I move amendment No. 1:
In page 16, to delete lines 20 and 21 and substitute the following:
"1.—(1) This Act may be cited as An Bille fán nGníomhaireacht Náisiúta um Bainistíocht Sócmhainní 2009.".
National Asset Management Agency Bill 2009: Report Stage.
Molaim an leasú seo chun a chur i gcuimhne don Aire, agus don Rialtas go hiomlán, gur chóir go mbeadh an teideal ar aon eagras atáá bhunú ag an Stáit i nGaeilge sa chéad áit, seachas sa dara háit mar a bhíonn i gcónaí. Sa chás seo, tá gach éinne ag caint faoi "NAMA" seachas an "Gníomhaireacht Náisiúnta um Bainistíocht Sócmhainní". Le tamall de bhlianta anuas, tá an Stáit ag bogadh i dtreo an Bhéarla de shíor. Tá an leasú seo os ár gcomhair mar nach bhfuil aistriúchán ar an mBille seo ar fáil faoi láthair. Fiú nuair atá an Acht rite, ní bheidh aistriúcháin ar fáil go ceann tamaill. Dá mbeadh sé ar fáil againn, bheadh sé soléir do gach éinne gur an Bille agus an Acht ceanann céanna atá ann. Go dtí sin, ba chóir go mbeimid ag rá go mbeadh an reachtaíocht i gcónaí luaite mar "An Bille fán nGníomhaireacht Náisiúnta um Bainistíocht Sócmhainní 2009".
Ba chóir go dtógfadh an t-Aire an moladh seo ar ais go dtí an Cabinet. Ba cheart go gcuirfimid Billí dhátheangacha os comhair na Dála, chun an Ghaeilge a chur chun cinn. Níl mé chun moill níos faide a chur ar an díospóireacht rí-thábhachtach seo. In ainneoin gur cheist tábhachtach í seo, ní hí an cheist is tábhachtaí lena bheimid ag déileáil.
We all know that the purpose of this Bill is, in the Government's view, to fix the banking system and to get it back to some kind of an even keel. We all understand the need for a functioning banking system. I would submit that the best way of doing so would be to create a State bank. The problem with the Government's policy on the whole banking issue is that it is ignoring the broader economy. The banking system cannot deal with the economic crisis on its own. Just a few days from now, thousands of people will march on the streets of Dublin in opposition to the Government's proposal to introduce cuts worth €4 billion. At the same time, this House is debating whether to hand over €54 billion to a banking sector that is neither properly regulated nor as accountable as it should be. The manner in which this Bill has been handled leaves a significant amount to be desired. The rabbit was let out of the hat last week when it was announced that an SPV will perform the functions of NAMA. The Minister has claimed that the purpose of the SPV is to keep the NAMA account off the books. I am not convinced that the State should operate with such sleight of hand. There is a need for proper and open accountability. We should face our responsibilities by dealing with this crisis in an honest way.
I would like to conclude by asking the Minister about the properties that are the subject of NAMA. If NAMA is to succeed, the properties in question will have to return to their crazy values of the past. If that happens, we will be back in a property bubble. Therefore, the NAMA gamble is crazy in any event. As the House is required to deal with a significant number of amendments, I will not use any more of its time by dealing further with this amendment.
Maidir le leasú Uimh. 1, tá sé tábhachtach go mbeadh leagan Gaeilge den Bhille ar fáil. Tuigim go bhfuil brú mór ar an Roinn Airgeadais. Tá sé geallta ag an Aire Airgeadais go mbeidh leagan iomlán Gaelige ar fáil. Tá sé intuigthe go bhfuil sé sin tábhachtach. Tá brú mór ar úsáid na Gaeilge, agus ar an Roinn Gaeltachta féin, ag an bpointe seo. Tá sé tábhachtach go mbeimid i ndáiríre faoin teanga. Tá mé sásta glacadh leis go bhfuil stró ag baint leis an leagan Gaeilge a chur ar fáil taobh istigh de ghearrthréimhse. Ag an am céanna, tá sé tábhachtach go mbeadh an t-Aire agus an Roinn i ndáiríre maidir le leagan iomlán Gaeilge, leis na leasuithe ar fad, a sholáthar chomh luath agus is féidir. Ceapaim go bhfuil usáid aisteach den bhfocal "fán" i dteideal an Bhille — "An Bille fán nGníomhaireacht Náisiúnta um Bainistíocht Sócmhainní 2009" — neamhchoitianta. Cé nach saineolaí mé ar an gné seo den ábhar, molaim gur fiú dúinn smaoineamh air.
