I propose to take Questions Nos. 46 and 57 together.
The total amount paid to NCB was £662,000 and withholding tax of £170,000 was deducted from this amount at the time of payment. The amount also included VAT of £132,000.
It is, of course, normal practice in the Department of Energy to appoint consultants or financial advisers after a competitive process in which price, track record, specific expertise are all taken into account. For the sale of the State's 25 per cent shareholding in Tara, however, competitive tenders were not sought. I am informed that the reason for this at the time was that there were very specific legal and tactical reasons, arising from the original 1975 Agreement with Tara, that no hint should in any way be given to the majority shareholders as to the Government's intentions. These reasons have been made public in great detail at a number of meetings of the Public Accounts Committee and indeed as recently as 6 June this year when there was a specific debate in this covering the issue arising from the second interim report of the Committee of Public Accounts on the Appropriation Accounts 1987.
The view was taken at the time that a public tendering process would send a clear signal of the State's intentions and would have quickly weakened the Department's negotiating position. This would have put the State and ultimately the taxpayer at a clear disadvantage.
In the event, therefore, the financial advisers were selected on the basis of qualitative criteria; in particular it is important to recall that NCB are the largest independent corporate finance and stockbroking house in Ireland without an association with a bank or other financial institution. There was, therefore, no potential conflict of interest arising from the existing or past lending relationships with Tara, its parent Outokumpu and associated companies.
I see no reason to change the standard procedures for the engagement of consultants by my Department. The normal practice for any Government Department is the competitive process which I have already described. Indeed an upcoming EC directive on public procurement is likely to make our practice mandatory. The decision to depart from the practice for the sale of the State's shareholding in Tara was taken by the then Minister in the very particular circumstances which surround this complex transaction.
