reached and no commitments entered into. That is the reality. As the Deputy said, in the event of any decision being taken the time-scale would be long before any legislative proposals would come forward.
Would the Minister agree that, in the event of such a policy decision being taken, all the indications are that non-Irish insurance investors would effectively proceed to take over the company in the event of its being privatised?
That would be a matter of speculation at this time.
Is the Minister not aware that there is fairly conclusive evidence available to him that, in the event of a policy decision of this nature being taken, Irish Life would effectively pass out of Irish hands?
I do not accept that. It is speculation at this stage.
The information is available to the Minister.
The Deputy seems to know.
Has the Minister laid down any ground rules for the further study of this question and would he make it a requirement that control remains in Irish hands? Will he assure the House that a decision will be made purely on the merits of the case and not on any ideological or doctrinaire grounds, as implied in Deputy Mac Giolla's question?
This matter has not been examined by the Government and, therefore, the two points which the Deputy mentioned have not arisen.
Could the Minister assure the House that the Government had no say in Irish Life investment policy which is a matter for the board of that company even in their present formation?
It has been set up on a legal basis.
Does the Minister agree that he has no objection in principle to a disposal of the equity in Irish Life to non-Government equity holders? Does he also agree that he has an open mind on this issue at the very least? Does he further agree that if it turns out to be the case that the sale of the shares in Irish Life is desirable in the public interest, in order to reduce public indebtedness a speedy rather than a delayed or deferred sale of these shares is in the national interest?
As I said, this is not just a matter for me; it involves the Government who have not yet examined it. It remains to be seen whether I would have an open mind on any of the issues that might arise following discussions.
Does the Minister not know if he has an open mind?
That was not the question the Deputy asked.
It is precisely the question I asked.
The question was in relation to decisions which will be taken and I said they had not yet been examined by the Government.