Ní saineolaí mé ach oiread. De réir an chomhairle atá faighte agam ón Ard-Aighne, tugann an téacs Béarla an leagan cheart d'ainm an Bhille i mBéarla. Is é sin an iomlán atá á dhéanamh againn in Alt 1. Dá bhrí sin, ní ghlacaim leis an leasú atá molta ag an Teachta Morgan. Tá sé de nós againn an t-ainm Béarla a úsáid san Alt sin i ngach Bille. Sa téacs Ghaeilge den Bhille, a fhoilsóidh an Roinn chomh luath agus is féidir, beidh ainm an Bhille i nGaeilge. Cé nach bhfuil mé i mo shaineolaí sa chás seo, aontaím leis an Teachta Ó hUigínn go bhfuil an teideal casta go leor.
Ba mhaith liom foláireamh a thabhairt don Aire. Má tá cás tógtha i gcoinne na reachtaíocht a seo gan leagan Gaeilge ar fáil, d'fhéadfadh an ghníomhaireacht NAMA ar fad titim go huile is go hiomlán. Is é sin an fáth gur chóir go mbeadh an Bille dátheangach ó thús.
Úsáideann cainteoirí dúchasacha an focal "NAMA" i nGaeilge faoi láthair.
Is í an tábhacht a bhaineann leis an leagan Gaeilge ná go bhfuil cuid de na maoin atá i ndeacrachtaí lonnaithe sna Gaeltachtaí éagsúla. Dá mba rud é go mbeadh dúshláin os comhair na cúirte, bheadh an foirm seo den reachtaíocht in úsáid. Glacaim leis go mbeidh obair mhór i gceist chun an foirm iomlán a chur ar fáil i nGaeilge. Ceapaim go mbeidh sé sin inghlactha nuair atá leagan Gaeilge á ullmhú.
Amendment put and declared lost.
As amendments Nos. 2 and 4, which arise from Committee Stage proceedings, are related, they may be discussed together.
I move amendment No. 2:
In page 16, between lines 35 and 36, to insert the following:
"2.—(1) For the purposes of this Act, the "Oireachtas Committee on NAMA" shall mean a Select Committee of each House, or a sub-committee thereof so enjoined and appointed by Resolutions of each such House, established with the purpose of monitoring the implementation of this Act, including all acts done in furtherance of this Act.
(2) The Committee shall be chaired by a member of Dáil Éireann who is not a member of a political party whose members form part of the government for the time being.
(3) The functions of the Committee shall include:
(a) to approve or decline the persons to be appointed by the Minister to the Board of NAMA (“the Board”) in accordance with section 19,
(b) to approve the appointment of casual vacancies to the Board under section 24,
(c) to approve the person nominated by the Chairperson of the Oireachtas Committee on NAMA to the position of Chairperson of NAMA in accordance with section 25,
(d) to approve codes of practice under section 34,
(e) to approve any guarantee issued by the Minister for debts and/or securities raised under section 48,
(f) to approve the form of accounts to be kept under section 52,
(g) to approve the appointment and remuneration of an expert reviewer under section 109,
(h) to, at the absolute discretion of the Committee, make an appeal under section 119 in the public interest where the Committee sees fit,
(i) to approve codes of practice under section 149,
(j) to review the operation of NAMA, and develop and publish recommendations for the amendment of this Act,
(k) to approve the form, of reports on credit flows and hear evidence on them,
(l) to review the shareholders agreement undertaken by the Master Special Purpose Vehicle,
(m) to approve the membership of the Valuation Panel, and
(n) to investigate any matter of concern to the Committee pertaining to NAMA or to the operation of this Act.
(4) The Committee shall have such powers that are reasonably ancillary to the discharge of its functions, which shall include, but are not limited to:
(a) to require the attendance of an officer or staff member of NAMA or a participating institution to attend before the Committee and give evidence on such matters connected to the operation of this Act as the Committee may direct, and
(b) to require production of any documentation from any person attending the Committee to give evidence under paragraph (a), which is material to such evidence.”.
On Committee Stage, there was a broad consensus that the necessary Oireachtas oversight of this body should be much stronger than any oversight we have previously envisaged. The difficulty with the Minister's proposal is that it envisages that the Oireachtas will oversee the National Asset Management Agency in the same way that it oversees the Health Service Executive, the National Roads Authority and many other bodies. It is clear that there is growing discontent with the degree of oversight in those areas. It is much more vital that we should have proper oversight of a body that will spend €54 billion on behalf of the taxpayer. Investment on this scale has never before been contemplated in this country.
The Minister is aware that many people are sceptical about this high-risk strategy. Equally, many people have significant doubts about the business plan with which we have been presented. People of great experience have cast enormous doubt on the underpinning of the business plan. One of the worrying elements of the business plan is the assumption that land and development properties that are currently yielding a 6% performance will eventually yield an 80% performance and thereby repay in full the moneys borrowed in respect of them. These things are very hard to believe.
