asked the Minister for Industry and Commerce if he will make a statement on the reason the allocation for export guarantee arrangements under the Insurance Act, 1953 has been increased by 141 per cent from £4.2 million to £10.135 million; and if he will make a statement on the matter.
Written Answers. - Export Guarantees.
23.
The Insurance Act, 1953 provides that any amount required to meet a liability incurred by the Minister in respect of claims arising on foot of guarantees given in connection with exports, shall be advanced out of the Central Fund and shall be repaid to the fund out of money provided by the Oireachtas. The subhead of my Department's Vote, to which the Deputy's question refers, is that under which the Central Fund is repaid moneys in respect of claims paid under the export credit scheme operated by the Insurance Corporation of Ireland.
The main reason for the increase in the provision is as a result of the payment of two large claims totalling IR£6,224,000. The claims arose from defaults by two American companies on foot of contracts with an Irish company for the supply of capital goods. One of the American companies has ceased to operate while the other has filed a Chapter 11 bankruptcy and is operating on a reduced scale. Detailed and delicate negotiations are taking place with the latter company in an effort to effect a recovery. The Deputy will appreciate that it would be preferable not to name the Irish or American companies involved while these negotiations in the US are proceeding.
I should point out that the provision of IR£10.135 million in respect of claims paid under the export credit scheme relate to total insured exports of approximately IR£600 million.