asked the Minister for Industry and Commerce the total estimated cost of the collapse of the Insurance Corporation of Ireland at the latest date for which figures are available; if the Government have any proposals to alter the financial basis of the rescue package for ICI; and if he will make a statement on the matter.
Ceisteanna—Questions. Oral Answers. - Insurance Corporation of Ireland.
10.
The audited accounts of the company recently published by the administrator showed a net balance sheet deficiency of £120 million at 31 December 1986 after the £100 million advanced from the banking sector is taken into account.
The Government have no proposals to alter the financial arrangements which have been made for the company.
In view of the fact that the reports of the recent court case were to the effect that the Insurance Corporation of Ireland were now making a profit, does the Minister intend to recoup to the Exchequer whatever losses were incurred in the original takeover of the company? I take it the Minister now regards ICI as a nationalised company?
The State has taken over the company. I presume that definition is good enough for the Deputy in reply to his question. According to the recent accounts published the ICI have made a profit. There have been reservations entered on both sides. The qualification of the auditors indicates an inability to assess whether the adminiistrator's provision for contingencies has been understated. Equally, they have an inability to assess whether such provision has been overstated. The auditors express no reservation about the adequacy of the outstanding claims estimates. I can assure the Deputy that any moneys that can be recovered will be recovered.
Is the Minister now satisfied that the £226 million, uncovered some months ago, is the final amount of the insolvency of this company, bearing in mind that originally the figure given us was one of £164 million which eventually became £226 million, on the basis of which £100 million was borrowed? Is the Minister satisfied that £226 million is the maximum amount of the insolvency of this company or could there be another £200 million?
I cannot say categorically that the figure of £226 million is the bottom line figure. The Deputy should be aware that there are many legal actions pending in relation to the recovery of moneys from various insurers and reinsurers along the way. I can give the Deputy only the information available to met at present but I cannot say that that is the end of the line.
Is the Minister prepared to disclose the net Exchequer contribution, the net contribution by the Central Bank and the net contribution by Allied Irish Banks to the rescue package to date?.
I might outline to the House the ICI funding arrangements that were brought into force. The Central Bank announced on 4 October 1985 that the financial arrangements they had made with AIB and the other licensed banks in respect of the ICI involved an advance for a period of 15 years of an amount of £100 million to the Minister for Finance for on-lending to the Insurance Corporation of Ireland fund and hence, under the supervision of the court, to the administrator. Seventy million pounds have been advanced by AIB and the remaining £30 million are from the Central Bank's own funds. The full cost of the funding is £9 million per annum to be borne as follows: AIB, £5.5 million; other licensed banks, £1.5 million and the administrator, £2 million, bringing the total to £9 million.
Can the Minister indicate whether these moneys have been drawn down?
I have not that information available in my brief at present. However, I shall be glad to communicate to the Deputy the information he has just sought.
Is the Minister aware of the recent comments of the administrator in relation to the future sale of the ICI? Has the Minister any plans to bring this forward?
I have no plans to bring it forward at present. I think the ICI will continue for quite some time yet before any such decisions will arise for consideration.