A sceptical Oireachtas will want to keep a close eye on the activities of NAMA. Members will want to know that those who are put in charge of NAMA are appropriate and suitable. We will be concerned to see how they develop NAMA's codes of practice. The purpose of the proposal before the House is to provide clearly for the establishment of an Oireachtas committee that will ride shotgun on the performance of NAMA, which will be a vital part of the future of every individual in the State. In our amendment, we have set out the various functions we believe the committee should fulfil. I have withdrawn some of the elements of my Committee Stage amendment which the Minister rightly argued could be seen to interfere with NAMA's day-to-day management activity. Instead, I have sought to confine Oireachtas oversight to general policy issues in which it would be appropriate for the Oireachtas to have a role. The appointment of the board of NAMA will obviously be a crucial issue. The Minister has said informally that he is willing to engage in negotiations or discussions with Opposition parties on this issue. While Opposition parties have a role, the Oireachtas has a wider role. I propose that the agreed group which will emerge from the Minister's consultations should be open to approval by a responsible Oireachtas committee. As the Minister has indicated he is willing to contemplate such a provision, I hope he will accept this amendment.
It is also important for the Oireachtas to be in a position to oversee codes of practice. Many of the codes that are to be developed will be vital not only in the management of this resource, but also in respect of people who have been brought into NAMA with performing loans. They will want to see codes of practice that allow them to access borrowings for the purpose of developing those sites. They have been paying everything and have a legitimate expectation that they will be able to raise finance. NAMA is not a bank and, therefore, people with performing loans will want to see codes of practice in place to allow them deal with this. Equally, they will want to see codes of practice that govern all sorts of abuses that could arise. The Oireachtas has a right to oversee and approve codes of practice under section 34 on the grounds that they will govern how circumstances develop. The Oireachtas needs to have a role in respect of the types of accounts to be presented on a quarterly basis, as has been accepted by the Minister.
The Minister was sympathetic to the view that it is important to protect the Minister by giving the Oireachtas a role in the appointment of members of the valuation panel and of the expert reviewer. These individuals will be playing a quasi-judicial role in deciding on appeals in regard to the valuation or inclusion of assets within NAMA. These decisions have financial implications amounting to billions of euro. The Minister was uncomfortable about being the decider of last resort without clear guidance on the basis on which to make a decision. He indicated on Committee Stage that he would welcome a role for the Oireachtas, particularly in respect of the expert reviewer and the valuation panel.
A vital issue that arose in the debate concerns the master special purpose vehicle, SPV. The Oireachtas understands why it is being contemplated but does not understand why there is not proper supervision of the activities and membership of the board. At a minimum, the Oireachtas needs to have oversight in respect of the shareholder agreement so it can be satisfied that agreement protects the taxpayer in the operation of NAMA. Thus, there would not be a board, controlled by a majority of private interests, in a position to usurp the proper authority of NAMA. It is vital not only that the master SPV be regulated within the legislation before it is passed but also that the Oireachtas have some role in the supervision of the shareholder agreement and the activity of the master SPV.
The powers of the Oireachtas committee will clearly have to break new ground. Traditionally agencies have bamboozled Oireachtas committees because they have a monopoly on expertise and the assembled information. An Oireachtas committee dealing with a body as complex as NAMA will have two arms tied behind its back unless it has access to expertise that can inform its questioning and scrutiny of the agency. It is very much the view of Fine Gael that we need an adviser to the committee of the calibre of the Comptroller and Auditor General. We have proposed a monitor from the Office of the Comptroller and Auditor General who would have access to all the papers in NAMA and who could advise the committee so it could efficiently and professionally scrutinise the agency in its operations.
There is broad consensus in the House that an oversight committee is needed. The Minister appears to be of the view that he will defer the establishment of such a committee until after the legislation is completed and that he will then only do so on the basis of existing powers and terms of reference of the House. It is very clear that the committee desired not only by those in the Opposition benches but also those in the Government benches should go beyond what is envisaged in the standard terms of reference of Oireachtas committees. The Oireachtas, through the committee, will need to be able to deal with appointments to valuation panels and the board itself and to challenge inappropriate valuations. If this legislation is passed without empowering the Oireachtas in this regard, an Oireachtas committee established subsequent to the passage of the legislation will be a damp squib. It will not have the effective powers required to do the job that consensus in the Oireachtas suggests is necessary.
There is no question but that we are breaking new ground and taking on enormous risks. Many, including me, believe we are going in a wholly wrong direction and that we should be doing something else. However, we have had this debate and lost it in votes in the House. It is vital, therefore, that as we proceed, we try to protect the taxpayer in respect of the operation of NAMA. The Minister agrees to that in principle and I look forward to his backing up his agreement to protect the taxpayer with a powerful Oireachtas committee that can play a genuine role in breaking new ground in overseeing the operation of a body that will be so important to the country's future.
The purpose of amendment No. 4 is to provide for the appointment of an oversight committee. This debate on Report Stage is, in effect, the last serious opportunity we have in the Dáil to try, on behalf of citizens and taxpayers, to correct the dreadful flaws in the Minister's proposals for NAMA. I refer in particular to the decision to overpay for the assets by a factor of at least €7 billion and possibly €11 billion or €12 billion.
The Bill does not deal at all with the extra recapitalisation that is likely to be necessary for the two main banks. The sums involved are likely to amount to at least a further €9 billion to €12 billion. The Bill does not refer to the recapitalisation of Irish Nationwide and EBS, which is likely to cost €1.5 billion, although the Minister is giving himself the power in the legislation to take a share in those institutions. No sums are mentioned.
The Bill makes provision for some of the largest, if not the largest, financial commitments ever made on a single occasion in a single Bill in the history of the State, yet major amendments are being tabled on Report Stage. The purpose of the oversight committee is to copy what has successfully happened in other countries where there have been banking crises. Since the beginning of banking, there have been bank failures. There is a considerable amount of literature, including historical literature, available throughout the world on how to try to fix a failed, broken banking system. The key lesson to be learned from recent examples and from history, in so far as Fianna Fáil is capable of taking a history lesson, is that unless there is a high level of transparency and oversight, the whole exercise is likely to prove a failure.
One can ask why that is the case. It is because as soon as bankers get the green light from the Government, the Minister, the king, the emir of the day, they are likely to run back and start to do exactly the same thing that led to the crash in the first place. That is why we see already that in anticipation of NAMA the banks are tightening up on credit rather than complying with the express purpose of providing credit to small and medium businesses. They are calling in businesses right around the country to put the thumb-screws on them and make things more difficult rather than less difficult.
The Labour Party proposal is for an oversight committee, based partly on the model in the United States and based on the advice we got from people in the Swedish bank rescue, that would report to the Dáil every 30 days. It does not cut across a possible special Dáil committee but it is different from it and much more essential than such a committee because the purpose of this is to put information into the public domain that not only allows the Dáil to be informed about what is happening in NAMA every 30 days but that would inform citizens, in particular journalists and citizens who are doing citizen journalism on the web and through blogs. In this crisis it has been so important in this country to have information about what is happening in our name. I see the Minister, as on the previous day when I mentioned citizen journalism and citizen bloggers——
We are all equal citizens in this country.
——shrugging his shoulders and looking as though he does not really believe in this concept.
I believe the concept involves citizens.
Citizen journalism is one of the great, new extensions of freedom brought about through the Internet. Thank God we have it in the context of our banking crisis.
Why do we not trust the Minister and the Department of Finance on this matter? Over the summer I requested information under freedom of information legislation on the dealings between the Department and Anglo Irish Bank in the run-up to the crisis in 2008 and up to the date of its nationalisation. The Minister will recall that Anglo Irish Bank was nationalised in January of this year, although he and Fianna Fáil had declared previously that it was fine. In the limited freedom of information documents that I received — because the Department decided to refuse most of the information — one dated 8 January 2009 is a draft to be sent to the European Commission on various Council regulations dealing with banking, says that Anglo Irish Bank is niche market rather than broad market. That is the Minister's document.
The document states also that there has been very close engagement and liaison between the Department of Finance and Anglo Irish Bank on an ongoing basis since it executed the legal instruments to join the guarantee scheme. It says that Anglo Irish Bank is considered a "fundamentally sound" institution. That was a matter of hours and days before the bank was nationalised to prevent it collapsing. The document goes on to state on page 39 that the assessment by Merrill Lynch supports the position that Anglo Irish Bank is "fundamentally sound". That is a company to whom the Minister told me yesterday he paid €7.4 million in fees to be told that. If he went up to Doheny and Nesbitt's and had a pint with the drinking economists they could have given him an educated insight into how Anglo Irish Bank was doing for far less than €7.4 million.
Hours and days before the nationalisation, page 40 of the document shows, Anglo Irish Bank was considered "fundamentally sound". The reason I refer to these documents is because they show the thinking of the senior officials in the Department in preparing an important document for the European Commission. That was the professional advice of a company, which the Minister acknowledged yesterday had been paid €7.4 million for advice on banking and bank capitalisation. If ever there was a case where institutions of the State needed oversight and information to go into the public domain this is it, not to undermine those institutions but rather for sensible people, whether economists in the Doheny and Nesbitt's school having their pint or ordinary people having a discussion around the breakfast table to be in a position to say: "Hold on, that does not appear entirely sensible to me, that Merrill Lynch, which is being paid €7.4 million should be putting into a document that this bank is fundamentally sound, or that senior officials who are not identified should be writing to the European Commission to say that this bank is fundamentally sound, and more than that, to give an opinion that this bank is niche market rather than broad market."
The Minister included the bank in the guarantee on the basis that it was systemically important and he continued to defend that position last week. It goes to show that someone somewhere in the Department of Finance did have the intellectual insight to say Anglo Irish Bank is a niche bank rather than a systemically important bank. Yet the type of arrangement——
A niche bank can be still systemically important.
The Minister can quibble all he likes with Jesuitical hairs——
That is the kind of thinking the Governor of the Central Bank had in the day.
We are trying on behalf of people in Ireland——
The Deputy should be allowed to speak without interruption.
I was talking to a business person this morning who last year was employing 15 people and this year is employing nine people. He is desperately trying to keep those nine people in employment. Similar to the experiences of other business people around the country his bank called him in last week to tell him that they were going to increase the charges and interest rates applying to the facilities that he enjoys from his bank. In a nutshell, that is why we need oversight. All of us in this Chamber, including the Minister, are fully aware that banks are putting the squeeze on business in an attempt to recover the profits that they have lost because of the crash and to get their share price up again. The Minister has told us repeatedly, and we in the Opposition all agree with him, that his objective in this package is to get credit flowing to small and medium businesses.
I worked in business before I was a lecturer. All of us who have worked in business know that that is an extremely challenging environment, no matter who is Minister for Finance. What we are asking for is oversight because if the Minister gives in to the banks in the way he is proposing to do, as I said previously, the banks will astonish him with their sheer ungratefulness as they literally go back to business as usual; back to the bonuses, the big salaries and to fleecing businesses with banking costs that are way out of line and over and above what people incur in other European countries.
The Minister is being the sugar daddy of all times to the banking system and, boy, do the banks know it. He is in a unique position, as sugar daddies usually are, to ask a favour of the person to whom he is giving all the sugar. That is what the relationship is. Instead, nobly, on behalf of taxpayers the Minister is saying he will forgo the insight, oversight and publication of information that will put stuff out there that will help us to get a viable working banking system. Instead we will retreat behind the old structures of the Department of Finance, which is completely outmoded for this tsunami that has affected the Irish banking system. New thinking is required. What we need to do is to open it up to oversight. The establishment of an oversight panel with regular reporting in the public domain is probably the most important thing that can be done to ensure that credit really does flow and that there is some brake or restraint on the banks and bankers returning to behaviour as usual. The banks can produce all the fancy diagrams and statistics they wish but the reality is they are trying to de-leverage and shrink their balance sheets. They are also obviously finding it more difficult to get credit-worthy propositions to which they can lend.
The main issue is that they are shrinking their balance sheets in an attempt to recover their capital. If they shrink their balance sheets to the extent they propose, the consequence will be that unless foreign banks come to Ireland and lend to Irish businesses, many Irish businesses and individuals who are good prospects for business or house purchase lending in a depressed market will not get loans. Can we rely on foreign banks coming back into the Irish market? I do not believe we can for two to three years. At present, most foreign owned banks operating in Ireland would prefer to leave this country and sell their Irish subsidiaries. They have been badly burnt by their Irish experience. Furthermore, their home countries are telling them, understandably, that they should bring their business back home. The Dutch and UK Governments want to concentrate their banking bail-out packages on the core business of their countries' banks for their countries' businesses.
It will require a deal of courage on the Minister's part to opt for something that is unusual in a small country such as Ireland, that is, the regular publication of information in the public domain. By all means, bring that information to a Dáil oversight committee but such a committee will be of limited value. According to the draft business plan and the Minister's subsequent remarks, the €54 billion of loans will be transferred between the establishment date of NAMA and probably seven months later at 30 day intervals. By the time a Dáil committee is up and running, most of the action will be over. That is why in the case of the asset relief programmes in the United States the reporting has been up-to-date on a monthly basis. The Minister said he will provide quarterly information and I welcomed that, but he needs to go several steps further and provide for oversight.
The Minister also promised, in response to the Committee Stage debate on this amendment, that he would provide some type of process auditor. We have seen the elaborate, if not labyrinthine, process diagram at the back of the business plan, but I do not see an amendment from the Minister in respect of the indication he gave the committee. That, at least, was some additional information but it was not sufficient. I refer to the elaborate diagram on page 35 of the draft business plan.
I intend to press the Labour Party amendment relating to oversight. I am happy to support the Fine Gael amendment as well but, as I said previously, I do not believe now is the time to establish extra Dáil committees unless, given the importance of this particular committee, at least one to three other committees are abolished or unless this special committee is, in effect, a sub-committee of one of the existing committees, such as the Committee of Public Accounts, the finance committee or the regulatory affairs committee. Taxpayers will not take kindly to the Dáil basically saying that its response to NAMA is to set up another committee. The Houses of the Oireachtas Commission has already put forward proposals to reduce significantly the number of committees. That is in the power of the Taoiseach and the Minister for Finance but we should not create extra committees unless we get rid of some of the surplus committees that exist at present.
That said, I am happy otherwise to support the Fine Gael amendment. However, it is not enough. The critical thing is that the Minister must try to provide information to citizens so they can understand what NAMA is about, in view of the fact that the consequences are so long term. They do not just apply to people who will be working over the next ten years but to people who will be working over the next 40 years.
The Minister introduced the special purpose vehicle, SPV, as a clever accounting trick to get the NAMA debt off the country's balance sheet. That does not fool anybody. Everybody knows that even though the SPV gets the debt into a footnote to the national accounts, the bond markets, international markets and the EU include it in our national debt and price our debt accordingly. I do not see the Minister bringing forward amendments to provide for greater oversight and transparency with regard to the special purpose vehicle. The special purpose vehicle changes NAMA fundamentally and changes the span of control and influence in NAMA to a critical group of investors of €51 million who will have key decision making powers, key oversight and influence and key membership of an inside group in NAMA. This is all for just €51 million, which is chicken feed to many of the people who operate in international banking. It is not chicken feed to anybody in the Dáil but it is to international bankers and pension fund managers.
In the example in France which the Minister quoted, the people who took the interest in the SPV were the banks who were to be the beneficiary of the French arrangements. They did it through pension funds, as is likely to happen here. The Irish Association of Investment Managers, which is heavily linked to the two big banks and Irish Life & Permanent, could come up with that money at a moment's notice. Why would anybody invest in the SPV? They would do so if they had a connection to a bank and if it gave them a unique position in terms of control, information, insight and influence. According to people such as George Soros and other major international financiers, the one item that is prized above all else is information. To pay €51 million for a permanent inside seat with regard to information on the Irish banking system for a ten year period and to have a good chance of getting that money back is an investment which I believe most operators will not have to be asked twice to make. While I am referring to pension funds this could also apply to hedge fund and private equity people, who will use that position to play the Irish market in a way that will not be to our advantage.
For these reasons, I urge the Minister to accept the concept of an oversight committee. He must take courage and say to the people who are accustomed to doing business in Ireland behind closed doors and secret bank walls that they should come out into the light and let the people who are meeting the €54 billion debt and providing the guarantee have some information about what is being done in their name.
Six other speakers wish to speak on these two amendments. I realise they can speak for as long as they wish but I ask them to be mindful of getting through as many amendments as possible. I call Deputy O'Donnell.
In the interest of consistency of contributions I will do that. I will speak to amendment No. 2. The taxpayers are investing €54 billion in NAMA. If it was the private sector, the taxpayers, like other investors in that sector, would be effectively shareholders. They would have access to annual accounts and could attend annual general meetings in order to put forward their views. They will not have such privileges under the Minister's proposal.
We, as politicians, and the Oireachtas are representing taxpayers, by way of proxy, in respect of the €54 billion that will be paid out. The Minister has nothing to fear — he should embrace the notion — from the establishment of a specific Oireachtas committee to oversee NAMA. Effectively, such a committee would act in the stead of taxpayers in respect of their investment of €54 billion. We were elected to represent taxpayers and it is they to whom we are answerable.
The committee to which I refer would deal with all the main matters in respect of which taxpayers would like answers to be provided, namely, appointments to the board of NAMA, the code of practice and the appointment of the expert reviewer. The Minister has taken on board the points raised in respect of the appointment of members of the evaluation panel. In addition, I believe that, in principle, he agrees that an Oireachtas committee could have a role to play. The question arises, however, as to whether he will take a leap of faith and — this is a critical point — enshrine such a committee in legislation.
We are establishing NAMA in order to ensure that funds flow to small businesses, home owners, etc. Such funds will act as a lubricant in respect of the engine of the economy. There must be proper oversight in this regard. Like us, the Minister has tabled an amendment relating to guidelines for the banks in respect of credit flows. I am of the view that there is a requirement to adopt the same principles with regard to State investment on behalf of the taxpayer as those which apply in respect of investments made in private vehicles. Ultimately, taxpayers will be investing in such a vehicle, namely, the SPV. The majority of the shareholding will be held by private investors and the latter will form the majority of the members on the board of the SPV. Effectively, there will be a shareholders' agreement in place. I am of the view that following due consideration, the Minister will embrace the concept of establishing an Oireachtas committee which will be on a statutory footing.
The key points relating to this matter revolve around transparency and accountability. Bank of Ireland released interim financial results earlier today. The figures were published and the shareholders were able to peruse them, as is their legal right. The Minister changed the year-end relating to Anglo Irish Bank from September to December, thereby putting off the publication of its figures. Taxpayers and the State effectively own Anglo Irish Bank but neither has seen any figures since last May. All of the other covered institutions — AIB, Bank of Ireland and Irish Life & Permanent — have published interim figures since that date. There is a need for the Oireachtas to establish what, in essence, would be a super committee which would have the resources to allow it to deal with the issues that arise. In addition, an official from the Office of the Comptroller and Auditor General would be delegated to report to the committee.
The Minister has provided assurances regarding the valuation of assets prior to their transfer to NAMA and indicated that such valuation will be subject to scrutiny by the Financial Regulator and under the reporting mechanism of the European Commission. Amendment No. 2 is reasoned, balanced and progressive and will provide comfort and assurance to taxpayers going forward. It must be remembered that the money being invested does not belong to the Minister or to us, it belongs to taxpayers. In the context of the reporting requirements relating to NAMA that are contained in the Bill, taxpayers will not obtain good value for money.
Establishment of the Oireachtas committee to which I refer would provide credibility to the NAMA project. We do not agree in principle with the establishment of NAMA, the work of which will involve overpaying for assets. We are of the view that this should not happen. Be that as it may, the Government has a majority and can vote the Bill through the Houses. However, we must ensure that the necessary structures are put in place in order to protect taxpayers' interests. The committee to which I refer would be a vital component in that regard.
I support the sentiment behind both amendments. On Committee Stage, I stated that I would prefer us to take the route of expanding the role of the Joint Committee on Finance and the Public Service which could then, in the interests of greater efficiency, establish a sub-committee to deal with this matter. However, it would be necessary to increase the membership of the joint committee in order to reduce the burden on those who currently serve on it. A precedent exists in this regard. The role of the Joint Committee on European Affairs was expanded in order to facilitate the process relating to the Lisbon treaty. There is no reason, therefore, why what I am suggesting, which might prove more cost-effective, could not happen.
I accept, however, that there is a legitimate argument in respect of establishing a dedicated committee to scrutinise the activities of NAMA and that this argument has significant merit. Some €54 billion of taxpayers' money is to be handed over to an organisation which has not been tested and in respect of which very little is yet known. Board members have not yet even been appointed. As a result, it is critical that the highest level of scrutiny should apply.
Accountability is essential. In that context, I hope the Minister will accept the sentiment behind these two amendments.
Section 2 states that the purpose of the legislation is to protect the interests of taxpayers, facilitate restructuring of credit institutions, restore confidence in the banking sector and facilitate the availability of credit in the economy. These are all good aspirations. As Deputies Bruton and O'Donnell stated, those of us on this side of the House do not agree with the process the Government has put forward in respect of achieving these aims, namely, the establishment of NAMA. However, we are democrats. The Government won the votes on Second Stage and Committee Stage so it seems that NAMA will proceed. We must, therefore, make do with that with which we have been presented.
Amendment No. 2 in the name of Deputy Bruton is a genuine attempt to oversee the objectives of the legislation. Such provision is not otherwise made in the Bill. I accept that the Minister will be in a position to oversee matters but the Oireachtas will have no role to play in this regard unless the committee to which the amendment refers is established on a statutory basis.
Deputy Bruton referred to the number of existing Oireachtas committees. Fine Gael would have no difficulty with a reduction in the number of such committees. In my opinion, the number could be halved. The reason for the increase in the number of committees has disappeared because the allowances for chairmen have been halved and the allowances relating to vice-chairmen and convenors have been abolished. The net allowance received by chairmen is now less that €5,000 per year. Having committees in place does not constitute an expense——
That is why I reduced the allowances.
——in a monetary sense. The chairman of a committee receives less than his counterpart on a local authority SPC, which is an interesting point.
They are overpaid.
I suggest, therefore, that we overcome any objections to the possibility that another committee be established. The Oireachtas committee on NAMA would not be established just for the sake of it. The committee will have statutory powers to do that which Deputy Bruton has outlined in amendment No. 2.
Ministers come and Ministers go. I have no doubt that the Minister for Finance has the interests of taxpayers at heart and that he is endeavouring to do his job in an honest way. However, he will not be here for the entire duration of NAMA's lifetime. That is a fact of life.
It is an absolute fact.
(Interruptions).
He may be in other places, but I very much doubt that he will still be Minister for Finance. He might be in Opposition or he might be Taoiseach.
Angola.
However, I can almost guarantee he will not be in his current position throughout the lifetime of NAMA.
The Minister has been promoted and demoted fairly quickly.
I was demoted first.
The Minister was then promoted.
We are seeking to ensure that the Houses of the Oireachtas will have in place a committee of qualified people who take their job seriously. I have no doubt there will always be within this House sufficient Members willing to be serious members of the committee and behave in a responsible manner.
One of the proposed functions of the committee is that it will approve the membership of the valuation panel. It is likely that membership of the panel will change owing to retirements and so on. There will be many changes in this regard throughout the period of operation of NAMA. I do not believe it is any harm to provide for Members of the Oireachtas to satisfy themselves that replacements are suitable persons. This is not as simple as setting up a panel, reviewing it on the first day and that is it. There will be many changes.
I am sure the directors of the master special purpose vehicle will also change from time to time. I would like to be satisfied that the shareholders' representatives will continue, in the taxpayers' eyes, to be suitable persons to serve as directors. Likewise, in respect of the State nominees. There is nothing but good to be gained from the establishment of this committee. It will in no way interfere with the day-to-day workings of NAMA or the master special purpose vehicle. It will, in my opinion, be a source of assurance to the public that somebody is keeping a watchful on all aspects of this legislation. As I stated previously, there are vasts amounts of money involved in this operation. There is no reason that on occasion, when the committee deems fit, its meetings should not be held in public session. This too will provide assurances for people in terms of the oversight necessary in this area. This should be done in public so that people can be satisfied that matters are progressing to their advantage.
I appeal to Members of this House to think positively about the creation of this committee, the purpose of which will be to ensure that the intent of the Act will be borne in mind at all times and to ensure the Oireachtas will have a watchful eye over the actions of the various bodies and associations involved in this process.
Amendments Nos. 2 and 4 have merit. I support my colleague, Deputy Morgan, who stated that the Select Committee on Finance and the Public Service could be the relevant committee as proposed in amendment No. 2 in the name of Deputy Bruton. The terms of reference of that committee could be extended to cover the functions of the proposed committee. I believe the functions set out are reasonable given the enormous amount of money about which we are speaking, namely, the €54 billion of taxpayers' money that is being committed to GNuBS, which is NAMA as gaelige, although I believe NAMA rolls easier of the tongue than GNuBS. Also we have recapitalised the banks and may have to do so again in the future.
While I accept the list of duties and functions over which the committee should have oversight, I would like to propose others, in particular functions listed in a later amendment in regard to the Minister's regulations. This is another area that should be scrutinised by a committee of this House given the powers this legislation gives to the Minister. There should be oversight by the Oireachtas of the actions of the Minister. Also, the Minister should accept the proposal to establish a committee specifically dealing with the biggest ever single expenditure by this State. I believe both proposals are reasonable. If we set up a committee to deal with the vital public interest, the volume of public moneys put to one side to deal with a crisis not of the public's making but of the making of a select few in our society who creamed it when times were good and then collapsed our economy because of their greed, the public will accept that we in this House are doing our job properly.
The committee should also have the power to try to influence the policies of NAMA as it goes forward, in particular in respect of the huge amount of vacant properties that will come under its remit and how exactly it should be disposed of. Obviously, the Minister is minded to believe that the disposal of development land and half built housing estates and apartment complexes throughout the country should result in the highest possible profit, thereby recreating a property bubble, the drastic consequences of which we are now experiencing. Some of these properties could be transferred, free of charge, to local authorities to address the housing waiting lists and the potential 35,000 home repossessions next year. According to the Economic and Social Research Institute, ESRI, next year 35,000 householders will not be able to afford their mortgages. A huge number of people could potentially be added to the housing waiting list. Currently, there are 45,000 families on that list yet we have properties around the country that are vacant and ready for occupancy. In the interests of public policy, we should be seeking to influence the transfer of these properties to local authorities or housing agencies. The Government rejected our proposal to include the right to housing in the Constitution. Had it been included, it would have had primacy over the profit motive of NAMA.
I urge the Minister to consider the proposal to establish a committee to approve codes of practice and the appointment of various experts to various committees. The committee could also examine any amending legislation. The Bill before us, An Bille fán nGníomhaireacht Náisiúnta um Bainistíocht Sócmhainní 2009 — National Asset Management Agency Bill 2009 — might be as good as the Minister can provide now. However, I believe that in a couple of weeks or months — I agree with other speakers that this legislation is rushed legislation — pitfalls will emerge and the legislation, despite my opposition to it, will require to be amended. The proposed committee could review the legislation when enacted, if the Government gets its way tomorrow, to determine what pitfalls might arise and what type of amending legislation may be required. This should be done in-house by the committee and will ensure that we in this House have a role in amending legislation to ensure the organisation we have established is operating in the public interest and not in the interests of the property market as proposed in the legislation before us.
Debate adjourned.
Sitting suspended at 1.30 p.m. and resumed at 2.30 p.m.